Second, we need a credible mechanism to manage the failure of even the largest firms, without causing or amplifying a systemic crisis. Let’s survey what has been proposed and implemented thus far in that two-front war on too big to fail.
The U.S. and global efforts to address too big to fail Reducing the probability of default of systemic financial firms Much has been done since the crisis to strengthen the regulation of large banking organizations. The highlights would begin with the Basel III capital and liquidity reforms, including the graduated risk-based capital surcharges for globally systemic financial firms.