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Ep 397: Larry White and the First Principles of Money

The Seen and the Unseen - hosted by Amit Varma

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Navigating Financial Crises: Bear Stearns and Lehman Brothers

This chapter explores the financial strategies during the Bear Stearns crisis, focusing on the Federal Reserve's creation of Maiden Lane, LLC to manage distressed assets. It contrasts the varying responses to Bear Stearns and Lehman Brothers' collapses, emphasizing the implications of inconsistent government interventions on market behavior. The discussion includes the moral hazard associated with such interventions, warning against prioritizing immediate stability over long-term risks in the financial sector.

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