Lehman’s “Not So Big” $600,000,000,000(!) Balance Sheet “The 2008 financial crisis itself was centered not on big banks but on “shadow banks” like Lehman Brothers that weren’t necessarily that big.” –Paul Krugman, “Sanders Over the Edge”; The NYT (4/8/2016) No matter what you think of big banks or who caused The 2008 Crash, I think...Read More
Shackling the Bond Vigilantes In a world where pundits divide into those who think the federal government should be doing more to help the economy, and those who think it’s already done (way) too much, economist and New York Times columnist Paul Krugman lands squarely in the former camp. In fact, you might say that he is...Read More
(Modern) History Quiz “You have to wonder what it will take for serious people to realize that punishing the populace for the bankers’ sins is worse than a crime; it’s a mistake.” Who said the above, about what? A. President Obama, about TARP, zero percent interest rates, and other Wall Street bailouts.B. FDR about investment...Read More
Too Big to Fail? Try, Too Complex to Reform Banks are like the heart that pumps blood ” credit ” to our country’s corporate muscles. If that heart is malfunctioning, any recovery will be anemic. But heart surgery is a very complex thing. You wouldn’t want yours done by a plumber or a politician. –Thomas...Read More
What Does a “Bird” Look Like? Before you pose the question, “What does a well-designed financial system look like?,” first ponder the question, “what does a bird look like?” Seriously. Robins, flamingos, and penguins bare little resemblance to one another. Yet scientists classify each as birds, and each could be called an environmental “winner”: endowed...Read More
And Then There Were Two Goldman and Morgan were assisted in a rather violent industry consolidation. They remain, more than ever, officially “too big to fail” (TBTF), so they know they can always request tax funds directly from the Treasury Department and elevate risks above competitors. With their enormous profits they can buy out any...Read More
