Do you disagree with the Fed's position as a lender of last resort, as well as the existence of FDIC? It's not equivalent, but it looks like what's going to happen is that the federal government is going to try to move to a model of being the absorber of risk of last resort.
Announcement
Collapse
No announcement yet.
A New New Deal?
Collapse
X
-
12-17-10 Mohamed Bouazizi NEVER FORGET
Stadtluft Macht Frei
Killing it is the new killing it
Ultima Ratio Regum
-
By the way, I haven't yet decided if I'm in favour of pulling the financial industry's chestnuts out of the fire or not.12-17-10 Mohamed Bouazizi NEVER FORGET
Stadtluft Macht Frei
Killing it is the new killing it
Ultima Ratio Regum
Comment
-
Originally posted by KrazyHorse
Why not? The US Fed. Gov't is able to absorb larger amounts of risk than individual private enterprises are. If the bailout is engineered correctly (big IF) then why can't they leverage that capacity to both unclog markets and turn a profit?I came upon a barroom full of bad Salon pictures in which men with hats on the backs of their heads were wolfing food from a counter. It was the institution of the "free lunch" I had struck. You paid for a drink and got as much as you wanted to eat. For something less than a rupee a day a man can feed himself sumptuously in San Francisco, even though he be a bankrupt. Remember this if ever you are stranded in these parts. ~ Rudyard Kipling, 1891
Comment
-
Again, refer back to my post on lender of last resort/provider of liquidity/bank insurer comment. Do you disagree with the idea that these roles have been net positives?12-17-10 Mohamed Bouazizi NEVER FORGET
Stadtluft Macht Frei
Killing it is the new killing it
Ultima Ratio Regum
Comment
-
Originally posted by KrazyHorse
Do you disagree with the Fed's position as a lender of last resort . . . but it looks like what's going to happen is that the federal government is going to try to move to a model of being the absorber of risk of last resort.I came upon a barroom full of bad Salon pictures in which men with hats on the backs of their heads were wolfing food from a counter. It was the institution of the "free lunch" I had struck. You paid for a drink and got as much as you wanted to eat. For something less than a rupee a day a man can feed himself sumptuously in San Francisco, even though he be a bankrupt. Remember this if ever you are stranded in these parts. ~ Rudyard Kipling, 1891
Comment
-
I agree that it should be punitive. And also that they may be allowing themselves to be too generous. The fact that these enterprises are limited liability provides all sorts of perverse incentives to some banks, however. To be fair to the Fed/Treasury this is the first time anybody's really tried this on this scale.12-17-10 Mohamed Bouazizi NEVER FORGET
Stadtluft Macht Frei
Killing it is the new killing it
Ultima Ratio Regum
Comment
-
Originally posted by Naked Gents Rut
Social Security is such a cluster****. One of the few political issues that still gets me angry.12-17-10 Mohamed Bouazizi NEVER FORGET
Stadtluft Macht Frei
Killing it is the new killing it
Ultima Ratio Regum
Comment
-
The real problem with discussing market discipline is that I'm not sure if market discipline actually applies to events which only take place once every 50 years (let's say).
On this time scale it is easy for me to imagine that market participants basically forget, or are incentivized to forget. When you can easily go your whole career without seeing something like this happen, do you really price it in?12-17-10 Mohamed Bouazizi NEVER FORGET
Stadtluft Macht Frei
Killing it is the new killing it
Ultima Ratio Regum
Comment
-
Originally posted by KrazyHorse
The real problem with discussing market discipline is that I'm not sure if market discipline actually applies to events which only take place once every 50 years (let's say).
On this time scale it is easy for me to imagine that market participants basically forget, or are incentivized to forget. When you can easily go your whole career without seeing something like this happen, do you really price it in?I came upon a barroom full of bad Salon pictures in which men with hats on the backs of their heads were wolfing food from a counter. It was the institution of the "free lunch" I had struck. You paid for a drink and got as much as you wanted to eat. For something less than a rupee a day a man can feed himself sumptuously in San Francisco, even though he be a bankrupt. Remember this if ever you are stranded in these parts. ~ Rudyard Kipling, 1891
Comment
-
I'm not sure that much discipline is worth the price being paid for it.12-17-10 Mohamed Bouazizi NEVER FORGET
Stadtluft Macht Frei
Killing it is the new killing it
Ultima Ratio Regum
Comment
-
Originally posted by Jon Miller
Considering that my room and board is ~14k, I think that Aeson's 6k gives him ~20k which is what I make a year.
Not sure how to price in room and board when I live in CA though. It'd be higher, definitely... but if I had to pay it (or my Aunt was paying that much more because I was there) I wouldn't be there in the first place.
If I did the work I was doing down there, as a paying job, I'd probably have made quite a bit more (but had to work more too). (And not been able to afford to live down there, at least not on the ocean side of I-5 )
Comment
Comment