Sunday, March 29, 2009

Quite a reach

The US Treasury (aka Geithner) is proposing legislation with an extremely broad reach. The devil is in the details as usual, and the details won't be there until Congress gets its collective mitts on the work; but even so treating insurance companies (or holding firms for same) like banks seems a little over the top.

If people quit trusting banks and start stuffing money under the mattress again, will the race to the National Bank of Mattress "have the potential to pose systemic risks to our economy but that are not currently subject to the resolution authority of the FDIC?"

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