D. McHattie

FDIC head Sheila Bair warns community banks are struggling to compete against their too-big-to-fail rivals. "Too big to fail has become worse," she said, "it's become explicit when it was implicit before." Bair contends government guarantees create competitive disparities between large and small banks, because "everybody knows small institutions can fail," making it more expensive for them to raise capital and secure funding.

This is exactly what is wrong.

No government, no matter how well it did in school, can outsmart the immutable laws of economics and human nature.

D


On Oct 20 12:25 PM tunaman4u2 wrote:

> Its very true...
> The LAW of unintended consequences will show up over time as the
> Fed's arrogance in believing its manipulation of the market is effective.