icandoitdon

How Is China's Export Driven Economy Booming?

Mr. Lounsbery writes:

"Larry refers to a paper written in March by the Kansas City Fed head, Thomas Koenig, entitled "Too Big Has Failed." Larry says the two underlying issues in the financial crisis have not been addressed and resubmits Hoenig's short list:

1. Losses must be identified and realized.
2. Management must be replaced.

Until both these steps are taken, true health can not return to the system.

Hoenig echoes economist Allan Meltzer’s view that “capitalism without failure is like religion without sin."
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this is heresy. mr. lounsbury clearly doesn't understand u.s. style capitalism, namely:

1. unlike other countries, the u.s. can have it's cake and eat it too. pain is for those countries who lack a reserve currency. in other words...everyone but us.

2. we don't fire incompetence...we embrace it. we've proven this time and again in both politics and business.

3. most important of all, hank paulson, ben bernake and tim geithner are national heros. we know this because they've all made this point repeatedly in recent months.

as for meltzer's view that "capitalism without failure is like religion without sin...." i think fed chairmen and treasury secretarys, and preachers and rabbis, see failure and sin the same way....something their respective flocks practice far more than themselves.