TAMPA, August 22, 2012 – As we approach the Republican and Democratic National Conventions with two major party candidates that don’t substantively disagree on anything, debate about the causes of the housing bubble and what should be done about it will inevitably recur.
Both candidates advocate massive government intervention. They just disagree about the details.
Neil Barofsky weighs in with the generally accepted argument that the repeal of Glass-Steagall was the creator of what he calls “the monster,” highly leveraged investment banks taking extraordinary risks that led to the 2008 financial meltdown.
Barofsky is right about Wall Street being a monster, but the repeal of Glass Steagall wasn’t its Frankenstein. As Tom Woods explains in his bestseller, Rollback,
“But did the repeal of two provisions of Glass-Steagall allowing affiliation of commercial banks with securities firms through their control by the same holding company contribute to the losses and risk that permeated the system? Certainly not. For one thing, commercial banks bought mortgage-backed securities for their AAA rating, their attractive return, and the minimal capital requirements associated with holding them; they did not acquire these assets because they were connected to investment banks that were trying to unload them.
Moreover, severe regulatory firewalls essentially prevent this kind of affiliation from contributing to losses or increased risk on the part of the commercial bank involved. The reverse problem, that affiliation with a commercial bank might bring down and investment bank, is exceedingly unlikely, given the relative magnitudes of assets held by each institution. The commercial banks’ assets were only a tiny fraction of those held by the investment banks they were affiliated with. These banks were in no position to cause the investment banks any serious problem, much less their complete downfall.”
If that’s true, then why was that “sucker going down,” as President Bush so eloquently put it?
TAMPA, August 3, 2012 – “When I was your age, I went to the movies for a dime and bought a big bag of popcorn and a soda for a nickel.”
TAMPA, July 5 2012 – Thank heaven for the great Steve Zahn, who in his hilarious turn as Lenny in the Beatlesque That Thing You Do, coined a phrase that applies to nearly every political sentiment expressed here in the land of the free.
TAMPA, June 21 2012 — Ron Paul 
TAMPA, June 18 2012 – 218 years ago, George Washington signed the Jay Treaty, reestablishing economic relations with the British. Claiming that John Jay and the Federalist Party had sold America out to the British and betrayed France, Jefferson’s Republicans denounced Jay as a monarchist and a traitor.
TAMPA, June 12 2012 – The rollercoaster ride for Ron Paul’s supporters continues amidst more delegate wins and Senator Rand Paul’s controversial endorsement of Romney.
TAMPA, June 10, 2012 – With all but one of the Republican primaries concluded, there are two things that are clear. The first is that unless something very improbable occurs, Mitt Romney will be the Republican nominee for president in 2012. The second is that Ron Paul will have an army of delegates at the Republican National Convention (RNC) in August.