tag:blogger.com,1999:blog-9612609.post5366905872196949752..comments2023-09-29T06:58:20.125-07:00Comments on Badtux the Snarky Penguin: How to End the Great RecessionBadTuxhttp://www.blogger.com/profile/01345749557330760251noreply@blogger.comBlogger1125tag:blogger.com,1999:blog-9612609.post-89138120532653841812010-03-23T16:29:12.549-07:002010-03-23T16:29:12.549-07:00Goig from solutoins to causes, we have this by Kru...Goig from solutoins to causes, we have this by Krugman, earlier today.<br /><br /><i><b>Jamie Dimon Was Right</b><br /><br />About the 19th century, that is.<br /><br />Dimon was castigated by many people, me included, for saying that a financial crisis is “the type of thing that happens every five, ten, seven, years.” Hey, no big deal.<br /><br />But that is the way banking worked once upon a time. I’m reading Gary Gorton’s Slapped by the Invisible Hand, which tells us that there were bank panics — systemic crises — in 1873, 1884, 1890, 1893, 1896, 1907, and 1914.<br /><br />On the other hand, there were no systemic crises from 1934 to 2007.<br /><br />The problem, as Gorton makes clear, is that the Quiet Period reflected a combination of deposit insurance and strong regulation — undermined by the rise of shadow banking. So we have a choice: restore effective regulation or go back to the bad old days.</i><br /><br />Cheers!<br />jXb the Non-Austrian trombonistJazzbumpahttps://www.blogger.com/profile/07337490817307473659noreply@blogger.com