by Keith Hennessey, Edward P. Lazear
September 03, 2013
In a new book entitled Observations on the Financial Crisis, Stanford professor Keith Hennessey and Stanford professor and Hoover senior fellow Edward P. Lazear draw on their experiences in the Bush administration, as well as discussions with colleagues and students, to present their thoughts and correct misperceptions about the financial crisis. The nineteen observations span the full trajectory of the financial crisis, from the various causes to Presidents Bush and Obama’s responses to the effects of the government’s actions. Three points deserve highlighting. Hennessey and Lazear argue that the “deregulatory hypothesis” is flawed; it is a misconception that President Obama’s administration addressed the financial crisis; and the positive effects of the fiscal stimulus have been overestimated and the extent of the recession has been exaggerated.