Reforms

Mark-To-Market Clarifications And Other Improvements

There has been a terrible amount of crookedness, and financial institutions should not be let off the hook. Let them live miserably with their bad loans and hold their damaged securities to maturity, thus crimping their ability to grow their businesses (as transparency requirements deter new clientele). Let new competition rise in their place. Don’t let these institutions use Chapter 11 blackmail as a means of off-loading their junk into “bad bank”surrogates or the balance sheets of taxpayers.

After Bailing Out AIG, Who Will Bail Out the U.S.?

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There is a lot we don't know yet about the FED's 79.9% stake in AIG. But we do know that the FED's rescue of AIG has enormous implications. Allegedly, AIG wrote nearly a half trillion dollars of credit derivative insurance on the viability of businesses throughout the world. We need to understand how far this ownership goes beyond symbolism and bridge financing. The U.S. taxpayer may be assuming a big chunk of liability for world commerce, and in the face of a credit contraction that will bring down global businesses.

Government Housing Market Intervention Is Bad Plan

Irwin Kellner is a learned economist, but his recommendation for “braking the fall” is wrongheaded. We don’t need bigger government! And we don’t need the scams that would come with government being the buyer of last (and eventually, first) resort. What our country needs is the prudent and streamlined regulation of financial institutions. Proper regulation can be instituted without growing the government’s role in the economy.

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