Wednesday, May 06, 2009
Shucks, if only we'd had a systemic-risk regulator
Counterpunch: Why economists should learn arithmetic
In Washington policy circles they're calling for a systemic-risk regulator. The implication is that the mess would never have happened if only they'd had one of these. The truth is that in boom times, even if the boom's not sustainable, public servants go along with the flow or they don't get promoted. A systemic-risk regulator (that's what the Fed's supposed to be anyway) would have been told to keep quiet and not to spoil the party. In any case, any numerate economist with a pulse should have seen the HPC (and consequent financial crash) coming. As the writer points out, all the signs were there.
Posted by icarus @ 02:34 PM (322 views) Add Comment
2 Comments
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1. bidin'matime said...
It's true - even as a self-employed accountant and financial adviser, I had to be careful who I warned about the impending crash - people just didn’t want to know! I hadn’t sold mortgages for years - thank goodness - but when people told me they were 'investing' in property I had to couch my warnings carefully - if I came straight out and told them I thought it was a really bad idea, then they would simply go elsewhere... This was only a fraction of my total business, so anyone whose job and entire income depended on it would have been keeping very quiet...
2. icarus said...
Like Cassandra - able to foresee tragedies but unable to forestall them since it was fated that nobody would heed her warnings.
In the modern world she'd just be a party pooper - and why spoil the party if any damage it causes can be sorted out by those not attending it.