All Posts Tagged With: "Too Big To Fail"
Crisis Economics: A Crash Course in the Future of Finance
Nouriel Roubini and Stephen Mihm’s book on the great subprime crisis gets off to a good start by dismissing as a red herring the “tired” argument attributing the boom to “greed” and focusing instead on “changes in the structure of incentives . . . that channeled greed in new and dangerous directions.” These included programs [...]
30Nov2011 | George A. Selgin | 2 comments | ContinuedThe Importance of Failure
In today’s society failure has become something to fear, avoid, and therefore prevent at all costs. Whether it is unemployment compensation, farm subsidies, or bailouts for failing companies, the world seems to view failure as having no redeeming social value. If success is all good and failure is all bad, then it seems as though [...]
26Oct2011 | and Steven Horwitz | 11 comments | ContinuedToo Big to Fail: The Inside Story of How Wall Street and Washington Fought to Save the Financial System—and Themselves
Books about the 2008 financial crisis keep coming, and New York Times reporter Andrew Ross Sorkin offers one of the better accounts of the meltdown. Using a large number of interviews, he reconstructs the words and acts of key people during the six months from the near-collapse of Bear Stearns in March to the bankruptcy [...]
24Feb2011 | Chidem Kurdas | 0 comments | Continued‘Too Big to Fail’ Banks Could Be Downsized
“An unusual alliance of conservatives and liberals is pushing to break up or downsize banks deemed “too big to fail,” rather than create a new regulatory regime led by the Federal Reserve to try to keep them from getting into trouble again.” (Washington Times, Monday) But still not allowed to fail. FEE Timely Classic: “Too [...]
9Nov2009 | Mike Van Winkle | 0 comments | ContinuedGovernment Sets Us Up for the Next Bust
If an athlete injures himself and suffers great pain, we recognize the shortsightedness of giving him painkillers to keep him going. The pain might be masked, but at the risk of greater injury later. That’s a good analogy for the inflationary policies now pursued by Washington. These policies may temporarily “stimulate the economy,” but they [...]
2Mar2009 | John Stossel | 32 comments | ContinuedToo Big to Fail
“Once you lose your freedom to fail, you also lose your freedom to succeed and you cease to be a free society.” —U.S. Rep. Jeb Hensarling of Texas In March 2008 the investment banking firm Bear Sterns failed and the federal government quickly stepped in. The public was inundated with the phrase “too big to fail” [...]
2Mar2009 | Michael Heberling | 8 comments | ContinuedBailing Out Statism
The key to understanding the saga of Fannie Mae and Freddie Mac—the recently nationalized twin government-sponsored enterprises (GSEs) that dominate home financing—is this: They were set up—intentionally—to distort the housing and mortgage markets. Government planners were not content to let voluntary exchange and spontaneous market forces configure those industries unmolested. So—holding the taxpayers hostage—they intervened. [...]
20Jan2009 | Sheldon Richman | 12 comments | ContinuedWhat Happened to Market Discipline?
During the late presidential campaign Barack Obama said, “[Today’s economic problems are] a stark reminder of the failures of . . . an economic philosophy that sees any regulation at all as unwise and unnecessary.” What? Does that mean that until last fall the Bush administration embraced the free market? Nonsense. Governments at all levels [...]
20Jan2009 | John Stossel | 3 comments | ContinuedNationalization of the Mortgage Market
Breaking down the mortgage market breakdown and how it’s all the government’s fault.
1Dec2008 | Robert P. Murphy | 7 comments | ContinuedThe Sky's the Limit
From the New York Times: The federal government unveiled $800 billion in new loans and debt purchases on Tuesday, hoping another infusion of cash can help unfreeze troubled credit markets and make borrowing easier for homebuyers, small businesses and students.The Federal Reserve said that it would buy up to $600 billion in mortgage-backed assets from [...]
25Nov2008 | Sheldon Richman | 0 comments | ContinuedToo Big to Fail?
This week, Henry Paulson said in an interview with the Washington Post that he wants the Federal Reserve to be able to regulate and ultimately take over any failing financial institution that it considers crucial — including hedge funds. This echoes a notion that has been endorsed by executives of some industry associations, that to [...]
22Nov2008 | Sheldon Richman | 0 comments | ContinuedThe Subprime Crisis Shows that Government Intervenes Too Little in Financial Markets?
Start with two assumptions. No. 1: banking and financial markets are inherently unstable. No. 2: government intervention into banking and financial markets can only stabilize (never destabilize). You’ll find it easy to conclude that any period of market instability we experience, like the recent subprime-lending problem, is the market’s fault and that it could have [...]
1Oct2008 | Lawrence H. White | 0 comments | ContinuedThe Fed Should Inflate to End the Financial Crisis?
The current housing and financial crisis has many people blaming “greed and market forces” for unleashing a panoply of evils on the unsuspecting middle class. This has led to many bad proposals to solve the crisis, such as the April 14 Wall Street Journal op-ed “The Inflation Solution to the Housing Mess” by John Makin, [...]
1Jul2008 | Ivan Pongracic Jr. | 1 comment | ContinuedCan the Feds Save the Housing Market?
Government Solutions Will Only Make Matters Worse
1Jun2008 | Robert P. Murphy | 13 comments | ContinuedWelfare for the Rich
Advocates of the free market—including those considered “right-wing” and “conservative”—believe it is wrong to violate property rights. Consequently, they oppose egalitarian measures to steal from the rich and give to the poor. Such “income redistribution” represents naked theft and epitomizes the Founding Fathers’ fears of unfettered democracy. At the same time, champions of laissez faire [...]
1Apr2007 | Robert P. Murphy | 10 comments | ContinuedGovernment Deposit Insurance: A Dumb Idea
A headline on an Associated Press story in mid-June read, “Doubling Deposit Insurance Opposed.” Surprisingly, the Clinton administration–which can usually be counted on to support anything that extends the reach of government–had come out against a proposal to raise the amount of bank deposits insured by the Federal Deposit Insurance Corporation from $100,000 to $200,000. [...]
1Oct2000 | Lawrence W. Reed | 0 comments | ContinuedThe Government Is the Stabilizer?
Stability is the perennial issue in macroeconomics. The economist’s judgment about the stability of the market economy stems from what Joseph Schumpeter called the “pre-analytic vision.” To illustrate the point, Schumpeter specifically used John Maynard Keynes and his pre-analytic vision: Markets are inherently unstable; the government is the stabilizer. This belief, or vision, was held [...]
1Jan2000 | Roger W. Garrison | 2 comments | Continued-
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