In remarks by?Federal Reserve Bank of Atlanta President Dennis Lockhart, he said regulators do not have a system in place that would allow orderly failures of the largest financial firms (NYSE:XLF) without taxpayer rescues.
Lockhart said in his speech:
�� The system we should work toward is one in which no institution is too big to fail,�� Lockhart said today in a speech in Atlanta. ��Much is being done in the aftermath of the Fed��s and the Treasury��s emergency interventions of 2008 to get to this state of affairs, but, in my view, this is a longer-term aspiration at this moment.��
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The Fed, along with other bank (NYSE:KBE) regulators, are working toward a solution that will avoid additional taxpayer-funded bailouts after the American International Group Inc. (NYSE:AIG) and Citigroup Inc. (NYSE:C) mishaps. One step to help the Fed has been last year’s passage of the Dodd-Frank Act; however, this is still a work in progress.
Financial stocks affected by Lockhart’s remarks include?Goldman Sachs (NYSE:GS), Morgan Stanley (NYSE:MS), JP Morgan (NYSE:JPM), Bank of America (NYSE:BAC), Citigroup (NYSE:C) and American International (NYSE:AIG).
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