Re: Too big to fail?

[Marshall Eubanks <tme () 21rst-century com>]

Sean Donelan wrote:
> Remember during the last deregulation cycle.  When the Savings & Loan
> and Bank industries were "deregulated" one open question was: are
> there banks considered too big to fail.  The problem with that doctrine
> is it warps management's risk analysis.  Instead of appropriate investments,
> management makes excessively risky decisions in an attempt to achieve
> short-term returns and maximize shareholder value.
>
> Is PG&E too big to fail?

I believe this is referred to as a "moral hazard"

Marshall Eubanks


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