Clinton says she would not bail out troubled banks

Hillary Clinton said that ould not hesitate to break apart banks that were "too big to fail".
Hillary Clinton said that ould not hesitate to break apart banks that were "too big to fail".PHOTO: REUTERS

NEW YORK (REUTERS) - Democratic presidential candidate Hillary Clinton would not bail out big banks to save them from collapse in the event of another financial crisis, she said on Tuesday (Oct 27).

During a late night television appearance with comedian Stephen Colbert, Clinton said her priorities were focused on raising the minimum wage and bolstering the middle class. "If you're president and the banks are failing, do we let them fail?" asked Colbert. "Yes, yes, yes, yes... ," Clinton said.

She added that she would not hesitate to break apart banks that were "too big to fail." "We now have stress tests and I'm going to impose a risk fee on the big banks if they engage in risky behaviour," she said.

During the 2008 recession, the US government poured cash into US banks to keep them afloat after years of risky loans. Under the 2010 Dodd-Frank Act, regulators were given the power to carve up the banks if they deem them "not credible."

Earlier this month, Clinton announced a plan to curb what she has called the abuses of Wall Street, proposing everything from raising the fines that can be levied by regulators to requiring executives to bear some of those costs.

The plan includes strengthening the "Volcker rule" in the Dodd-Frank Act, which prohibits banks from certain kinds of trading on their own account, and imposing a new tax on high-frequency trading. "We need to get back to putting the middle class at the center of our politics," Clinton told Colbert.