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US banks no longer 'too big to fail'

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America's biggest banks are now in a position to go bust without state intervention, the Bank of England's deputy governor declares

The deputy governor of the Bank of England has declared an end to the era of taxpayer bail-outs for the world's giant lenders.

Almost five years to the day since the collapse of Lehman Brothers triggered the worst financial crisis since the 1930s, Paul Tucker claimed that America's biggest banks are now in a position to go bust without state intervention.

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Absolute rubbish.

The big bank's now have more robust rules in place forcing them to carry much more capital security to hedge against losses, but they are just as large compared to the economy as they were pre-recession - if not even larger now. If any of the big banks again got themselves in a position to become insolvent, they would still be bailed out with taxpayer cash.

The rhetoric by Mr Tucker is largely political, to give govt and the media a sound-bite to reassure the still-twitchy public and investors.

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Now they're too bigger to fail. :D

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