Observers at a Conference suggest that the FED is too closed to Wall Street. It is therefore too prone to bail out bad decisions. Good point, I just mentioned in the last post that large insurance firms did not engage in such folly. Yet the FED has 'bailed out' Bear Stearns. I also mentioned that Congress is now being asked to 'loan' $50 B to essentially re capitalize Ford and GM. Shortly after 9/11 Congress worte poorly managed airlines checks for $15 B. LUV had $2B in the bank at the time, why didn't the others? WHy didn't Congrfess demand improved financial management in exchange for your money, bad deal I would say.
What is both the ethical and financial imperative that the FED should follow? IF you or I open a deli at down the street from this campus and go bust, will Bernake bail us out, not likely. What is your take?
Again as I have mentioned before, when these bad investments are folded into another company we never really learn what the failed company did, their errors are not on display as a lesson to others. Or as Jim Rogers put it, the guys at Bear Stearns get to keep their Maseratis bought with bonuses paid on these failed schemes while you and I get the bill for their mistakes. Funny I don't hear the candidates talking about this, do you?
Professor Elam 
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