[lbo-talk] Goodbye to the export of surplus capital?

SA s11131978 at gmail.com
Mon Feb 7 09:26:55 PST 2011


On 2/7/2011 12:16 PM, brad wrote:


> Okay, but how do you not include the role that financial innovations
> and policy changes played in the ability of lenders to increase their
> leverage. Surely, this increased the pressure to lend which helped
> with the inflation of the bubble. I don't see how it could simply be
> a one way relationship. Wouldn't the two work together to inflate the
> bubble?

Yes, exactly - policy changes and institutional evolution. Without those, the nascent froth would have petered out.

SA



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