“Nationalization of the Morgage Market”

– August 18, 2010

“On Sunday, September 7, the United States government took control of more than half the U.S. mortgage market, through its seizure—and that is the word used in mainstream press accounts—of Fannie Mae and Freddie Mac, two colossal government-sponsored e …


“New Financial Rulebook Tangles Loan Bundlers, Rating Agencies”

– July 23, 2010

“A minor rule change in the law unexpectedly shut down the market for selling new bundles of car loans and consumer loans after bond issuers, ratings agencies and the Securities and Exchange Commission found themselves caught in a tangle of old and new …


“Haste Makes Waste in Financial Regulatory Bill”

– July 7, 2010

“The Congressional Conference Committee worked all night on Friday, June 25, finally quitting at 5:37 in the morning, so that President Obama could go to the G-20 Summit in Canada saying that Congress had finished a bill. Throughout the night comments …


Lessons Unlearned

– July 2, 2010

On Wednesday, I posted a link to F.A. Hayek’s “The Use of Knowledge in Society”. Like Leonard Read’s “I, Pencil”, Hayek’s knowledge paper explains why it is impossible for an economy to be centrally planned. I have mentioned this idea in earlier posts, …


“The Use of Knowledge in Society”

– June 30, 2010

“The peculiar character of the problem of a rational economic order is determined precisely by the fact that the knowledge of the circumstances of which we must make use never exists in concentrated or integrated form but solely as the dispersed bits o …


“Text of Dodd-Frank Wall Street Reform and Consumer Protection Act”

– June 28, 2010

“A summary of the Dodd-Frank Wall Street Reform and Consumer Protection Act, released Saturday by the House Financial Services Committee. The legislation is expected to come before Congress next week for a final vote. 1. Dodd-Frank Wall Street Reform a …


What Financial Re-Regulation?

– June 3, 2010

“In two weeks, I am supposed to speak on a panel entitled “Financial Re-regulation.” My question is, what re-regulation? To me, re-regulation means you would reverse some step that you took toward deregulation. But the new financial reform bill does no …


“Financial Reform Bill is a ‘Disaster’: Sen. Gregg”

– May 25, 2010

“The financial regulatory bill is a “disaster,” and its proposed consumer protection agency would create a Fannie and Freddie “on steroids,” Sen. Judd Gregg, R-N.H. told CNBC on Monday. “The bill is a disaster because it doesn’t address the fundamental …


“Can the Government Regulate Inflation?”

– May 20, 2010

“In a recent column, Nobel Prize winning economist Paul Krugman claimed that the government needs to have two important duties in finance. First, it must keep interest rates low; second, it must strictly regulate where the newly created money goes. Now …


“Gambling with Other People’s Money”

– May 3, 2010

“Beginning in the mid-1990s, home prices in many American cities began a decade-long climb that proved to be an irresistible opportunity for investors. Along the way, a lot of people made a great deal of money. But by the end of the first decade of the …


“A Three-Point Plan to Save the Euro”

– April 30, 2010

“The rescue package requested by Greece will, if endorsed, buy the eurozone six months, perhaps a year at most. By then, the Greek government will have exhausted the aid and be forced to ask for more or to borrow at astronomical rates. This assumes tha …


An Economy of Liars

– April 20, 2010

Free markets depend on truth telling. Prices must reflect the valuations of consumers; interest rates must be reliable guides to entrepreneurs allocating capital across time; and a firm’s accounts must reflect the true value of the business. Rather tha …