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Politics : Ask Michael Burke
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To: Lymond who wrote (72280)12/23/1999 1:40:00 PM
From: BGR  Read Replies (2) of 132070
 
John,

Au contraire, a populist would have called for the heads of the bankers. I did just the opposite. The banking system is of immense importance to capitalism, which in turn has brought unprecedented prosperity in the post WWII era to those countries like the USA which very wisely followed it. I like this system, I must confess.

The present system with its modest socialization of risk (are you against Social Security, too?) via the backup of the Federal Reserve Board (which averted a post 87 depression as well as handled the S&L crisis pretty well) makes way more sense to me than a TL system where banks are out on their own (ala the pre-Fed 19th century era). There used to be bank failures en masse those days. Systemic risk was extremely high and hence a hindrance to productive use of capital. I think that modern capitalism has made a lot of progress in the last 100 years and the US is a fine example of its success. Turning the clock back is foolish.

If the Fed didn't make three hasty rate cuts, there would perhaps be a lot of former middle-class US citizens as well. So, the policy error, perhaps, was post the 1997 crash when it came to the S.E. Asian economies. The Fed needs to be applauded for its fine performance.

Do you consider a blind faith in TL (not saying that you have such a faith) as objective?

-BGR.
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