Book Review: Guardians of Finance Making Regulators Work for Us

Journal of Applied Finance, Fall/Winter 2012, Volume 22, No.2

Posted: 11 Sep 2012

See all articles by James R. Barth

James R. Barth

Auburn University; Milken Institute

Gerard Caprio

Williams College

Ross Levine

University of California, Berkeley - Haas School of Business; National Bureau of Economic Research (NBER)

Date Written: 2012

Abstract

Guardians of Finance is a rare book which addresses the question of where were the regulators, Guardians, when the financial crisis occurred in a clear and balanced manner. The Guardians have largely escaped criticism by cloaking themselves behind a convenient narrative. Under this view, the Guardians were powerless to stop the crisis which represented an accidental event. Furthermore, they allege if only granted additional powers, for example the Dodd Frank Act (DFA), future accidents would be eliminated. Even though it is difficult to envision what powers regulators lacked that could have stopped the crisis. The often blamed Glass-Steagall Act repeal is shown to be a red herring as the crisis occurred in countries which did not have a Glass-Steagall to repeal. This book, like their 2006 book Rethinking Bank Regulation: Till Angels Govern may be uncomfortable for both those on the right and left given its balance. The book, however, is not about blame, but about the accountability needed to achieve real progress. Essentially, you cannot learn if you do not understand.

Keywords: financial crisis, Glass-Steagall Act, Dodd Frank Act (DFA)

Suggested Citation

Barth, James R. and Caprio, Gerard and Levine, Ross Eric, Book Review: Guardians of Finance Making Regulators Work for Us (2012). Journal of Applied Finance, Fall/Winter 2012, Volume 22, No.2 . Available at SSRN: https://ssrn.com/abstract=2145055

James R. Barth (Contact Author)

Auburn University ( email )

415 West Magnolia Avenue
Auburn, AL 36849
United States
334-844-2469 (Phone)
334-844-4960 (Fax)

Milken Institute ( email )

1250 Fourth Street
Santa Monica, CA 90401
United States

Gerard Caprio

Williams College ( email )

Williamstown, MA 01267
United States
413-597-2465 (Phone)
413-597-4045 (Fax)

Ross Eric Levine

University of California, Berkeley - Haas School of Business ( email )

545 Student Services Building, #1900
2220 Piedmont Avenue
Berkeley, CA 94720
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Here is the Coronavirus
related research on SSRN

Paper statistics

Abstract Views
684
PlumX Metrics