Financial regulation goes in cycles. Some event occurs in which an abusive practice apparently harms the public. The government creates new regulations to prevent similar harm in the future. But ingenious financial firms attempt end runs around the new regulations.…
Reaction to Fed’s lending reins a matter of politics
Just because several horses already have disappeared over the hill, closing the barn door isn’t necessarily a bad idea. More may be coming in from the corral and you wouldn’t want them to gallop away too. But to secure an…
Favors are subtle forms of “rent seeking”
There always will be people willing to do favors for public officials. Can these be benign or do they always constitute ‘rent seeking’? That’s the term economists use for the manipulation of government policy for private benefit. Several prominent public…
At the Fed, President appoints, Senate disappoints
The Federal Reserve is supposed to be insulated from politics, but that is impossible to do perfectly, especially in an election year. That is coming out in two ways right now. First, politics is keeping the Fed’s Board of Governors…