After missing last week, let's get right to this installment of Five for the Weekend.
- Neill Ferguson argues in the Financial Times that saving Lehman Brothers would not have prevented the crisis: If only we had learnt from Lehman that no bank should be “too big to fail”, we might still have a real capitalist system, instead of the state-guaranteed monstrosity that is the real legacy of last year’s crisis. If only. I don't agree with Ferguson on everything he writes and says. But, gosh, I wish Charlie Rose (my favorite TV show) would have him on instead of the same old, same old economists and financial writers who worship at the feet of Keynes.
- Holman Jenkins gives his take on Lehman and the financial meltdown in The Wall Street Journal: The time to worry about moral hazard is now, between crises, when we have an opportunity to change the incentives of the system to make future crises less likely.
- Staying with WSJ, one of their blogs interviews Congressman Ron Paul about what the world would be like without the Federal Reserve: "You’d go back to the day that if you wanted to borrow money to build a house, somebody would’ve had to save some money. You wouldn’t have zero savings and all the credit in the world. That’s just a total distortion of capitalism. Capital comes from savings. The part you don’t use for everyday living which you have left over, you reinvest and you save or you loan it out. We were living with something absolutely bizarre that had nothing to do with capitalism. We had no savings whatsoever yet there was all the credit in the world."
- John Wasik writes on Bloomberg about a potential financial product called the "R" bond -- and how it could help Americans saving for retirement protect their funds against the next Lehman-style catastrophe.
- Peter Brimelow reports on MarketWatch about investor Charles Allmon, who's been bearish since the 1980s. Allmon still thinks Dow 3000-4000 could happen: The remaining three stocks in Allmon's portfolio are firmly based in a dark view of human nature and human action: tobacco companies Altria Group and Philip Morris International Inc. ; and gold producer Newmont Mining Corp. Allmon writes: "Smokers continue to puff away, so we'll accept their largess. When does inflation ignite and begin to ravage the U.S. economy? Do keep in mind those great intellects in Congress who manage our government and would love a wee touch of inflation, around 2%, more or less. I would expect that to continue, until something ignites a bigger inferno."
And with that -- have a great weekend.
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