Why Short-Selling Bans Are Dumb
November 16, 2009
Regulators around the world, including our own SEC, succumbed to populist fervor following the Lehman collapse and banned short-selling "to protect the integrity and quality of the securities market and strengthen investor confidence." It's still an open question as to whether the ban had any positive effect on investor confidence, but evidence is piling up that "quality" -- a market's ability to provide liquidity and price discovery -- headed south.
Should We Care About the "Big" in "Too Big To Fail"?
November 10, 2009
Oftentimes when you debate a skeptic of structural reform on Wall Street, the skeptic will say something like: "Why are you so worked up about 'too big to fail'? Lehman was far from the biggest bank on Wall Street, but it caused plenty of damage." If anything, "too-interconnected-to-fail" is the real issue, they'll say--implying that this makes addressing the problem utterly futile, since severing interconnections is a lot harder than limiting bank size. In my experience, this can temporarily wrong-foot you long enough for the other person to seize the rhetorical advantage.
November 02, 2009
Judging from Jeopardy, economics needs a lot more popularizing. Is America's long-term unemployment problem looking downright European? The 'did Lehman cause the crisis?' debate continues. Roubini says "reckless" U.S. policy will lead to biggest bubble ever. Nate Silver gives 5-to-2 odds that gay marriage in Maine will be affirmed. David Warsh: Carmen Reinhart is the most influential female economist around.
October 07, 2009
Study: Calorie posting in NYC restaurants hasn't changed behaviors. Krugman: Why does the Fed insist on reviving shadow banking? Bill Clinton: Bush should have rescued Lehman. Does a tax credit for boosting employment make sense? More signs of a thaw: Sales at eBay rose in Aug. and Sept.
Was the G20 Summit Actually Dangerous?
September 26, 2009
It is easy to dismiss the G20 communique and all the associated spin as empty waffle. Ask people in a month what was accomplished in Pittsburgh and you’ll get the same blank stare that follows when you now ask: What was achieved at the G8 summit in Italy this year? Perhaps just having emerging markets at the table will bring the world closer to stability and more inclined towards inclusive growth, but that seems unlikely. Should we just move on--back to our respective domestic policy struggles? That’s tempting, but consider for a moment the key way in which the G20 summit has worsened our pre
Do I Dare Defend Paulson Again?
September 22, 2009
Yes! Steve Weisman over at The Peterson Institute posted a nice riff yesterday about James Stewart's recent New Yorker piece reconstructing the week Lehman collapsed. His (and Stewart's) conclusion? Hank Paulson screwed up massively: My takeaway is that while Lehman executives were oblivious to the warning signs over the imminent failure of their storied investment firm, Treasury Secretary Henry Paulson may have increased the odds of a Lehman collapse by taking a hard line opposing a government role in its rescue.
September 16, 2009
What recession? Wages are rising. (Or are they?) First firm to participate in toxic loans progam is selected. Lehman owes about $2 billion in back taxes. Barclays shows that accounting hijinks are alive and well. Scott Sumner: the Fed caused the crisis by printing too little money. Felix Salmon gets profiled.
Did Tight Monetary Policy Cause the Crisis?
September 11, 2009
In his NYT mag piece, Paul Krugman blames macroeconomists for believing the world behaved as well as the math behind their models. His solution? To re-embrace Keynes. But in a provocative counterpoint on VoxEU, Scott Sumner says looking back to Keynes won't solve the problem.
September 10, 2009
A decade's worth of income gains for Americans has been wiped out. Two top-notch accounts from Bloomberg on the global effects of Lehman's collapse. The FT has one too. Alaska spends more per pupil than any other state. Up to 12% of the gender wage gap is due to men working more dangerous jobs. Is a 2% inflation target too low?
Let's Talk Financial Crisis
September 09, 2009
For anyone interested in debating where the economy and financial system stand a year after the Lehman collapse, TNR is hosting a conference on the subject this coming Monday, September 14, at the Willard Hotel in Washington. We've got a real murderer's row of speakers and panelists lined up--Rep. Barney Frank, Commodity Futures Trading Commission Chairman Gary Gensler, The Wall Street Journal's David Wessel, hedge fund manager (and TNR investor) Bill Ackman, former New York Gov. Eliot Spitzer, among them.