On Mon, Sep 14, 2009 at 12:56 PM, Nick Arnett <nick.arn...@gmail.com> wrote: > > > On Mon, Sep 14, 2009 at 11:57 AM, John Williams <jwilliams4...@gmail.com> > wrote: >> >> There appears to be some ignorance masquerading as certainty floating >> around here. In the interest of reducing ignorance and increasing >> humility, here are some educational papers. >> >> The Financial Crisis and the Policy Responses: An Empirical Analysis of >> What Went Wrong >> John B. Taylor >> >> http://www.stanford.edu/~johntayl/FCPR.pdf >> > > Interesting that you chose not to quote the paragraph that describes his > opinion of the "heart of the financial crisis."
It seems to have been summarized by the part I excerpted, which was Taylor's conclusion. The big MBS push was largely an unintended consequence of government regulations. And it was made worse by government regulations, as described in the paragraph after the one you quoted: | In the United States there were other government actions at play | here. The government sponsored agencies Fannie Mae and Freddie Mac were | encouraged to expand and buy mortgage backed securities, including those | formed with the risky sub-prime mortgages. While legislation, such | as the Federal Housing Enterprise Regulatory Reform Act of 2005, was | proposed to control 9 these excesses, it was not passed into law. These | actions of these agencies should be added to the list of government | interventions that were part of the problem. > The behavior he describes > below is precisely what the Commodity Futures Modernization Act of 2000 made > lawful by removing the regulatory barriers that were in place for decades. Where does Taylor write that? Or do you claim it from another source? If so, what source? _______________________________________________ http://mccmedia.com/mailman/listinfo/brin-l_mccmedia.com
