The banking industry suffered credit crises in the 1970s, 1980s, 1990s, and 2000s. An unavoidable conclusion is that its loan loss reserves were in all cases too small. 

Losing money is embarrassing. And an embarrassed Jamie Dimon publicly admitted that J.P. Morgan Chase goofed. Three senior executives lost their jobs as a result. But politicians and regulators in Washington are rushing to leverage the bank's misfortune for their own gain.

In a new book entitled “Financing Failure: A Century of Bailouts,” Vern McKinley provides the most detailed account yet of the government’s decision-making process during these momentous events.

On April 13, 2012, the US Department of the Treasury released new cost estimates for the Troubled Asset Relief Program. Looking principally at actual and projected contractual cash flows, the document concludes that: "Overall, the government is now expected to at least break even on its financial stability programs and may realize a positive return." 

At this event, Representative Kevin Brady (R-TX) will discuss new legislation aimed at increasing the accountability of the Federal Reserve while strengthening its independence from political pressure.

The Dodd-Frank legislation has many problems and omissions, and much is still uncertain about implementation. But the new liquidation authority provides for the possibility of making it so that future crises do not involve the bailouts of creditors that truly embodied the problem of having banks that are too big to fail.

The Federal Reserve could give banks a big incentive to expand by setting negative interest rates on their excess reserves. 

If financial stability was at the top of the central banks' agenda by 1999, one can reasonably wonder what they were doing about it from 1999 to 2007.