Sunday, October 12, 2008

The only way to deal with economic crisis

The only way to deal with economic crisis is to force players to bear the cost of their mistakes.

Risky behavior

Any bailout of the financial system will encourage more risky behavior by banks.

Level playing field

You only have a level playing field when you leave the market heal by itself.

Saturday, October 11, 2008

Regulators

Regulators try to prevent risk in the market.

Thy start reducing risk then reducing benefits and then reducing the market.

Central Banks

In a prosperous society Central Banks should be small and powerless institutions
owned by stockholders not by Government.

Thursday, October 9, 2008

The ability of self-healing

The market system has the ability of self-healing and put your fate in your own hands.

A regulated market is a sick market without self-healing ability.

Money given by the Government

Money given by the Government is money taken from one part of the economy
and redistributed it to other who either save or spend it.

Neither one change incentives to invest or take risk.