Another take on the economic crisis: somewhat dry and academic but quite thorough.
The most illuminating idea was a refinement of the distorted compensation incentives that poison Wall Street. Rajan’s idea is an employee’s performance bonus held in long-term escrow to ensure it does not blow up a too-big-to-fail bank employer within a year or two.
Rajan’s discussion of safety nets as an essential feature of modern economies was also welcome.
Report Card: B+