Nassim Taleb who has long been critical of Ben Bernanke, Alan Greenspan, Tim Geithner and a Fed Policy that couldn’t predict the financial crisis, or address it, has once again lashed out at banks and the The Fed.
In an interview with BBC, Taleb said that the banking industry got us to the crisis but they haven’t suffered.
He said banks today are more centralized and powerful, than they were before the crisis. They have sneaky lobbying in Washington and the monetary policy in the U.S. has been far too accommodating of the banks:
“The Core of the problem is that asymmetry in payoff socializing losses and privatizing gain and the generator of that inequity is still there, worse than ever.
…The fact that they bailed out the banks then, in ’87 again and they kept repeating it, gave banks the feeling that they could hi-jack society… In 2008 when they bailed out the banks once again, they should have set the ground to remove that problem.”
Taleb argued that the current low interest rates have only supplied banks with cheap money and have done little to address larger problems in the economy. Clearly he won’t be pleased on all the chatter about a third round on monetary easing.