Tucson By Choice!: Required Reading: "Too Big To Fail. The Hazards of Bank Bailouts" Stern & Feldman

Required Reading: "Too Big To Fail. The Hazards of Bank Bailouts" Stern & Feldman

Too Big To Fail; the Hazards of Bank BailoutsThe subject hasn't decended upon us full blown as a result of the sub prime mess.  This book, available on Amazon and through other sources, was published in 2004.

The foreward was written by Paul Volker, and the authors, Gary Stern and Ron Feldman, served at the time as officers of the Federal Reserve Bank.

The authors warned in 2004 that "too little has been done to reduce creditors' expectations of ... protection.  To a large degree, the question is one of moral hazard, wherein anticipation of a safety net reduces a creditor or bank's incentive to act prudently."

That's exactly what happened. 

I'm Mike in Tucson, your preferred Tucson, Arizona mortgage lender.
Mike Jones (Tucson Mortgage Company, LLC): Loan Officer in Tucson, Pima County, Arizona
Think of me as your local expert.

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Comment balloon 7 commentsMike Jones • September 28 2008 09:14PM

Comments

Mike- I just found another great read to understand this mess and that the regulations are causing greater problems with free markets.

  The Forgotten Man: A New History Of The Great Depression by Amity Shlaes.

Posted by Katerina Gasset, Get It Done For Me Virtual Services (Get It Done For Me Virtual Services ) about 11 years ago

Katerina,

Thanks for being the first to comment.  I've heard good things about this book.

Mike in Tucson

Posted by Mike Jones, Mike Jones NMLS 223495 (SUNSTREET MORTGAGE, LLC (BK-0907366, NMLS 145171) ) about 11 years ago

Money is the root of all evil.

Posted by Susie Blackmon, Ocala, Horses, Western Wear, Horse Farms, Marketing about 11 years ago

Mike - sounds like a good read, and that the authors had good indication of what was to come.

Posted by Sharon Paxson, Newport Beach Real Estate (Compass) about 11 years ago

Sharon,

Thanks for commenting.  You can get free excerpts on Amazon.com

Susie,

The quote actually adds four words:  "the love of money is the root of all evil."  Do you think there's a chance that those words might be placed over the doors of the house and senate chambers?  LOL

Mike in Tucson

Posted by Mike Jones, Mike Jones NMLS 223495 (SUNSTREET MORTGAGE, LLC (BK-0907366, NMLS 145171) ) about 11 years ago

Mike,

Why is it that we do not heed warnings or at the very least check and see if there is any validity to them?  This book sounds like a good read.

Posted by Don Rogers, Realtor, Broker, CDPE, GRI, OnullFallon MO & St Charles County MO homes (Keller Williams Realty Chesterfield) about 11 years ago

Mike, I don't know if it is the presence of a safety net that makes these guys so willing to take unnecessary risks (as we see it now) but rather a lack of a good education. After all, those that fail to learn from history are bound to repeat it.

Bill Roberts

Posted by Bill Roberts, "Baby Boomer" Retirement Planner (Brooks and Dunphy Real Estate) about 11 years ago

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