Economist Tyler Cowen has just posted a handy list of his views on the crisis. I found myself nodding my head in agreement on just about all of them. Go to his blog for the whole thing, but here are a few of my faves:
1. Glass-Steagall repeal was not a major cause of the financial crisis, nor was government-induced “minority lending.”
2. We should use regulation to move more of the currently unregulated derivatives markets to the clearinghouse model.
3. The crisis represents a massive conjunction of both market and governmental failure. …
5. The modified Paulson plan was better than nothing — especially after the market had been scared — but far from my first choice. In any case the plan would have been revised almost immediately. The Paulson and Dodd plans were never that far apart. …
7. In the meantime the Fed should not worry much about inflation.
8. The critical deregulatory mistake was allowing excess leverage. Many deregulations get blamed but in fact contributed little to the problem. …
10. Libertarians are overrating the moral hazard argument, as many equity holders have been wiped out. …
15. The crisis is complex and has many causes; there won’t be a simple or quick solution.