Category Archives: Financial Crises

The CBO gets worse

John Taylor writes, The second CBO procedural change was to discontinue the use of the “alternative fiscal scenario” in the long-term projections There is more at the link. I think that CBO modeling is way over-rated and biased toward interventionist … Continue reading

Posted in Economic education and methods, government debt crisis | 2 Comments

Debt and the economy

Kevin Erdmann comments, Debt isn’t a sign of risk taking. Equity is. The reason Ford has lots of debt isn’t because risk-seeking shareholders demand that they leverage up. Risk-seeking shareholders buy unleveraged Tesla shares. The reason Ford has lots of … Continue reading

Posted in Financial Crises | 18 Comments

Stanley Fischer, pre-crisis

He writes, We have a better capitalized and more liquid banking system, less run-prone money markets, and more robust resolution mechanisms for large financial institutions. However, it would be foolish to think we have eliminated all risks. For example, we … Continue reading

Posted in Financial Crises | 14 Comments

Is Illinois the trailer for the debt movie?

I assume you have been following the story. Illinois is now grappling with $15 billion of unpaid bills and an unthinkable quarter-trillion dollars owed to public employees when they retire. This would be the third year in a row that … Continue reading

Posted in government debt crisis | 15 Comments

Two Thoughts on William Niskanen

I had only one close encounter with him. That was when he went to a Congressman’s office to argue against TARP and he invited me to join in the meeting. My observations about him: 1. He was highly principled. If … Continue reading

Posted in Financial Crisis of 2008 | 8 Comments

What I’m Reading

Two books that attack conventional economic modeling, especially in light of the financial crisis. I have a preview copy of Economics for Independent Thinkers, by Daniel Nevins. I have a review copy of The End of Theory, by Richard Bookstaber. … Continue reading

Posted in books and book reviews, Financial Crisis of 2008 | Tagged , | 15 Comments

When to break up the big banks

Stephen G. Cecchetti and Kermit L. Schoenholtz write, From our perspective, by raising the odds of an effective resolution, FIBA (as a complement to Dodd-Frank) boosts the credibility of the U.S. regime. Over time, foreign regulators also may be reassured … Continue reading

Posted in Financial Crises, Mark Thoma is Indispensable | 7 Comments

Needed: A March for Fiscal Responsibility

John Cochrane writes, We live on the edge of a run on sovereign debt. The US has a shorter maturity structure than most other countries, and a greater problem of unresolved entitlements. Despite our “reserve currency” status, we may actually … Continue reading

Posted in government debt crisis | 13 Comments

If I were an editor

I would be very hard on a lot of manuscripts. As a result, fewer published books would fail to meet my standards. By the same token, a lot of authors would be really frustrated, and they would give up trying … Continue reading

Posted in books and book reviews, Financial Crises | 3 Comments

Financial Policy if I were in charge

This afternoon, I am supposed to participate in a discussion of financial regulatory policy. There are so many participants, including big shots like John Taylor and John Cochrane, that I may end up not saying anything. I probably will just … Continue reading

Posted in Financial Crises, financial markets, Housing and housing finance | 32 Comments