Discover more from Brad DeLong's Grasping Reality
The Puzzle of Properly Regulating American Finance
Two very good brand-new books very much worth reading...
I really ought, by this stage in my career, to have a relatively strong and well-informed view of what kind of financial regulatory system is appropriate for which of the many stages in the development of first the industrial and then the post-industrial market economy.
But I find I do not.
I have a lot of scattered insights. I have a great deal of knowledge of what individual market failures and externalities are. But I have never bothered—or is it I have never been able?—o think through how the entire picture adds up.
And I do quail at the task: it would be a very hard thing to do.
Here, however, our two very important pieces of grist for this particular mill:
“Taming the Street,” by Diana B. Henriques, and “The Problem of Twelve,” by John Coates, tell the story of America’s powerful and unwieldy financial institutions…
J. Bradford DeLong :: Sept. 12, 2023, 5:00 a.m. ET
TAMING THE STREET: The Old Guard, the New Deal, and FDR’s Fight to Regulate American Capitalism, by Diana B. Henriques <https://www.amazon.com/dp/B0BPX762S3>
THE PROBLEM OF TWELVE: When a Few Financial Institutions Control Everything, by John Coates <https://www.amazon.com/dp/B0BW65PTNV>
“The rulers of the exchange of mankind’s goods have failed, through their own stubbornness and their own incompetence,” President Franklin D. Roosevelt said at his first inaugural in 1933 as he kicked off his New Deal. “The money changers have fled from their high seats in the temple of our civilization. We may now restore that temple to the ancient truths.” The direct reference to Matthew 21, and F.D.R.’s implication that he was going to do the work of the Lord in cleansing the temple of impiety—those were deliberate…