Time again to think about Moral Hazard
"I'm a market-oriented guy, but not when I'm faced with the prospect of a global meltdown"
President George W. Bush, 14 Nov 2008
cit. by Nicole Gelinas The Fall
https://www.amazon.de/-/en/Nicole-Gelinas/dp/B00JX0O9GO
Mitigating the COVID Economic Crisis:
Act Fast and Do Whatever It Takes
CEPR Press, 2020
http://itsr.ir/en/Content/upload/COVIDEconomicCrisis.pdf#page=32
In March 2020, as Covid-19 hit the west, prices in the $21tn US Treasuries sector went haywire as market liquidity collapsed.
Relying on ad hoc emergency measures is not a good way to make policy, not least because it creates moral hazard.
So, as the March anniversary looms, the Fed should explain to the public in easy-to-understand language what created the problem, and how to avoid a repeat.
Gillian Tett 4 March 2021
https://englundmacro.blogspot.com/2021/03/the-21tn-us-treasuries-sector.html
Moral Hazard
https://www.internetional.se/moralhazardwsjled0925.htm
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