Opinion | Why orderly liquidation is important
I believe that Allan Sloan and I were talking past each other when he interviewed me for his column ["Wall Street living wills doomed to fail," Deals, June 15]. Perhaps that's because we spoke on a Sunday evening after dinner and a long workweek.
In any event, I want to make absolutely clear that I view "living wills" as a vital part of ensuring that the largest financial companies can be resolved in an orderly way, consistent with the process and tools that the Federal Deposit Insurance Corp. has long used to close insured banks. As part of this resolution planning, there may be a need for corporate simplification and restructuring or even divestiture, in order to achieve a viable, credible resolution plan. I understand the sentiment — which he clearly reflected in his column — that we should just "break them up" now, but that is not realistic. However, we do have the tools to make these complex behemoths simplify and rationalize their legal structures with their business lines so that if and when they get into trouble, their individual business units can be quickly broken apart and sold off into the private sector.
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