Might Martin Wolf have too many “not risky” friends and too few “risky”?

Sir I completely share Martin Wolf’s concerns about “1930s…economic catastrophe with long lasting political results” “Bernanke makes an historic choice” September 19. And to that effect let me just reference the letter I wrote titled “The monsters that thrive on hardship haunt my dreams”, and that you so kindly published on the last day of 2009. 

But it is precisely because of it that I do not agree with any injections of any sort of stimulus, before we have eliminated the regulatory taxes on access to bank credit for those perceived as “risky”, and which result from the regulatory subsidies given to the access to bank credit to those perceived as “not risky”. That discrimination waters down any long lasting effect of QEs and fiscal stimulus, and is therefore basically setting us up for a monstrous inflation. 

I just cannot understand how Martin Wolf can keep silent, year after year, about the distortions produced by petit bank regulators, when setting their risk-adverse risk-weights which determine the capital requirements for banks. Or, is it that Wolf has too many friends among the “not-risky” and too few among the “risky”? If so, perhaps he should divulge his conflict of interest. 

Frankly, who authorized bank regulators to do to our banks what they did?