I appear to be the skeleton at the feast. I do NOT think this is a great column, largely because there is no discussion of what should be done.
The parenting analogy is debateable. However, if we accept it, any parent knows that positive reinforcement of good behavior is at least as important as allowing the negative reinforcement from the natural consequences of poor behavior to procede without impedance.
So what is desirable behavior, Mr Gross? Does positive reinforcement come from regulation? Wall Street may throw the biggest tantrums, but we all pay for these messes, no matter what is done. Anbd the other commentors are right --rich people are likely to pay less than their "fair share".
So tell me what you think should happen and why. Don't just moralize. It makes you sound like Bernanke .
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Wall Street Throws A Tantrum
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The same might be said about Washington's current economic ministrations. The nation is now nursing a seriously skinned knee because of reckless behavior in housing and credit. But rather than force consumers, borrowers and bankers to face the consequences of their own actions, Washington is functioning as a helicopter parent. Harvard economist Ricardo Hausmann, who characterized America as "whiner of first resort," believes the rush to stimulus is being led more by a concern for Wall Street than a concern for Main Street. Rather than take their lumps after several years of exceptional returns, the banks are furiously lobbying for help. They're getting it.
Instead of looking to the Federal Reserve or Congress to bail them out, the people who dominate the global economy should engage in some introspection—to evaluate what they did wrong and how they could avoid screwing up in the future. As Wendy Mogel puts it: "Good judgment comes from experience and experience comes from bad judgment."
© 2008
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