The Ethics of Governance

This Article discusses the need for a board of last resort to set financial values during periods of extreme economic stress, i.e., the “liquidity black hole” events. The purpose of this proposed board, the “Independent Treasury Board,” would be to address valuation uncertainty during bust periods immediately following major financial crises. If an Independent Treasury Board existed prior to 2008, it could have helped rein in some valuations that were among the causes for the Great Recession. More importantly, it could have quickened recovery from the Great Recession during the period immediately following the financial crisis by shortening the period of valuation uncertainty. If created now, the Independent Treasury Board should become a permanent part of the United States Treasury Department