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Politics : American Presidential Politics and foreign affairs -- Ignore unavailable to you. Want to Upgrade?

To: DuckTapeSunroof who wrote (34283)	3/23/2009 6:53:06 PM
From: Peter Dierks	Read Replies (1) \| Respond to of 71588

I would not say that the Fed (alone) had (or should ever have!) anywhere near all the powers and policy tools required to single-handedly "solve" any kind of globally synchronized financial collapse the likes of which we have stumbled into. I was not attempting to assert they should have been able to solve the crisis. I was asserting that the powers they held for many decades were sufficient to deal with the situation and allow failure to accrue where it belonged. Re: "If that had not been allowed if my understanding is correct hundreds of thousands of investors would have become unsecured creditors of the failed wall street firms who held their securities in street name." Not necessarily... SIPC insurance would still apply. (And investors would stand even higher in the bankruptcy chain for repayment then even bondholders....) Re: "Still, a better solution would have been to protect the investors rather than the fat cats." (Which 'investors' and which 'fat cats'? Aren't 'fat cats' generally the largest of 'investors'?) Investors are the ones who invest. The fat cats in this case were the people who ran the investment houses. While some of them are also investors, many just take the money and spend it.