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Risks to Rise Exponentially

In today's Wall Street Journal, Peter Wallison nicely dissects a truly frightful proposal of a man who is, quite Frankly, a hypocrite of first rank.  Here are Wallison's opening paragraphs:

After their experience with Fannie Mae and Freddie Mac, you'd think
that Congress would no longer be interested in creating companies seen
by the market as backed by the government. Yet that is exactly what the
relevant congressional committees — the Senate Banking Committee and
the House Financial Services Committee — are now considering.

In the wake of the financial crisis, the idea rapidly gaining
strength in Washington is to create a systemic risk regulator. The
principal sponsor of the plan is Barney Frank, the chair of the House
Financial Services Committee. A recent report by the Group of Thirty (a
private sector organization of financial regulation specialists),
written by a subcommittee headed by Paul Volcker, also endorsed the
idea, as has the U.S. Chamber of Commerce and the Securities Industry
Financial Markets Association.

Anyone who imagines, even for a split second, that this sort of regulation is a good idea is hopelessly delusional.


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