The Hanover Collaboration

Can any of the anti-regulation economists who come here respond to this quote from vanity fair ?

One of the hidden causes of the current global financial crisis is that the people who saw it coming had more to gain from it by taking short positions than they did by trying to publicize the problem.

BTW: I found that article from here

Back in February, I wrote this article describing an ominous credit crisis as well as I could understand from my brother-in-law. Roughly speaking, it was a prediction of what has happened in the last few weeks. (Actually, he predicted this almost exactly as it happened, I just didn’t understand him.)

We had some excellent commentary that largely assuaged my fears. In particular, you guys convinced me that there would be sufficient liquidity to prevent any wide-spread problems. I am hoping we could continue that discussion given the current situation. Do you guys think that the government should do nothing? Should it buy the securities at less than the “hold to maturity” price? Do you think the bailout plan is good/necessary?

Looking out over a snowy Cambridge right now, I see total gridlock. A few cities, most notably London (and New York to some extent) are trying to fix the problem by implementing a “congestion tax”. I think it’s a great idea. I think it should be dynamically priced and implemented anywhere where it could be made to work logistically (e.g. any highway that already has a toll system).