House Financial Services required reading: Some unlikely choices

Members of the House Financial Services Committee may have bickered bitterly over which party is to blame for the financial crisis during today´s hearing on regulatory restructuring, but they demonstrated a propensity for bipartisanship in their reading material.

Articles from the New York Times and the Cleveland Plain Dealer, which, respectively, covered the cause of the financial crisis and the exploitation of a neighborhood in Cleveland by a mortgage broker, were submitted for the record by Republican Rep. Steven LaTourette of Ohio.

Next, the committee´s chairman Barney Frank, D-Mass. actually read pre-selected excerpts from a National Journal article on GSE reform and from a book by John McCain´s economic adviser Mark Zandi, titled Financial Shock.

A witness, Alice Rivlin, a former director of the Congressional Budget Office now at the Brookings Institute, recommended late Federal Reserve governor Ned Gramlich´s book, Subprime Mortgages: America's Latest Boom and Bust for an explanation of the home loans´ role in the financial meltdown, and the new release by David Smick, The World is Curved: Hidden Dangers to the Global Economy, also came up as a good lesson on the crisis.

But not all of the suggested media had as serious a tone. "I think everyone in the financial industry should watch Jurassic Park," American Bankers Association President Ed Yingling said, referring to the Hollywood horror movie in which dinosaurs are re-created and break free of their zoo-like habitats to terrorize humans on an island.

Mr. Yingling likened the creation of new financial derivatives to the dangerous illusions of control the humans in Jurassic Park entertain. "They think they have things under control but the animals will find a way to get out."