Tags: Economists | Warn | Crisis

Economists Warn Another Crisis on the Way

Wednesday, 03 Mar 2010 03:20 PM

By Dan Weil

  Comment  |
   Contact  |
  Print   |
    A   A  
  Copy Shortlink
Without strong financial regulatory reform, the economy may fall right back into recession, warns a report from prominent economists, bankers and former regulators.

The group includes Nobel laureate Joseph Stiglitz, United Nations economist Rob Johnson and bank bailout watchdog Elizabeth Warren.

The problem is that banks continue to use borrowed money to take outsized risk, the report says.

So without regulation to halt that practice, the financial system is caught in a “doomsday cycle” that ends with bailouts, the report says.

"Risk-taking at banks will soon be larger than ever," the report says, according to ABC News.

In the absence of more vigilant regulation, “Another crisis — a bigger crisis that weakens both our financial sector and our larger economy — is more than predictable, it is inevitable," Johnson wrote in the report.

"Our government leaders have shown little capacity to fix the flaws in our market system."

Johnson has choice words for officials in Washington. “Our government leaders have shown little capacity to fix the flaws in our market system."

Stiglitz called the report "an important point of departure for a debate on where we are on the road to regulatory reform."

Richmond Federal Reserve President Arthur Lacker takes issue with criticism launched at the Fed.

“I think we are being made a scapegoat in the current political environment,” he told Bloomberg. “I think we are accountable.”

© 2014 Moneynews. All rights reserved.

  Comment  |
   Contact  |
  Print   |
  Copy Shortlink
Around the Web
Join the Newsmax Community
Please review Community Guidelines before posting a comment.
>> Register to share your comments with the community.
>> Login if you are already a member.
blog comments powered by Disqus
 
Email:
Country
Zip Code:
Privacy: We never share your email.
 
Follow Newsmax
Like us
on Facebook
Follow us
on Twitter
Add us
on Google Plus
Around the Web
Top Stories
You May Also Like

Rubio: Obama's Cuba Policy Change Will Not Lead to Freedom

Sunday, 21 Dec 2014 12:38 PM

Sen. Marco Rubio says he has no problem with changing policy with Cuba, but says he wants to do something that will brin . . .

McCain: Obama Doesn't Understand Hacks Are Warfare

Sunday, 21 Dec 2014 11:44 AM

Sen. John McCain, the incoming Chairman of the Senate Armed Services Committee, said President Barack Obama doesn't unde . . .

Mike Rogers: Obama Said 'Aloha' Instead of Acting on Sony Hackers

Sunday, 21 Dec 2014 10:01 AM

House Intelligence Committee chairman said on Sunday the United States has the capability to make it very hard for North . . .

Most Commented

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

 
NEWSMAX.COM
America's News Page
©  Newsmax Media, Inc.
All Rights Reserved