Counting the Cost

Richard Fisher, President and CEO of the Federal Reserve Bank of Dallas, shares much wisdom in this statement in a guest column discussing the recent upheavals in the financial markets:

Looking to the future, the emerging discussion on new regulations and a new supervisory framework should proceed, but regulations by themselves cannot replace good judgment by individual investors or bankers or financiers, and certainly by policymakers. Policymakers need to remain vigilant in seeking the right balance between prudent and indiscriminate risk taking. But the elimination of risk – and the consequences of incurring risk – can never be the goal of any policymaker in a capitalist system.

One can only hope that policymakers will follow that advice.