financial lockdown

Alan Greenspan is disappointed in Dodd-Frank

by

I am devastated. Writing in the Financial Times today, Alan Greenspan, argues that the Dodd-Frank Wall Street Reform and Consumer Protection Act will have–indeed is already having–unintended consequences. He cites five specific cases. 1) Making credit ratings agencies legally liable for their opinions about risk made them unwilling to give Ford Motor Credit a rating … Read more

On low probability-high cost events

by

Earthquakes, tsunamis, and nuclear accidents are low probability-high cost events. So are financial crises. There is nothing we can do to prevent earthquakes and tsunamis.  Sure, with improving technology, we are sometimes able to get a bit of advance warning.  And we can design structures that are more resistant to natural disasters.  For the most … Read more

Forum shopping

by

The Financial Times reports that Oswald Grübel, chief of the Swiss bank UBS, “…has attacked the UK government for its public neglect of the City of London, warning that tougher regulations will see Britain and the rest of Europe cede investment banking business to Asia and the US.” Yes, by all means, let’s not overdo … Read more

An economist at the movies

by

Although movies dealing with themes of economics and high finance are common, it is rare to see films with economists cast in starring roles.  This past week I managed to see two. In Freakonomics: The Movie, the economist is portrayed as hero.  Based on the book of the same name by economist Steven Levitt and … Read more