The Volcker Rule Is No Magic Bullet

From today’s WSJ:

It is amusing to me that five (count them!) former Treasury secretaries of the U.S. think that further government control of the financial community will somehow prevent or repair this or any other boom-bust credit cycle (Letters, Feb. 22). The primary entity that needs to be restrained is the federal government in all its various forms. Its agencies have worked together to orchestrate the most massive credit expansion in our history, the real cause of our current difficulties, all the while telling the American people that they were doing them a favor.

In the process, they manipulated the financial community, among many others, to achieve their questionable goal of increasing home ownership at any cost. I am no particular advocate of banks or hedge funds, but the notion that all of these former Treasury officials are encouraging closer control of one of their key instruments in the wholesale manipulation of the American economy is laughable. We are in far more trouble than I thought.

Jane Mercer

Memphis, Tenn.

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