Posts filed under “Analysts”
Dodd-Frank has burdened small banks — and the businesses that rely on them — much more than large businesses that have access to capital markets. Is this why we’re experiencing the slowest recovery in two generations?
So asks Peter Wallison, a scholar at the American Enterprise Institute, a conservative think tank that advocates for free markets and views government regulation with suspicion.
Nonetheless, Wallison has raised a question worth asking — and answering — since he isn’t the only one who blames Dodd-Frank for the stubbornly slow recovery from the financial crisis. Just by way of background, Wallison was a member of the federal commission that studied the cause of the 2008 meltdown and was the lone member to lay almost all of the blame at the feet of the government-sponsored entities, Fannie Mae and Freddie Mac. Most scholars have concluded that the causes of the crisis were many — including deregulation of the sort Wallison has advocated — and his arguments have been widely disputed (see this, this or this).
But leaving that aside, let’s spend a few minutes examining the assertion that Dodd-Frank, adopted in 2010 to lower the odds of another financial crisis, is responsible for the slow economic recovery.
Wallison’s argument goes like this . . .
Continues at Don’t Blame Dodd-Frank for the Slow Recovery
Can We Rely on Market-Based Inflation Forecasts? Michael D. Bauer and Erin McCarthy FRBSF Economic Letter, September 21, 2015 A substantial decline in market-based measures of inflation expectations has raised concerns about low future inflation. An important question to address is whether the forecasts based on market information are as accurate…Read More
Every now and then a remarkably bad idea springs to life. It gets debated, ridiculed and eventually discarded. In the marketplace of ideas, free and open debate help to determine which ideas are useful and which wind up in the rubbish heap. (John Stuart Mill was onto something). We tolerate reprehensible ideas because, ultimately, free…Read More
My Sunday Washington Post Business Section column is out. This morning, we look at two competing investment philosophies, Alpha & Beta. The print version had the sort of misleading headline Be the guy with the calm and collected investing strategy – I much prefer the online version’s The best investment strategy for you? It’s the…Read More
I spent the past week in Maine, fishing for smallmouth bass and discussing policy with largemouth economists. It is an annual trip, and one where the wine flows freely and the debate is sincere and robust and perhaps best of all, very unguarded. The open nature of the discussion is the result of the Chatham House…Read More
My Sunday Washington Post Business Section column is out. This morning, we look at how the internet evolved as a source of bad investment opinion. The print version had the full headline How to sort out the garbage of online investment advice; I like the online version hed, Hey, investment cranks: The Internet never forgets. Here’s an excerpt from…Read More
Farhad Manjoo of the NYT explains the why the usual pattern seems to be happening with Apple: “Analysts’ estimates vary wildly, with many originally predicting that Apple sold three million to five million watches from April to the end of June. After studying Apple’s opaque earnings report, several analysts revised their estimates down to about 1.5 million to…Read More
Earlier this summer, I tweeted a wonderful line from Brett Arends column, 25 things I wish I knew when I graduated from high school:
3 simple rules will explain 99% of human behavior 1: Most people don’t think. 2: Some people are jerks. 3: Everyone is selling something.
— Barry Ritholtz (@ritholtz) June 15, 2015
That led to a delightful column last week from Michael Johnston’s A Visual History of Market Crash Predictions.
Here are some of the more egregious calls, but the entire article is well worth your time to read:
Source: Fund Reference
Sometimes the gains from a new regulatory regime are obvious. The creation of the Federal Deposit Insurance Corp. is a perfect example. Your bank deposits are guaranteed by the government up to some stated amount, no matter the recklessness or irresponsibility of the bankers running the place. It wasn’t always this way. Before the FDIC,…Read More