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There is an entire network in the US that depends on the loan and credit system offered by these financial institutions. Small businesses depend on it, farmers depend on it, and home owners depend on it. The concern is that if these banks collapse, so does the mechanism for loaning money in the US economy, and the rest of the economy will collapse with them due to a contraction of the money supply.
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What would happen if we don't bail out wall street?
What would happen if we don't bail out wall street? And what's the difference between wall street and main street?