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During the 2008 financial crisis, it was clear that many banks would need additional equity, though it was unclear which banks would need additional equity.
During the 2008 financial crisis, it was clear that many banks would need additional equity, though it was unclear which banks would need additional equity. The U.S. government effectively forced all banks to issue equity, whether they needed additional capital or not. That is, they were forced to issue equity even if raising capital did not create any value. What is the rationale for forcing all banks to issue equity rather than allowing banks to choose individually whether or not to issue equity?
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