Single Regulator To Solve Systemic Risk

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To solve the problem of a single systemically critical firm potentially bringing down the rest of the economy, SEC Chairwoman Mary Schapiro believes a single systemic-risk regulator should do the trick. While a group of regulators will be involved in creative guesswork to set standards for,"liquidity, capital and risk-management practices" for large financial firms, it will be up to the systemic risk gatekeepers to determine when to force companies to sell assets or cease business. Should this stroke of genius come into being, the government will have pulled off the impossible. It will have successfully transferred the fate of systemic risk mitigation to the only group of people currently trusted less than risk management groups at banks- the government itself.

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