The Curse of Government Failure | Steve H. Hanke | Cato Institute: Commentary

The Curse of Government Failure | Steve H. Hanke | Cato Institute: Commentary: "Without the Fed pushing interest rates to artificially low levels, yield-chasing speculators, who employed carry trades and fantastic leverage, would have never seen the light of day. Yes, there were other government failures that contributed to various asset bubbles and associated instabilities in the real estate markets, for example. But, the primary enabler was the Fed and its ultra-accommodative monetary policy. Among other things, it was the Fed's monetary laxity that led to the fall of the dollar against the euro and the dramatic rise in commodity prices that climaxed in July 2008."

"$3.40 of lost output is associated with every dollar of government spending. So, the much touted fiscal multiplier is negative, not positive. This is a case — like many others in the government sphere — in which doing nothing would have been superior to doing something."

"there were over 115 government regulatory agencies for financial services before the crisis. Where were they as the Fed-induced credit mania built to a climax?"