Entrepreneurship is based on the risk-taking which is impeded by dumb and overly sissy bank regulators.
Sir, Daniel Pinto concludes his letter “Entrepreneurship belongs at the heart of western businesses”, April 4, by stating “The west is suffering from a chronic Entrepreneurial Deficit Disorder”.
Indeed and if we understand that entrepreneurship is foremost based on risk taking, and consider that bank regulators, with their risk weighted capital requirements, allow banks to earn much higher risk adjusted returns on equity on “absolutely safe” exposures, than on “risky” exposures, it should not be difficult to understand why the west has entered into a death spiral.
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