Paul Volcker’s critique of how our financial system has evolved
In a fascinating interview published in the Wall Street Journal, Paul Volcker lights into those who advocate for a continuation of the financial system that resulted in a spillover to the real economy, creating the current economic mess. It’s very thought provoking.
For my part, I remember when banking was boring. Predictable, low margin, commodity like, and boring. The best and brightest didn’t lust for careers with Chemical Bank or Manufacturers’ Hanover, and the cream of the crop of our students didn’t automatically revert to Finance as the best place to spend their futures. As Volcker suggests, perhaps we need to uncouple the protection of ‘too big to fail’ risks from the basics that we need to keep an economy going.
A phrase that should alarm all of us: privatizing gains and socializing losses.
Filed In: Uncategorized