Pathology of a Crisis Eric Dash, New York Times
Charitable Capitalism William Greider, The Nation
Joe Biden: Even rattlesnakes are more popular than bankers Raw Story (hat tip reader John D)
Fears of China property bubble Financial Times (hat tip reader Michael)
The Rise and Fall of Empires Paul Kedrosky
Antidote du jour:
fresno dan says: Joe Biden: Even rattlesnakes are more popular than bankers
NO, rattelsnakes are far, far, far, …
O, lets just say INFINITELY more popular than bankers.
chad says: yeah I’d go out of my way to save a rattlesnake, and most living things, from hardship but I find catch myself more and more wishing for some pretty dreadful things to happen on Wall Street.
fresno dan says: Pathology of a Crisis Eric Dash, New York Times “Regulators have begun to act on some of the lessons learned. Federal officials are discussing whether to impose hard limits, not just soft guidelines, on the portion of bank balance sheets that can be made up of commercial real estate loans. That would automatically prevent the buildup of risky assets and take more discretion out of the examiners’ hands.”
As someone who works in a regulatory agency, I am sympathetic. And I agree that whatever advantages to guidance and flexible rules, they are countered by the fact at the time you are trying to impose them, things are fine. I liken it to speed limits – safe and reasonable is vague, agrueable, and subject to abuse. 40 miles per hour is clear, simple, and auditable – and one doesn’t have to worry about talking to the police for the latest “interpretations” of speed limit regulation.
In my agency, one hears how our flexible system is so much better than say the Germans with all their rules – yet when I inspect a German firm, I find that the Germans have no trouble complying with all those (clear) rules, but are OF COURSE confused by the (flexible) US rules (SO AM I). And than there are those pesky facts – like fewer problems with German products produced under their regulatory regime than with American products produced under our regulatory regime.
There is a bizarre aversion to clear simple rules that I discern in the US regulatory regime – its like its a “checklist” and that would mean instead of an all wise regulator whose subtile discernment is essential to understanding what we are trying to get at (?and maybe getting a high paying consultancy after the regulatory career?), a monkey could do it.
You know, I keep reading what a BRILLENT guy Bernanke and Summers are…and I look at this mess…and I say give give the monkeys a chance.
MyLessThanPrimeBeef says: It looks like the cat’s eyes are open as he jumps into the unknown.
I understand that when frogs jump, they estimate where they are going and jump with their eyes closed. And because they are products of natural evolution, they never seem to miss.
On the other hand, our central bankers, well, they seem to jump into economic policies with their eyes closed as well, except…well, except, like many Homo Not-So-Sapiens endeavors, their blind un-natural jumps miss invariably.
Michael says: There is a big move down today in the stock market.
But there was a way to make money from this move, if only your DJIA index timing signal told you TWO DAYS AGO that the market is in correction mode.
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The Dash piece tells the same story and reaches the same bleak non-conclusion we’ve seen a hundred times by now.
The problem is clear: these banks need to be put in restraints.
The failure of gentle, nuanced, suggestive, discretionary “regulation” is manifest.
So what’s the prognosis according to this article? They still want to allow every action and any size of any activity. They want every casino game, and for the casino to run as rampants as it wants to run. All they want to do is be able to administer a tweak here and a tweak there, and they think a shotglass can contain a tsunami.
They just will not learn, that ONLY structural reforms, hard limits, hard caps, blunt objects, bans, real prison risks, can ever work.
(That this example involves smaller banks shows that although size in itself is our biggest problem, it’s not the only structural problem. The casino is antisocial, vandalistic, malevolent at smaller levels as well.)