1. Fed released the result of the first TAF operations held yesterday. Here are economists’ reactions.
2. WSJ Blog points to US Senator Charles Schumer ‘s speech on 4 subprime myths:
1. The Myth of Vastly Expanded Home Ownership from Subprime Lending
2. The Myth of the Unqualified Borrower
3. The Myth That Borrowers Can Easily Obtain Perfect Knowledge of The Terms of Their Mortgage Loans
4. The Myth that the Free Market Alone Will Fix Everything
Superb.
3. Numerous suggestions are being floated to fix this subprime mess. Read Summers’ advice (suggest fiscal policy intervention) and Fisch et al ‘s suggestion (taking a cue from Savings & Loan crisis, provides excellent advice). Eminent economists comment on whether fiscal measures would help.
4. TTR on dangers of rupee appreciation, and on whether the Central Bank intervention would work or not.
5. Ajay Shah says capital controls are futile.
