3 ms·
The 2007/8 bailout of banks is far from the first time the US government has socialized losses in the sector. The modern era of Wall Street bailouts started in
by clarkmoody 8y ago
The 2007/8 bailout of banks is far from the first time the US government has socialized losses in the sector.
The modern era of Wall Street bailouts started in the '80s after the Mexican Peso crisis.
Bank bailouts have been happening since Colonial times, through emergency suspensions of specie payment, par laws, legal tender laws, etc.
> we can't rely on the banks to make sound financial decisions
Banks that have an implicit (or explicit) guarantee of bailout are making rational decisions about risk, since they can offload it on the taxpayer.
- fernandopj 8y ago> Banks that have an implicit (or explicit) guarantee of bailout are making rational decisions about risk, since they can offload it on the taxpayer. Agreed. From their perspective it's a sound and rational play - a better term would be to say we can't rely on banks to make moral or ethical decisions from a society perspective
- downrightmike 8y agoThe shoe was on the other foot once: "Morgan helps end the Panic of 1893 Gold certificateOn February 20, 1895, J.P. Morgan & Co. led a bond offering that helped rescue the United States from a severe two-year economic depression." https://www.jpmorgan.com/country/US/en/jpmorgan/about/history/month/feb https://www.jpmorgan.com/country/US/en/jpmorgan/about/histor...