The whole purpose of the Obama administration’s crusade to regulate the economy more than it already is, amounts to a foolhardy attempt to smooth out the booms and severe financial jolts and recessions of the past.
The U. S. has repeatedly been through a recurring economic cycle over many, many years. Other economies around the world have experienced the same.
The bottom line: Over-regulation or overly-strict regulation never works. The effort always has a short term goal, but it is, nevertheless, used because it’s always a political measure to temper public unrest.
Conventional regulation in the latest financial downturn just didn’t help. There was the usual political factor that overrode all supervision that the regulation afforded. Easy money and the subprime crisis were the babies that Congress and the Obama administration created, not the lack of supervision.
I have commentated on this repeatedly, mentioning how simple bank guarantees and not having “mark-to market” accounting for banks in an emergency, would have helped. (Also see past Earl J Weinreb NewsHole® comments.)
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