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Tuesday, May 14, 2013

Liberty in Books: The Financial Crisis and the Free Market Cure

The primary cause for the 2008-09 financial crisis, and for our ongoing economic woes, is government policy. Financial services is the most regulated industry in the world. As a result, the industry has performed poorly. Government regulations created incentives for massive misinvestment. When the “bubble” burst, millions of jobs were destroyed and tremendous wealth evaporated.

Mr. Allison claims that the fundamental cause of the financial crisis is not economic but philosophical. The cure is also philosophical. 

  • John Allison is the President and CEO of the Cato Institute. Prior to joining Cato, he was Chairman and CEO of BB&T Corporation, the 10th largest financial services holding company headquartered in the United States.