Lacker Says Government Should Be Ready to Let Big Banks Fail
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Federal Reserve Bank of Richmond President Jeffrey Lacker said plans to limit the size or change the structure of the largest financial institutions must be made with the intent of allowing a failure without government aid.
“It makes perfect sense to constrain the scale and scope of financial firms in a way that ensures that they can be resolved in an orderly manner, without government protection for creditors,” Lacker told a conference at the University of Richmond.