“To drain the swamp, as President Trump promised to do, it is first necessary to contain the swamp. That’s why at the meeting today of the Financial Stability Oversight Council (FSOC), the new financial regulators should stop the flood of “too big to fail” designations that rained down so freely during the Obama administration.
Created by the Dodd-Frank financial reform law in 2010, the FSOC is a council of financial regulators from various agencies that has the power to designate a financial firm as a “systemically important financial institution” (SIFI). With the SIFI designation, FSOC is both bestowing on a firm a potential benefit, by telling the capital markets that the government will not let this firm fail, and a potential harm by saddling it with an extra layer of regulation.”
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