One of the best explanations you will hear of the financial crisis and its aftermath

This remarkable video from economist Brian Wesbury is one of clearest explanations you will hear on the financial crisis and its aftermath.

It is entitled "TARP was a mistake."

One of the hardest-hitting points that Mr. Wesbury makes in the video is the fact that, to this day, the view that Congress needed to somehow use taxpayer dollars to buy up troubled mortgage-backed assets is not challenged by members of either side of the political aisle in Washington. Nowhere can we find a politician brave enough to say that the very idea of buying back troubled assets was mistaken.

Mr. Wesbury also points out that at the time, he was arguing that changing mark-to-market accounting rules would have fixed the problem, rather than spending taxpayer dollars. He cites this video from September 2008 in which he made that argument (and he was also making that argument in writing in many places leading up to September 2008).

We have noted before that we are also on record saying that mark-to-market was a big part of the problem (as early as this post from March 2008). We also publicly stated in April 2009 that it was time to retire TARP (and since then have argued that we certainly don't need to compound it by continued TARP-like "stimulus" or "jobs" bills).

We have long believed that a crucial component of investment is the ability to sort out the real situation from the "conventional wisdom" in various matters large and small. We believe that having a correct understanding of the Financial Panic of 2008-2009 will be extremely important to investors for many years to come.

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