recession (1953–1954) and, 223–225, 226
recession (1957–1958), 229–230
taxes and, 87, 220–222, 674
Truman’s war budget/taxes and, 214–215, 216, 220, 221–222, 231
Eisenhower Minimum, 84–86, 218, 689–690, 692, 710
Election reforms
campaigns and, 672, 673, 707–708
incumbency and, 673, 707
overview, 672–674, 707–708
Electric vehicles/batteries
fuel efficiency/carbon footprint and, 603–604, 607
incumbent companies, 602
stimulus (after 2008 financial crisis), 602–607
Elliot Capital, 663–664
Energy sector
black/green energy lobbies, 694–695
energy independence and, 694–695
problems overview, 694–695
See also Green energy; specific companies
Energy tax, 607–608
ESF (Exchange Stabilization Fund), 188–189
Eurodollar futures, 310, 311, 312
Exchange Stabilization Fund (ESF), 188–189
Experian, 567–568, 570
Extended Stay America, 538, 539, 540, 541–542, 544, 545, 547
ExxonMobil
shale gas drilling companies and, 522
stock buybacks/strategy, 457, 458, 459, 460
Fair Labor Standards Act (1938), 160
Fannie Mae. See Housing/Fannie Mae and Freddie Mac
Federal Open Market Committee (FOMC), 265, 267, 331, 332–333, 338, 339, 340, 344, 373, 378
Federal Reserve
beginnings, 88, 197
design, 176, 208, 209, 268
monetary central planning beginnings, 285, 289
purpose, 122, 200–201, 268
reforms needed, 707
Treasury Department relationship, 196, 200, 201, 205–207
“wealth effects” doctrine, 13–15, 20–21, 26, 211–212, 366, 374, 380, 393, 428, 463, 467, 477
World War II and, 199–200, 201
See also specific individuals; Wall Street/Federal Reserve
Financial crisis (2008)
bank run and, 24–28, 32–33
as “BlackBerry Panic of 2008,” 45
compared to meltdowns (1987/2000–2001), 577–578
denial before, 377–381
false depression call/comparison, 578–579, 583–588, 593, 595, 612
false panic of, 32–34, 444–446, 583–588
interest rates, 445, 446, 503
liquidation process, 25–26
“money” vanishing, 402–403
pre-crisis deficit, 589–591
stock markets following, 367–368
urban legends of, 32, 39, 45
See also Housing bubble (1990s–2000s)
Financial crisis (2008) aftermath
factors breaking fall, 585–586
fear, 583–588
Great Depression comparison, 585, 586
household finances, 368–369
PCE (personal consumption expenditure), 586
return to pre-crisis conditions, 629–630
service vs. manufacturing economy effects, 585–588
social insurance, 590–591
Financial crisis (2008) bailout
amounts, 7, 49
auto loan business example, 444
“contagion risk” and, 5, 6, 8–9, 10, 12, 19, 26, 27–28, 32–33, 43–44, 399
dissenters, 19
effects, 10, 11, 12, 19, 25, 37
effects without, 19–20, 24–26, 32, 42
Fed scaring Congress, 8, 9, 10, 32, 33–34, 38, 45–46
free-market capitalism vs., 12–13, 21
investigations into, 7, 33
lack of analysis, 44
lack of debt reduction, 629
New Deal legend and, 167
purpose, 42
TARP bill/vote, 3, 32, 33–34, 45, 49, 55, 57
See also specific companies; specific individuals
Financial crisis of future
description, 669–671
free market capitalism and, 671
Financial futures
cash settlements and, 311–313
Eurodollar futures, 310, 311, 312
Federal Reserve moves and, 302–303
gambling regulation and, 311–312
physical delivery and, 310–311, 312–313
signals from, 302–303
volatility, 304–305
See also Chicago “Merc” (CME); Melamed, Leo
Fink, Larry, 441, 442, 668
First Data Corporation LBO, 518–519, 530–531
First Solar
history, 599–600
Solyndra vs., 600, 602
Fiscal cliff
defense spending and, 680, 681, 692–693
Keynesian doctrine and, 679–683, 690–691
as new normal, 682–686, 690–693
significance, 668–669
social insurance, 686–688, 692
tax cuts and, 680, 681
Wall Street and, 668, 679, 680, 681, 691
Fisher, Irving
monetary policies, 183, 186–187, 188, 190–191, 193
Thomas Amendment and, 183, 186–187, 188
Fisker Automotive
federal funding, 602, 606–607
history/cars, 602–604
Fisker, Henrik, 603, 604
“Fixed rule” monetary theory, 261–262, 263, 265, 266, 338
Floating currencies
adoption/description, 284
commodity price inflation examples, 124, 125
global inflation, 124–126, 133
gold standard end effects, 56, 60, 109–111, 124–126, 133–135, 176–177, 231
instability, 289, 296–297, 300–301
state central banks and, 109–110
US supporters of, 120, 123, 142, 196, 234, 264
FOMC (Federal Open Market Committee), 265, 267, 331, 332–333, 338, 339, 340, 344, 373, 378
Food stamp program
description/problems, 181–182
growth, 650
See also Social insurance
Forbes, 422
Ford auto company, 572
Ford, Edsel, 155
Ford, Gerald
administration, 304, 305
New York City request for federal money, 129
Simon and, 20, 127
spending/taxes, 87, 126–127, 130–131
Ford, Henry, 155
“Fracking” and Wall Street, 522–523
Freddie Mac. See Housing/Fannie Mae and Freddie Mac
Freescale Semiconductor Inc., 514, 516–518
Friedman, Milton
background, 119
beliefs/doctrines, 43, 142, 172–173, 183, 186, 196, 206, 234, 261–262, 264–265, 285, 495
Big government legacy, 272–273
financial futures, 310, 311
“fixed rule” monetary theory, 261–262, 263, 265, 266, 338
floating currency and, 14, 142, 196, 234, 260, 264, 273, 274, 284, 285, 288, 295, 302, 312
Great Depression theories, 42, 184, 186, 243, 268, 269–272, 277
Nixon and, 260, 274
open market operations, 267–269
social insurance, 553
Wall Street speculation and, 265–267, 278, 284
Frist, Thomas, 528–529
Full-employment budget
Heller/stimulus and, 227–229
“new economics” and, 227–229, 232
Nixon and, 121–122, 127, 131
Future recommendations. See Solutions
GAFO sales, 651
“Gain on sale” profit scam, 37–39
Garman, 488, 489
Garn-St. Germain bill (1982), 177–178
Garner, John Nance, 194
Gates, Bill, 453
GE Capital, 39, 41
Geithner, Tim
monetary policies, 246
“stress tests,”
666
General Electric
bailout, 3, 36–37, 41–42
before 2008, 356–357, 467–470, 472
EPS/stock price changes, 467–470, 472
M&A deals, 472
stock buybacks, 472
toxic assets, 3, 35–36
General Motors
before financial crisis (2008), 572, 616–618
DIP loans and, 614, 616–617, 619
payables-receivables strategy, 617
strike (1970), 114
General Motors Acceptance Corporation
bailout, 40, 42, 576
subprime auto loans/housing mortgages, 40
General Motors bailout
description, 614–616
downsizing vs., 618–619, 621
problems overview, 621–623
reasons for, 619–621
suppliers, 660, 661, 662, 663
UAW/wage bill and, 619, 620–621, 660, 662
See also Lear Corporation
George, Walter, 194
Gephardt, Richard, 309
Gingrich, Newt, 104
Glass, Carter
background/doctrines, 142, 176, 197
FDR/treasury and, 143, 156, 157, 161
Federal Reserve and, 197, 198, 199, 209, 268, 321
Glass-Steagall, 13, 168, 176–178, 208, 396, 399
Glass-Steagall II, 707
“Global” firm definition, 7
Gold standard
British default (1931), 118, 138, 142–143, 149, 153, 182, 240–241, 242, 244
British devaluation of pound/effects, 252–256, 284
deterioration of, 247–249, 250–252, 258–259
European countries (late 1920s–1931), 118, 138, 142–143, 149, 153, 182, 238, 240–241, 242, 244
FDR actions/effects, 138–139, 140–142, 149, 157, 158, 161–162, 189–190, 192, 194
flaws, 243–245
gold pool establishment/history, 246–247, 253–257
gold selection reasons, 237–238
Heller-Tobin proposal, 247–249
history, 235–236, 295–296
London Economic Conference (1933) and, 139, 143–145, 187, 190, 191
panic of 1960, 235, 236–237, 243
restoration by countries (1925–1928), 142
Thomas Amendment and, 140, 141, 186, 187–188, 190, 193
US currency swap lines, 250–251, 253
See also Bretton Woods monetary system
Gold standard end
effects, 56–57, 273–275, 281–284
misunderstanding consequences, 281–287
Smithsonian Agreement (1971), 282–283
See also Speculative finance
“Goldilocks economy,” 233, 377, 443
Goldman Sachs
Alltel LBO and, 523
auto industry bailout and, 664
Bain Capital and, 562
before financial crisis (2008), 22–23, 28–29, 384–385
crash of 1929/Great Depression and, 16, 155
financial crisis/bailout, 3, 4, 7, 8, 10, 24, 48, 49
financial futures/options exchanges, 301–302
inside information and, 493, 502–503
profits (2009), 3–4
tax break (2012), 676
Tesla Motors, 604, 605–606
toxic assets, 22–23
without bailout, 6, 8, 20, 22, 24–26
See also Wall Street growth; specific individuals
Gore, Al, 309, 604
Gorman, Joseph, 567–568
Gramm-Leach-Bliley repeal act (Glass-Steagall), 177
Great Depression
bank crisis timing, 154–155
bank failure causes (1920–1933), 151–155
consumer prices, 89
Federal Reserve banks (October 1929–March 1933), 269–272
global trade and, 145–147
Hoover recovery and, 148–150, 166, 167
inventory liquidation, 147, 148
Keynesian cure and, 148
myth on recovery, 202
roots/causes of, 42–43, 137–138, 145–148, 151, 183–184, 225–226
silver price and, 162
US exports and, 137–138, 145–147, 151
See also specific individuals
Great Inflation, 346, 347, 383, 384, 385, 404–405, 418
Great Moderation, 250, 345, 365, 380, 381, 431, 443, 454, 490, 504, 508, 512, 530
Green energy
energy tax vs., 607–608
stimulus and, 598–608
See also specific companies
Greenberg, Hank, 9–10
Greenspan, Alan
background/policies, 13–14, 56, 58, 62, 212, 249–250
business debt and, 453–454
debt growth/effects, 62–66, 323
easing campaign (1987–1992), 349–353
on “free market” transactions, 471
gold standard and, 56, 61, 323, 351–352
Great Depression and, 323
“home bias” theory, 326–327
housing boom and, 18
inflation and, 352, 353–354
interest rates, 266, 314
“irrational exuberance,” 330, 331, 334, 336, 358
LTCM bailout and, 15, 16–17, 62, 141, 319, 332, 334–335, 389, 390–392
money-printing, 340, 447–448
old economy and, 325
prosperity illusion and, 107, 448
“Put” description/effects, 17–18
rate cutting (2001), 340–341
Russian default and, 332–334
Social Security rescue plan, 98, 102–104
stock market crash (October 1987), 303, 305, 314–317, 318, 319, 320–321, 350
TBTF doctrine, 13
wealth effects doctrine, 13–15, 374
See also Stock market bubbles; specific events
Grocery stores/sales, 649–651
GSE (government-sponsored enterprise)
description, 170–171, 580
nationalizing, 171, 580
See also Housing bubble (1990s–2000s); Housing/Fannie Mae and Freddie Mac
Guardian Savings and Loan, 440
Guardian Trust Group, 155
Gutfreund, John, 387
Haldeman, Bob, 114–115, 117, 122, 284
Harbour Report, 618
Harrah’s LBO, 518–519
Hartford Steam Boiler, 9
Hazlitt, Henry, 117
HCA Inc. LBO, 518–519, 524–525, 526, 527, 529
Health-care inflation, 696–699
Health care system
abolishing health insurance, 709–710
employer health insurance problems, 696–697
groups priced out of system, 696–697, 698
problems overview, 696–699
See also specific components
Hedge funds
description/role of, 486–487, 491–494, 499–500, 501–502
inside information and, 493, 502–503
John Paulson and, 494–496
Keynesian foundation/speculation and, 491–492
liquidity function myth, 490–491
options/OTC derivatives, 489–490
SEC regulation and, 496
statistics on, 486, 494, 499
Heller, Walter
deficit-financed tax cuts, 249, 674
Heller-Tobin proposal, 247–248
Kennedy and, 226–229, 231, 247–249, 674
“new economics”/mistakes, 226–229, 247–249
Hertz, 514
Hewlett-Packard
M&A deals, 461, 462–463
stock buybacks, 457, 461–463
Hicks, John, 595n
Hilton Hotels
“bridge loans” and, 534–535
LBO, 518–519, 533–536
Hoover, Herbert
banking crisis and, 153, 158
FDR and, 138, 139, 155–156
gold standard, 190
Great Depression and, 145, 148–150, 16
6, 167, 315
letter to president-elect FDR, 155–156
panic blame and, 156, 158
policies/beliefs, 138, 345, 673, 674, 689
Hopkins, Harry, 165
Hotel construction
description, 537–538, 546, 547
LBOs and, 538–542, 545
Household leverage ratio changes, 642–644
Housing and Community Development Act (1992), 406–407
Housing bubble (1990s–2000s)
adjustable rate mortgages (ARMS), 434
“Alt-A” mortgages, 429, 435–437, 439
causes, 17–18, 369, 370
collapse/effects, 370, 431
description, 18, 26, 28, 340, 346, 369–370, 374–375, 376–377, 379, 391, 425–427, 430–431
Fed ignoring problems, 431–432, 433, 436, 437–438
“flipping” houses, 425, 427
“gross originations,” 426–427
GSE background, 405–409
GSE hidden losses, 410
GSE speculation, 414
home builders/stocks, 432–433
home finance subsidies, 412–413
home ownership rate, 435
homeowners’ leveraged buyouts (LBO), 425
household consumption and, 372–373, 429–430, 537
household savings and, 369
HUD ownership strategies, 412–413, 419
interest rates, 369, 426, 431, 433, 434
legislation and, 404–405, 408
MEW (mortgage equity withdrawal), 427–430, 537, 555–556
money-printing policies, 439–440
mortgage broker industry, 418–419
mortgage lender changes, 404–405, 414–416, 418–419, 537
mortgage securitization, 419–421, 438–440, 441
partnerships/K street, 141–142
S&L deregulation/disaster and, 405, 416–418
“second lien” mortgages, 436–437
unregulated mortgage brokers/banks, 414–415
Housing bubble (1990s–2000s) and subprime mortgages
background, 28–30
companies involved, 421–422, 440, 441, 442
description, 421–424, 435–437, 440–442
Fed and, 433–435
fraud, 421–423, 424, 440, 441
GMAC, 40
interest rates and, 423–424
“twofer” households, 40
Housing/Fannie Mae and Freddie Mac
after housing crash, 30, 693
evolution/problems, 169–172, 405–406, 407–408, 409, 439, 580
Fannie Mae Foundation/money, 411
hidden losses, 410
New Deal origins, 169–171, 172
speculators and, 414
stock prices, 407–408
Housing market (after 2007)
baby boom retirement effects, 647–648
down payment amount and, 580
FHA insurance and, 579–580
home-buyers’ tax credit/fraud, 580–581
housing lobby and, 580
MEW-II doctrine and, 583
mortgage rate/refinancing, 581–583
need for reform, 693–694
Howe, Louis, 144
The Great Deformation Page 100
