Mason Discusses U.S. Financial Crisis in Wall Street Journal

March 18, 2008

The Wall Street Journal featured an article entitled "U.S. Mulls Next Steps in Crisis," which discussed Washington’s steps to broker a bailout of Bear Stearns Cos. and offer emergency credit to Wall Street firms. In the article, Criterion affiliate Joseph Mason noted the risks of making other, similar loans in the future.

Mason explained that Fed loans to weak banks in the 1930s and 1980s merely kept them alive long enough for their problems to get bigger. Regulators, Mason said, always hope that they can limit their help with loans, but "if you're insolvent, you have more liabilities than assets, so giving you more liabilities is not going to help that fundamental problem of insolvency."

To read the article in full, click here.