Wilbur Ross quits Ocwen Financial

Wilbur Ross quits Ocwen Financial

Distressed asset investor bringing his magic to Bank of Cyprus

Dustin Johnson levels blockbuster claims at title attorneys

Is Nat Hardwick the fall guy?

CFPB proposes 7 big changes to foreclosure process for mortgage servicers

Adds guidance on extended borrower protections
W S

Krugman: The Mortgage Morass

/ Print / Reprints /
| Share More
/ Text Size+
American officials used to lecture other countries about their economic failings and tell them that they needed to emulate the U.S. model. The Asian financial crisis of the late 1990s, in particular, led to a lot of self-satisfied moralizing. Thus, in 2000, Lawrence Summers, then the Treasury secretary, declared that the keys to avoiding financial crisis were “well-capitalized and supervised banks, effective corporate governance and bankruptcy codes, and credible means of contract enforcement.” By implication, these were things the Asians lacked but we had. We didn’t. The accounting scandals at Enron and WorldCom dispelled the myth of effective corporate governance. These days, the idea that our banks were well capitalized and supervised sounds like a sick joke. And now the mortgage mess is making nonsense of claims that we have effective contract enforcement — in fact, the question is whether our economy is governed by any kind of rule of law.

Recent Articles by Jason Philyaw

Comments powered by Disqus