Saving too-big-to-fail banks: Here comes a new government takeover strategy

The federal government could soon have the right to seize control of troubled financials institutions that are deemed "too big to fail," fire their top executives, wipe out shareholders and rewrite the institution's loan agreements. These are among the provisions in a new bill that Representative Barney Frank is likely to introduce this week, according to a report in Monday's New York Times. If Frank's bill makes it though the legislative process, bankruptcy court would no longer be the ultimate decision maker for giant financial institutions whose collapse could jeopardize the financial system. Instead, the government would take that role.