Inflated How Money and Debt Built the American Dream

by Whalen, R. Christopher; Roubini, Nouriel

• ISBN13: 9780470875148
• ISBN10: 0470875143
• Edition: 1st
• Format: Hardcover
• Copyright: 2010-12-07
• Publisher: Wiley

Summary

Americans as a whole view themselves as reasonably prudent and sober people when it comes to matters of money, reflecting the puritan roots of the earliest European settlers. Yet as a community, we also seem to believe that we are entitled to a lifestyle that is well-beyond our current income, a tendency that goes back to the earliest days of the United States and particularly to get rich quick experiences ranging from the Gold Rush of the 1840s to the real estate bubble of the early 21st Century. Inflated examines this apparent conflict and makes the argument that such a world view is so ingrained in us that to expect the United States to live in a "deflated" world is simply unrealistic. It skillfully seeks to tell the story of, money inflation and public debt as enduring (and perhaps endearing) features of American life, rather than something we can one day overcome as our policy makers constantly promise. bull; Features interviews with todayrs"s top financial industry leaders and insiders. bull; Offer a glimpse into the future of the Federal Reserve and the role it will play in the coming years bull; Examines what the future may hold for the value of the U.S. dollar and the real incomes of future generations of Americans The gradual result of the situation we find ourselves in will inevitably lead to inflation, loss of economic opportunity, and a decline in the value of the dollar. This book will show you why, and reveal how we might be able to deal with it.

Author Biography

R. CHRISTOPHER WHALEN is cofounder and Managing Director of Institutional Risk Analytics, a Torrance, California, bank rating agency and consulting firm. He is editor of IRA's popular newsletter, the Institutional Risk Analyst, and heads IRA's advisory practice. Whalen is among one of the most frequently quoted financial analysts in the United States and appears regularly on Bloomberg, CNBC, and National Public Radio. He worked for the U.S. House of Representatives, the Federal Reserve Bank of New York, as a Mexico analyst during the 1990s, and as an investment banker for firms such as Bear Stearns & Co., and Prudential Securities. During his three decades as an investment banker and writer, Whalen contributed to publications such as Barron's, American Banker, the New York Times, Financial Times, and many others. He has testified before both the U.S. Congress and the Securities and Exchange Commission on issues ranging from financial regulation to OTC derivatives to XBRL to the federal rescue of GMAC. For more information, visit www.rcwhalen.com.

Table of Contents

Preface	p. ix
Acknowledgments	p. xiii
Introduction	p. xvii
Free Banking and Private Money	p. 1
The Bank of the United States	p. 4
State Debt Defaults	p. 9
The Age of Andrew Jackson	p. 15
The Panic of 1837	p. 20
The Gold Rush	p. 24
The Rise of Bank Clearinghouses	p. 26
Lincoln Saves a Nation by Printing Money	p. 29
The Lincoln Legacy	p. 32
Financing the War	p. 35
Salmon Chase and Jay Cooke	p. 40
Fisk and Gould Profit by Inflation	p. 44
The Panic of 1873	p. 49
Gold Convertibility Restored	p. 52
The Battle Over Silver Money	p. 54
A Changing American Dream	p. 57
The Silver Compromise	p. 58
Robber Barons and the Gilded Age	p. 63
The Age of Speculation	p. 65
Republicans Embrace Inflation	p. 68
The Panic of 1893	p. 72
The Cross of Silver	p. 74
The Evangelical Silverites	p. 76
The Turning Point: 1896	p. 78
The Rise of the Central Bank	p. 85
The Progressive: Theodore Roosevelt	p. 88
A Flexible Currency	p. 95
The Crisis of 1907	p. 99
The National Monetary Commission	p. 103
The Passage of the Federal Reserve Act	p. 110
Roosevelt, Wilson, and the Politics of Reform	p. 115
War, Boom, and Bust	p. 123
The Fed During WWI	p. 135
A Return to Republican Normalcy	p. 142
The Roaring Twenties	p. 146
A New Era of Debt and Investing	p. 149
The Rise of Consumer Finance	p. 154
America Transformed	p. 158
Prelude to the Depression	p. 163
Bust: Stocks Fall and Tariffs Rise	p. 166
Inflation versus Deflation	p. 173
Ford, Couzens, and the Detroit Banks	p. 179
New Deal to Cold War	p. 183
FDR and the Era of Broken Precedent	p. 185
The Seizure of Gold and Dollar Devaluation	p. 190
Dollar Devaluation Hurt World Trade	p. 196
The Rise of the Corporate State	p. 198
The Reconstruction Finance Corporation	p. 204
Central Planning Arrives in Washington	p. 209
FDR Embraces Federal Deposit Insurance	p. 211
The Legacy of FDR	p. 214
The Fed and the RFC	p. 217
Corporativist Reform at the Fed	p. 227
America Goes to War	p. 231
Wartime Inflation and Debt Finance	p. 236
Bretton Woods and Global Inflation	p. 238
Debt and Inflation: A Rising Tide Lifts All Boats	p. 241
Federal Revenues Grow	p. 247
The Fed Regains Independence	p. 252
The Post-War Economy Soars	p. 254
The Legacy of War	p. 255
Cold War, Free Trade	p. 258
The Dollar's Golden Age	p. 264
Global Imbalances Return	p. 268
Richard Nixon's Betrayal	p. 271
The End of the Dollar Peg	p. 273
The Return of Sovereign Borrowing	p. 278
Leveraging the American Dream	p. 285
The New Uncertainty	p. 289
Humphrey-Hawkins and Full Employment	p. 295
Balanced Budgets and Inflation	p. 300
Volcker's Shock Treatment	p. 304
The Crisis Managers	p. 308
The Latin Debt Crisis	p. 311
Reagan Reappoints Volcker	p. 314
The Neverending Crisis	p. 317
Volcker Exits, Volatility Returns	p. 320
From Excess to Delusion	p. 323
The Greenspan Legacy	p. 326
A New Monetary Order	p. 329
The Growth Challenge	p. 334
Jobs versus Inflation	p. 336
Changing Places	p. 338
Triffin's Dilemma and the Dollar	p. 341
Notes	p. 347
Selected References	p. 365
About the Author	p. 369
Index	p. 371
Table of Contents provided by Ingram. All Rights Reserved.