But the presumption in favor of light financial sector regulation now has few defenders. The consensus view is rather that of William McChesney Martin, who served as US Federal Reserve Chairman from 1951 to 1970 a good central bank prevents speculative excess by taking away the punchbowl before the party really gets going.

You can argue that neither group should have boosted its spending to such a degree that both were subject to irrational exuberance and that someone should have taken away the punchbowl earlier. But you cannot argue that these groups did not increase their spending, and that their increased spending did not pull large numbers of Americans roughly two million in each case into productive and valued employment.