BRYAN CAPLAN
May 7, 2013
Keynesian Bets: What's Out There
May 6, 2013
Keynesian Bets Bleg
May 6, 2013
The Pyramid of Macroeconomic Insight and Virtue
May 2, 2013
A Natalist Provision
May 1, 2013
I Was a Teenage Misanthrope
DAVID HENDERSON
May 5, 2013
John Thacker on Vaccinations and the Sequester
May 3, 2013
Chef Rudy's Virtues Project
May 2, 2013
My take on Reinhart and Rogoff
May 1, 2013
Medicare Kills a Program
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Please God, just one more bubble.
Have you seen that onion story? Too true.
Here, here. Such legislation would not only be silly, but it would increase transaction costs across the board thus punishing the non-idiots amongst us. Gross!
Normally the fools and their money are separated when a downturn hits the economy and overlevereged positions have to be closed out. In a healthy economy, the prudent savers are then in a position to use their savings to invest in any liquidated assets and we go on from there.
When the government continues to stimulate for years on end, the prudent investors slowly lose their savings and only risky behavior remains. Soon we get to the place where we start defaulting on our mortgages. Unfortunately, continuing to stimulate the economy is not the right solution for this situation. If we do not allow fools to lose their money, we only end up with more fools. As scary as it sounds, the Fed needs to raise interest rates.
I agree, but merely having some regulation in place that may obstruct the next recurrence until they re-examine and rethink why it was created in the first place and decide it is no longer needed may delay the next one.
There's no need for such regulation anyway. Just promise to hang any CEO who ruins his company. Disincentives matter.
PS If hanging seems a little extreme, force them to divorce, and marry women 20 years older than their present wives.
"PS If hanging seems a little extreme, force them to divorce, and marry women 20 years older than their present wives. "
Forced a CEO to marry someone 10 years younger than them does not seem to be that big of a punishment
;)
So idiots deserve to be punished. It just so happens that we have all been an idiot sometime.
"So idiots deserve to be punished. It just so happens that we have all been an idiot sometime."
I think the comments about creating positive law to punish CEOs was facetious; designed to get a chuckle.
However, idiotic action should not be divordced from the natural consequences of that action. It can be looked upon as "punishment", but I choose to see it as Nature's way of teaching us, "don't do that."
If we shield idiots from the consequences of their actions, they not only remain idiots, but they conclude that idiocy pays, breeding more idiocy.