When the costs are too much, even for the insured, patients hunt for other ways. A wave of new treatments have cured devastating diseases. Here at Economix, journalists and economists analyze the news and use economics as a framework for thinking about the world. The Medicine Is a Miracle, but Only if You Can Afford It. It is a highly leveraged bank, meaning that it borrows through the capital markets most of the money that it puts to work.Īs Anat Admati of Stanford University and her colleagues tirelessly point out, the central vulnerability in our modern financial system is excessive reliance on borrowed money, particularly by the biggest players. It is the study of our lives our jobs, our homes, our families and the little decisions we face every day. This work is also discussed by the Nytimes Economix Blog. Goldman is not a venture capital fund or primarily an equity-financed investment fund. Unemployment Duration Dependence (with Kroft and Notowidigdo). Goldman Sachs now enjoys exactly the same kind of unfair, nontransparent and dangerous subsidy: it has effectively become a new form of government-sponsored enterprise. Those institutions should be euthanized as soon as possible. In Belgium as elsewhere, the sharing economy is receiving increased attention in public discourse. Nonetheless, Fannie and Freddie were badly mismanaged – and followed the market in 2005-7 with bad bets based on excessive leverage – in large part because they had an implicit government subsidy. Basically, it lays out the unattractive perspective that taxes must be raised to meet rising budget obligations. Kwak and I refuted the view that these government sponsored enterprises were the primary drivers of subprime lending and the 2007-8 financial crisis – that debacle was much more about extreme deregulation and private-sector financial institutions seeking to take on crazy risks. thought this NY Times Economix blog was very informative about tax policy. However, there is consensus that the implicit government backing afforded to Fannie Mae and Freddie Mac in recent decades allowed them to borrow at least 25 basis points (0.25 percent) below what they would otherwise have had to pay – a significant difference in modern financial markets.
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