The G7 finance ministers endorsed an approach to regulation in April, which stipulated transparency, disclosure, and strict risk management, i.e., nothing new. ++ This hackneyed approach will fail again. ++ Regulation hasn’t kept up with the last 30 years of market changes and is not needed except to enforce best practice. ++ Regulators must begin to use a system-wide approach, financial
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The newest tale of woe among American investment banks is the housing market, according to The Economist. Some analysts on Wall Street predict that the housing bubble is on the verge of collapse, and point to the “subprime mortgage market” as the culprit. These loans, given to potential homeowners with poor credit at little or no money down, provide initial low “teaser” interest rates, which
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