Why Toxic Assets Are So Hard to Clean Up

Details

Author(s):
  • Kenneth Scott
Publish Date:
July 20, 2009
Publication Title:
Wall Street Journal, July 20, 2009, pg. A13
Format:
Op-Ed or Opinion Piece
Citation(s):
  • Kenneth E. Scott and John B. Taylor, Why Toxic Assets Are So Hard to Clean Up, Wall Street Journal, July 20, 2009, pg. A13.

Abstract

Despite trillions of dollars of new government programs, one of the original causes of the financial crisis — the toxic assets on bank balance sheets — still persists and remains a serious impediment to economic recovery. Why are these toxic assets so difficult to deal with? We believe their sheer complexity is the core problem and that only increased transparency will unleash the market mechanisms needed to clean them up.