Monday, April 9, 2012

The Dog That Didn't Bark

As to whether 'the repeal of Glass-Steagall' was the cause of the 2008 financial crisis, that would be Paul Krugman.  Never one to miss any opportunity to criticize a Republican, he nonetheless is MIA, if not positively gone over to the enemy:
As I’ve written repeatedly, I don’t think that too-big-to-fail is at the heart of our financial problems. Nor do I think a sharp separation between narrow banking depository institutions and other financial players is a silver bullet: unless the shadow banking system is really reined in, financial institutions will create things that look like deposits, act like deposits, but don’t have an FDIC guarantee; yet in crisis, there will be strong incentives to bail them out anyway.
But, the Glass-Steagall-done-it crowd still has Lyndon LaRouche:
In assigning responsibility for the 2007-08 financial collapse. the Final Report of the Financial Crisis Inquiry Commission (FCIC) places crucial emphasis on banking deregulation, and particularly the erosion and repeal of Franklin Roosevelt's Glass-Steagall Act.The Commission's mandate from Congress did not include making recommendations for resolving the current crisis and preventing a future one, but economist and statesman Lyndon LaRouche has identified the restoration of Glass-Steagall, which was repealed in 1999, as the critical and essential condition for halting the present collapse and beginning to rebuild our economy.

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