printObama’s “new regulatory regime” has Peter Schiff anticipating that the U.S.S.A. may soon “appoint a Politburo, move into dilapidated housing blocks, and parade [its] missiles in the streets.”
“The underlying problem is that the excessive risk taking which brought about the crisis was not market-driven, but a direct consequence of government interference with risk-inhibiting market forces. Rather than learning from its mistakes and allowing market forces to once again control risks and efficiently allocate resources, the government is merely repeating its mistakes on a grander scale – thereby sowing the seeds for an even greater crisis in the future.
As is typical of government attempts to control economic outcomes, Obama’s plans focuses on the symptoms of the disease and not the cause. The American financial system imploded for two reasons: cheap money and moral hazard – both of which were supplied by the government. Under the proposed new regulatory structures, these toxic ingredients will be combined in ever-increasing quantities.
The proposals most notably involve extra regulatory oversight of financial entities that the government deems ‘too big to fail.’ This implies that it is desirable to have such entities in the first place, and that the government will continue to back those large organizations that fall under its protection.”
A voice in the wilderness…
Some other historical characters that Barack and Michelle Obama remind me of – Juan and Eva Peron – who tried to centralize everything in the economy and were enormously popular during their demagogic tenure. Americans love living beyond their means piling up debt after debt – private or public. Those like Schiff, Paul, Mercer, etc. are just watching the mass of lemmings eagerly running to the cliffs.
People need to really understand where we’re heading with this regulatory nightmare. Schiff stated on Napolitano’s Freedom Watch last week that some regulatory agency told him that his investment firm had hired too many people and that he faced a fine of 100K. I wish he had talked more about that. I would like to know all the ins-and-outs of that regulation.