Of course, the Federal Reserve is the chief bank regulator and their source of information is the banks themselves, mostly, but is that creating a bank-bias in decision making? Is it ideology?
UPSIDE-DOWNSY
If the mortgage market is the "central element" in the current set of problems, then why choose to address it through the banking system, where the default-problem gets magnified by leverage and investor worry?
Why not go right to the housing market? Why not go right after the default problem, directly and surely? The rest will follow that, not the other way around.
Is it less costly to try to do it all by shoring up the banking system? No, no, no. And No!
OTHERWISE
Listen to Ben on "too big to fail". Boy, he's got that down. He just needs a little more understanding of the derivatives markets and he'll be picture perfect, IMHO.
He could have been a LOT more positive on long-term fundamentals and used the Greenspan term, "resiliency" at least three times or more.
Wednesday, October 15, 2008
Banks, Banks, Banks on the Brain!
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