How can we put the barnkers’ necks on the block?

Matt Levine writes: A “financial crisis” means, roughly, “that someone borrows money from someone else and can’t pay it back, and it is socially or politically unacceptable that the people who loaned the money not get their money back.” So the way to avoid financial crises is to clearly define the classes of people whom it is socially and politically acceptable not to pay back.  The Fed’s new rules on “total loss-absorbing capacity,” which requires banks to fund themselves partly with long-term debt that would be, as the name implies, loss-absorbing. Banks issue debt that is explicitly government guaranteed (retail deposits, etc.), and other debt that is systemically important and disastrous not to pay back (repo, etc.), but that shouldn’t lull you into thinking that allbank debt is systemic and subject to implicit government guarantees. TLAC debt, with “loss” right in the name, shouldn’t lull anyone.