What Economists Can Tell President Obama

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July 3 (Bloomberg) -- President Barack Obama sought advice on the economy from former Federal Reserve Chairman Ben S. Bernanke and Ronald Reagan adviser Martin Feldstein at a private White House lunch with mostly conservative-leaning thinkers. “Unintended Consequences” Author Edward Conard speaks on “In The Loop.” (Source: Bloomberg)

Of the bestseller of how the u.s. should incentivize job creator's. president obama yesterday hosted several economists, conservative economist.

Ben bernanke, and also someone you know very well from the american enterprise institute.

You are a visiting scholar.

If you are in the white house and had a face-to-face with the president, what would you say?

Close to five percent today.

They loan us our money.

They have to put that on the proceeds for the sale.

We have to put that money to work to reach full employment and maximum growth range.

We found a way to do that with subprime mortgages.

It kept the money circulating.

That money is sitting idly and unused.

It is sitting in the bank as excess deposits going nowhere.

And we do not have any alternative to put it to work.

Until that time, we will have a mediocre recovery.

Where we put that money to instantly create jobs?

As instantly as you can get.

You need them to find a new way to make it work.

It was the only way we were recirculating the money.

Maybe he dropped 50%, but you get as heavy-handed as they got over the last five years, and that one channel -- did you hear the president's radio interview?

He is still attacking wall street bankers and he says, the risks they take art too much.

When traders take that that's and everyone else is left holding the bag.

He says wall street still incentivizes too much risk.

It is a hard argument to make for the general public we are able to trade those two things separately appear the funding part is easy.

Everyone wants to go back to the 1950's. we have successfully been able to separate those because we have credit default swaps.

If we restrict banks to only the long side of the trade, we know from finance that we can get massive distortions if we do things like that.

It is crazy to restrict the banks to only the long side of the trade.

You will still have banks and institutions like aig that will be too big to fail.


You have enormous money market, enormous money flows.

What about the argument from the president?

Which i agree it's hard to make to the public, that the taxpayers have to clean up the mess.

The government a profit.

They did not know that going in, but in hundred years of history has shown us.

People do not understand banks are highly unstable.

Stay with me.

We have got a lot more to talk about.

Edward will stay with me through the jobs report.

Coming up, tech lovers to the auto dealers.

We will tell you who won the latest showdown in pennsylvania.


This text has been automatically generated. It may not be 100% accurate.


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