In Defense of Dominique Strauss-Kahn

The Federal Reserve is in business to create moral hazard. The mere act of being a central banker means your job description involves creating moral hazard.

- Harvey Rosenblum, executive VP of Dallas Fed

Recently, IMF managing director Dominique Strauss-Kahn has had his reputation tarnished by a US scandal that would be barely worth gossiping about in a cafe in France.  Apparently this has been a part of a pattern of consumptive behavior going back many years.

And that kind of economics leadership is exactly what the world needs now.  Someone needs to rekindle what Keynes called the 'animal spirits' in bankers.  As Mr. Rosenblum and other Fed employees have noted, central banking is about creating moral hazard.  Who is more qualified to spread moral hazard around the world than Dominique Strauss-Kahn?  Who can possibly fill his shoes?