Bonfire of the Vanities

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pages: 98 words: 29,610

From Bauhaus to Our House by Tom Wolfe

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Bonfire of the Vanities, Buckminster Fuller, Plutocrats, plutocrats, The Chicago School, urban renewal

Also by Tom Wolfe The Kandy-Kolored Tangerine-Flake Streamline Baby The Pump House Gang The Painted Word The Electric Kool-Aid Acid Test Radical Chic & Mau-Mauing the Flak Catchers Mauve Gloves & Madmen, Clutter & Vine The Right Stuff In Our Time The Bonfire of the Vanities A Man in Full Hooking Up I Am Charlotte Simmons Tom Wolfe is the author of a dozen books, among them such contemporary classics as The Electric Kool-Aid Acid Test, The Bonfire of the Vanities, I Am Charlotte Simmons, and Radical Chic & Mau-Mauing the Flak Catchers. He lives in New York City. Notes 1 The government thought (quite mistakenly) that a new and cosmopolitan architecture might help transcend the country’s bitter racial and ethnic hostilities. 2 It was sometimes permissible to construct a “mono-pitch” roof, a roof with one sloping surface instead of two; and this exception to the rule for worker housing in the 1920s is given devout homage today, on a gigantic scale, in such office towers as the Citicorp Building in New York and Pennzoil Place in Houston. 3 Likewise, in the field of psychology.


pages: 478 words: 126,416

Other People's Money: Masters of the Universe or Servants of the People? by John Kay

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Affordable Care Act / Obamacare, asset-backed security, bank run, banking crisis, Basel III, Bernie Madoff, Big bang: deregulation of the City of London, bitcoin, Black Swan, Bonfire of the Vanities, bonus culture, Bretton Woods, call centre, capital asset pricing model, Capital in the Twenty-First Century by Thomas Piketty, cognitive dissonance, corporate governance, Credit Default Swap, cross-subsidies, dematerialisation, diversification, diversified portfolio, Edward Lloyd's coffeehouse, Elon Musk, Eugene Fama: efficient market hypothesis, eurozone crisis, financial innovation, financial intermediation, fixed income, Flash crash, forward guidance, Fractional reserve banking, full employment, George Akerlof, German hyperinflation, Goldman Sachs: Vampire Squid, Growth in a Time of Debt, income inequality, index fund, inflation targeting, interest rate derivative, interest rate swap, invention of the wheel, Irish property bubble, Isaac Newton, London Whale, Long Term Capital Management, loose coupling, low cost carrier, M-Pesa, market design, millennium bug, mittelstand, moral hazard, mortgage debt, new economy, Nick Leeson, Northern Rock, obamacare, Occupy movement, offshore financial centre, oil shock, passive investing, peer-to-peer lending, performance metric, Peter Thiel, Piper Alpha, Ponzi scheme, price mechanism, purchasing power parity, quantitative easing, quantitative trading / quantitative finance, railway mania, Ralph Waldo Emerson, random walk, regulatory arbitrage, Renaissance Technologies, rent control, Richard Feynman, risk tolerance, road to serfdom, Robert Shiller, Robert Shiller, Ronald Reagan, Schrödinger's Cat, shareholder value, Silicon Valley, Simon Kuznets, South Sea Bubble, sovereign wealth fund, Spread Networks laid a new fibre optics cable between New York and Chicago, Steve Jobs, Steve Wozniak, The Great Moderation, The Market for Lemons, the market place, The Myth of the Rational Market, the payments system, The Wealth of Nations by Adam Smith, The Wisdom of Crowds, Tobin tax, too big to fail, transaction costs, tulip mania, Upton Sinclair, Vanguard fund, Washington Consensus, We are the 99%, Yom Kippur War

I shall then move on to the broader economic effects of financialisation on economic stability, on the performance of business and on economic inequality. The rise of the trader No sooner did you pass the fake fireplace than you heard an ungodly roar, like the roar of a mob … It was the sound of well-educated young white men baying for money on the bond market. Tom Wolfe, The Bonfire of the Vanities, 1987 We are Wall Street. It’s our job to make money. Whether it’s a commodity, stock, bond, or some hypothetical piece of fake paper, it doesn’t matter. We would trade baseball cards if it were profitable. … We get up at 5am & work till 10pm or later. We’re used to not getting up to pee when we have a position.

The elements of the new trading culture – based around fixed income, currency and commodities, and turbo-charged by derivatives – were now in place. Markets in shares were no longer the centre of speculative activity. Fixed interest, currency and, later, commodities (FICC) were central to the new trading culture. Sherman McCoy, the vainglorious anti-hero of Wolfe’s 1987 novel The Bonfire of the Vanities, was, like Nick Carraway, a bond trader. But the environment in which McCoy worked was very different from that experienced by Nick Carraway. The changes that occurred in the structure of financial services firms are described in more detail below, but with these firms the dominant ethos changed radically.

., 2012, ‘The UK’s External Balance Sheet: The International Investment Position (IIP)’, Office for National Statistics, March, http://www.ons.gov.uk/ons/rel/bop/the-international-investment-position/2010/art-uk-s-iip.html. Wolf, M., 2008, Fixing Global Finance, Baltimore, MD, The Johns Hopkins University Press. Wolfe, H., 1930, The Uncelestial City, London, Gollancz. Wolfe, T., 1987, The Bonfire of the Vanities, New York, Farrar, Straus and Giroux. Woodward, R.U., 2001, Maestro: Greenspan’s Fed and the American Boom, New York and London, Simon and Schuster. Zeleny, J., 2008, ‘Obama Weighs Quick Undoing of Bush Policy’, The New York Times, 9 November. Ziegler, P.S., 1988, The Sixth Great Power: Barings, 1765–1929, London, Collins, 1988.

The America That Reagan Built by J. David Woodard

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affirmative action, anti-communist, Ayatollah Khomeini, Berlin Wall, Bonfire of the Vanities, colonial rule, Columbine, cuban missile crisis, Deng Xiaoping, friendly fire, glass ceiling, global village, Gordon Gekko, gun show loophole, income inequality, invisible hand, Jeff Bezos, laissez-faire capitalism, late capitalism, Mikhail Gorbachev, mutually assured destruction, new economy, postindustrial economy, Ralph Nader, Ronald Reagan, Ronald Reagan: Tear down this wall, Silicon Valley, South China Sea, stem cell, Ted Kaczynski, The Predators' Ball, trickle-down economics, women in the workforce, Y2K, young professional

Greed in all its forms—greed for life, for money, for love, knowledge—has marked the upward surge of mankind. And greed—you mark my words—will not only save Teldar Paper, but that other malfunctioning corporation called the USA. Thank you very much. The same theme was addressed in literature. In 1990, one of America’s foremost writers, Tom Wolfe, released a blockbuster bestseller entitled The Bonfire of the Vanities.6 The book dealt with what Wolfe called the ‘‘big, rich slices of contemporary life,’’ in this case the heady materialism of the 1980s. The plot followed the life of Sherman McCoy, a prodigiously successful bond trader at a prestigious Wall Street firm. One night Sherman, accompanied by his mistress, fatally injures a black man in a car accident.

Lou Cannon, President Reagan (New York: Simon and Schuster, 1991), p. 516. CHAPTER 4: A RISING TIDE 1. International Financial Statistics: 1957–1998. 2. National Review, August 31, 1992. 3. Barron’s, February 11, 1984. 4. John Ehrman, The Eighties (New Haven, CT: Yale University Press, 2005). 5. Wall Street, imdb.com. 6. Tom Wolfe, The Bonfire of the Vanities (New York: Farrar, Straus and Giroux, 1987). 7. Theodore Dreiser, An American Tragedy (New York: Modern Library, 1956). 8. Janet Lowe, Secret Empire: How 25 Multinationals Rule the World (Homewood, IL: Business One Irwin, 1992), p. 5. 9. Bryan Burrough and John Helyar, Barbarians at the Gate (New York: Harper and Row, 1990). 10.

White, John Kenneth. The Values Divide. New York: Chatham House, 2003. Williamson, Murray, and Robert H. Scales, Jr. The Iraq War. Cambridge, MA: The Belknap Press, 2003. Wolf, Naomi. The Beauty Myth: How Images of Beauty Are Used Against Women. New York: Doubleday, 1991. Wolfe, Tom. The Bonfire of the Vanities. New York: Farrar, Straus and Giroux, 1987. Woodard, J. David. The New Southern Politics. Boulder, CO: Lynne Rienner Press, 2006. Woodward, Bob. The Agenda: Inside the Clinton White House. New York: Simon and Schuster, 1994. Woodward, Bob. The Choice. New York: Simon and Schuster, 1996. York, Byron.


pages: 257 words: 71,686

Swimming With Sharks: My Journey into the World of the Bankers by Joris Luyendijk

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bank run, barriers to entry, Bonfire of the Vanities, bonus culture, collapse of Lehman Brothers, collective bargaining, credit crunch, Credit Default Swap, Emanuel Derman, financial deregulation, financial independence, Flash crash, glass ceiling, Gordon Gekko, high net worth, hiring and firing, inventory management, job-hopping, London Whale, Nick Leeson, offshore financial centre, regulatory arbitrage, shareholder value, sovereign wealth fund, the payments system, too big to fail

This is a former managing director talking me through the listing of a new company on the stock exchange. Until he fell into a depression and dropped out, he had been a classic ‘Master of the Universe’ banker. To my surprise, this type of banker seemed perfectly happy with the name, even though Tom Wolfe coined it in Bonfire of the Vanities in the eighties to satirise the overwheening confidence of the ambitious young men who racked up millions on Wall Street. Many Master of the Universe bankers did not seem to know the providence of their nickname, nor did they seem to care. Neither for the literature nor for the irony. That said, whenever they described their work I couldn’t help but feel a sense of recognition, affinity even.

Index ABN Amro 1, 2 accountancy firms 1, 2, 3 and incentives 1 Adoboli, Kweku 1 AIG 1, 2, 3 al-Qaida 1 amorality 1, 2, 3, 4 Anderson, Geraint 1 Ankenbrand, Bernd 1 Asperger’s syndrome 1, 2 asset management 1 author’s Guardian blog 1 (see also Guardian) first interviews posted on 1 ‘Going native …’ subtitle of 1 readers’ comments posted on 1, 2, 3, 4, 5, 6, 7, 8 responses to interviews on 1, 2 traditional banking said to be under-represented on 1 Back from the Brink (Darling) 1, 2, 3 back office 1, 2 Bank of America, mixed investment–commercial nature of 1 banker types: blinkered 1, 2 cold fish 1 and Faustian pacts 1 legality defines ‘ethics’ of 1 corresponding to animals 1 delusional 1, 2 Masters of the Universe 1 passim, 1, 2 cold fish’s scorn for 1 criticism of sector resented by 1 sector readily defended by 1 neutrals 1, 2, 3, 4, 5, 6, 7 nicknames for 1 teeth grinders 1, 2, 3, 4 bankers (see also banks): in back office 1, 2 evaluation of colleagues by 1 and Faustian pacts 1 and hopping between jobs 1, 2 leisure-time spending by 1, 2 (see also financial sector: remuneration in) and love life 1 in middle office 1, 2, 3, 4, 5 more power and status in, post-crash 1 nicknames used by 1 not alone in causing financial crisis 1 (see also global financial crisis) and religion 1 types of, see banker types working hours of 1, 2, 3, 4 banks (see also bankers; central banks; financial sector): ABN Amro 1, 2 abusive culture in 1 accountancy firms used by 1, 2, 3 annual results announcements of 1 balances of, as ‘blackest of black holes’ 1 Bank of America, mixed investment–commercial nature of 1 Barclays, mixed investment– commercial nature of 1 Barings 1 rogue trader at 1 BNP Paribas, mixed investment–commercial nature of 1 capital buffers of 1, 2, 3 capital buffers of 1, 2 Casenove 1 and caveat emptor 1, 2, 3, 4, 5, 6 Citigroup 1, 2 mixed investment–commercial nature of 1 ‘close and continuous supervision’ of 1 (see also regulators) combined investment–commercial nature of 1 commercial: definition of, clarified 1 vs investment 1, 2 investment banks taken over by 1 Deutsche Bank 1 mixed investment–commercial nature of 1 divide between different types of 1 as dog-eat-dog world 1 Goldman Sachs 1 as exception to short-termism 1 as ‘pure’ investment bank 1 Smith’s book on 1 Smith’s NYT piece on 1, 2 HR personnel in, and redundancy 1 HSBC 1 annual results announcement of 1, 2 and drugs money 1, 2 mixed investment–commercial nature of 1 and incentives: ‘perverse’ 1, 2, 3, 4, 5, 6 short-termism encouraged by 1 insurance’s overlap with 1 as ‘intensely political’ workplaces 1 investment: ‘animal’ types within 1 books about 1 as ‘casinos’ 1, 2, 3 and ‘castes’ 1 vs commercial 1, 2 commercial banks begin to take over 1 culpability of, in global financial crash 1 daily routine of 1, 2, 3 definition of, clarified 1 and dot-com bubble 1, 2, 3 job titles within 1, 2, 3 radically changed ownership structure of 1 and risk and compliance 1, 2, 3, 4, 5, 6 (see also regulators) risk-taker–risk-bearer dichotomy in 1 and ‘rock’n’roll traders’ 1 speculation by 1 subcultures engendered by 1 and IT 1, 2 patches and workarounds in 1 JP Morgan 1 rogue trader at 1, 2 Lehman Brothers: collapse of 1, 2, 3, 4, 5 inadequate buffers of 1 as ‘pure’ investment bank 1 Lloyds, annual results announcement of 1, 2 mega- 1 investment banks’ mutation with 1 speculate with people’s savings 1 Merrill Lynch 1 Morgan Grenfell 1 and prop trading 1, 2, 3, 4 rating agencies paid by 1 (see also credit-rating agencies) RBS, annual results announcement of 1, 2 recruitment in 1, 2 and redundancy 1, 2, 3, 4, 5, 6 as ‘enhanced severance’ 1 as rite of passage 1 termed ‘the cull’ 1 in UK vs US 1, 2 and work-related visas 1 and regulators 1 fighting symptoms rather than cause 1 and Financial Services Authority, Financial Conduct Authority, Prudential Regulation Authority 1 identification of, with financial sector 1 ‘idiots’ description applied to 1, 2 ‘losing people at all levels’ post-crash 1 numbers working for 1 and self-declaration 1 Salomon Brothers 1 Samuel Montagu 1 Schroders 1 silo mentality in 1 Société Générale: mixed investment–commercial nature of 1 rogue trader at 1 and ‘too big to fail’ concept 1, 2, 3, 4 and ability to blackmail 1 and ‘too big to manage’ concept 1 UBS 1 rogue trader at 1, 2 unpopularity of employees in 1 zero job security in 1, 2 and diminishing employee loyalty 1, 2, 3 Barbarians at the Gate (Burrough, Helyar) 1 Barclays: mixed investment–commercial nature of 1 Sants offered top job at 1 Barings, rogue trader at 1, 2 Binge Trading: The Real Inside Story of Cash, Cocaine and Corruption in the City (Freedman) 1 Blair, Tony, ‘adviser’ role of 1, 2, 3 blinkered bankers 1, 2 (see also banker types) BNP Paribas, mixed investment–commercial nature of 1 Bonfire of the Vanities (Wolfe) 1 bonuses 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13 (see also remuneration) Labour’s plan to levy extra tax on 1 Brown, Gordon, financial sector praised by 1 buffers, see capital buffers Buiter, Willem 1 Canary Wharf 1 capital buffers 1, 2, 3, 4 ‘capture’ 1 Casenove 1 caveat emptor 1, 2, 3, 4, 5, 6 CDOs (collateralised debt obligations) 1, 2, 3, 4 ‘hybrid’ 1, 2 and rating agencies 1 ‘squared’ 1 ‘synthetic’ 1, 2 central banks 1, 2 (see also banks) Bank of England 1 reaction of, to global financial crisis 1 Swiss 1 CERN 1 charity donations 1 Chinese walls 1, 2, 3 Citigroup 1, 2 mixed investment–commercial nature of 1 City (see also banks; financial sector): amorality in 1, 2, 3 anti-Semitism, sexism, snobbery and homophobia in 1 codes and mores of 1 collection of interviews from (City Lives) 1 crude terminology used in 1 and discrimination 1 ethical dilemmas in 1 greed-driven as popular image of 1 ‘it’s only other people’s money’ mentality in 1 jargon and language of 1 law firms that dominate (‘magic circle’) 1 long-term relationships in 1 and ‘my word is my bond’ 1, 2 as term 1 UK and Europe reshaped in image of 1 City Lives (Courtney, Thompson) 1 Cityboy: Beer and Loathing in the Square Mile (Anderson) 1, 2 Clinton, Hillary 1 code of silence 1, 2, 3, 4 cold fish 1 (see also banker types) and Faustian pacts 1 legality defines ‘ethics’ of 1 collateralised debt obligations (CDOs) 1, 2, 3, 4 ‘hybrid’ 1, 2 and rating agencies 1 ‘squared’ 1 ‘synthetic’ 1, 2 commercial banks (see also banks): definition of, clarified 1 vs investment 1, 2 investment banks taken over by 1 Confessions of a City Girl: The Devil Wears Pinstripes (Stcherbatcheff) 1 confidentiality 1 Cooper, George 1 credit-default swaps (CDSs) 1 credit-rating agencies 1, 2, 3, 4, 5 and CDOs 1 Moody’s 1, 2 ‘oligopoly’ of 1 paid by banks 1 Damn, It Feels Good to Be a Banker (Leveraged Sell-Out) 1 Darling, Alistair 1, 2, 3 memoir of, see Back from the Brink Darwinism, social 1 Das, Satyajit 1 Davies, Howard 1 deals, code names for 1 Deloitte 1 delusional bankers 1, 2 (see also banker types) Der Spiegel 1 Derman, Emanuel 1 Deutsche Bank 1, 2 mixed investment–commercial nature of 1 dot-com bubble 1, 2, 3 economists, unhelpful 1 ‘enhanced severance’ 1 (see also redundancy) Ernst & Young 1 European Banking Union 1 European Commission 1 executive search 1 Financial Conduct Authority 1 financial crash 1 passim bankers not alone in causing 1 books written about 1, 2 and domino effect 1, 2 and government bail-outs 1 harrowing beginnings of 1 ignorance about 1, 2 ignorance of real threat posed by 1 indifference towards 1 investment banks’ culpability in 1 more ‘cock-up than conspiracy’ 1 next 1 parliamentary commissions into 1, 2 political impasse before and after 1 and redundancy 1 regulators’ personnel losses since 1 regulators’ symptoms-overcause response to 1 seen as ‘black swan’ 1 Western world ‘crippled’ by 1 The Financial Crisis: Who Is to Blame?


pages: 437 words: 113,173

Age of Discovery: Navigating the Risks and Rewards of Our New Renaissance by Ian Goldin, Chris Kutarna

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2013 Report for America's Infrastructure - American Society of Civil Engineers - 19 March 2013, 3D printing, Airbnb, Albert Einstein, AltaVista, Asian financial crisis, asset-backed security, autonomous vehicles, banking crisis, barriers to entry, battle of ideas, Berlin Wall, bioinformatics, bitcoin, Bonfire of the Vanities, clean water, collective bargaining, Colonization of Mars, Credit Default Swap, crowdsourcing, cryptocurrency, Dava Sobel, demographic dividend, Deng Xiaoping, Doha Development Round, double helix, Edward Snowden, Elon Musk, en.wikipedia.org, epigenetics, experimental economics, failed state, Fall of the Berlin Wall, financial innovation, full employment, Galaxy Zoo, global supply chain, Hyperloop, immigration reform, income inequality, indoor plumbing, industrial robot, information retrieval, intermodal, Internet of things, invention of the printing press, Isaac Newton, Islamic Golden Age, Khan Academy, Kickstarter, labour market flexibility, low cost carrier, low skilled workers, Lyft, Malacca Straits, megacity, Mikhail Gorbachev, moral hazard, Network effects, New Urbanism, non-tariff barriers, Occupy movement, On the Revolutions of the Heavenly Spheres, open economy, Panamax, personalized medicine, Peter Thiel, post-Panamax, profit motive, rent-seeking, reshoring, Robert Gordon, Search for Extraterrestrial Intelligence, Second Machine Age, self-driving car, Shenzhen was a fishing village, Silicon Valley, Silicon Valley startup, Skype, smart grid, Snapchat, special economic zone, spice trade, statistical model, Stephen Hawking, Steve Jobs, Stuxnet, TaskRabbit, too big to fail, trade liberalization, trade route, transaction costs, transatlantic slave trade, uranium enrichment, We are the 99%, We wanted flying cars, instead we got 140 characters, working poor, working-age population, zero day

The 2008 financial crisis has already taught us to respect this class of threat, but we do not yet appreciate how widespread it has become. Systemic risks are also growing within our national and geo-politics. A Renaissance age creates big winners and big losers. Our social bargain is weakening, just when the technologies to summon solidarity, or rally rebellion, are made common and powerful. Five hundred years ago, the Bonfire of the Vanities, religious wars, the Inquisition and ever-more-frequent popular revolts tore at the peace in which genius labored and smothered some of the brightest lights of the age. Now, voices of extremism, protectionism and xenophobia likewise seek to tear apart the connections that spark present-day genius, while popular discontent has sapped our public institutions of the legitimacy needed to take bold actions.

—Girolamo Savonarola (1452–1498)1 Empowered prophets In early February 1497, the Dominican friar Girolamo Savonarola and his band of fanatic youth followers gathered up all the tangible evidence of this strange new age they could lay their hands on—immoral books, heretical texts, nude paintings and sculptures, indecent perfumes, new musical instruments and baubles from far away—and piled them into a giant heap in Florence’s central piazza, rising 60 feet high in seven tiers to represent the seven deadly sins. On February 7, Carnival Day, Savonarola set fire to the lot in an event that became known to history as the Bonfire of the Vanities. By itself, that act wasn’t so remarkable. Public bonfires to burn away sin had been lit by Italian clergy before—by Bernardino da Siena in the 1420s, and more recently by Bernardino da Feltre in 1483.2 Nor was Savonarola’s message new. He spoke, in a loud and gifted voice, against moral corruption in society and against the church’s complicity with it, but the same could have been said of many preachers before him.3 In a previous time and place, Savonarola might have been marginalized and ignored.

See also Copernicus, Nicolaus Australia, 20, 43, 225 automation, 116, 146, 167 Aztecs, 9, 19, 93 al-Baghdadi, Bakr, 207, 208–9 Barker, Robert, 30 Berlin Wall, 4, 7, 10, 21–2, 77–8 Bhopal Union Carbide disaster, 99 bin Laden, Osama, 166, 210 Black Death, 1, 70, 72–3, 93, 143, 173–5, 177, 184 Bohr, Niels, 124 Bonfire of the Vanities, 8, 203–4. See also Savonarola, Girolamo Botticelli, Sandro: Madonna of the Book, 109 Brahe, Tycho, 29, 35, 106, 263 Brant, Sebastian, 26 Brazil, 43, 54, 68, 248, 262 Brunelleschi, Filippo, 90, 93, 109, 142, 204, 239, 246 Buonarroti, Michelangelo, 6, 109, 132, 142, 246, 266 Creation of Adam, 1, 151, 240 David, 2, 3, 235–6 Dying Slave, 110 Sistine Chapel ceiling, 1, 9, 240 Bush, George H.


pages: 851 words: 247,711

The Atlantic and Its Enemies: A History of the Cold War by Norman Stone

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affirmative action, anti-communist, Ayatollah Khomeini, bank run, banking crisis, Berlin Wall, Bernie Madoff, Big bang: deregulation of the City of London, Bonfire of the Vanities, Bretton Woods, British Empire, central bank independence, Deng Xiaoping, desegregation, Dissolution of the Soviet Union, European colonialism, facts on the ground, Fall of the Berlin Wall, financial deregulation, Francis Fukuyama: the end of history, Frederick Winslow Taylor, full employment, Henry Ford's grandson gave labor union leader Walter Reuther a tour of the company’s new, automated factory…, illegal immigration, income per capita, interchangeable parts, Jane Jacobs, Joseph Schumpeter, labour mobility, land reform, means of production, Mikhail Gorbachev, new economy, North Sea oil, oil shock, Ponzi scheme, price mechanism, price stability, RAND corporation, rent-seeking, Ronald Reagan, Silicon Valley, special drawing rights, Steve Jobs, strikebreaker, The Death and Life of Great American Cities, trade liberalization, trickle-down economics, V2 rocket, War on Poverty, Washington Consensus, Yom Kippur War, éminence grise

He had been a graduate student at the London School of Economics, despised the concentration at his native Prince-ton on two-dimensional economics, but, almost by chance, was wafted into a world in which his starting salary was twice that of his professor, and then made cruel mock of the whole greedy and stupid business of the bond market. Tom Wolfe’s Bonfire of the Vanities remains the outstanding novel of the decade and perhaps even the half -century. He too had made his observations on the trading floor of Salomon Brothers, once a rather staid and safe Wall Street house, turned into a sort of perambulatory worldwide casino. The money thereby let loose might well be directed towards assets held by the State - in most countries, many.

In 1934 the Stavisky scandal had almost destroyed republican, democratic France, since government ministers and parliamentary deputies had been found to be involved in an upended credit pyramid, the apex of which stood in the municipal pawn-shop of Bayonne; the Madoff running it was found dead in mysterious circumstances. Now, in New York, life imitated art, in this case Tom Wolfe’s Bonfire of the Vanities and Oliver Stone’s Wall Street: the makers of ‘junk bonds’ vanished into prison as recession pricked their bubbles. In London the empire of Robert Maxwell collapsed. He (repulsively: the baseball cap making it worse), larger than life, was a lie from the start. He was not, as he claimed, a Czech and therefore a gallant ally.

Melanie Phillips, All Must Have Prizes (1996), is another on education. In general, Alan Sked, An Intelligent Person’s Guide to Post-War Britain (1997), and Richard Vinen, Thatcher’s Britain (2009), can be strongly recommended. The fate of the eighties ‘revolution’ in the Atlantic world causes head-shaking. The poet of the era is Tom Wolfe, The Bonfire of the Vanities (1987), but there are precursors of great power, Radical Chic (1970), The Painted Word (1975), and From Bauhaus to Our House (1981), making mock. For England, Simon Jenkins, Accountable to None (1995), is a brilliant book. David Frum, Dead Right (1995), shows how developments in finance derailed affairs in the USA.


pages: 430 words: 109,064

13 Bankers: The Wall Street Takeover and the Next Financial Meltdown by Simon Johnson, James Kwak

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Andrei Shleifer, Asian financial crisis, asset-backed security, bank run, banking crisis, Bernie Madoff, Bonfire of the Vanities, bonus culture, capital controls, Carmen Reinhart, central bank independence, collapse of Lehman Brothers, collateralized debt obligation, corporate governance, Credit Default Swap, credit default swaps / collateralized debt obligations, crony capitalism, Edward Glaeser, Eugene Fama: efficient market hypothesis, financial deregulation, financial innovation, financial intermediation, financial repression, fixed income, George Akerlof, Gordon Gekko, greed is good, Home mortgage interest deduction, Hyman Minsky, income per capita, interest rate derivative, interest rate swap, Kenneth Rogoff, laissez-faire capitalism, late fees, Long Term Capital Management, market bubble, market fundamentalism, Martin Wolf, moral hazard, mortgage tax deduction, Ponzi scheme, price stability, profit maximization, race to the bottom, regulatory arbitrage, rent-seeking, Robert Shiller, Robert Shiller, Ronald Reagan, Saturday Night Live, sovereign wealth fund, The Myth of the Rational Market, too big to fail, transaction costs, value at risk, yield curve

The economic and political elites could agree that innovation was good, and that homeownership was good. But the ideology of finance went beyond the idea that Wall Street was good for America. Banking was not only the center of the U.S. economy—it became cool, seductive, and even sexy. In 1987, Tom Wolfe’s novel The Bonfire of the Vanities introduced the term “Master of the Universe” to American culture, in the form of multimillionaire investment banker Sherman McCoy, who lived in “the sort of apartment the mere thought of which ignites flames of greed and covetousness under people all over New York and, for that matter, all over the world.”72 Although the term was used sarcastically, and McCoy turns out badly in both the human and financial senses, the image of the swashbuckling, super-rich banker engaged in transactions too complex to be understood by ordinary mortals was born.

Census Bureau, Income, Poverty, and Health Insurance Coverage, supra note 33, at Table A-1. 71. Alan Greenspan, “Consumer Finance” (lecture, Federal Reserve System’s Fourth Annual Community Affairs Research Conference, Washington, D.C., April 8, 2005), available at http://www.federalreserve.gov/BoardDocs/speeches/2005/20050408/ default.htm. 72. Tom Wolfe, The Bonfire of the Vanities (New York: Farrar, Straus & Giroux, 1987), 9. 73. Stanley Weiser, “Repeat After Me: Greed Is Not Good,” Los Angeles Times, October 5, 2008, available at http://articles.latimes.com/2008/oct/05/entertainment/ca-wallstreet5. 74. Michael Lewis, “The End,” Portfolio, December 2008, available at http://www.portfolio.com/news-markets/national-news/portfolio/2008/11/11/The-End-of-Wall-Streets-Boom. 75.


pages: 309 words: 91,581

The Great Divergence: America's Growing Inequality Crisis and What We Can Do About It by Timothy Noah

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autonomous vehicles, blue-collar work, Bonfire of the Vanities, Branko Milanovic, call centre, collective bargaining, computer age, corporate governance, Credit Default Swap, David Ricardo: comparative advantage, Deng Xiaoping, Erik Brynjolfsson, feminist movement, Frank Levy and Richard Murnane: The New Division of Labor, Gini coefficient, income inequality, industrial robot, invisible hand, job automation, Joseph Schumpeter, low skilled workers, lump of labour, manufacturing employment, moral hazard, oil shock, pattern recognition, performance metric, positional goods, post-industrial society, postindustrial economy, purchasing power parity, refrigerator car, rent control, Richard Feynman, Richard Feynman, Ronald Reagan, shareholder value, Silicon Valley, Simon Kuznets, Stephen Hawking, Steve Jobs, The Spirit Level, too big to fail, trickle-down economics, Tyler Cowen: Great Stagnation, union organizing, upwardly mobile, very high income, War on Poverty, We are the 99%, women in the workforce, Works Progress Administration, Yom Kippur War

But according to the Central Intelligence Agency (whose patriotism I hesitate to question), income distribution in the United States is now more unequal than in Uruguay, Nicaragua, Guyana, and Venezuela, and roughly on par with Argentina.35 Income inequality is actually declining in Latin America even as it continues to increase in the United States.36 Economically speaking, the richest nation on Earth is starting to resemble a banana republic. The main difference is that the United States is big enough to maintain geographic distance between the villa-dweller and the beggar. As Ralston Thorpe tells his St. Paul’s classmate, the investment banker Sherman McCoy, in Tom Wolfe’s 1987 novel The Bonfire of the Vanities: “You’ve got to insulate, insulate, insulate.” Why do Americans tolerate this troubling state of affairs? The biggest likely reason is our enduring belief in upward mobility. Economic inequality is less troubling if you live in a country where any child, no matter how humble his or her origins, can grow up to be president.

Thompson, The Politics of Inequality: A Political History of the Idea of Economic Inequality in America (New York: Columbia University Press, 2007). Jeffrey G. Williamson, Inequality, Poverty, and History (Cambridge, MA: Basil Blackwell, 1991). Jeffrey G. Williamson and Peter H. Lindert, American Inequality: A Macroeconomic History (New York: Academic Press, 1980). Tom Wolfe, The Bonfire of the Vanities (New York: Farrar Straus, 1987). 1. Three years before Willford I. King’s book appeared, Frank Hatch Streightoff, an instructor in economics at DePauw, published a book called The Distribution of Incomes in the United States (New York: Columbia University, 1912). But on page 155, Streightoff threw in the towel.


pages: 323 words: 95,188

The Year That Changed the World: The Untold Story Behind the Fall of the Berlin Wall by Michael Meyer

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Ayatollah Khomeini, bank run, Berlin Wall, Bonfire of the Vanities, Bretton Woods, BRICs, call centre, Fall of the Berlin Wall, falling living standards, Francis Fukuyama: the end of history, haute couture, Mikhail Gorbachev, mutually assured destruction, Ronald Reagan, Ronald Reagan: Tear down this wall, union organizing

Because it goes to the heart of democracy and the nation’s social and economic troubles.” Failure to reach what Geremek called a new “social contract” could lead to more than a war within the party. It could easily touch off a social “explosion.” The novelist Tom Wolfe, in his 1980s bestseller Bonfire of the Vanities, anointed one Reverend Bacon as the man who controlled “the steam” in New York, twisting a social safety valve to release pent-up pressure when racial relations approached the bursting point, or notching them up when he wanted to make a political point. In Poland in early 1989, that role fell to General Jaruzelski.

., 222 Beyond the Wall (Pond), 227, 234 Bill of Rights, U.S., 30 Bismarck Strasse (Berlin), 15 Black Friday (Czech). See Velvet Revolution (Prague; 1989) Bloc That Failed, The (Gati), 39, 224 BMW, 72, 161, 228–229 Bogomolov, Oleg, 63 Bölling, Klaus, 121 Bolshevik Revolution (1917), 65–66, 85 Bond, James, 21 Bonfire of the Vanities (Wolfe), 53 border guards at the Berlin Wall, 3, 5–10, 15–17, 27, 97–105 fall of Berlin Wall and, 5–10, 97–104, 168–170 Boyd, Gerald M., 222 Brain race, 21 Brandenburg Gate, Berlin Wall, 3, 15, 170, 204 Brazil, 217 Breslau, Karen, 167 Bretton Woods Agreement, 21 Brezhnev, Leonid, 39, 45, 71, 91, 225–226 Brezhnev Doctrine, 39, 45, 63, 91, 227 Brian Lapping Associates, 228 Brokaw, Tom, 9, 183 Brookings Institution, Nuclear Audit, 22–23, 223–224 Bucharest, 105–111 Ceaucescu’s home, 198–200 Ceaucescu’s palace, 107, 198–199 fall of communism and, 193–201 Warsaw Pact summit (1989), 91–95 See also Romania Buckley, William F., Jr., 223 Budapest fall of communism in Hungary, 28, 29–39, 41–42, 46, 61, 66–74, 125, 128, 137, 139–140, 143–145 People’s Picnic (1989), 66–67 reburial of Imre Nagy, 84–88 See also Hungary Bulgaria, fall of communism in, 190–191 Bulletin of Atomic Scientists, 227 Bush, George H.


pages: 338 words: 106,936

The Physics of Wall Street: A Brief History of Predicting the Unpredictable by James Owen Weatherall

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Albert Einstein, algorithmic trading, Antoine Gombaud: Chevalier de Méré, Asian financial crisis, bank run, Benoit Mandelbrot, Black Swan, Black-Scholes formula, Bonfire of the Vanities, Bretton Woods, Brownian motion, butterfly effect, capital asset pricing model, Carmen Reinhart, Claude Shannon: information theory, collateralized debt obligation, collective bargaining, dark matter, Edward Lorenz: Chaos theory, Emanuel Derman, Eugene Fama: efficient market hypothesis, financial innovation, George Akerlof, Gerolamo Cardano, Henri Poincaré, invisible hand, Isaac Newton, iterative process, John Nash: game theory, Kenneth Rogoff, Long Term Capital Management, Louis Bachelier, mandelbrot fractal, martingale, new economy, Paul Lévy, prediction markets, probability theory / Blaise Pascal / Pierre de Fermat, quantitative trading / quantitative finance, random walk, Renaissance Technologies, risk-adjusted returns, Robert Gordon, Robert Shiller, Robert Shiller, Ronald Coase, Sharpe ratio, short selling, Silicon Valley, South Sea Bubble, statistical arbitrage, statistical model, stochastic process, The Chicago School, The Myth of the Rational Market, tulip mania, V2 rocket, volatility smile

If banks couldn’t borrow from one another for less than 20%, surely corporations and governments that were trying to issue bonds would need to pay even higher rates (since typically bonds are more risky than interbank loans). The so-called bond bores of the 1970s, traders who had chosen to work in the least exciting of the financial markets, now needed to cope with the most variable market of all. (Sherman McCoy, the star-crossed antihero of Tom Wolfe’s novel Bonfire of the Vanities, was an eighties-era bond trader who took himself to be so important, given the changes in the bond markets during the late seventies and early eighties, that he privately called himself a “Master of the Universe.” The name has stuck, now used to refer to Wall Street traders of all stripes.)

Barron’s, May 11. Wilson, E. B. 1901. Vector Analysis. New York: Charles Scribner’s Sons. — — — . 1912. Advanced Calculus. Boston: Ginn and Company. — — — . 1931. “Reminiscences of Gibbs by a Student and Colleague.” Bulletin of the American Mathematical Society 37 (6). Wolfe, Tom. 1987. Bonfire of the Vanities. New York: Farrar, Straus and Giroux. Wood, John Cunningham, and Michael McClure. 1999. Vilfredo Pareto: Critical Assessments of Leading Economists. London: Routledge. Wu, Tai Tsun, and Chen Ning Yang. 1975. “Concept of Nonintegrable Phase Factors and Global Formulation of Gauge Fields.”


pages: 391 words: 102,301

Zero-Sum Future: American Power in an Age of Anxiety by Gideon Rachman

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Asian financial crisis, bank run, battle of ideas, Berlin Wall, Big bang: deregulation of the City of London, Bonfire of the Vanities, borderless world, Bretton Woods, BRICs, capital controls, centre right, clean water, collapse of Lehman Brothers, colonial rule, currency manipulation / currency intervention, deindustrialization, Deng Xiaoping, Doha Development Round, energy security, failed state, Fall of the Berlin Wall, financial deregulation, Francis Fukuyama: the end of history, full employment, global reserve currency, greed is good, Hernando de Soto, illegal immigration, income inequality, invisible hand, Jeff Bezos, laissez-faire capitalism, market fundamentalism, Martin Wolf, Mexican peso crisis / tequila crisis, Mikhail Gorbachev, moral hazard, mutually assured destruction, Naomi Klein, offshore financial centre, open borders, open economy, Peace of Westphalia, peak oil, pension reform, Plutocrats, plutocrats, price stability, RAND corporation, reserve currency, rising living standards, road to serfdom, Ronald Reagan, shareholder value, Sinatra Doctrine, sovereign wealth fund, special economic zone, Steve Jobs, Stewart Brand, The Chicago School, The Great Moderation, The Myth of the Rational Market, Thomas Malthus, trickle-down economics, Washington Consensus, Winter of Discontent

By 2006, the richest 1 percent gobbled up 23 percent of national wealth.16 In the United States and the United Kingdom, the success of the free-market reforms of the 1980s was closely associated with a boom in the financial services industry, which was swiftly reflected in house prices and popular culture. In the States, the boom was captured in the film Wall Street, with its catchphrase “greed is good,” and in Tom Wolfe’s novel The Bonfire of the Vanities. The Dow Jones Industrial Average, which stood at 950 on the day Reagan took office, reached a peak of over 2,700 in August 1987—before the stock-market crash of October of that year.17 Some of Reagan’s critics on the left never accepted that his economic policies had succeeded. They saw them as a cruel sleight of hand, fueled by unsustainable tax cuts and deficit spending and hopelessly tilted towards the wealthy.

INDEX Abalkin, Leonid, 56–57 Adelman, Kenneth, 167 Afghanistan, 55, 174, 199, 208–12, 244, 251–56, 258 as failed state, 10, 132, 181 U.S. war in, 96, 165, 167, 169, 174, 181, 185, 209–10, 212, 230, 233, 239, 240, 249, 252–53, 254, 268, 272, 273, 314n Africa, 7, 96, 195, 228, 235, 247, 274, 283, 289 global problems and, 205–8 African National Congress, 36, 69 African Union force, 210 Aganbegyan, Abel, 56–57 Age of Anxiety, 11, 171–292 Age of Optimism, 6, 11, 85, 91–170, 173–75, 183, 188, 191, 194, 195, 208, 231, 246–49, 259–62, 271, 272, 277, 280, 281, 286 antiglobalization movement and, 96, 153, 155–62 democracy and, 99–105 the East and, 135–43 Europe and, 145–53, 290 new world order in, 87, 93, 95–96, 230 peace and, 103, 118, 126–34, 140, 304n power and, 93, 96, 118, 162–70 progress and, 118–26 prosperity and, 107–18, 133, 134, 140, 173, 194 Age of Transformation, 11, 13–90 agriculture, 56, 125, 195, 206, 290 in China, 23, 25, 294n Ahmadinejad, Mahmoud, 197, 227, 242, 244, 248 Ahmed, Kamal, 313n AIG, 201 air-traffic controllers, 39 Albright, Madeleine, 166 Aliber, Robert, 265 Allende, Salvador, 74 al-Qaeda, 10, 96, 156–57, 161–62, 210, 252, 256 American Enterprise Institute (AEI), 39, 163–64, 167–68 Angola, 43, 131, 205, 247 Annan, Kofi, 132 antiglobalization movement, 96, 153, 155–62 antitrust cases, 120 apartheid, 69, 70 Apple, 120, 261 Aquino, Corazon, 43 Arab world, 269 Argentina, 77, 78, 188 democracy in, 17, 71, 72 Falklands War and, 34, 73, 76 military regime in, 73, 75, 76 Arizona, 211, 260 Asia, 24, 66, 94, 110, 111, 114, 117, 134–43, 157, 184, 195, 200, 205, 217, 245, 256, 274, 279 democracy in, 18, 85, 94, 283 economic crisis in (1997–98), 6, 107–8, 141–43, 159, 218, 269 rise of, 4, 6, 8, 9, 46, 59–60, 73, 80, 95, 137–40, 143, 146, 173, 262 see also East Asia; specific places Asian values, 138 Aslund, Anders, 221 Audacity of Hope, The (Obama), 170 Austria, 68, 269 authoritarianism, 9, 75–76, 124, 138, 140, 174, 175–76, 233–49, 257, 283, 284 global government and, 220, 221, 223, 231 Axis of Hugo, 241–42, 249 Baghdad, 124, 125, 148, 253–54 bailouts, 113, 142, 188–89, 195 Balkan wars, 125, 130–33, 145, 146 Balls, Ed, 3 Baltic states, 58–59, 235 Bangalore, 84–85, 141 banks, 142, 159, 191–92, 200 see also investment banks BBC, 108, 279 Beijing, 15, 25, 27, 65, 137, 190, 202–3, 206, 234–38, 240, 261, 268, 305n Tiananmen Square massacre in, see China, Tiananmen Square massacre in Belarus, 59 Belgrade, U.S. bombing of Chinese embassy in, 268 Berlin, East, 65 Berlin, West, 63 Berlin Wall, fall of, 11, 43, 63, 67, 68, 69, 73, 143, 146, 147, 149, 150, 152, 165, 180, 312n-13n Bernanke, Ben, 116–17 Bezos, Jeff, 120 Bhutto, Benazir, 211, 252 Blair, Tony, 43–44, 114–15, 118, 132, 201–2, 279–80 Bloom, Allan, 99, 100, 104 Boeing, 6, 155 Bolivia, 72, 78, 242 Bonfire of the Vanities, The (Wolfe), 40 Boot, Max, 146, 167, 168 Bosnia, 131, 132, 133, 231 Branden, Nathaniel, 109 Brazil, 17, 71, 73, 75–78, 176, 244, 245, 246, 286 in BRICs, 76–77, 196 global government and, 217, 219, 226, 227 zero-sum future and, 262, 276 Bremmer, Ian, 193 Bretton Woods, 9 Brezhnev, Leonid, 54, 64 Brezhnev Doctrine, 64, 67 Brickell, Mark, 112–13 BRICs (Brazil, Russia, India, and China), 76–77, 196 Bright, John, 128 Brookings Institution, 139, 256 Brown, Gordon, 3, 114, 117 Brussels, 213, 215, 311n Buchanan, Pat, 42, 157–58, 260 Bulgaria, 145–48 Burma, 160, 227, 274, 275 Bush, George H.


pages: 314 words: 101,452

Liar's Poker by Michael Lewis

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barriers to entry, Bonfire of the Vanities, cognitive dissonance, corporate governance, financial independence, financial innovation, Home mortgage interest deduction, interest rate swap, London Interbank Offered Rate, margin call, mortgage tax deduction, nuclear winter, Ponzi scheme, The Predators' Ball, yield curve

His mouth never seemed to alter in shape; rather it expanded and contracted proportionally when he spoke. And out of that mouth came a steady stream of bottom-line analysis and profanity. The Piranha, that day, began by devouring the government of France. The French government had issued a bond known as the Giscard (yes, the one described by Tom Wolfe in Bonfire of the Vanities. Wolfe learned of the Giscard from a Salomon trader; in fact, to research his fictional bond salesman, Wolfe had come to 41 and sat spitting distance from the Human Piranha). The Piranha was troubled by the Giscard, so dubbed because it had been the brainchild of the government of Valery Giscard d'Estaing.

That morning I looked into the Japanese market, saw that it was indeed the case, and wondered why I had dreamed of it, since I couldn't recall having ever spoken of the subject. Gobbledygook to you, perhaps. A second language to me. *One of Alexander's financial heroics found its distorted way to the center of Tom Wolfe's Bonfire of the Vanities. Wolfe describes his protagonist, Sherman McCoy, getting himself in trouble with the gold-backed French government bonds, the so-called Giscard bonds It was Alexander who had first discovered the Giscard was mispnced, and far from getting himself in trouble he made many millions of dollars exploiting the mispncing Many of the trades that Alexander suggested followed one of two patterns.


pages: 741 words: 179,454

Extreme Money: Masters of the Universe and the Cult of Risk by Satyajit Das

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affirmative action, Albert Einstein, algorithmic trading, Andy Kessler, Asian financial crisis, asset allocation, asset-backed security, bank run, banking crisis, banks create money, Basel III, Benoit Mandelbrot, Berlin Wall, Bernie Madoff, Big bang: deregulation of the City of London, Black Swan, Bonfire of the Vanities, bonus culture, Bretton Woods, BRICs, British Empire, capital asset pricing model, Carmen Reinhart, carried interest, Celtic Tiger, clean water, cognitive dissonance, collapse of Lehman Brothers, collateralized debt obligation, corporate governance, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, Daniel Kahneman / Amos Tversky, debt deflation, Deng Xiaoping, deskilling, discrete time, diversification, diversified portfolio, Doomsday Clock, Emanuel Derman, en.wikipedia.org, Eugene Fama: efficient market hypothesis, eurozone crisis, Fall of the Berlin Wall, financial independence, financial innovation, fixed income, full employment, global reserve currency, Goldman Sachs: Vampire Squid, Gordon Gekko, greed is good, happiness index / gross national happiness, haute cuisine, high net worth, Hyman Minsky, index fund, interest rate swap, invention of the wheel, invisible hand, Isaac Newton, job automation, Johann Wolfgang von Goethe, joint-stock company, Joseph Schumpeter, Kenneth Rogoff, Kevin Kelly, labour market flexibility, laissez-faire capitalism, load shedding, locking in a profit, Long Term Capital Management, Louis Bachelier, margin call, market bubble, market fundamentalism, Marshall McLuhan, Martin Wolf, merger arbitrage, Mikhail Gorbachev, Milgram experiment, Mont Pelerin Society, moral hazard, mortgage debt, mortgage tax deduction, mutually assured destruction, Naomi Klein, Network effects, new economy, Nick Leeson, Nixon shock, Northern Rock, nuclear winter, oil shock, Own Your Own Home, pets.com, Plutocrats, plutocrats, Ponzi scheme, price anchoring, price stability, profit maximization, quantitative easing, quantitative trading / quantitative finance, Ralph Nader, RAND corporation, random walk, Ray Kurzweil, regulatory arbitrage, rent control, rent-seeking, reserve currency, Richard Feynman, Richard Feynman, Richard Thaler, risk-adjusted returns, risk/return, road to serfdom, Robert Shiller, Robert Shiller, Rod Stewart played at Stephen Schwarzman birthday party, rolodex, Ronald Reagan, Ronald Reagan: Tear down this wall, savings glut, shareholder value, Sharpe ratio, short selling, Silicon Valley, six sigma, Slavoj Žižek, South Sea Bubble, special economic zone, statistical model, Stephen Hawking, Steve Jobs, The Chicago School, The Great Moderation, the market place, the medium is the message, The Myth of the Rational Market, The Nature of the Firm, The Predators' Ball, The Wealth of Nations by Adam Smith, Thorstein Veblen, too big to fail, trickle-down economics, Turing test, Upton Sinclair, value at risk, Yogi Berra, zero-coupon bond

Serve in opaque tumbler of awed, ill informed media coverage.1 Hedge fund managers: “considered [themselves] part of the new era and the new breed, a Wall Street egalitarian, a Master of the Universe, who was only a respecter of performance.”2 The original Masters of the Universe were HeMan and his Friends in the 1980s popular children’s cartoon. Tom Wolfe used the term to satirize his bond trader protagonist in Bonfire of the Vanities. In 2009, Lloyd Blankfein, CEO of Goldman Sachs, unconsciously borrowed from Wolfe to justify bumper profits: “performance is the ultimate narrative.”3 By the new millennium, Wolfe admitted that hedge fund managers had superseded bankers as the new Masters of the Universe. Keeping Up with the Joneses Hedge funds came to prominence when Soros broke the Bank of England and the pound sterling on Black Wednesday, September 16, 1992.

David McNally “From financial crisis to world slump: accumulation, financialization, and the global slowdown” (15 December 2008), expanded version of a paper presented to the plenary session (“The global financial crisis: causes and consequences”), 2008 Historical Materialism Conference, University of London (http://marxandthefinancialcrisisof2008.blogspot.com/2008/12/david-mcnally-from-financial-crisis-to.html). 40. Alan Greenspan, Testimony to the House Committee on Oversight and Government Reform (23 October 2008). Chapter 15—Woodstock for Hedge Funds 1. Martin Baker (1995) A Fool and His Money, Orion Books, London: 157, 158. 2. Tom Wolfe (1988) The Bonfire of the Vanities, Picador, London: 64. 3. Tony Tassell “The Goldman Sachs narrative” (8 February 2010) Financial Times. 4. Quoted in Robert Slater (2009) Soros: The World’s Most Influential Investor, McGraw Hill, New Jersey: 178. 5. Philip Delves Broughton (2009) Ahead of the Curve: Two Years at Harvard Business School, Penguin Books, New York: 99. 6.

See also Warren Buffet Berle, Adolf, 54 Berlin Wall, fall of, 101, 295 Bernanke, Ben, 170, 182, 203, 303, 338, 366 debt, 267 Great Moderation, 277 on 60 Minutes, 343 September, 2008, 342 Bernstein, Peter, 26, 129, 208 Besley, Tim, 278 Best, George, 88 beta (market returns), 241 Beveridge Report, 47 Beveridge, Sir William, 47 Beyond Belief, 338 Bhagavad Gita, 339 Bhide, Amar, 312 BHP Billiton, 59 bias, 243 Bieber, Matthew, 198 Bierce, Ambrose, 326 Big Short, The, 198 Biggs, Barton, 99 Bild, 358 Billboard Top 100 Chart, 124 Billings, Josh, 233 billionaire drivel, 327 bills of exchange, 32 bimetallism, 26 bio-fuels, 334 Bird, John, 91, 320 Black Swan, The, 95, 126 Black Wednesday, 240 Black, Fischer, 121, 127 black-box trading, 242 Black-Scholes models, 120-122, 277 Black-Scholes-Merton (BSM) option, 121 Blackrock, 170 Blackstone, 167, 325 Blackstone Group, The, 154, 318 Blair, Tony, 81 Blankfein, Lloyd, 239, 364 Blinder, Alan, 129 Blomkvist, Mikhael, 360 Bloomberg TV, 92 Bloomberg, Michael, 164 Bloomsbury group, 29 Blue Force, 264 Blumberg, Alex, 185 Boao Forum, 324 boards of directors, knowledge of business operations, 292-293 BOAT (Best of All Time), 228 Boesky, Ivan, 147, 244 Bogle, Jack, 123 Bohr, Niels, 101, 257 Boiler Room, 185 Bonanza, 31 Bond, James, 26 Bonderman, David, 154, 164, 318 bonds, 169 adjustable rate, 213 failure of securitization, 204-205 high opportunity, 143 insurance, 176 junk, 143, 145-146 Milken’s mobsters, 146-147 municipal, 211-214 PAC (planned amortization class), 178 ratings, 143, 282-285 securitization, 173 TAC (target amortization class), 178 TOBs (tender option bonds), 222 U.S. Treasury, 87, 174 VADM (very accurately defined maturity), 178 Bonfire of the Vanities, 239 bonuses, 317-318 books, financial, 96-98 boom and bust cycles, 305 Booth School of Business, 116 Borges, Jorge Luis, 210 Born, Brooksley, 300 borrowing levels, increase in, 265, 267-268 Boston Post, 34 Bottomley, Horatio, 89 Bourdieu, Pierre, 308 Bouton, Daniel, 227 Bowers, David, 357 Bowie Bonds, 168 Bowie, David, 157, 168, 186 Bowsher, Charles, 272 Boy, John, 330 BP (British Petroleum), Gulf of Mexico oil spill, 361 Braddock, Ben, 308 Brandenburg Gate, Ronald Reagan’s speech at, 101 Brazilian reals, 21 Breeden, Richard, 292, 296 Bretton Woods, 29-30 BRIC (Brazil, Russia, India, and China), 90 bridges, 150, 158 Bridgewater, 327 Bright-Sided: How the Relentless Promotion of Positive Thinking Has Undermined America, 186 British Aluminum (BA), 57 British pound sterling, 22 Brodsky, Joseph, 44 brokers money, 22 mortgages, 186 Brown, Gordon, 81, 342, 347 Brown, Ian Harold, 35 Bryan, William Jennings, 26, 324 bubbles, 277-278 economies, 39, 54 end of, 329 price, 299 Buckely, Christopher, 98 budget deficits, 1970s, 104 Buffett, Warren, 154, 202, 276, 325-326 bonuses, 319 compensation, 316 derivatives, 211, 225, 236 end of bubble, 329 Financial Times, 206 Gen Re Securities, 231 GE stock, 344 hedge funds, 261 ownership percentage of Moody’s, 283 purchase of, 322 bugs, gold, 28 Bulletin of Atomic Scientists, 34 bullion, gold.


pages: 423 words: 126,096

Our Own Devices: How Technology Remakes Humanity by Edward Tenner

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Bonfire of the Vanities, card file, Douglas Engelbart, Frederick Winslow Taylor, future of work, indoor plumbing, informal economy, invention of the telephone, invisible hand, Jacquard loom, Joseph-Marie Jacquard, Network effects, optical character recognition, QWERTY keyboard, Stewart Brand, women in the workforce

The FBI is able to identify 70 percent of the footwear impressions it receives, according to the former head of its footwear unit, William J. Bodziak.5 Sneakers are as suited for self-assertion as for flight. The bouncing and dragging “pimp walk” was a staple of black exploitation films of the 1960s and early 1970s, just before the sneaker explosion. In Tom Wolfe’s 1987 novel Bonfire of the Vanities, youthful black defendants in the Bronx County Courthouse defy officialdom with the pimp walk’s successor, an insolent gait called the “pimp roll,” a “pumping swagger” that another writer, a London journalist, has described as “that swaying, strutting way you walk when your soles are bouncy and your ankles supported”—a gait less feasible in sandals than in running shoes.

Bodziak, Footwear Impression Evidence (New York: Elsevier, 1990); Andrea Codrington, “Technology and Design Run Wild in the Soles of the Newest Sneakers,” New York Times, November 6, 1997. 6. John W. Fountain, “Noted with … Pride; Way Black When,” Washington Post, July 25, 1999; Tom Wolfe, Bonfire of the Vanities (New York: Farrar, Straus and Giroux, 1987), 110; William Leith, “Pump It Up,” The Independent (London), July 8, 1990. 7. Michelle Higgins, “The Ballet Shoe Gets a Makeover, but Few Yet See the Pointe,” Wall Street Journal, August 18, 1998. 8. Wolfgang Decker, “Die Lauf-Stele des Königs Taharka,” Kölner Beiträge zur Sportwissenschaft, vol. 13 (1984), 7–37; E.


pages: 407 words: 136,138

The Working Poor: Invisible in America by David K. Shipler

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Bonfire of the Vanities, call centre, David Brooks, full employment, illegal immigration, late fees, low skilled workers, payday loans, profit motive, Silicon Valley, telemarketer, The Bell Curve by Richard Herrnstein and Charles Murray, union organizing, Upton Sinclair, War on Poverty, working poor

And I think this is an American problem … this advertising, you got to have this, you got to have the newest, the latest, the best, and so on—and that is, I think, an American problem.” Overspending is certainly not the exclusive province of the poor. Tom Wolfe, capturing the opposite side of Horatio Alger’s America, deftly caricatures the foibles of the affluent. “I’m already going broke on a million dollars a year!” the bond trader screams to himself in The Bonfire of the Vanities: The appalling figures came popping up into his brain. Last year his income had been $980,000. But he had to pay out $21,000 a month for the $1.8 million loan he had taken out to buy the apartment. What was $21,000 a month to someone making a million a year? That was the way he had thought of it at the time— and in fact, it was merely a crushing, grinding burden—that was all!

., New York Times, Mar. 26,1999, p. Ci. 10. Consumer Reports, January 2001, pp. 20–24. 11. Geraldine Fabrikant, New York Times, Dec. 3, 2000, Section 3, p. 17. 12. Vivienne Hodges and Stuart Margulies, Stanford çth Language Arts Coach Grade 4 (New York: Educational Design, 1998). 13. Tom Wolfe, The Bonfire of the Vanities (New York: Bantam, 1987), pp. 142–43. Chapter Two: Work Doesn’t Work 1. Alan Weil and Kenneth Finegold, Welfare Reform: The Next Act (Washington, D.C.: Urban Institute Press, 2002). Introduction at http://www.urban.org/pubs/welfare_reform/intro.html. 2. Robert Lerman, “Single Parents’ Earnings Monitor,” Urban Institute, Oct. 26, 2001, and Dec. 26, 2002, available at www.urban.org. 3.


pages: 474 words: 136,787

The Red Queen: Sex and the Evolution of Human Nature by Matt Ridley

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affirmative action, Alfred Russel Wallace, Atahualpa, Bonfire of the Vanities, demographic transition, double helix, Drosophila, feminist movement, invention of agriculture, Menlo Park, phenotype, rent control, theory of mind, University of East Anglia, women in the workforce

In a good year for mice, a male can catch so many mice that he can simultaneously give two females the impression that he is a fine male; he can provide each with more mice than he could catch for one in a normal year.36 Nordic forests seem to be full of deceitful adulterers, for a similar habit by a deceptively innocent-looking little bird led to a long-running dispute in the scientific literature of the 1980s. Some male pied flycatchers, in the forests of Scandinavia, manage to be polygamous by holding two territories, each with a female in it, like the owls or like Sherman McCoy in Tom Wolfe’s The Bonfire of the Vanities, who keeps an expensive wife on Park Avenue and a beautiful mistress in a rent-controlled apartment across town. Two teams of researchers have studied the birds and come to different conclusions about what is going on. The Finns and Swedes say that the mistress is deceived into believing that the male is unmarried.

., 224 Bernstein, Harris, 41–4 Betzig, Laura, 120, 191–4, 232 Bilharzia, 72, 78 Birds concealed ovulation among, 223 mating systems of, 209, 213–16, 219 parasites of, 146–7 sex chromosomes in, 116–17 sexual selection in, 133–7, 138–9, 158 See also specific species Birds of paradise, 143–4 Birkhead, Tim, 214, 215, 219 Blind Watchmaker, The (Dawkins), 15 Bloom, Paul, 318, 321 Bodmer, Walter, 81 Bogart, Humphrey, 199 Bonfire of the Vanities (Wolfe), 225 Bonobos, 208–9, 222 Borgia, Cesare, 273 Bosnia, 198 Botticelli, Sandro, 272, 280 Bounty (ship), 195 Bowerbirds, 143, 158 Boyce, Mark, 147 Brain critical period and, 276–7 of dolphins, 299–300 gender differences in, 239 hormones and, 246–50, 255–6 mechanisms of, 311–13 neoteny and, 316–18 progression in size of, 300–303 toolmaking and, 313–14 Brain Sex (Moir and Jessel), 247 Bremermann, Hans, 71–2, 73, 74 Brooks, Lisa, 28 Brown, Don, 198 Buddha, 21 Budding, 48 Burley, Nancy, 117, 160, 216, 223 Burt, Austin, 59–60, 68–9, 83 Buss, David, 259–60, 265, 290 Butler, Samuel, 127 Byrne, Richard, 324–5 Caesar, Julius, 193, 325 Caligula, 193, 273 Carotenoids, 151, 159 Carroll, Lewis, 2 Catherine of Aragon, 233 Catholic Church, 222 controversies with state, 232–3 Cattle breeding, 119 Chaffinches, 277–8 Chagnon, Napoleon, 196–7 Chemical defence, 68 Chimpanzees, 6–7, 206–9, 211–12 intelligence of, 325–6 power seeking among, 188 promiscuity of, 205 toolmaking by, 313 violence of, 196 China ancient, 191, 192, 199 female infanticide in, 117, 122 harem polygamy in, 186 marriage customs in, 275 Chlamydomonas, 97, 98 Chloroplasts, 96–7 Chomsky, Noam, 304, 311, 318 Chromosomes, 29, 42, 43, 90 crossovers on, 60 jumping genes and, 91–2 parasitic, 69 selfish, 92 sex, 95, 105–10, 116–18, 256, 271 swapping of chunks of, 94–5 Claudius, 193 Clutton-Brock, Tim, 112 Coalitions of males, 189–90 Coelacanth, 31, 60 Cognitive approach, 311 Cohen, Fred, 66–7 Coming of Age in Samoa (Mead), 308 Commons, tragedy of, 87, 122 Communication, 321–3 Competition, 62, 63, 89–90 diversity and, 57–8 female, 224 sexual selection and, 129, 132 within species, 33–4 testicular size and, 214 violence and, 195 Complexity, 15 Computer viruses, 66–7 Concealed ovulation, 222–4 Conditioning, 172, 244 Conflict, 17–19 Conjugation, 91, 98 Connectionism, 310 Connor, Richard, 189, 326 Contingent history, 17 Coolidge, Calvin, 290 Cooperation, 17–19 among genes, 88–90 individual selection and, 36 reciprocity as key to, 74 Corals, 55–6 Cortisol, 151, 247, 256 Cosmides, Leda, 96, 106, 267, 303, 311, 321, 323, 324, 329 Cott, Hugh, 131 Courtly love, 232 Courtship, 128, 129, 150, 163, 164 competition and, 132–3 Cousins, marriage between, 234 Critical period, 276–8 Cronin, Helena, 138 Crook, John, 321 Crossing over, 94–5, 122 Crow, James, 32, 48 Cytomegalovirus, 99 Dahomey, 168 Daly, Martin, 227–8 Dart, Raymond, 314 Darwin, Charles, 6, 8, 9, 14, 19, 27, 31–3, 36, 58, 61, 130–32, 134, 135, 138, 143, 158, 214, 241, 295, 301, 319 Darwin, Erasmus, 24, 232 Darwinian history, 235–6 Dawkins, Marian, 154, 156 Dawkins, Richard, 9, 15, 63, 65, 92, 118–19, 153, 323 Deep structure of language, 304 Deer, 180 Democracy, 199 Descartes, René, 306 Descent of Man and Selection in Relation to Sex (Darwin), 130 Despotism, 191–3, 199, 200, 203, 264 Determinism, 252–5 Diamond, Jared, 143, 208 Dickemann, Mildred, 121, 190 Dio, 193 Dionysus effect, 328 Diploidy, 43, 44, 93 Disease theory, 73–6 Dispersal, 54 Division of labour, sexual, 242, 243, 251, 253–4 Divorce, 264–5 DNA, 29, 40, 42, 43–4, 50 discovery of, 8–9 insertions of, 49 parasitic, 92 in sex chromosomes, 116 Dogs, 317 Dolphins, 189, 212, 299–300 Dominance beauty and, 295–6 biased sex ratios and, 112–15, 119–20 and cultural gender bias, 120–22 inheritance of, 230–31 personality and, 289–90 sexual selection and, 143–4 wealth and, 187–8 Dörner, Gunter, 256 Douglas firs, 77 Dunbar, Robin, 206 Durkheim, Emil, 307, 322, 339 Eals, Marion, 243 Ecology, 41, 43–4, 54–61, 62–3, 76–7 intelligence and, 319–20 mating systems and, 180–86 Education, gender differences and, 249 Egypt, ancient, 191 Eleanor of Aquitaine, 234 Eliot, George, 322 Ellis, Bruce, 260, 261, 263, 289, 296 Ellis, Havelock, 294 Elm trees, 56 Endler, John, 158 Environment of evolutionary adaptedness (EEA), 184–6 Ericsson, Roland, 116 ‘Essay on Man, An’ (Pope), 336 Eugenics, 295, 307 Evolution of Sex (Maynard Smith), 40 Exogamy, 113, 114, 182–3 Extinction 61 Extra-pair copulation (EPC), 214 Facial features, 282–8 Fallon, April, 293 Fantasies, sexual, 261–3 Fashion, status and, 291–4 Fat distribution, 154–6 Fei-ti, 192, 199 Felix Holt, the Radical (Eliot), 322 Felsenstein, Joe, 83 Feminism, 252–5 Finches, 160, 246–7 5-alpha-reductase deficiency, 250 Fisher, Helen, 264 Fisher, Ronald, 31, 32, 35, 119, 122, 134–5, 138–42, 143, 159, 281, 288, 330 Flaubert, Gustave, 216 Flax, 71 Flour beetles, 92 Flycatchers, 225 Foley, Robert, 182–4 Foragers, see Hunter-gatherers Ford, Henry, 320 Fossils, 60, 61 of human ancestors, 183, 301, 317 Fox, Robin, 307 Frank, Steve, 93 Free will, 4, 5, 7 Freud, Sigmund, 273–6, 308, 322, 339 Frogs, 156–7 Fruit flies, 93–4, 142, 173 Fungi, 68, 84 bacteria and, 68, 69 Fusion sex, 97–9 Galton, Francis, 287, 339 Game theory, 177, 180, 213 //Gana San people, 187 Gender(s), 13, 87–123 asymmetry between, 171–5 choosing, 122 cultural preference patterns for, 120–22 determination of, 95, 105–10 dominance and, 112–15, 119–20 hermaphroditism versus, 100–103 mentality and, 239–67 and organelles, 96–8, 100–103 parasites altering, 104–5 selling, 115–20 Generations, length of, 68–9 Genes, 8–9, 16, 31–3 altruism and, 36 asexual, 38 of bacteria, 68, 90–91 behaviour and, 306–7, 309 and competition within species, 34 cooperation between, 19, 88–95 crossing over of, 94–5 in defence against parasites, 64 definition of, 29 gender and, 88, 100 histocompatibility, 72–3 homosexuality and, 255–7, 271–2 hormones and, 246 jumping, 82, 91–2 kin selection and, 74 meiotic-drive, 94 mental differences and, 244 mixing of, 30, 53 mutations and, 44–50 neoteny, 330–32 in organelles, 96–8, 100–103 for ornamentation, 140 parliament of, 95, 123 polymorphism and, 69–71, 81 racial differences and, 12–13 repair of, 41–4, 49–50, 60, 83 resistance, 75, 81–2 selfish, 92–4 sex and, 12–13 sex-linked, 330 for sexual reproduction, 36–7 sexual selection and, 136, 137 and tangled bank theory, 59–60 Genetics, 40–41, 42, 44–50 Genome, 29 ‘Gentle Echo on Woman, A’ (Swift), 202 Germanic tribes, 195 Ghiselin, Michael, 36–7, 38, 57 Gibbons, 206, 207 Gibbon, Edward, 193 Gigerenzer, Gerd, 323–4 Goodall, Jane, 114, 188, 207, 325 Gonadotrophin, 118 Gordian, 193 Gorillas, 206, 208, 209, 211, 212 intelligence of, 320 Goshawks, 222 Gosling, Morris, 117 Gould, Stephen Jay, 38–9, 306, 309, 316, 317 Grackles, 160 Gradualism, 60 Grafen, Alan, 93–5 Grant, Valerie, 115, 118 Greece, ancient, 197 Group selection, 34–6, 69 Grouse, 136, 137, 139, 147, 181–2 Guilford, Tim, 154, 156 Guppies, 134, 158–9 Gynodioecious plants, 101 Haig, David, 93–5, 271–2 Haldane, J.


pages: 453 words: 132,400

Flow by Mihaly Csikszentmihalyi

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Albert Einstein, Bonfire of the Vanities, centralized clearinghouse, conceptual framework, correlation does not imply causation, double helix, fear of failure, Ignaz Semmelweis: hand washing, invisible hand, Isaac Newton, job satisfaction, Mahatma Gandhi, meta analysis, meta-analysis, Necker cube, pattern recognition, place-making, Ralph Waldo Emerson, the scientific method, Thomas Kuhn: the structure of scientific revolutions

First of all, wandering in the dark forest, Dante realizes that three fierce beasts are stalking him, licking their chops in anticipation. They are a lion, a lynx, and a she-wolf—representing, among other things, ambition, lust, and greed. As for the contemporary protagonist of one of the bestsellers of 1988, the middle-aged New York bond trader in Tom Wolfe’s Bonfire of the Vanities, Dante’s nemesis turns out to be the desire for power, sex, and money. To avoid being destroyed by them, Dante tries to escape by climbing a hill. But the beasts keep drawing nearer, and in desperation Dante calls for divine help. His prayer is answered by an apparition: it is the ghost of Virgil, a poet who died more than a thousand years before Dante was born, but whose wise and majestic verse Dante admired so much that he thought of the poet as his mentor.

Therapeutic processes in a yoga ashram. American Journal of Psychotherapy 39:253–62. ——. In press. Personal growth in a yoga ashram: A social psychological analysis. The social scientific study of religion, vol. 2. Wittfogel, K. 1957. Oriental despotism. New Haven: Yale University Press. Wolfe, T. 1987. The bonfire of the vanities. New York: Farrar, Straus. Wood, E. 1954. Great system of yoga. New York: Philosophical Library. Wundt, W. 1902. Grundzuge der physiologischen Psychologie, vol. 3. Leipzig. Wynne, E. A. 1978. Behind the discipline problem: Youth suicide as a measure of alienation. Phi Delta Kappan 59:307–15.


pages: 414 words: 119,116

The Health Gap: The Challenge of an Unequal World by Michael Marmot

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active transport: walking or cycling, Affordable Care Act / Obamacare, Atul Gawande, Bonfire of the Vanities, Broken windows theory, Capital in the Twenty-First Century by Thomas Piketty, Carmen Reinhart, Celtic Tiger, centre right, clean water, congestion charging, correlation does not imply causation, Doha Development Round, epigenetics, financial independence, future of work, Gini coefficient, Growth in a Time of Debt, illegal immigration, income inequality, Indoor air pollution, Kenneth Rogoff, Kibera, labour market flexibility, lump of labour, Mahatma Gandhi, meta analysis, meta-analysis, microcredit, New Urbanism, obamacare, paradox of thrift, race to the bottom, Rana Plaza, RAND corporation, road to serfdom, Simon Kuznets, Socratic dialogue, structural adjustment programs, the built environment, The Spirit Level, trickle-down economics, urban planning, Washington Consensus, Winter of Discontent, working poor

I don’t know whether it would lead to less crime. It feels like it might, if there is anything to the broken windows theory.45 What is clear, though, is that women no longer have to stand in long queues to collect water, there is less water-borne disease, and as a result children lose fewer days of school. In Bonfire of the Vanities, the novelist Tom Wolfe talks of his obscenely rich banker achieving ‘isolation’ from the chaos of New York. He could have been living in New York, London or Frankfurt for all the contact he had with people who were not in his rarefied stratum. For people with less money and privilege, and particularly for families, community is where life happens, death too.

Political Economy Research Institute – Working Paper Series. 2013; April(322). 32International Monetary Fund. World Economic Outlook October 2012: Coping with High Debt and Sluggish Growth. Washington DC: IMF, 2012. 33UCL Institute of Health Equity. Reducing the Number of Young People Not in Employment, Education or Training (NEET). Public Health England, 2014. 34Wolfe T. The Bonfire of the Vanities. London: Vintage Books, 1987. 7 DO NOT GO GENTLE 1Gawande A. Being Mortal. London: Profile Books, 2014. 2United Nations Population Fund, HelpAge International. Ageing in the Twenty-First Century: A Celebration and A Challenge. New York: UNFPA, 2012, p. 33. 3Kinsella K, He W, U.S. Census Bureau.


pages: 311 words: 130,761

Framing Class: Media Representations of Wealth and Poverty in America by Diana Elizabeth Kendall

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Bernie Madoff, blue-collar work, Bonfire of the Vanities, call centre, David Brooks, declining real wages, Donald Trump, employer provided health coverage, ending welfare as we know it, framing effect, Georg Cantor, Gordon Gekko, greed is good, haute couture, housing crisis, illegal immigration, income inequality, lump of labour, mortgage tax deduction, new economy, payday loans, Ponzi scheme, Ray Oldenburg, Richard Florida, Ronald Reagan, Saturday Night Live, telemarketer, The Great Good Place, Thorstein Veblen, trickle-down economics, union organizing, upwardly mobile, urban planning, working poor

She is engaged to a young, ambitious Wall Street trader with goals much like Gekko himself had when he became involved in chicanery resembling much of what has contributed to many of this country’s financial problems in the twenty-first century.94 Like the original Wall Street and other films such as the 1980s classic Bonfire of the Vanities, Wall Street 2 highlights price-tag framing: everything (and everybody) has a price, and the higher the price, the greater the zeal with which people will pursue wealth and power at any cost. 9781442202238.print.indb 48 2/10/11 10:46 AM Twenty-Four-Karat Gold Frames 49 Not only does price-tag framing tell media audiences how much the rich pay for their possessions, but it also may suggest that ordinary people can live like millionaires, even if on a reduced scale.

., 7 Berroa, Anna, 96–97 The Betrayal of Work: How Low-Wage Jobs Fail 30 Million Americans and Their Families (Shulman), 158 Betty Crocker, 172 The Beverly Hillbillies, 142 Biagi, Shirley, 223 Biden, Joseph, 175 Biel, Jessica, 114 Blair, Henry William, 127 Blakely, Edward J., 207, 208 Blasi, Gary, 93 Bloom, Orlando, 76 Bloomberg, Michael R., 32, 33 Blue Collar TV, 146 Bobos in Paradise (Brooks), 165–66, 206 The Bold and the Beautiful, 57 Bonfire of the Vanities (1990), 48 Born to Buy: The Commercialized Child and the New Consumer Culture (Schor), 217 Boston Globe, 60 Boston Med, 10 Bourdieu, Pierre, 34 BP oil spill, 16, 30, 137, 139, 216 9781442202238.print.indb 290 Bradley-Martins, charitable activities, 25 Branson, Richard, 62 Brathwaite, Kim, 95–96 Bravo, 12–13, 44 Bricklayers Protective Union, 125 Brittain, Deborah C., 27 Broke, USA: From Pawnshops to Poverty, Inc.


pages: 385 words: 128,358

Inside the House of Money: Top Hedge Fund Traders on Profiting in a Global Market by Steven Drobny

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Albert Einstein, asset allocation, Berlin Wall, Bonfire of the Vanities, Bretton Woods, buy low sell high, capital controls, central bank independence, Chance favours the prepared mind, commodity trading advisor, corporate governance, correlation coefficient, Credit Default Swap, diversification, diversified portfolio, family office, fixed income, glass ceiling, high batting average, implied volatility, index fund, inflation targeting, interest rate derivative, inventory management, Long Term Capital Management, margin call, market bubble, Maui Hawaii, Mexican peso crisis / tequila crisis, moral hazard, new economy, Nick Leeson, oil shale / tar sands, oil shock, out of africa, paper trading, Peter Thiel, price anchoring, purchasing power parity, reserve currency, risk tolerance, risk-adjusted returns, risk/return, rolodex, Sharpe ratio, short selling, Silicon Valley, The Wisdom of Crowds, too big to fail, transaction costs, value at risk, yield curve, zero-coupon bond

After a while, I started thinking, “Is this what I want to do with my life?” I looked at my friends’ careers, and the people who liked their lives the most were the proprietary traders. I started spending my spare time in upstate New York reading finance stuff: Reminiscences of a Stock Operator, Bonfire of the Vanities, Market Wizards, Money Masters—anything I could get my hands on. My game plan was to go to business school; get a job in proprietary trading; work 10 years on the sell side developing my knowledge, experience, contacts, and track record; and then make a move to the buy side. I applied to a bunch of business schools and was offered a fellowship at the University of North Carolina (UNC).

See also Central bank(s)/banking Bank of Canada, 285 Bank of England, 14–15, 113, 152, 161, 166, 175, 274–275, 285 Bank of Japan, 175, 318 Bank paper, 141 Barclays Capital, 134–139, 141, 153 Barings Singapore, 80 Barron’s, 231, 238 Baruch, Bernard, 146–147 Bear/bearish markets, 82–83, 123, 157, 225, 228, 230, 237, 340 Beauty contest, 164–165 Behavioral finance, 152, 159 Bernanke, Ben, 350 Bessent, Scott, 14, 16, 20, 269–288 Bessent Capital, 269 Beta, 8, 282, 328 BHP Billiton, 252 Bid/offer spreads, 45, 61 Big-bet approach, 341–343 Black box trading systems, 332 Black Monday, 11, 212–213 Black Wednesday 1992, 10, 14–17, 29, 114, 275 361 362 Blodgett, Henry, 260 Bond investments, 61, 88, 118, 121–122, 146–147, 157–158, 231, 251 Bond market, 61, 78, 145, 149–151, 193, 225–226, 292, 323, 328 Bond market rout of 1994, 10, 17, 155 Bond prices, 204 Bond rally, 75 Bond specialists, 127 Bonfire of the Vanities (Wolfe), 244 Boom-bust cycle, 167–168 Bosnia, 51 Bottom-up approach, 51, 346 Brady bonds, 296 Brazil/Brazilian real,193, 204, 208–209, 239, 261, 290, 295–296, 327–328, 334–335 Bretton Woods, 6–7, 90, 123, 201 British pound, 14–16, 76, 117, 209, 221–222, 274, 285. See also Sterling Brown Brothers, 271 BTPs (Buoni del Tesoro Poliennali), 85–87 Bucket shops, 36 Buffett,Warren, 278, 292 Bull/bullish market, 83, 107, 123, 217, 225–226, 228, 230–231, 239, 273 Bund/BTP convergence trade, 85–87 Bundesbank, 14 Bunds, 75, 340 Business cycle, global, 328–329 Butterfly options, 46 Buy and hold strategy, 7, 47 Buy low, sell high, 228–229 Buy signals, 226 Call options, 85 Canada, 167 Canadian dollar, 67, 239, 286 Capital allocation, 24, 33, 98–99, 315, 321 Capital preservation, 144, 323–324 Carry trades, 78–79, 110–111, 113, 117–118, 125, 134 Cash market, 85 Caxton, 9–10, 33 Central bank(s)/banking, 32, 40, 83, 139–140, 148, 151–153, 161–162, 167–170, 204, 313, 331 Central banker(s), 13–14, 160, 229, 349.


pages: 162 words: 51,473

The Accidental Theorist: And Other Dispatches From the Dismal Science by Paul Krugman

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Bonfire of the Vanities, Bretton Woods, clean water, collective bargaining, declining real wages, floating exchange rates, full employment, George Akerlof, George Gilder, Home mortgage interest deduction, income inequality, indoor plumbing, informal economy, invisible hand, knowledge economy, life extension, lump of labour, new economy, Nick Leeson, paradox of thrift, Plutocrats, plutocrats, price stability, rent control, Ronald Reagan, Silicon Valley, trade route, very high income, working poor

The evidence is overwhelming, and it comes from many sources—from government agencies like the Bureau of the Census, from Fortune’s annual survey of executive compensation, and so on. And, of course, there’s the evidence that confronts anyone with open eyes. Tom Wolfe is neither an economist nor a liberal, but he is an acute observer. When he wanted to portray what was happening in American society he came up with the world of The Bonfire of the Vanities. Here’s a rough (and reasonably certain) picture of what has happened: The standard of living of the poorest 10 percent of American families is significantly lower today than it was a generation ago. Families in the middle are, at best, slightly better off. Only the wealthiest 20 percent of Americans have achieved income growth at anything like the rates nearly everyone experienced between the forties and early seventies.


pages: 207 words: 63,071

My Start-Up Life: What A by Ben Casnocha, Marc Benioff

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affirmative action, Albert Einstein, barriers to entry, Bonfire of the Vanities, business process, call centre, David Brooks, don't be evil, fear of failure, hiring and firing, index fund, informal economy, Jeff Bezos, Lao Tzu, Menlo Park, Paul Graham, place-making, Ralph Waldo Emerson, Sand Hill Road, side project, Silicon Valley, Steve Jobs, Steven Pinker, technology bubble, traffic fines

O’Rourke River Town, by Peter Hessler Novels I Am Charlotte Simmons, by Tom Wolfe Reading in the Dark, by Seamus Deane Dubliners, by James Joyce The Scarlet Letter, by Nathaniel Hawthorne The Plot Against America, by Philip Roth Ender’s Game, by Orson Scott Card Disgrace, by J. M. Coetze Indecision, by Benjamin Kunkel The Secret Life of Bees, by Sue Monk Kidd The Bonfire of the Vanities, by Tom Wolfe Saturday, by Ian McEwan Random On Paradise Drive, by David Brooks How to Be Alone, by Jonathan Franzen A Hope in the Unseen, by Ron Suskind Dress Your Family in Corduroy and Denim, by David Sedaris Clinton & Me, by Mark Katz What Does It Mean to Be Well Educated? by Alfie Kohn Consider the Lobster, by David Foster Wallace A Supposedly Fun Thing I’ll Never Do Again, by David Foster Wallace 181 Acknowledgments I am lucky on many levels, and it’s most evident if I think about the people who have entered my life.


pages: 196 words: 57,974

Company: A Short History of a Revolutionary Idea by John Micklethwait, Adrian Wooldridge

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affirmative action, barriers to entry, Bonfire of the Vanities, borderless world, business process, Corn Laws, corporate governance, corporate social responsibility, credit crunch, crony capitalism, double entry bookkeeping, Etonian, hiring and firing, invisible hand, James Watt: steam engine, joint-stock company, joint-stock limited liability company, Joseph Schumpeter, knowledge economy, knowledge worker, laissez-faire capitalism, manufacturing employment, market bubble, mittelstand, new economy, North Sea oil, race to the bottom, railway mania, Ronald Coase, Silicon Valley, six sigma, South Sea Bubble, Steve Jobs, Steve Wozniak, strikebreaker, The Nature of the Firm, The Wealth of Nations by Adam Smith, Thorstein Veblen, trade route, transaction costs, tulip mania, wage slave, William Shockley: the traitorous eight

Milken was indicted on almost one hundred counts of racketeering—and eventually sent to jail. Across in Britain, Hanson’s ambition overran itself: after an unsuccessful play for ICI, its two founders effectively broke up the company in 1996. Goldsmith ended his career as an antiglobalization crusader. Wall Streeters were pilloried for their greed in The Bonfire of the Vanities (1987), Liar’s Poker (1989), and Barbarians at the Gate (1991). By the end of the century, shareholders had plainly failed to restrain managerial power in the way that many had hoped. Nine in ten big American companies were incorporated in Delaware, a state whose laws favored managers over shareholders.


pages: 183 words: 17,571

Broken Markets: A User's Guide to the Post-Finance Economy by Kevin Mellyn

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banking crisis, banks create money, Basel III, Bernie Madoff, Big bang: deregulation of the City of London, Bonfire of the Vanities, bonus culture, Bretton Woods, BRICs, British Empire, call centre, Carmen Reinhart, central bank independence, centre right, cloud computing, collapse of Lehman Brothers, collateralized debt obligation, corporate governance, credit crunch, crony capitalism, currency manipulation / currency intervention, disintermediation, eurozone crisis, fiat currency, financial innovation, financial repression, floating exchange rates, Fractional reserve banking, global reserve currency, global supply chain, Home mortgage interest deduction, index fund, joint-stock company, Joseph Schumpeter, labor-force participation, labour market flexibility, liquidity trap, London Interbank Offered Rate, lump of labour, market bubble, market clearing, Martin Wolf, means of production, mobile money, moral hazard, mortgage debt, mortgage tax deduction, Ponzi scheme, profit motive, quantitative easing, Real Time Gross Settlement, regulatory arbitrage, reserve currency, rising living standards, Ronald Coase, seigniorage, shareholder value, Silicon Valley, statistical model, Steve Jobs, The Great Moderation, the payments system, Tobin tax, too big to fail, transaction costs, underbanked, Works Progress Administration, yield curve, Yogi Berra

The first instinct of market participants, who rarely have personal experience of extended downturns, since up to 2008 there had not been any since the early 1980s, is that time will solve the problem. Markets always come back. Except, of course, when they don’t. The new “Masters of the Universe,” as Tom Wolfe dubbed the Sherman McCoys of this world in The Bonfire of the Vanities (Bantam, 1998), actually believed that their way of life is natural. After the panic of 2008 recedes in memory, people will become less hostile to finance, regulations will prove unworkable, and the political tide will turn. No doubt Richard Whitney, Chairman of the New York Stock Exchange and uncrowned king of the 1920s Golconda, felt the same way, at least until he was headed to Sing Sing.


pages: 302 words: 74,878

A Curious Mind: The Secret to a Bigger Life by Brian Grazer, Charles Fishman

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4chan, Airbnb, Albert Einstein, Apple II, Asperger Syndrome, Bonfire of the Vanities, en.wikipedia.org, game design, Google Chrome, Howard Zinn, Isaac Newton, Jeff Bezos, Kickstarter, out of africa, RAND corporation, Ronald Reagan, Silicon Valley, stem cell, Steve Jobs, Steve Wozniak, the scientific method, Tim Cook: Apple

Rader: psychiatrist, administers stem cell injections for a variety of illnesses Jason Randal: magician, mentalist Ronald Reagan: president of the United States, 1981–1989 Sumner Redstone: media magnate, businessman, chairman of CBS, chairman of Viacom Judith Regan: editor, book publisher Eddie Rehfeldt: executive creative director for the communications firm Waggener Edstrom David Remnick: journalist, author, editor of the New Yorker, winner of the Pulitzer Prize David Rhodes: president of CBS News, former vice president of news for Fox News Matthieu Ricard: Buddhist monk, photographer, author of Happiness: A Guide to Developing Life’s Most Important Skill Condoleezza Rice: U.S. secretary of state, 2005–2009, former U.S. national security advisor, former provost at Stanford University, professor of political economy at the Stanford Graduate School of Business Frank Rich: journalist, author, former columnist for the New York Times, editor at large for New York magazine Michael Rinder: activist and former senior executive for the Church of Scientology International Richard Riordan: mayor of Los Angeles, 1993–2001, businessman Tony Robbins: life coach, author, motivational speaker Robert Wilson and Richard Hutton: criminal defense attorneys Brian L. Roberts: chairman and CEO of Comcast Corporation Burton B. Roberts: chief administrative judge, New York Supreme Court in the Bronx, model for a character in Tom Wolfe’s novel The Bonfire of the Vanities Michael Roberts: fashion journalist, fashion and style director at Vanity Fair, former fashion director at the New Yorker Joe Robinson: speaker and trainer on work-life balance and productivity Gerry Roche: senior chairman of Heidrick & Struggles, a business executive recruiting firm Aaron Rose: film director, art-show curator, writer Charlie Rose: journalist, TV interviewer, host of PBS’s Charlie Rose Maer Roshan: writer, editor, entrepreneur who launched Radar magazine and radaronline.com Pasquale Rotella: founder of Insomniac Events, which produces music festival Electric Daisy Carnival Karl Rove: Republican political consultant, chief strategist for George W.


pages: 446 words: 578

The end of history and the last man by Francis Fukuyama

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affirmative action, anti-communist, Ayatollah Khomeini, Berlin Wall, Bonfire of the Vanities, centre right, cuban missile crisis, deindustrialization, Deng Xiaoping, European colonialism, F. W. de Klerk, Fall of the Berlin Wall, Francis Fukuyama: the end of history, full employment, Gini coefficient, Hernando de Soto, income inequality, Isaac Newton, Joseph Schumpeter, kremlinology, labour mobility, land reform, Mikhail Gorbachev, nuclear winter, open economy, post-industrial society, postindustrial economy, RAND corporation, Ronald Reagan, Socratic dialogue, strikebreaker, the scientific method, The Wealth of Nations by Adam Smith, Thomas Kuhn: the structure of scientific revolutions

In particular, the virtues and ambitions called forth by war are unlikely to find expression in liberal democracies. T h e r e will be plenty o f metaphorical w a r s — c o r p o r a t e lawyers specializing in hostile takeovers w h o will think of themselves as sharks o r gun328 Immense Wars of the Spirit 329 slingers, and bond traders w h o imagine, as in T o m Wolfe's novel The Bonfire of the Vanities, that they a r e "masters of the universe." (They will believe this, however, only in bull markets.) But as they sink into the soft leather of their B M W s , they will know somewhere in the back of their minds that t h e r e have been real gunslingers and masters in the world, w h o would feel contempt f o r the petty virtues required to become rich o r famous in m o d e r n America.

INDEX Abortion, 176 Acid rain, 86 Affirmative action, 237, 293 Afghanistan, 26, 127, 275 African National Congress, 15, 111 Afrikaners, 14, 2 1 , 1 1 1 , 172 Afro-American culture, 237 Aganbegyan, Abel, 29 A toe-dominated regime (Syria), 16 Albalkin, Leonid, 29 Albania, 27, 112 Alcibiades, 3 1 7 Alexander II, Czar of Russia, 75 Alfonsin government (Argen­ tina), 14 Algeria, 275 Alienation, 65, 197, 335 All Quiet on the Western Front (Re­ marque), 5 Alwyn, Patricio, 42 Ambition, 162 American Bill of Rights, 43, 159 American Civil War, 1 7 1 , 175— 176, 2 6 1 , 330 American Revolution, 42, 64, 134 Amish, 85 Amour-propre, 8 3 - 8 4 , 155, 162, 255 Andropov, Yuri, 47 Angell, Norman, 5 Anger, 1 6 3 - 1 6 5 , 1 7 1 , 172, 1 7 8 180 Angola, 35 Animal behavior, 297 Anomie, 337 Anthropology, 151 Anti-liberal doctrines, 2 3 5 - 2 4 4 Anti-Stalinism, 30, 40 Apartheid, 2 0 - 2 1 , 77, 1 1 1 , 1 7 1 172 Aquino, Corazon, 14, 1 1 9 - 1 2 0 Arab-Israeli conflict, 283 Aral Sea, 115 Argentina, 14, 16, 19, 20, 23, 42, 1 0 4 - 1 0 6 , 1 1 2 , 1 1 3 , 256 Aristocracies, 45, 1 8 5 - 8 6 , 200, 259, 260, 265 Aristophanes, 296 Aristotle, 5 5 - 5 6 , 127, 335 Aron, Raymond, 66, 95 ASEAN (Association of South­ east Asian Nations), 102 Assembly of Women (Aris­ tophanes), 294 Associational life, 3 2 2 - 3 2 4 Astayev, Viktor, 37 Ataturk, Kemal, 236, 256, 272 Athens, 48, 127, 184, 247, 3 1 6 , 317 Athletic competition, 3 1 8 - 3 2 0 Atlantic Charter, 258 Augustine, Saint, 56, 183 Australia, 1 1 1 Austria-Hungary, 333 Authoritarianism, 8 - 9 , 1 1 , 12, 37, 3 9 - 4 2 , 124 current crisis of, 1 3 - 2 2 , 44, 47 market-oriented, 123, 124 new Asian, 2 3 8 - 2 4 3 403 404 Ba'ath parties, 16, 236 Bacon, Francis, 56, 57, 72, 135 Baigan, Ishida, 227 Balance of power, 2 4 7 - 2 5 0 Baltic states, 2 7 - 2 8 , 2 1 5 , 273 Bangladesh, 275 Basques, 269 Battle of Jena, significance of, 64, 67 Beast with red cheeks, 162, 1 7 0 - 1 8 0 , 188 "Bee and the Communist Ideal, The" (Nuikin), 23 Belief, 3 0 9 - 3 1 0 Bell, Daniel, 91 Bellah, Robert, 227, 229 Belorussia, 35 Beria, Lavrenty, 32, 40 Berlin Wall, 27, 178, 263, 280 Biology, 151 Bipolarity, 248, 255, 262 Black market (Soviet), 32 Black underclass, 2 9 3 - 2 9 4 Bogomolov, Oleg, 29 Bolshevik party, 43 Bolshevik Revolution, 24, 25, 66, 3 0 4 - 3 0 5 Bombing, 6 Bonfire of the Vanities, The (Wolfe), 329 Botswana, 35 Bourgeois, 145, 160, 180, 185, 188, 189, 3 1 4 , 323, 329 Brazil, 14, 20, 42, 1 0 4 - 1 0 5 , 112, 123 Brezhnev, Leonid, 8, 10, 32, 76 Brezhneva, Galina, 16 Bryce, Lord, 42 Buddhism, 2 1 6 - 2 1 7 , 227 Bukovsky, Vladimir, 169 Bulgaria, 27, 36, 112 Bureaucracy, 65, 89 as characteristic of modern societies, 7 7 - 7 8 INDEX Burma, 14, 85 Bush, George, 3 1 8 , 328 Bushido ethic, 227 Caetano, Marcello, 13, 18 Calvinism, 226, 227, 229 Cambodia, 79, 127, 275, 293 Canada, 264 Capitalism, 44, 9 0 - 9 1 , 98, 99, 102, 103, 106, 108, 114, 120, 204, 2 2 6 - 2 3 0 , 290, 292,316 Capitalism, Socialism, and Democ­ racy (Schumpeter), 123 Capital punishment, 261 Carthage, 248 Caste system, 228 Catholicism, 19, 221 Ceaucescu, Nicolae, 1 1 5 Centrally planned economic sys­ tems, 90, 9 1 , 9 3 - 9 6 , 98, 107 Ceylon, 123 Chad, 275 Chamorro, Violetta, 14 Charismatic authority, 115 Charter 77, 166 Charter of the United Nations, 282 Checks and balances, 188 Chemical and biological weap­ ons, 278 Chemistry, 151 Chernenko, Konstantin, 47 Chernobyl, 1 1 5 Chiang Ching-kuo, 14 Chile, 14, 2 1 , 42, 104, 112, 123 Chinese Revolution, 1 1 , 66, 127 Christian Democracy, 284 Christianity, 56 grounds for human equality, 1 9 6 - 1 9 7 , 301 Hegel and, 2 1 6 , 301 as slave ideology, 62, 1 9 6 198, 205, 2 6 1 , 301 INDEX Churbanov, Yury, 32 Churchill, Winston, 3 1 8 CIA (Central Intelligence Agency), 18, 28 Citizenship, 202, 322 Civil rights, 4 2 - 4 3 , 2 0 3 - 2 0 4 , 237 Civil society, 33, 2 1 9 , 2 2 1 , 222 Civil war American, 1 7 1 , 1 7 5 - 1 7 6 , 2 6 1 , 330 English, 271 Spanish, 79 Class conflict, 65, 1 1 8 - 1 1 9 Classical liberal trade theory, 100 CNN (Cable News Network), 7 Cold War, 7, 10, 46, 127, 233, 246, 248, 252, 262, 264, 272, 282, 283 Collectivization, 30 Collor de Mello, Fernando, 42 Colombia, 14 Colonialism, 99, 258, 267, 338 Communications technology, 7 Communism, 7, 45; see also Au­ thoritarianism; Communist parties; Totalitarianism belief in permanence of, 8, 10 Havel on, 1 6 6 - 1 6 9 legitimacy of, 1 0 - 1 1 as slave ideology, 205 Soviet-style, 9 - 1 0 worldwide collapse of, 8, 12, 2 5 - 3 8 , 1 7 7 - 1 7 9 , 264, 280, 293, 296 Communist Manifesto (Marx and Engels), 65 Communist parties Chinese, 34 Filipino, 1 1 9 Portuguese, 18, 47 South African, 15 405 Soviet, 26, 27 Spanish, 19 Community, 242, 304, 3 2 2 - 3 2 7 Compassion, rise of, 261 Comte, Auguste, 68 Condorcet, Marquis de, 57, 62 Conflict resolution, 1 1 7 - 1 1 9 Confucianism, 2 1 7 , 325 Congress of Vienna, 267, 331 Conservatives, in Soviet Union, 40-41 Constitution of the United States, 25, 153, 184, 187, 200, 204, 296 Consumer electronics industry, 84 Consumerism, 4, 63, 8 3 - 8 5 , 126, 169, 230, 242 Contradictions, 6 1 , 64, 65, 136, 137, 139 Cortés, Hernando, 259 Cosmopolitanism, 126 Costa Rica, 123, 2 1 7 - 2 1 8 "Cotton mafia," 32 Craft guilds, 232 Crimean War, 75 Critique of Pure Reason (Kant), 151 Croatia, 272, 273 Cuba, 10, 14, 25, 127 Cultural relativism, 340 Cultural Revolution, 79, 95, 96 Culture preconditions for democracy, 215, 2 1 9 - 2 2 2 relationship to thymos, 2 1 3 work attitudes and, 2 2 4 - 2 2 5 , 230-234 Cunhal, Alvaro, 18 Custine, Marquis de, 25 Cyprus, 20 Czechoslovakia democratic transition in, 36, 112 406 Czechoslovakia (cont.) fall of communist govern­ ment, 27, 1 7 7 - 1 7 8 nationalism in, 273 Darwin, Charles, 299 Debray, Régis, 320 Declaration of Independence, 134, 153, 158, 186, 196, 200, 204, 296 Decline of the West (Spengler), 68 Defensive modernization, 7 4 - 7 6 de Gaulle, Charles, 332 de Klerk, F.


pages: 598 words: 172,137

Who Stole the American Dream? by Hedrick Smith

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Affordable Care Act / Obamacare, airline deregulation, anti-communist, asset allocation, banking crisis, Bonfire of the Vanities, British Empire, business process, clean water, cloud computing, collateralized debt obligation, collective bargaining, corporate governance, Credit Default Swap, credit default swaps / collateralized debt obligations, currency manipulation / currency intervention, David Brooks, Deng Xiaoping, desegregation, Double Irish / Dutch Sandwich, family office, full employment, global supply chain, Gordon Gekko, guest worker program, hiring and firing, housing crisis, Howard Zinn, income inequality, index fund, informal economy, invisible hand, Joseph Schumpeter, Kenneth Rogoff, knowledge economy, knowledge worker, laissez-faire capitalism, late fees, Long Term Capital Management, low cost carrier, manufacturing employment, market fundamentalism, Maui Hawaii, mortgage debt, new economy, Occupy movement, Own Your Own Home, Peter Thiel, Plutonomy: Buying Luxury, Explaining Global Imbalances, Ponzi scheme, Ralph Nader, RAND corporation, Renaissance Technologies, reshoring, rising living standards, Robert Shiller, Robert Shiller, rolodex, Ronald Reagan, shareholder value, Shenzhen was a fishing village, Silicon Valley, Silicon Valley startup, Steve Jobs, The Chicago School, The Spirit Level, too big to fail, transaction costs, transcontinental railway, union organizing, Unsafe at Any Speed, Vanguard fund, We are the 99%, women in the workforce, working poor, Y2K

Since top company executives were privy to inside company information, they could obviously cash in big-time by trading in company stock. But the unwritten code frowned on that. “Were everyone to seek to do so …,” Galbraith wrote, “the corporation would be a chaos of competitive avarice.” By the 1980s, competitive avarice was in. Tom Wolfe captured the winner-take-all creed in his book Bonfire of the Vanities, and so did Oliver Stone’s 1987 movie, Wall Street. “Greed, for lack of a better word, is good,” preached Gordon Gekko, the movie’s mogul investor. “Greed is right, greed works…. Greed, in all of its forms … has marked the upward surge of mankind.” It certainly marked the upward surge in CEO pay, which rocketed from forty times the pay of an average company worker in 1980 to nearly four hundred times by 2000.

As former Nixon political strategist Kevin Phillips put it, Wall Street “hijacked” the U.S. economy for its own profit, causing a “perilous overconcentration” of economic power. In terms of political power, Wall Street has no peer. Over the past two decades, the bankers portrayed by Tom Wolfe in Bonfire of the Vanities as arrogant “Masters of the Universe” have been even more successful than the leaders of other sectors of business, such as oil or the military-industrial complex or the pharmaceutical industry, in influencing Washington to adopt their agenda. They have lobbied successfully to overturn New Deal–era laws and time-tested government regulations.


pages: 416 words: 204,183

The Rough Guide to Florence & the Best of Tuscany by Tim Jepson, Jonathan Buckley, Rough Guides

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air freight, Bonfire of the Vanities, car-free, housing crisis, land reform, Plutocrats, plutocrats, sustainable-tourism, trade route, upwardly mobile, urban planning

. $-6# 5BCBTDP (The terrace is called the arringhiera, from the same root as the English word “harangue”.) Tempers can get frayed at such gatherings, but things used to be a lot wilder than they are today: in 1343, for example, one inflammatory meeting ended with a man being eaten by a mob. Most famously, it was here that Savonarola held his “Bonfires of the Vanities” (see p.124) – on the very spot where, on May 23, 1498, he was to be executed for heresy. A circular plaque in the pavement near the fountain marks the place. The statues Florence’s political volatility is encapsulated by the Piazza della Signoria’s array of statues, most of which were arranged in the sixteenth century to accentuate the axis of the Uffizi.

Continual decrees were issued from San Marco: profane carnivals were to be outlawed, fasting was to be observed more frequently, children were to act as the agents of the righteous, informing the authorities whenever their parents transgressed the Eternal Law. Irreligious books and paintings, expensive clothes, cosmetics, mirrors, board games, trivialities and luxuries of all types were destroyed, a ritual purging that reached a crescendo with a colossal “Bonfire of the Vanities” on the Piazza della Signoria. Meanwhile, Charles VIII was installed in Naples and a formidable alliance was being assembled to overthrow him: the papacy, Milan, Venice, Ferdinand of Aragon and the Emperor Maximilian. In July 1495 the army of this Holy League confronted the French and was badly defeated.


pages: 279 words: 87,910

How Much Is Enough?: Money and the Good Life by Robert Skidelsky, Edward Skidelsky

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banking crisis, Bertrand Russell: In Praise of Idleness, Bonfire of the Vanities, call centre, David Ricardo: comparative advantage, death of newspapers, financial innovation, Francis Fukuyama: the end of history, full employment, happiness index / gross national happiness, income inequality, income per capita, informal economy, invisible hand, John Maynard Keynes: Economic Possibilities for our Grandchildren, John Maynard Keynes: technological unemployment, Joseph Schumpeter, lump of labour, market clearing, market fundamentalism, profit motive, purchasing power parity, Ralph Waldo Emerson, The Wealth of Nations by Adam Smith, Thomas Malthus, Thorstein Veblen, Tobin tax, union organizing, University of East Anglia, wage slave, World Values Survey

We prefer the term “respect” because it brings out more clearly its interpersonal dimension. Respect is conferred; dignity is inherent. Still, our ability to respect a human being presupposes that there is something in him worthy of respect, and this something could, if desired, be called dignity. * Sherman McCoy, the “master of the universe” in Tom Wolfe’s novel, Bonfire of the Vanities, consumes his salary in rents, school fees, etc., with the result that bankruptcy follows within a few weeks of his losing his job. He is in effect a wage-slave, if a rather well-heeled one. * Lord Turner admits this possibility. In his third lecture, he writes that the ends of change and economic freedom “need to be balanced against other potentially desirable objectives.”


pages: 223 words: 10,010

The Cost of Inequality: Why Economic Equality Is Essential for Recovery by Stewart Lansley

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banking crisis, Basel III, Big bang: deregulation of the City of London, Bonfire of the Vanities, borderless world, Branko Milanovic, Bretton Woods, British Empire, business process, call centre, capital controls, collective bargaining, corporate governance, correlation does not imply causation, credit crunch, Credit Default Swap, crony capitalism, David Ricardo: comparative advantage, deindustrialization, Edward Glaeser, falling living standards, financial deregulation, financial innovation, Financial Instability Hypothesis, floating exchange rates, full employment, Goldman Sachs: Vampire Squid, high net worth, hiring and firing, Hyman Minsky, income inequality, James Dyson, Jeff Bezos, job automation, Joseph Schumpeter, Kenneth Rogoff, knowledge economy, laissez-faire capitalism, Long Term Capital Management, low skilled workers, manufacturing employment, market bubble, Martin Wolf, mittelstand, mobile money, Mont Pelerin Society, new economy, Nick Leeson, North Sea oil, Northern Rock, offshore financial centre, oil shock, Plutocrats, plutocrats, Plutonomy: Buying Luxury, Explaining Global Imbalances, rising living standards, Robert Shiller, Robert Shiller, Ronald Reagan, savings glut, shareholder value, The Great Moderation, The Spirit Level, The Wealth of Nations by Adam Smith, Thomas Malthus, too big to fail, Tyler Cowen: Great Stagnation, Washington Consensus, Winter of Discontent, working-age population

This claim seemed to be vindicated when two hedge fund partners, Myron Scholes and Robert Merton, won the Nobel Prize for economics in 1997. Their Greenwichbased firm, Long Term Capital Management had been founded by John Meriwether, a former highly successful bond trader at Salomon, Lewis’s boss and widely believed to be the inspiration for the Bonfire of the Vanities , Tom Wolf’s 1980s novel of Wall Street excess. For a while the heavily-leveraged operation grew to be one of the most lucrative of the American hedge funds. Even when their award-winning formula failed and LTCM collapsed in 1998, nearly bringing Wall Street down with it, the modelling and recruitment continued.


pages: 377 words: 110,427

The Boy Who Could Change the World: The Writings of Aaron Swartz by Aaron Swartz, Lawrence Lessig

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affirmative action, Alfred Russel Wallace, Benjamin Mako Hill, bitcoin, Bonfire of the Vanities, Brewster Kahle, Cass Sunstein, deliberate practice, Donald Trump, failed state, fear of failure, Firefox, full employment, Howard Zinn, index card, invisible hand, John Gruber, Lean Startup, More Guns, Less Crime, post scarcity, Richard Feynman, Richard Feynman, Richard Stallman, Ronald Reagan, school vouchers, semantic web, single-payer health, SpamAssassin, SPARQL, telemarketer, The Bell Curve by Richard Herrnstein and Charles Murray, the scientific method, Toyota Production System, unbiased observer, wage slave, Washington Consensus, web application, WikiLeaks, working poor

Ware’s method is to publish a page each week or so in a weekly paper (the Sunday New York Times, the Chicago Reader), then redraw the entire chapter and send it out as an edition of the Novelty Library, then redraw it a third time when the entire book is published. So this is a way of getting intermediate results, but you could just wait for the final books themselves (if they are ever finished). Bonfire of the Vanities by Tom Wolfe Absolutely fantastic. A rare must-read novel—packed full of information about society, journalism, activism, race, etc. I can’t convey just how good it really is. It’s like The Power Broker of fiction. How to Win Friends and Influence People (reread) by Dale Carnegie There’s a reason this is a classic.


pages: 207 words: 86,639

The New Economics: A Bigger Picture by David Boyle, Andrew Simms

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Asian financial crisis, back-to-the-land, banking crisis, Bernie Madoff, Big bang: deregulation of the City of London, Bonfire of the Vanities, Bretton Woods, capital controls, carbon footprint, clean water, collateralized debt obligation, colonial rule, Community Supported Agriculture, congestion charging, corporate social responsibility, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, delayed gratification, deskilling, en.wikipedia.org, energy transition, financial deregulation, financial innovation, full employment, garden city movement, happiness index / gross national happiness, if you build it, they will come, income inequality, informal economy, Jane Jacobs, land reform, loss aversion, microcredit, Mikhail Gorbachev, mortgage debt, neoliberal agenda, new economy, North Sea oil, Northern Rock, offshore financial centre, oil shock, peak oil, pensions crisis, profit motive, purchasing power parity, quantitative easing, Ronald Reagan, seigniorage, Simon Kuznets, sovereign wealth fund, special drawing rights, The Wealth of Nations by Adam Smith, Thomas L Friedman, too big to fail, trickle-down economics, Washington Consensus, working-age population

Other books to read Ha-Joon Chang and Illene Grabel (2004) Reclaiming Development: An Alternative Economic Manual, Zed Books, London Herman Daly and John Cobb (1994) For the Common Good, Beacon Press, New York Herman Daly and Joshua Farley (2004) Ecological Economics: Principles and Applications, Island Press, Washington, DC Jeff Gates (2001) Democracy at Risk, Perseus, New York Oliver James (2008) The Selfish Capitalist: Origins of Affluenza, Vermilion Books, London David Korten (1995) When Corporations Rule the World, Earthscan, London Bernard Lietaer (2001) The Future of Money, Century, London Erik Reinart (2007) How Rich Countries got Rich and Why Poor Countries Stay Poor, Constable, New York Vandana Shiva (1999) Stolen Harvest, South End Press, New York Joseph Stiglitz (2002) Globalisation and its Discontents, Penguin, London 16 THE NEW ECONOMICS Notes 1 2 3 4 5 6 7 8 9 10 11 12 13 14 Tom Wolfe (1988) Bonfire of the Vanities, Cape, London. Arts Council (1946), First Annual Report, London. Intergovernmental Panel on Climate Change (2008) Climate Change 2007, Geneva. United Nations Development Programme (1998) Consumption for Human Development, Oxford University Press, New York. Daily Telegraph (2003) 16 April.


pages: 224 words: 91,918

The Electric Kool-Aid Acid Test by Tom Wolfe

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Bonfire of the Vanities, Buckminster Fuller, edge city, Golden Gate Park, Haight Ashbury, haute couture, Menlo Park, Ronald Reagan, stakhanovite, Stewart Brand, strikebreaker, the scientific method, Thorstein Veblen

Of the many other people I talked to or corresponded with, I particularly want to mention Vic Lovell, Paul Sawyer, Paul Krassner, Pat Hallinan, Brian Rohan, Paul Robertson, Jerry Garcia, Gary Goldhill, Michael Bowen, Anne Severson, Paul Hawken, Bill Tara, Michael Laton, Jack the Fluke, Bill Graham, John Bartholomew Tucker, Roger Grimsby, Marshall Efron, Robin White, Larry McMurtry, Larry Schiller, Donovan Bess, Carl Lehmann-Haupt, and Mr. and Mrs. Fred Kesey. About the Author TOM WOLFE is the author of a dozen books, among them such contemporary classics as The Electric Kool-Aid Acid Test, The Right Stuff, The Bonfire of the Vanities, and A Man in Full. A native of Richmond, Virginia, he earned his B.A. at Washington and Lee University and a Ph.D. in American studies at Yale. He lives in New York City.


pages: 602 words: 120,848

Winner-Take-All Politics: How Washington Made the Rich Richer-And Turned Its Back on the Middle Class by Paul Pierson, Jacob S. Hacker

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accounting loophole / creative accounting, affirmative action, asset allocation, barriers to entry, Bonfire of the Vanities, business climate, carried interest, Cass Sunstein, clean water, collective bargaining, corporate governance, Credit Default Swap, David Brooks, desegregation, employer provided health coverage, financial deregulation, financial innovation, financial intermediation, full employment, Home mortgage interest deduction, Howard Zinn, income inequality, invisible hand, knowledge economy, laissez-faire capitalism, Martin Wolf, medical bankruptcy, moral hazard, Nate Silver, new economy, night-watchman state, offshore financial centre, oil shock, Ralph Nader, Ronald Reagan, shareholder value, Silicon Valley, The Wealth of Nations by Adam Smith, too big to fail, trickle-down economics, union organizing, very high income, War on Poverty, winner-take-all economy, women in the workforce

Even more important, they pushed for an energized and cohesive party dedicated to a radical restructuring of government’s role to unleash the winner-take-all economy. The baby steps of the 1980s were ready to give way to something more ambitious. Chapter 8 Building a Bridge to the Nineteenth Century By all accounts, the 1980s was a great time to be rich. As chronicled in pop-culture movies like The Bonfire of the Vanities and Wall Street, it was a moment when capitalism’s winners took center stage. And as they did so, they revealed the contours of a new capitalism. Deal-makers and financial gamblers were supplanting captains of industry as the biggest winners of all. But the 1980s was just a warm-up act. The staggering paychecks that generated such wonder and bewilderment would have been dismissed a few years later as decidedly second-rate.


pages: 374 words: 114,600

The Quants by Scott Patterson

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Albert Einstein, asset allocation, automated trading system, Benoit Mandelbrot, Bernie Madoff, Bernie Sanders, Black Swan, Black-Scholes formula, Bonfire of the Vanities, Brownian motion, buttonwood tree, buy low sell high, capital asset pricing model, centralized clearinghouse, Claude Shannon: information theory, cloud computing, collapse of Lehman Brothers, collateralized debt obligation, Credit Default Swap, credit default swaps / collateralized debt obligations, diversification, Donald Trump, Doomsday Clock, Emanuel Derman, Eugene Fama: efficient market hypothesis, fixed income, Gordon Gekko, greed is good, Haight Ashbury, index fund, invention of the telegraph, invisible hand, Isaac Newton, job automation, John Nash: game theory, law of one price, Long Term Capital Management, Louis Bachelier, mandelbrot fractal, margin call, merger arbitrage, NetJets, new economy, offshore financial centre, Paul Lévy, Ponzi scheme, quantitative hedge fund, quantitative trading / quantitative finance, race to the bottom, random walk, Renaissance Technologies, risk-adjusted returns, Rod Stewart played at Stephen Schwarzman birthday party, Ronald Reagan, Sergey Aleynikov, short selling, South Sea Bubble, speech recognition, statistical arbitrage, The Chicago School, The Great Moderation, The Predators' Ball, too big to fail, transaction costs, value at risk, volatility smile, yield curve, éminence grise

In December 1987, audiences in movie theaters listened to Gordon Gekko, the slimy takeover artist played by Michael Douglas, proclaim the mantra for the decade in Oliver Stone’s Wall Street: “Greed is good.” A series of popular books reflecting the anti–Wall Street sentiment hit the presses: Bonfire of the Vanities by Tom Wolfe, Barbarians at the Gate by Wall Street Journal reporters Bryan Burrough and John Helyar, The Predators’ Ball by Connie Bruck, Liar’s Poker by Michael Lewis. The quants were licking their wounds. Their wondrous invention, portfolio insurance, was roundly blamed for the meltdown.


pages: 471 words: 124,585

The Ascent of Money: A Financial History of the World by Niall Ferguson

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Admiral Zheng, Andrei Shleifer, Asian financial crisis, asset allocation, asset-backed security, Atahualpa, bank run, banking crisis, banks create money, Black Swan, Black-Scholes formula, Bonfire of the Vanities, Bretton Woods, BRICs, British Empire, capital asset pricing model, capital controls, Carmen Reinhart, Cass Sunstein, central bank independence, collateralized debt obligation, colonial exploitation, Corn Laws, corporate governance, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, currency manipulation / currency intervention, currency peg, Daniel Kahneman / Amos Tversky, deglobalization, diversification, diversified portfolio, double entry bookkeeping, Edmond Halley, Edward Glaeser, Edward Lloyd's coffeehouse, financial innovation, financial intermediation, fixed income, floating exchange rates, Fractional reserve banking, Francisco Pizarro, full employment, German hyperinflation, Hernando de Soto, high net worth, hindsight bias, Home mortgage interest deduction, Hyman Minsky, income inequality, interest rate swap, Isaac Newton, iterative process, joint-stock company, joint-stock limited liability company, Joseph Schumpeter, Kenneth Rogoff, knowledge economy, labour mobility, London Interbank Offered Rate, Long Term Capital Management, market bubble, market fundamentalism, means of production, Mikhail Gorbachev, money: store of value / unit of account / medium of exchange, moral hazard, mortgage debt, mortgage tax deduction, Naomi Klein, Nick Leeson, Northern Rock, pension reform, price anchoring, price stability, principal–agent problem, probability theory / Blaise Pascal / Pierre de Fermat, profit motive, quantitative hedge fund, RAND corporation, random walk, rent control, rent-seeking, reserve currency, Richard Thaler, Robert Shiller, Robert Shiller, Ronald Reagan, savings glut, seigniorage, short selling, Silicon Valley, South Sea Bubble, sovereign wealth fund, spice trade, structural adjustment programs, technology bubble, The Wealth of Nations by Adam Smith, The Wisdom of Crowds, Thomas Malthus, Thorstein Veblen, too big to fail, transaction costs, value at risk, Washington Consensus, Yom Kippur War

To keep the firm afloat, Lorenzo was driven to raid the municipal Monte delle Dote (a kind of mutual fund for the payment of daughters’ dowries).38 Finally, in 1494, amid the chaos of a French invasion, the family was expelled and all its property confiscated and liquidated. Blaming the Medici for the town’s misfortunes, the Dominican preacher Girolamo Savonarola called for a purgative ‘Bonfire of the Vanities’, a call answered when a mob invaded the Medici palace and burned most of the bank’s records. (Black scorch marks are still visible on the papers that survived.) As Lorenzo himself had put it in a song he composed in the 1470s: ‘If you would be happy, be so. / There is no certainty about tomorrow.’


pages: 363 words: 123,076

The Gang That Wouldn't Write Straight: Wolfe, Thompson, Didion, Capote, and the New Journalism Revolution by Marc Weingarten

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1960s counterculture, Bonfire of the Vanities, British Empire, citizen journalism, cognitive dissonance, Donner party, East Village, Haight Ashbury, In Cold Blood by Truman Capote, Menlo Park, New Journalism, non-fiction novel, pre–internet, rent control, rolodex, Ronald Reagan, Stewart Brand, upwardly mobile, working poor

Boynton, interviewed the authors of these and other recent nonfiction classics for a 2005 book called The New New Journalism. With the exception of Jimmy Breslin, who continued to write a weekly column until retiring from newspaper work in November 2004, New Journalism’s greatest practitioners moved on to other pursuits. Tom Wolfe virtually gave up journalism to devote himself to novels such as The Bonfire of the Vanities and I Am Charlotte Simmons. Michael Herr has published only three smallish titles in the years since Dispatches. Since publishing Thy Neighbor’s Wife, his 1980 book about sexual mores in America, Gay Talese has written only one other book (Unto the Sons, a multigenerational saga of his own family) and has spent ten years working on the next one.


pages: 289 words: 113,211

A Demon of Our Own Design: Markets, Hedge Funds, and the Perils of Financial Innovation by Richard Bookstaber

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affirmative action, Albert Einstein, asset allocation, backtesting, Black Swan, Black-Scholes formula, Bonfire of the Vanities, butterfly effect, commodity trading advisor, computer age, disintermediation, diversification, double entry bookkeeping, Edward Lorenz: Chaos theory, family office, financial innovation, fixed income, frictionless, frictionless market, George Akerlof, implied volatility, index arbitrage, Jeff Bezos, London Interbank Offered Rate, Long Term Capital Management, loose coupling, margin call, market bubble, market design, merger arbitrage, Mexican peso crisis / tequila crisis, moral hazard, new economy, Nick Leeson, oil shock, quantitative trading / quantitative finance, random walk, Renaissance Technologies, risk tolerance, risk/return, Robert Shiller, Robert Shiller, rolodex, Saturday Night Live, shareholder value, short selling, Silicon Valley, statistical arbitrage, The Market for Lemons, time value of money, too big to fail, transaction costs, tulip mania, uranium enrichment, yield curve, zero-coupon bond

First, unlike the U.S. government, corporations can go into default, which means credit risk is added as a consideration to yield curve dynamics. Second, there is far more liquidity risk. There are many more corporate bonds than Treasury bonds, and most corporate bonds only traded by appointment. This led, true to the caricature in Tom Wolfe’s novel Bonfire of the Vanities, to bond salesmen whose principal expertise was knowing who owned what bonds (the principal value of having done the bond underwriting) and passing these bonds from one hand to the other for a spread. Sell $100 million of bonds at a quarter-point spread, and the firm would pocket $250,000 for making a few phone calls.


pages: 421 words: 128,094

King of Capital: The Remarkable Rise, Fall, and Rise Again of Steve Schwarzman and Blackstone by David Carey; John E. Morris; John Morris

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asset allocation, banking crisis, Bonfire of the Vanities, carried interest, collateralized debt obligation, corporate governance, credit crunch, diversification, diversified portfolio, fixed income, Gordon Gekko, margin call, Menlo Park, mortgage debt, new economy, Northern Rock, risk tolerance, Rod Stewart played at Stephen Schwarzman birthday party, Sand Hill Road, sealed-bid auction, Silicon Valley, sovereign wealth fund, The Predators' Ball, éminence grise

It was Schwarzman’s sixtieth birthday party on February 13 that elevated him from being one more Wall Street bigwig to a symbol. It transformed him into a cliché for the age and a punching bag. The scale of the bash stunned even jaded Wall Streeters, and to the man in the street the extravagance reinforced every negative stereotype of financiers. It was the reality version of Bonfire of the Vanities, and the press had a field day, for the event encapsulated the power and wealth of private equity and of the small band of men who controlled its biggest firms. The potential political fallout from the party worried Henry Silverman, the ex-Blackstone partner who had left to run Cendant. He says he bluntly asked Schwarzman, “Why would you do this?”

How I Became a Quant: Insights From 25 of Wall Street's Elite by Richard R. Lindsey, Barry Schachter

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Albert Einstein, algorithmic trading, Andrew Wiles, Antoine Gombaud: Chevalier de Méré, asset allocation, asset-backed security, backtesting, bank run, banking crisis, Black-Scholes formula, Bonfire of the Vanities, Bretton Woods, Brownian motion, business process, buy low sell high, capital asset pricing model, centre right, collateralized debt obligation, corporate governance, correlation coefficient, Credit Default Swap, credit default swaps / collateralized debt obligations, currency manipulation / currency intervention, discounted cash flows, disintermediation, diversification, Emanuel Derman, en.wikipedia.org, Eugene Fama: efficient market hypothesis, financial innovation, fixed income, full employment, George Akerlof, Gordon Gekko, hiring and firing, implied volatility, index fund, interest rate derivative, interest rate swap, John von Neumann, linear programming, Loma Prieta earthquake, Long Term Capital Management, margin call, market friction, market microstructure, martingale, merger arbitrage, Nick Leeson, P = NP, pattern recognition, pensions crisis, performance metric, prediction markets, profit maximization, purchasing power parity, quantitative trading / quantitative finance, QWERTY keyboard, RAND corporation, random walk, Ray Kurzweil, Richard Feynman, Richard Feynman, Richard Stallman, risk-adjusted returns, risk/return, shareholder value, Sharpe ratio, short selling, Silicon Valley, six sigma, sorting algorithm, statistical arbitrage, statistical model, stem cell, Steven Levy, stochastic process, systematic trading, technology bubble, The Great Moderation, the scientific method, too big to fail, trade route, transaction costs, transfer pricing, value at risk, volatility smile, Wiener process, yield curve, young professional

Gordon: Finance, Investment and Macroeconomics: The Neoclassical and a Post Keynesian Solution (London: Edward Elgar, 1994). 4. “You see, Daddy didn’t bake the cake, and Daddy isn’t the one who gets to eat it. But he gets to slice the cake and hand it out. And when he does, little golden crumbs fall off the cake. And Daddy gets to eat those.” This extract from Tom Wolfe’s Bonfire of the Vanities captures the essence of a lot of investment finance. We slice up raw financial returns and create return distributions that suit people’s portfolios. Thus, for example, a collection of bonds is analogous to a side of beef, the senior tranches of a CDO are like steak, and the junior tranches are like sausages, all priced accordingly with something left over for us.


pages: 425 words: 122,223

Capital Ideas: The Improbable Origins of Modern Wall Street by Peter L. Bernstein

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Albert Einstein, asset allocation, backtesting, Benoit Mandelbrot, Black-Scholes formula, Bonfire of the Vanities, Brownian motion, buy low sell high, capital asset pricing model, debt deflation, diversified portfolio, Eugene Fama: efficient market hypothesis, financial innovation, financial intermediation, fixed income, full employment, implied volatility, index arbitrage, index fund, interest rate swap, invisible hand, John von Neumann, Joseph Schumpeter, law of one price, linear programming, Louis Bachelier, mandelbrot fractal, martingale, means of production, new economy, New Journalism, profit maximization, Ralph Nader, RAND corporation, random walk, Richard Thaler, risk/return, Robert Shiller, Robert Shiller, Ronald Reagan, stochastic process, the market place, The Predators' Ball, the scientific method, The Wealth of Nations by Adam Smith, Thorstein Veblen, transaction costs, transfer pricing, zero-coupon bond

The Brady report explained this tragedy by denouncing “mechanical, price-insensitive selling . . . concentrated in the hands of surprisingly few institutions” and proposed a series of constraints to bring the market’s penchant for wildness under control. The popular literature about the world of investment in the 1980s carries titles that reflect those events: Bonfire of the Vanities, Barbarians at the Gates, The Predators’ Ball, and Liars’ Poker. The main characters are arrogant, greedy, cynical, and shady. At one point or another in their careers, they grow rich beyond the dreams of most of us—largely because they have profited from the new technologies, novel financial instruments, and mysterious investment strategies that emerged from the revolution in finance and investing.


pages: 584 words: 187,436

More Money Than God: Hedge Funds and the Making of a New Elite by Sebastian Mallaby

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Andrei Shleifer, Asian financial crisis, asset-backed security, automated trading system, bank run, barriers to entry, Benoit Mandelbrot, Berlin Wall, Bernie Madoff, Big bang: deregulation of the City of London, Bonfire of the Vanities, Bretton Woods, capital controls, Carmen Reinhart, collapse of Lehman Brothers, collateralized debt obligation, Credit Default Swap, credit default swaps / collateralized debt obligations, crony capitalism, currency manipulation / currency intervention, currency peg, Elliott wave, Eugene Fama: efficient market hypothesis, failed state, Fall of the Berlin Wall, financial deregulation, financial innovation, financial intermediation, fixed income, full employment, German hyperinflation, High speed trading, index fund, Kenneth Rogoff, Long Term Capital Management, margin call, market bubble, market clearing, market fundamentalism, merger arbitrage, moral hazard, natural language processing, Network effects, new economy, Nikolai Kondratiev, pattern recognition, pre–internet, quantitative hedge fund, quantitative trading / quantitative finance, random walk, Renaissance Technologies, Richard Thaler, risk-adjusted returns, risk/return, rolodex, Sharpe ratio, short selling, Silicon Valley, South Sea Bubble, sovereign wealth fund, statistical arbitrage, statistical model, technology bubble, The Great Moderation, The Myth of the Rational Market, too big to fail, transaction costs

By 1990 Meriwether’s team included Robert Merton and Myron Scholes, who would later win the Nobel Prize for their pioneering work on options pricing. In the mid-1980s, most Salomon partners had not gone to college, much less a PhD program.4 The personification of the firm’s trading culture was Craig Coats Jr., a tall, handsome, charismatic stud believed by many to be the model for the hero in Tom Wolfe’s The Bonfire of the Vanities. Coats ran Salomon’s government-bond trading the old-fashioned way: While Meriwether’s professors debated whether the relationship between two bonds was out of its normal range, or whether the volatility of a bond price was likely to decelerate, Coats’s main tool was a firm belief in his own instincts.


pages: 823 words: 220,581

Debunking Economics - Revised, Expanded and Integrated Edition: The Naked Emperor Dethroned? by Steve Keen

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accounting loophole / creative accounting, banking crisis, banks create money, barriers to entry, Benoit Mandelbrot, Big bang: deregulation of the City of London, Black Swan, Bonfire of the Vanities, butterfly effect, capital asset pricing model, cellular automata, central bank independence, citizen journalism, clockwork universe, collective bargaining, complexity theory, correlation coefficient, credit crunch, David Ricardo: comparative advantage, debt deflation, diversification, double entry bookkeeping, en.wikipedia.org, Eugene Fama: efficient market hypothesis, experimental subject, Financial Instability Hypothesis, Fractional reserve banking, full employment, Henri Poincaré, housing crisis, Hyman Minsky, income inequality, invisible hand, iterative process, John von Neumann, laissez-faire capitalism, liquidity trap, Long Term Capital Management, mandelbrot fractal, margin call, market bubble, market clearing, market microstructure, means of production, minimum wage unemployment, open economy, place-making, Ponzi scheme, profit maximization, quantitative easing, RAND corporation, random walk, risk tolerance, risk/return, Robert Shiller, Robert Shiller, Ronald Coase, Schrödinger's Cat, scientific mainstream, seigniorage, six sigma, South Sea Bubble, stochastic process, The Great Moderation, The Wealth of Nations by Adam Smith, Thorstein Veblen, time value of money, total factor productivity, tulip mania, wage slave

From tranquility to breakdown To a neoclassical economist, the most striking aspect of the Great Recession was the speed with which apparent tranquility gave way to sudden breakdown. With notable, noble exceptions like Nouriel Roubini, Robert Shiller, Joe Stiglitz and Paul Krugman, economists paid little attention to the obvious Bonfire of the Vanities taking place in asset markets, so in a sense they didn’t see the warning signs, which were obvious to many others, that this would all end in tears. My model, in contrast, is one in which the Great Moderation and the Great Recession are merely different phases in the same process of debt-financed speculation, which causes a period of initial volatility to give way to damped oscillations as rising debt transfers income from workers to bankers, and then total breakdown occurs when debt reaches a level at which capitalists become insolvent.


pages: 551 words: 174,280

The Beginning of Infinity: Explanations That Transform the World by David Deutsch

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agricultural Revolution, Albert Michelson, anthropic principle, artificial general intelligence, Bonfire of the Vanities, conceptual framework, cosmological principle, dark matter, David Attenborough, discovery of DNA, Douglas Hofstadter, Eratosthenes, Ernest Rutherford, first-past-the-post, Georg Cantor, Gödel, Escher, Bach, illegal immigration, invention of movable type, Isaac Newton, Islamic Golden Age, Jacquard loom, Jacquard loom, John Conway, John von Neumann, Joseph-Marie Jacquard, Loebner Prize, Louis Pasteur, pattern recognition, Richard Feynman, Richard Feynman, Search for Extraterrestrial Intelligence, Stephen Hawking, supervolcano, technological singularity, The Coming Technological Singularity, the scientific method, Thomas Malthus, Thorstein Veblen, Turing test, Vernor Vinge, Whole Earth Review, William of Occam

The Jews of Florence were expelled. Gangs of ruffians inspired by Savonarola roamed the city searching for taboo artefacts such as mirrors, cosmetics, musical instruments, secular books, and almost anything beautiful. A huge pile of such treasures was ceremonially burned in the so-called ‘Bonfire of the Vanities’ in the centre of the city. Botticelli is said to have thrown some of his own paintings into the fire. It was the bonfire of optimism. Eventually Savonarola was himself discarded and burned at the stake. But, although the Medici regained control of Florence, optimism did not. As in Athens, the tradition of art and science continued for a while, and, even a century later, Galileo was sponsored (and then abandoned) by the Medici.


pages: 1,169 words: 342,959

New York by Edward Rutherfurd

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Bonfire of the Vanities, British Empire, illegal immigration, margin call, millennium bug, out of africa, place-making, Plutocrats, plutocrats, rent control, short selling, Silicon Valley, South Sea Bubble, the market place, urban renewal, Y2K, young professional

The market and all the service industries, including the law firms, that went with it. In ’84, the market had experienced its first million share trading day. Traders, brokers, anyone dealing in shares or bonds had the opportunity to make a fortune. It was all beautifully summarized in Tom Wolfe’s Bonfire of the Vanities, which had just hit the best-seller lists as Maggie’s pregnancy began. Greed was everywhere. Greed was exciting. Successful greedy men were heroes. Greed was good. But Gorham had to ask himself: Had he been greedy enough? Sometimes, sitting in his office, he’d take out the silver Morgan dollar his grandmother had given him and stare at it sadly.


pages: 1,336 words: 415,037

The Snowball: Warren Buffett and the Business of Life by Alice Schroeder

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affirmative action, Albert Einstein, anti-communist, Ayatollah Khomeini, barriers to entry, Bonfire of the Vanities, Brownian motion, capital asset pricing model, card file, centralized clearinghouse, collateralized debt obligation, corporate governance, Credit Default Swap, credit default swaps / collateralized debt obligations, desegregation, Donald Trump, Eugene Fama: efficient market hypothesis, global village, Golden Gate Park, Haight Ashbury, haute cuisine, Honoré de Balzac, If something cannot go on forever, it will stop, In Cold Blood by Truman Capote, index fund, indoor plumbing, interest rate swap, invisible hand, Isaac Newton, Jeff Bezos, joint-stock company, joint-stock limited liability company, Long Term Capital Management, Louis Bachelier, margin call, market bubble, Marshall McLuhan, medical malpractice, merger arbitrage, Mikhail Gorbachev, moral hazard, NetJets, new economy, New Journalism, North Sea oil, paper trading, passive investing, pets.com, Plutocrats, plutocrats, Ponzi scheme, Ralph Nader, random walk, Ronald Reagan, Scientific racism, shareholder value, short selling, side project, Silicon Valley, Steve Ballmer, Steve Jobs, supply-chain management, telemarketer, The Predators' Ball, The Wealth of Nations by Adam Smith, Thomas Malthus, too big to fail, transcontinental railway, Upton Sinclair, War on Poverty, Works Progress Administration, Y2K, zero-coupon bond

In New York, their righteously indignant neighbors sued them when an allegedly unauthorized crane appeared on their penthouse terrace to hoist a twenty-two-foot, five-hundred-pound Christmas tree into the Gutfreunds’ living room.68 Thus did Susan Gutfreund become 1980s Nouvelle Society’s most beloved object of parody. The Gutfreunds graced magazine covers and Susan earned a role in Tom Wolfe’s roman à clef, The Bonfire of the Vanities.69 Susan’s friends defended her, but however overdone the satire might be, nobody, not even her husband, questioned that this outpouring of opulence had diverted his attention, at least a little bit.70 A corporate history published around this time included a telling remark. Instead of making a decision and expecting others to follow, it said Gutfreund “liked to involve the people who would be affected” and “would bend over backward to make them comfortable with what was to be done.”


pages: 1,351 words: 385,579

The Better Angels of Our Nature: Why Violence Has Declined by Steven Pinker

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1960s counterculture, affirmative action, Alan Turing: On Computable Numbers, with an Application to the Entscheidungsproblem, Albert Einstein, availability heuristic, Berlin Wall, Bonfire of the Vanities, British Empire, Broken windows theory, California gold rush, Cass Sunstein, citation needed, clean water, cognitive dissonance, colonial rule, Columbine, computer age, conceptual framework, correlation coefficient, correlation does not imply causation, crack epidemic, cuban missile crisis, Daniel Kahneman / Amos Tversky, David Brooks, delayed gratification, demographic transition, desegregation, Doomsday Clock, Douglas Hofstadter, Edward Glaeser, en.wikipedia.org, European colonialism, experimental subject, facts on the ground, failed state, first-past-the-post, Flynn Effect, food miles, Francis Fukuyama: the end of history, fudge factor, full employment, ghettoisation, Gini coefficient, global village, Henri Poincaré, impulse control, income inequality, informal economy, invention of the printing press, Isaac Newton, lake wobegon effect, libertarian paternalism, loss aversion, Marshall McLuhan, McMansion, means of production, mental accounting, meta analysis, meta-analysis, Mikhail Gorbachev, mutually assured destruction, open economy, Peace of Westphalia, Peter Singer: altruism, QWERTY keyboard, race to the bottom, Ralph Waldo Emerson, random walk, Republic of Letters, Richard Thaler, Ronald Reagan, Rosa Parks, Saturday Night Live, security theater, Skype, Slavoj Žižek, South China Sea, statistical model, stem cell, Steven Levy, Steven Pinker, The Bell Curve by Richard Herrnstein and Charles Murray, The Wealth of Nations by Adam Smith, theory of mind, transatlantic slave trade, transatlantic slave trade, Turing machine, ultimatum game, uranium enrichment, V2 rocket, Walter Mischel, WikiLeaks, women in the workforce

Urbanites quit other American cities in droves, leaving burned-out cores surrounded by rings of suburbs, exurbs, and gated communities. Books, movies, and television series used intractable urban violence as their backdrop, including Little Murders, Taxi Driver, The Warriors, Escape from New York, Fort Apache the Bronx, Hill Street Blues, and Bonfire of the Vanities. Women enrolled in self-defense courses to learn how to walk with a defiant gait, to use their keys, pencils, and spike heels as weapons, and to execute karate chops or jujitsu throws to overpower an attacker, role-played by a volunteer in a Michelinman-tire suit. Red-bereted Guardian Angels patrolled the parks and the transit system, and in 1984 Bernhard Goetz, a mild-mannered engineer, became a folk hero for shooting four young muggers in a New York subway car.


pages: 1,797 words: 390,698

Power at Ground Zero: Politics, Money, and the Remaking of Lower Manhattan by Lynne B. Sagalyn

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affirmative action, airport security, Bonfire of the Vanities, clean water, conceptual framework, corporate governance, deindustrialization, Donald Trump, Edward Glaeser, estate planning, Frank Gehry, Guggenheim Bilbao, high net worth, informal economy, intermodal, iterative process, Jane Jacobs, mortgage debt, New Urbanism, place-making, rent control, Rosa Parks, Silicon Valley, sovereign wealth fund, the built environment, the High Line, time value of money, too big to fail, Torches of Freedom, urban decay, urban planning, urban renewal, white flight, young professional

Childs came with one of his SOM partners and John “Janno” Lieber, Silverstein executive in charge of the Trade Center project. Libeskind came with his lawyer, Edward W. Hayes, a hard-charging incisive veteran of political battles, who was a model for the lawyer Tommy Killian in Tom Wolfe’s novel The Bonfire of the Vanities. Hayes understood the dynamic of power after being around the city’s development battles for thirty-five years. His job, he said, was to lead Libeskind “though the jungles of New York without getting ambushed and eaten alive.” On what was ahead, he was razor-sharp: “There are people that reach positions of power, and as far as they’re concerned, we’re just players on a chessboard.