This blog printed on 100% recycled electrons.
President Obama announced sweeping reforms of the U.S. financial system yesterday. As you would expect, some Republicans are grumbling about overregulation (indeed, we all remember how FDR's financial regulations led to 70 years of... oh, wait, pretty decent economic growth without another depression). At least analyst is able to take the opposite view, that Obama's proposed regulations don't go far enough to make banking boring and safe for the institutions that are too big to fail.
Whatever the potency of the president's proposal, he's at least moving in the right direction. More responsible oversight of lending and investing will not only stabilize the economy (lower peaks, but shallower valleys) but also help our image abroad. Consider: many of our partners in the global economy blame the United States for causing the recession. China can certainly make the argument: we crash our economy with subprime loans, then have to tighten our belts and and buy less stuff, leaving China with exports they can't sell and workers they can't keep busy.
Our bull-in-the-china-shop routine in financial affairs during the last ten years may have done as much damage to international trust of the United States as our foreign-policy buckarooism. The calls we're hearing from Russia and China to create a new global currency to end dependence on the dollar (and the euro and yen) aren't just political gamesmanship to undermine the United States; they're also a reflection of a lack of faith in the U.S. financial system. It may just be rhetoric, but to have major players even talking about ditching the dollar is not good for us.
The rest of the world is moving away from deregulation and risky business; so should we. Financial regulations may give the red-criers more reasons to shout "European socialism!" at the President (and the electorate), but in this case, acting a bit more like Europe will help assure the world that we are fixing what we broke and reducing the chances that we'll break the economy again.
RIP Quincy Jones
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Probably one of the greatest music producers EVER! I have to tell you, I
have been beside myself, I get it, he was old, but everything you listened
to deca...
5 hours ago
Cory,
ReplyDeleteYou are so off base that you have things backwards. FDR’s finaincial regulations included Fannie Mae, and Fannie Mae was one of the main reasons for the current financial mess. The top reason if the Woodrow Wilson Federal Reserve’s regulation of the banking sector.
And in regard to China, they are moving away from the central–planning philosophies, and toward free-markets. The reason the world has less faith in the American economic system is because if have too much central planning.