Financial Fix Must be Clear and Efficient
Glenn Hubbard, Hal Scott, & Luigi Zingales | September 24, 2008
Urgent action to save the financial system is good, but current draft legislation is risky. ++ Congress should not rush into a decision but needs to concentrate on three things: quickly restoring financial stability with low cost, punishing those responsible, and addressing the cause of the crisis — the price collapse in the real-estate market. ++ The Treasury plan has major problems, including the exorbitant costs which may exceed $1 trillion. ++ Efficient design is needed to reduce cost.
