Citing a Greenspan interview: "The majority of lawyers, in my
experience, seek to regulate -- that is, to contain certain activities
with little weight given to the lost benefits of such activities," he
says. "The question is: What do you lose? In this case, a very valuable
instrument [credit default swaps, the derivatives at the core of the
current mess] for the diminution of systemic risk. You can stop the
system dead and eliminate speculative losses. But you will also get
significantly reduced economic activity and ultimately lower standards
of living."
Barrett, Paul. 2008. "Wall Street Staggers." Business Week (17
September): pp. 28-32.
--
Michael Perelman
Economics Department
California State University
michael at ecst.csuchico.edu
Chico, CA 95929
530-898-5321
fax 530-898-5901
www.michaelperelman.wordpress.com
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