dimelab dimelab: shrinking the gap between talk and action.

subprime crisis Topic in The Credit Debacle Catalog

subprime crisis possible (1).

Christopher Whalen Fri 2010-09-17 19:31 EDT

The key to the future of finance is now emerging

Basel III is entirely irrelevant to the economic situation and even to the banks. Through things like minimum capital levels, the Basel II rules provided the illusion of intelligent design in the regulation of banking and finance. In fact, Basel II made the subprime crisis possible and the subsequent bailout inevitable [by enabling off-balance sheet finance and OTC derivatives]...Part of the reason for my undisguised contempt for the Basel III process comes from caution regarding the benefits of regulating markets...But a large portion of my criticism for Basel III and the entire Basel framework is even more basic, namely the notion that any form of a priori regulation, public or private, can prevent people from doing stupid things...The key premise of Basel III is that the use of minimum capital guidelines and other strictures will somehow enable regulators to prevent a crises before it occurs. The only trouble is that regulators have no objective measures for compliance with Basel II/III, much less predicting market breaks...As in past decades and crises right through to 2008, the regulators will be the last to know about a problem...

Christopher Whalen; Emergency; finance; future; Key.

Thu 2008-03-20 00:00 EDT

Paul Craig Roberts: How to End the Subprime Crisis

suspend mark-to-market! Counterpunch

ending; Paul Craig Roberts; subprime crisis.

Tue 2007-08-28 00:00 EDT

naked capitalism: Jim Grant on the Subprime Crisis

naked capitalism: Jim Grant in the NYT on the Subprime Crisis; "capitalism without financial failure is not capitalism at all, but a kind of socialism for the rich"

Jim granting; naked capitalism; subprime crisis.