The title of this post, apart from alluding to Milton Friedman’s famous quip about Keynesian economics, is the title of a recent speech by Klaas Knot, President of the Netherlands Bank. Answering his own question, Knot says, … Yes – as long as we stay eclectic, pragmatic…
Despite both the recent release of a set of “GSE reform principles” by the Mortgage Bankers Association and Treasury Secretary Designee Steven Mnuchin’s promise to prioritize reform of Fannie Mae and Freddie Mac, as matters stand such reform seems likely to remain stalled for some time: while…
Under Dodd-Frank, the new Financial Stability Oversight Council (FSOC) has the authority to designate companies as “systemically important financial institutions” or “SIFIs.” By identifying and branding these companies as systemically important, we’ve been told, the government will end “too big to fail.” Dodd-Frank’s supporters claim bailouts like…
(Originally appeared on June 11, 2011.) I promise to make this my last post for a while concerning the matter of 100-percent versus fractional-reserve banking. However, in addressing some comments on my recent posts it occurred to me that some very serious misunderstanding is at play concerning…
It looks like Deutsche Bank is heading toward failure. Why might we be concerned? The problem is that Deutsche is too big to fail — more precisely, that the new Basel III bank resolution procedures now in place are unlikely to be adequate if it defaults. Let’s…