Richmond Fed President Jeffrey Lacker: The crisis happened in part due to "constructive...

|By:, SA News Editor
Richmond Fed President Jeffrey Lacker: The crisis happened in part due to "constructive ambiguity" - encouraging firms to act as if they weren't backstopped, while actually standing ready to help - and that idea is no longer plausible. Specific decision rules are needed when deciding on bailouts, and Dodd-Frank reform only seems to get partway there, embodying "two contradictory approaches."