Troubled banks must be allowed a way to fail

Finally some common sense! Hoenig needs to be put in charge of the Fed.

FT.com / Comment / Opinion - Troubled banks must be allowed a way to fail:

"Troubled banks must be allowed a way to fail
By Thomas Hoenig
Published: May 3 2009 19:01 Last updated: May 3 2009 19:01
When the
financial crisis began to unfold in 2007, US policymakers reacted quickly out of
fear that rapidly evolving events would lead to a global economic collapse. In
my view, the policy response to this point has been ad hoc, resulting in
inequitable outcomes among firms, creditors, and investors. Despite taking a
number of actions to stabilise markets and institutions, uncertainty continues
and markets remain stressed.
I believe there is an alternative method for
addressing this crisis that deals more effectively with the issues we currently
face while also considering the long-run consequences of those actions: the
implementation of a systematic plan to resolve large, problem financial
institutions."