What’s wrong with Bloomberg?
Bloomberg was created to report financial and economic events to financiers. Yet it seems that it has drawn the wrong conclusions from the crisis and fallen into the interventionist trap. Repeating usual basic statist/interventionist misconceptions isn’t what we expect from such a respectable company. The editorial line of the Financial Times or The Economist seems to be much more balanced in comparison, even if I don’t agree with everything they say.
Last week, Bloomberg reported that:
Four years after President Barack Obama signed the Dodd-Frank Wall Street Reform and Consumer Protection Act into law, polling suggests that most Americans think it hasn’t done enough to protect them from a repeat of the 2008 financial crisis, a disaster from which the global economy has yet to fully recover.
Unfortunately, they’re right.
According to Bloomberg, Dodd-Frank is the ultimate tool that regulators need to make the system ‘safe’:
Dodd-Frank provides regulators with all the powers they need to prevent the financial sector from leaning on taxpayers and putting the economy in danger. All that’s wanting, four years on, is the will to use them.
This goes against all evidences so far. Dodd-Frank has many issues (too many links to provide… I let you google it). Just don’t tell Bloomberg.
Today, Bloomberg announced its support of tighter regulatory oversight for insurers and… Berkshire Hathaway:
Could Warren Buffett’s Berkshire Hathaway Inc. threaten the stability of the financial system? The U.S.’s top regulators are asking themselves this question as they consider whether Berkshire and other large insurers should come under Federal Reserve oversight.
The answer is yes.
While many of Bloomberg’s contributors publish interesting and intellectually-stimulating articles, and many of its financial facts-reporting articles are useful sources of information, Bloomberg ‘Editors’ have taken a very narrow view of what happened during the crisis based on platitudes, partial understandings and other misconceptions, and keep lamenting about the lack of regulatory pressure/intrusion/control. According to the website, it looks like regulation is the alpha and the omega: if only regulators and politicians were more tightly controlling the financial system, there would be no crisis. Criticisms and challenges (or at least discussions) of regulatory failures and regulatory distortions seem to be pretty much non-existent in editorials. Is this really the type of balanced reporting we expect from such a serious financial publication?