Does the financial meltdown represent a market failure? Or it just indicates the incompetence of government when they tried to create a "fair society" through the Community Reinvestment Act (CRA)? Do you know the market could prevent the catastrophe but it was again crippled by government when the Fed decided to rescue Bear Stearns? Even when Lehman failed, the market was developing a pricing mechanism for toxic assets but the $700 billion TARP effectively killed the market of these toxic assets. In our luncheon titled "The Policy Implications of the Global Crises of 2008: Food, Oil, Finance", we ran through the timeline and explored how government has propelled the financial tsunami. Reference materials of the luncheon can be accessed here and also downloaded from our website here.
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