A Selective Defense of “Too Big to Fail” [Barron's]

Posted on March 1, 2010 by Bob Pozen

Reviewed by Jim McTague. Here’s an idea for curbing the rapine of all those financial executives thumbing their noses at the taxpayers who rescued them from ruin: Limit their annual salaries to $300,000 to $400,000, and institute three-year performance programs that award bonuses to good stewards, but not the bad.

That’s just one of several provocative ideas found in this thorough, intelligent and straightforward book by money manager Robert Pozen, which traces the ontogeny of the financial crisis and offers remedies — most of them delectably controversial — for preventing calamities.

A Better Blueprint for Financial Regulation [Barron's]

Posted on September 27, 2009 by Bob Pozen

As Rahm Emanuel, President Barack Obama’s chief of staff, once said, “Never let a serious crisis go to waste.”

But the current financial crisis won’t be the catalyst to rethink fundamentally the structure of U.S. financial regulation. Instead, Congress will fill a few holes in the regulatory foundation, and install new radar for detecting systemic risk within the existing framework of regulation according to financial function or service. Unfortunately, in some cases, that’s too little, too late.

What shape is financial regulation likely to take? Let’s examine what the government will do — and what it should do…

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