Monday, November 24, 2008

Citigroup - Too large to fail?

Is Citigroup too large to fail?

Lehman Brothers was obviously not too large to fail.

Bear Stearns was not too large to fail.

AIG was too large to fail.

If Citigroup is too large to fail, how should the nationalization of Citigroup take place?

Socialism doesn't work very well.

Allowing pure capitalism hasn't worked perfectly.

Could a synergistic nationalization of Citigroup work better than the simple profit model? How would it be structured?

Along with letting the President, the FED, the Treasury, the Congress, etc., determine who the winners and losers will be when runs on capitalism take place, why not create a fund of last resort, owned by taxpayers, to be benefited by taxpayers, whereby nationalized assets act like an endowment to support health care, education, energy development, scientific progress, retirement, and those who really do need help; like the poor, the oppressed, the sick, the wounded, the unemployed, etc. This fund would provide work for those that are out of work. Competition would still play an important part in determining income levels, opportunities for advancement, and most importantly, accountability. This fund would help those employed to help themselves. It would give them nationalized assets to provide the capital base that caused their jobs to be lost. It would provide education and accountability to help them improve.

Synergism still feels like a better approach to the nationalization of capitalism, than simply choosing winners and losers and letting competition, fear and greed determine the next batch of winners and losers.

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