So argues Roger Altman, the Clinton administration's deputy secretary of the treasury, in a New York Times' editorial. Altman makes two main points:  the fed's power-- to set interest rates and control inflation-- is undermined by the alphabet soup of federal ...

The Washington Post's Neil Irwin analyzes if the mortgage crisis has led to an inappropriately expanded role for the public/private Federal Reserve. The Fed this weekend engineered the loans necessary to bail out Fannie Mae and Freddie Mac. It did the same with Bear Stearns. The Fed's mission, however, ...

This morning's papers are dominated by the government's bailout of mortgage behemoths Fannie Mae and Freddie Mac. The New York Times' Peter S. Goodman's does a big-picture analysis: U.S. political leaders view their country as the beacon of free-market capitalism, but ...

The New York Times' Stephen Labaton reports on the big news of the weekend-- Treasury Secretary Henry Paulson announcing a potential $300 billion bailout for mortgage financiers Fannie Mae and Freddie Mac. The stock of both companies, which are partly owned by the ...

The Wall Street Journal's Kara Scannell and Susanne Craig take a long look today at the low-profile kept by Securities and Exchange Commissioner Christopher Cox during the Bear Stearns bailout. They lead with the amazing image of Cox ...

That’s what New York Times columnist Paul Krugman argues—that the so-called major announcement today by Treasury Secretary Henry Paulson is a ruse to keep financial institutions from being regulated. Krugman is less than impressed with the administration’s plan of re-arranging the regulatory bureaucracy. “To hide their lack of ...

The government’s financial regulatory institutions are making the rules as they go along. Following the Bear Stearns bailout, the Federal Reserve made the unprecedented move of setting aside $30 billion to lend to investment banks.

Treasury Secretary Henry Paulson conceded yesterday that if securities firms were going to start ...

As the nation's central bank, the Federal Reserve usually tries to stimulate the economy by cutting interest rates or giving loans to banks. In 1932, however, the federal government gave the Federal Reserve the authority to loan money to people, partnerships or corporations in “unusual and exigent circumstances.”  The ...

Recently the New York Times made a point that Understanding Government would like to second:  when you deprecate the role of government for years on end, government stops working, in every sense. 

The worsening economic news on Wall Street and around the world derives from much more than the subprime mortgage market debacle.   Seasoned investors around the world are realizing that the U.S. economy and political environment are in  decay.  This kind of confidence gap can't derive from number-crunching alone.  It is more likely the result of a failure of leadership in the U.S. government.