Tuesday, September 30, 2008

Will this lesson be learned?

Neuroscience tells us we are pattern seekers and our brain thinks that "Two is a trend – three a rule." How many crises like this have happened? Three if you count the S&L crisis in the early 1980s, or two, 1929 and the current one. Regulation of the financial markets is a lesson learned from 1929 and overtime optimism takes over rational caution.

Will the politicians/regulators follow the rule below for the U.S.?

Rule No.1: Appropriate regulation and oversight is needed for a well-functioning financial market in the U.S.
Rule No.2: If you consider deregulation, refer to rule N0.1.

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