"Every thief has an excuse."
--Jacob Moore (Wall Street Money Never Sleeps)
Peter Atwater notes the bifurcated nature of the US banking system. Large firms deemed too big to fail have benefitted from govt largesse in the form of bailouts, favorable accounting regs, and uber low interest rates.
Small banks have not been privy to the same special treatment and remain in rough shape following the credit collapse.
The sad thing is that many of these small firms made the right decisions ahead of the crisis and were poised to reap a huge windfall when the big guys failed.
Instead, the big banks who took too much risk were rewarded, while the little banks that were prudent were penalized.
position in SH
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1 comment:
One could have made the case that when Lehman was on the brink it was too big to fail — assets of $639 billion and employing over 26,000 people. Yet in a few days the market, once allowed to do the job, reallocated the good pieces of Lehman to various buyers and the bad parts have vanished. It was poetry.
~Frank Shostak
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