housing crisis

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pages: 169 words: 52,744

Big Capital: Who Is London For? by Anna Minton

Airbnb, Berlin Wall, Big bang: deregulation of the City of London, Boris Johnson, Capital in the Twenty-First Century by Thomas Piketty, collateralized debt obligation, Credit Default Swap, credit default swaps / collateralized debt obligations, Donald Trump, eurozone crisis, Fall of the Berlin Wall, Frank Gehry, high net worth, housing crisis, illegal immigration, Kickstarter, land value tax, market design, new economy, New Urbanism, offshore financial centre, payday loans, quantitative easing, rent control, Right to Buy, sovereign wealth fund, the built environment, The Wealth of Nations by Adam Smith, urban renewal, working poor

Spurr, Heather, ‘Clark vetoes council’s PRS licensing scheme’, Inside Housing, 23 December 2015 9. ‘Housing in London 2017’, London Datastore, GLA 10. Edwards, Michael, ‘The housing crisis and London’, City, Vol. 20 (2), pp. 222–37, 2016 11. ‘What are renters thinking?’, Briefing by Sian Berry, Green Party Member of the London Assembly, 2016 12. Skapinker, Michael, ‘London house prices push out the people the city needs the most’, Financial Times, 9 September 2015 13. Fifty Thousand Homes, ‘London’s housing crisis and what it means for business’, http://www.fiftythousandhomes.london/facts/ 14. Chakrabortty, Aditya, Keynote speech at ‘London’s Housing Crisis and its Activisms’ one-day conference, hosted by the University of East London and Birkbeck College at University Square, Stratford, 26 April 2016 15. This conversation took place in spring 2016.

It turns out she did, breaking down in tears at the thought of what the community now had to face, despite all their efforts. Then she composed herself and continued. But as she returned to her seat, she tripped up on a misplaced lead and fell, breaking her arm. It was an upsetting incident and felt to me like a disturbing metaphor for London’s housing crisis. I went home feeling that it was necessary to combine my work so far with a specific investigation of the housing crisis. At the same time, Bob Catterall, the editor of the brilliant multi-disciplinary journal City, had commissioned a Special Feature on the housing crisis, which I was co-editing with Paul Watt, Reader in Urban Studies at Birkbeck. I owe Paul a huge debt of gratitude for the work we did together on that Special Feature and the accompanying housing conference we hosted at the University of East London in spring 2016.

From Nine Elms up to Vauxhall and along to Southwark and Blackfriars bridges, mile upon mile of serried ranks of balconied apartments in gated complexes have already been built and at Elephant and Castle the Australian property developer Lendlease is working with Southwark Council to render the area unrecognizable, replacing with a forest of luxury towers the affordable housing which once characterized the area. Outside some of these buildings ‘anti-homeless spikes’ prohibit homeless people from sitting or sleeping on the pavement. Since 2008 much has been written about the housing crisis. Exploring the fallout from that year’s financial crash, which combined large increases in wealth in property assets for the richest with widespread austerity, Big Capital makes explicit the links between the sheer wealth at the top and the housing crisis, which does not affect just those at the bottom but the majority of Londoners who struggle to buy properties and pay extortionate rents. From the removal from their homes of people on low incomes to the use of property purely as profit and no longer as a social good, the active flouting of democracy by business and local councils alike, the scandal in housing benefit and the pressure on individuals and families at all income levels, this is a new politics of space.


pages: 505 words: 133,661

Who Owns England?: How We Lost Our Green and Pleasant Land, and How to Take It Back by Guy Shrubsole

back-to-the-land, Beeching cuts, Boris Johnson, Capital in the Twenty-First Century by Thomas Piketty, centre right, congestion charging, deindustrialization, digital map, do-ocracy, Downton Abbey, financial deregulation, fixed income, Goldman Sachs: Vampire Squid, Google Earth, housing crisis, James Dyson, Kickstarter, land reform, land tenure, land value tax, linked data, loadsamoney, mega-rich, mutually assured destruction, new economy, Occupy movement, offshore financial centre, oil shale / tar sands, openstreetmap, place-making, plutocrats, Plutocrats, profit motive, rent-seeking, Right to Buy, Ronald Reagan, sceptred isle, Stewart Brand, the built environment, the map is not the territory, The Wealth of Nations by Adam Smith, trickle-down economics, urban sprawl, web of trust, Yom Kippur War, zero-sum game

‘All the while,’ Churchill growled, ‘the land monopolist has only to sit still and watch complacently his property multiplying in value, sometimes manifold, without either effort or contribution on his part; and that is justice!’ And that’s why land – and who owns it – lies at the heart of the housing crisis. It’s not because bricks and mortar have suddenly become incredibly expensive. It’s because the value of the land itself has gone through the roof. According to the Office for National Statistics, the value of land in the UK has increased fivefold since 1995. Landowners are laughing all the way to the bank: over half of the UK’s wealth is now locked up in land, dwarfing the amounts vested in savings. Who owns land matters. How landowners use their land has implications for almost everything: where we build our homes, how we grow our food, how much space we leave for nature. After all, we’re not just facing a housing crisis. We’re also in the throes of an epoch-making environmental crisis, with our land scoured of species and natural habitats after decades of intensive farming.

The Church Commissioners own land totalling around 105,000 acres, on top of what the dioceses own – and in 2017 this land generated a whopping £226 million of income for the Church. What remains, however, of the Church’s traditional commitment to using its resources to help the poor and homeless? ‘The Church of England remains a very large landowner,’ admitted Justin Welby, the Archbishop of Canterbury, in a TV interview about the housing crisis. ‘We need to be committed to housing development, and, most of all, to community building.’ Welcome as the Archbishop’s commitment is, I’m sceptical that the Church will help solve the housing crisis after researching how its Commissioners have managed their estate. In contrast to the financial mismanagement that’s characterised the Church’s loss of glebe land, the centralised estate of the Church Commissioners seems to have been very efficiently managed over the last seventy years. But such business acumen has seen them take up the mantle of property developers, and sell off affordable residential housing in favour of more lucrative commercial developments.

In 2016, the Church Commissioners gave permission to a fracking firm to carry out underground seismic surveys on their Ormskirk Estate in Lancashire, the first step towards fracking. The other major test facing the Church over the use of its land is how it responds to the ongoing housing crisis. Warm words from the Archbishop of Canterbury are all very well; but, having allowed vast swathes of land to be sold off, what can the Church practically do about it? It could make a start by confessing to its past sins – by submitting to a searching inquiry into how it permitted its glebe to be flogged off, and how its investment policies have exacerbated the housing crisis by gentrifying key parts of London. Next, the Church Commissioners, having invested heavily in digitising maps of their landholdings in recent years, should publish these maps as a resource for housing associations and local authorities seeking to find local land.


pages: 518 words: 170,126

City for Sale: The Transformation of San Francisco by Chester W. Hartman, Sarah Carnochan

affirmative action, Albert Einstein, Bay Area Rapid Transit, big-box store, business climate, Golden Gate Park, Haight Ashbury, housing crisis, illegal immigration, John Markoff, Loma Prieta earthquake, manufacturing employment, new economy, New Urbanism, profit motive, Ralph Nader, rent control, Ronald Reagan, Silicon Valley, South of Market, San Francisco, strikebreaker, union organizing, urban planning, urban renewal, very high income, young professional

The housing market is as tight as it has ever been.”44 One should not have excessive faith that the business turndown of 2000–2001 will spell much relief for San Francisco’s overburdened housing consumers. But these same forces creating a housing crisis in San Francisco have also produced probably the strongest local housing movement in the nation. San Francisco’s Housing Movement TOOR’s fight against displacement from the South of Market area and related struggles in the Western Addition were the 1960s forerunners of San Francisco’s housing movement. Starting in the early 1970s, the Tenants Ac- Housing Crisis and Housing Movement / 337 tion Group and later the San Francisco Tenants Union45 organized individual buildings around maintenance and repair issues and provided tenants’ rights counseling, mainly in the Haight-Ashbury and Fillmore neighborhoods, via a “hotline” and publication of tenants’ rights handbooks.

In the early eighties, it was reported that “Mayor Feinstein wants to avoid turning the city into what she termed ‘a magnet for the homeless of the entire Bay Area, the state and the U.S.’ ”172 But it is highly unlikely that homeless folks just hanker to live on San Francisco’s streets as opposed to Chicago’s or Atlanta’s. The problem for the most part afflicts local residents who, due to poverty, the city’s housing crisis, and, for some, personal issues, are frozen out of the housing market. Sentiments such as those expressed by Feinstein are heard by city officials all over America and mask an unwillingness to provide the needed services. Paul Boden, director of the city’s Coalition on Homelessness, accurately notes: “I don’t know of one city in the country that doesn’t say it’s a magnet and that homeless peo- Housing Crisis and Housing Movement / 381 ple come from somewhere else. Fargo, North Dakota, was calling itself a magnet. It’s kind of sad, actually.”173 What is undeniable is the massive gap between need and resources: The city’s now fifteen hundred shelter beds can serve about one-tenth the number of homeless persons on and around the streets.

City for Sale OTHER BOOKS BY CHESTER HARTMAN Between Eminence and Notoriety: Four Decades of Radical Urban Planning Housing: Foundation of a New Social Agenda (with Rachel Bratt and Michael Stone) Challenges to Equality: Poverty and Race in America Double Exposure: Poverty and Race in America Paradigms Lost: The Post Cold War Era (with Pedro Vilanova) Housing Issues of the 1990s (with Sara Rosenberry) Winning America: Ideals and Leadership for the 1990s (with Marcus Raskin) Critical Perspectives on Housing (with Rachel Bratt and Ann Meyerson) The Transformation of San Francisco America’s Housing Crisis: What Is to Be Done? Displacement: How to Fight It (with Dennis Keating and Richard LeGates) Housing and Social Policy Yerba Buena: Land Grab and Community Resistance in San Francisco The World of the Urban Working Class (Marc Fried, with Chester Hartman) Housing Urban America (with Jon Pynoos and Robert Schafer) City for Sale The Transformation of San Francisco R E V I S E D A N D U P D AT E D E D I T I O N CHESTER HARTMAN with Sarah Carnochan University of California Press Berkeley Los Angeles London University of California Press Berkeley and Los Angeles, California University of California Press, Ltd.


pages: 301 words: 77,626

Home: Why Public Housing Is the Answer by Eoin Ó Broin

Airbnb, carbon footprint, Celtic Tiger, financial deregulation, housing crisis, Kickstarter, land reform, mortgage debt, negative equity, open economy, passive investing, quantitative easing, Right to Buy, Ronald Reagan, the built environment

Throughout the course of 2018 there was a growing public perception that Eoghan Murphy was out of his depth and unable to get a grip on the housing crisis. Newspaper journalists and radio broadcasters were quoting anonymous Fine Gael back benchers and Ministerial colleagues who were expressing dissatisfaction with his failure to deliver. Hugh O’Connell writing in the Sunday Business Post in November quoted sources close to Government who claimed that the Taoiseach was getting ‘frustrated’ with his Minister’s handling of the housing portfolio.133 In January, the Irish Mail on Sunday ran the following headline on their front page, ‘Varadkar “Losing Faith in Housing Minister”’.134 The two-page spread quoted anonymous Cabinet colleagues saying the Taoiseach was ‘exasperated’ with Murphy’s failure to get to grips with the housing crisis and that the once close relationship between the two has been replaced by a ‘coldness between them’.135 There were also growing protests on the street.

You poor take courage, you rich take care This earth was made a common treasury for everyone to share All things in common, all people one. They came in peace – the order came to cut them down. Words and music © Leon Rosselson, 1975 The lyrics are derived from a seventeenth-century pamphlet attributed to the English Digger leader Gerrard Winstanley. ADVANCE PRAISE FOR HOME ‘In this hard-hitting and timely book Ó Broin exposes the failures in politics and economics that plunged Ireland into a housing crisis. He also argues that change lies in the hands of a new generation of politicians and activists and the question they face is this: are we to see homes as places to generate rent and interest from, or as places to live?’ Paul Mason, journalist and author of PostCapitalism: A Guide to our Future ‘A wide ranging and thorough analysis of where we have gone wrong in housing in Ireland, followed by innovative ideas for putting things right.’

Michelle Norris, Head of School of Social Policy, Social Work and Social Justice, University College, Dublin ‘Ó Broin argues that the Irish housing system is dysfunctional because of successive governments’ over reliance on the private market to meet housing demand. He argues for a new form of State involvement in housing – public housing – as the only way of ensuring that everyone will have an opportunity to live in a good quality affordable home. This book is accessible to anyone who is interested in solutions to the current housing crisis.’ – Simon Brooke, adjunct assistant professor at Trinity College, Dublin Democratic Programme Adopted by Dáil Éireann 21.1.1919 We declare in the words of the Irish Republican Proclamation the right of the people of Ireland to the ownership of Ireland, and to the unfettered control of Irish destinies to be indefeasible, and in the language of our first President, Pádraig Mac Phiarais, we declare that the Nation’s sovereignty extends not only to all men and women of the Nation, but to all its material possessions, the Nation’s soil and all its resources, all the wealth and all the wealth-producing processes within the Nation, and with him we reaffirm that all right to private property must be subordinated to the public right and welfare.


pages: 296 words: 76,284

The End of the Suburbs: Where the American Dream Is Moving by Leigh Gallagher

Airbnb, big-box store, Burning Man, call centre, car-free, Celebration, Florida, clean water, collaborative consumption, Columbine, commoditize, crack epidemic, East Village, edge city, Edward Glaeser, extreme commuting, helicopter parent, Home mortgage interest deduction, housing crisis, Jane Jacobs, Kickstarter, low skilled workers, Mark Zuckerberg, McMansion, Menlo Park, mortgage tax deduction, negative equity, New Urbanism, peak oil, Peter Calthorpe, Ponzi scheme, Richard Florida, Robert Shiller, Robert Shiller, Sand Hill Road, Seaside, Florida, Silicon Valley, Steve Jobs, Stewart Brand, the built environment, The Death and Life of Great American Cities, Tony Hsieh, transit-oriented development, upwardly mobile, urban planning, urban sprawl, Victor Gruen, walkable city, white flight, white picket fence, young professional, Zipcar

Anyone who has read a newspaper over the past couple of years might reasonably deduce that the suburbs have been in some trouble lately: statistics and articles about the pain being inflicted on our bedroom communities have been appearing almost since the financial crisis began, citing not just the number of foreclosures among American home owners but related issues like the rise in crime and poverty in suburban communities. (“The Death of the Fringe Suburb,” read one recent headline; “Struggling in the Suburbs,” said another; a third declared, “The Housing Crisis Could End Suburbia as We Know It.”) Meanwhile, a cache of articles, papers, and popular books has heralded the resurgence of cities. But what the headlines miss is that while much of the hurt can be blamed on the recent recession and its immediate effects, there are larger trends at work. Many of the suburbs affected by the housing crisis are not experiencing a temporary setback but a permanent one, the result of a powerful tectonic shift whose forces have been grinding away for quite some time. • • • When I set out to write a book in the spring of 2011, I originally planned to explore the future of our economy and how the aftereffects of the financial crisis would bring permanent changes to various aspects of our lives.

Thanks to these efforts, the low pace of new home construction, and the strengthening of the housing market, much of the excess housing inventory has been worked off. As of this writing, we have a 4.4-month supply of existing homes, the lowest housing supply since early 2006. But the migration of wealth from suburb to city started well before Wall Street concocted the no-income, “no-doc” loans that led to the housing crisis. Cities’ renaissance started as early as the mid-1990s, urban housing prices have been rising since 1980, and crime rates have been falling for almost as long. Toll Brothers started moving into the New York City market in 2003. The trend might have been accelerated by the housing crisis, but it was happening already. Home valuations are now reflective of the shift inward. Christopher Leinberger, analyzing data from the online real estate database Zillow, found this to be the case by comparing real estate prices in center cities and inner suburbs with their far-out suburban counterparts in the late 1990s and today.

One of the hottest areas is in multifamily construction—the market for apartment and condo buildings and other structures containing four or more housing units, whether in cities or in suburbs. Construction of this kind of housing has more than doubled since the housing crisis set in. Part of this growth is due to a boom in the market for rental housing. The number of renters surged by more than five million in the 2000s, the largest ten-year increase since World War II. Vacancy rates are down and rents are soaring across the country, even in markets with lots of foreclosures. The vast majority of multifamily housing starts these days are rentals, whereas in the height of the housing crisis they were predominantly condos for sale. Meanwhile, the urbanization of the suburbs has only just begun. It’s not just New Urbanists and other urban or “green” activists that are preaching this idea.


The New Enclosure: The Appropriation of Public Land in Neoliberal Britain by Brett Christophers

Boris Johnson, Capital in the Twenty-First Century by Thomas Piketty, Corn Laws, credit crunch, cross-subsidies, Diane Coyle, estate planning, ghettoisation, Hernando de Soto, housing crisis, income inequality, invisible hand, land reform, land tenure, land value tax, late capitalism, market clearing, Martin Wolf, New Journalism, New Urbanism, off grid, offshore financial centre, performance metric, Philip Mirowski, price mechanism, price stability, profit motive, Right to Buy, Skype, sovereign wealth fund, special economic zone, the built environment, The Wealth of Nations by Adam Smith, Thorstein Veblen, urban sprawl, wealth creators

Osborne, ‘UK House-Building Crisis – and How to Solve It’, Guardian, 19 May 2014. 4 G. Trefgarne, ‘Planning Log-Jam “Has Created Housing Crisis”’, Telegraph, 15 January 2003. 5 K. Niemietz, Abundance of Land, Shortage of Housing, IEA Discussion Paper No. 38, April 2012 – pdf available at iea.org.uk. 1 D. Bowie, ‘Responses to the Housing Crisis in the UK’, paper presented at the RC21 ‘The Ideal City’ conference, Urbino, Italy, 27–29 August 2015. 2 Bowie identifies two in particular – Paul Cheshire and Alun Evans – and cites two studies: P. Cheshire, M. Nathan and H. Overman, Urban Economics and Urban Policy: Challenging Conventional Policy Wisdom (Cheltenham: Edward Elgar, 2014); and A. Evans and O. Hartwich, Unaffordable Housing: Fables and Myths (London: Policy Exchange, 2005). 3 Bowie, ‘Responses to the Housing Crisis’, p. 4. 4 C. Howes, ‘The Ownership of Vacant Land by Public Agencies’, Land Development Studies 1 (1984), pp. 23–33, at p. 26. 5 HC Deb 24 April 1986, c491. 6 HC Deb 30 November 1990, c1138. 1 R.

And its lobbying is often underwritten or accompanied by monetary payment. In March 2014, the following headline appeared in London’s Evening Standard: ‘Sell Public Land to Solve Housing Crisis, Boris Johnson Is Told.’1 And in this case it was not Whitehall doing the telling. Johnson, then London mayor, was being instructed to privatize public land in the capital by London First, a business lobby group. He would hear the same message from the Berkeley Group, one of Britain’s leading property developers. In 2012, Johnson had commissioned the development analysts Molior to research barriers to housing delivery in London, which prompted Berkeley in 2015 to proffer its own diagnosis and advice regarding the same issue: ‘Despite the housing crisis and need for the public sector to raise funds, public sector land is not being released quickly enough for development’.

Indeed, lack of land was the single ‘highest-rated reason from survey respondents for their authority not engaging in housing delivery’, cited by nearly 90 per cent.2 After four decades of incessant pressure to sell their land, many local authorities simply no longer have the land they need to build housing, which is something that most want, and feel they are in principle able, to do – Morphet and Clifford finding ‘a growing appetite and capacity in local authorities to return to or increase their roles in providing housing as a core function’.3 As I discussed earlier in this chapter, some local authorities, in the face of a mounting housing crisis, have latterly begun buying back ex-council houses, at a significant financial loss. Denuded of the necessary land to build housing, as well as schools, some councils, such as Enfield, have also recently been (re)acquiring land for the purposes of new housing development, usually – as in Enfield’s case – in partnership with private-sector developers.1 As if that were not enough, the government’s February 2017 housing White Paper raised the prospect of giving local authorities enhanced compulsory purchase powers to buy back from housebuilders ex-public land on which the latter were failing to build. (‘A solid start to tackling Britain’s housing crisis’, the Financial Times crowed.)2 Its May 2017 general election manifesto made similar noises about reforming compulsory purchase powers, for similar purposes, and in his November budget the Chancellor announced a first step – the Homes and Communities Agency would get new compulsory purchase powers ‘to help support local authorities and developers to deliver new housing and infrastructure’.3 All of this, needless to say, without a word about the decades-long history of public-land disposal that has put the state in the absurd position of having to contemplate the substantial, forced and costly (re)purchase of land.4 I cannot have been the only one to have had their breath literally taken away by Prime Minister Theresa May’s promise of ‘a new generation of council houses to help fix our broken housing market’ in the very same speech, to the Tory party conference in October 2017, in which she also pledged to ensure councils ‘release more land for housing’ to the private sector.1 Nevertheless, none of the vast commentary on the speech, including by so-called housing experts, mentioned this manifest contradiction.


Beautiful Data: The Stories Behind Elegant Data Solutions by Toby Segaran, Jeff Hammerbacher

23andMe, airport security, Amazon Mechanical Turk, bioinformatics, Black Swan, business intelligence, card file, cloud computing, computer vision, correlation coefficient, correlation does not imply causation, crowdsourcing, Daniel Kahneman / Amos Tversky, DARPA: Urban Challenge, data acquisition, database schema, double helix, en.wikipedia.org, epigenetics, fault tolerance, Firefox, Hans Rosling, housing crisis, information retrieval, lake wobegon effect, longitudinal study, Mars Rover, natural language processing, openstreetmap, prediction markets, profit motive, semantic web, sentiment analysis, Simon Singh, social graph, SPARQL, speech recognition, statistical model, supply-chain management, text mining, Vernor Vinge, web application

Chapter 16, Beautifying Data in the Real World, by Jean-Claude Bradley, Rajarshi Guha, Andrew Lang, Pierre Lindenbaum, Cameron Neylon, Antony Williams, and Egon Willighagen, shows how crowdsourcing and extreme transparency have combined to advance the state of drug discovery research. Chapter 17, Superficial Data Analysis: Exploring Millions of Social Stereotypes, by Brendan O’Connor and Lukas Biewald, shows the correlations and patterns that emerge when people are asked to anonymously rate one another’s pictures. Chapter 18, Bay Area Blues: The Effect of the Housing Crisis, by Hadley Wickham, Deborah F. Swayne, and David Poole, guides the reader through a detailed examination of the recent housing crisis in the Bay Area using open source software and publicly available data. Chapter 19, Beautiful Political Data, by Andrew Gelman, Jonathan P. Kastellec, and Yair Ghitza, shows how the tools of statistics and data visualization can help us gain insight into the political process used to organize society. Chapter 20, Connecting Data, by Toby Segaran, explores the difficulty and possibilities of joining together the vast number of data sets the Web has made available.

It could probably be argued that housing prices had a significant effect on the CPI throughout the period under study. With this basic overview in hand, we now drill down into the details. In the following sections we break the house sales into smaller groups, first by price and then by location. We are interested in finding out whether the housing crisis has affected some groups of homeowners more than others. The Rich Get Richer and the Poor Get Poorer Has the housing crisis equally affected the rich and the poor? Has the effect of the crisis been to improve or worsen the relative equality of these two groups? In this section, we will explore how the crisis has affected the distribution of housing prices. A big caveat is that we are looking at the Bay Area, so homes will be more expensive than in many other 308 CHAPTER EIGHTEEN Download at Boykma.Com places in the country, but we still expect to see some relative inequalities.

The single circle represents the location of Mountain View, the only city where the sale price has continued to increase. percentage of college graduates, and commute time. The correlation between price drop and commute time is weak, but note that all of the cities with the longest commute times (more than 35 minutes) have particularly large drops in price. It appears that the housing crisis has been relatively more damaging in poorer areas. The county-level census data contains more variables than the data for cities, so we analyzed the county data for further explanation of the housing crisis. The plot at the top of Figure 18-12 shows, for each county in which we had sales data, the percentage change in the number of housing units (from 2000 to 2006) plotted against the median sale price in 2008. There is a strong negative relationship between recent home values and the amount of new construction.


pages: 232

Planet of Slums by Mike Davis

barriers to entry, Branko Milanovic, Bretton Woods, British Empire, Brownian motion, centre right, clean water, conceptual framework, crony capitalism, declining real wages, deindustrialization, Deng Xiaoping, edge city, European colonialism, failed state, Gini coefficient, Hernando de Soto, housing crisis, illegal immigration, income inequality, informal economy, Intergovernmental Panel on Climate Change (IPCC), Internet Archive, jitney, jobless men, Kibera, labor-force participation, land reform, land tenure, liberation theology, low-wage service sector, mandelbrot fractal, market bubble, megacity, microcredit, Nelson Mandela, New Urbanism, Pearl River Delta, Ponzi scheme, RAND corporation, rent control, structural adjustment programs, surplus humans, upwardly mobile, urban planning, urban renewal, War on Poverty, Washington Consensus, working poor

Although the dominant global pattern is the eviction of the poor from the center, some Third World cities reproduce US-style urban segregation, with the postcolonial middle classes fleeing from the core to gated suburbs and so-called "edge cities." This has long been the case in Kingston, where one quarter of a million poor people inhabit the crime-ridden but culturally dynamic Downtown, wThile the middle 40 David Glasser, "The Growing Housing Crisis in Ecuador" in Carl Patton (ed.), Spontaneous Shelter: International Perspectives and Prospects, Philadelphia 1988, p. 150. 41 Oscar Lewis, The Children of Sanche%: Autobiography of a Mexican Family, New York 1961. 42 Kalinga Tudor Silva and Karunarissia Athukorala, The Watta-Dwellers: A Sociological Study of Selected Urban Tow-Income Communities in Sri Tanka, Lanham (Md.) 1991, p. 20. 43 Feng-hsuan Hsueh, Beijing: The Nature and the Planning of the Chinese Capital City, Chichester 1995, pp. 182-84.

Algeria in the early 1980s, for example, began to subdivide urban land reserves into plots, ostensibly for development by housing cooperatives; building materials were furnished at subsidized prices. As architect Djaffar Lesbet observes, however, this theoretically elegant balance between state aid and local initiative did not democratize access to housing: "The building plots have allowed those whom the system privileged to hold onto their lead, to achieve their own housing. They have also helped to reduce the dramatic and political tone of the housing crisis, by transforming this national issue into an individual problem."44 As a result, civil servants and others have acquired subsidized detached homes and villas, while the truly poor have ended up in illegal shacks in bidonvilles. Although lacking the revolutionary elan of Algeria, Tunisia also developed substantial state-subsidized housing, but 75 percent of it was unaffordable by the poor, who instead crowded into Tunis's sprawling slums such as Ettadhamen, Mellassine, and Djebel Lahmar.45 India illustrates the same trend in several different guises.

Most of the site-and-service lots ended up in the hands of state employees and the middle class.12 Planning expert Charles Choguill says this is unsurprising because the minimum savings required by the World Bank to qualify for a construction loan was so high that it automatically excluded most of the squatters.13 Likewise, in another site-and-service scheme in Lusaka, only one fifth went to the target group, and roughly the same dismal result obtained in Dakar.14 Writing in 1993, the ILO's A. Oberai concluded that World Bank slum-upgrading and sites-and-services projects had largely failed to have visible impact on the housing crisis in the Third World: "Despite efforts to make projects replicable, the project approach ties up excessive resources and institutional effort in a few locations and has not been able to achieve the desired level of housing stock. The project approach is therefore unlikely to have a significant impact on solving the problem of shelter in most developing countries."15 Other critics pointed to the programmatic disassociation of housing provision from employment creation, and the inevitable tendency for sites-and-services schemes to be located in peripheries poorly served, if at all, by public transport.16 11 Greg O'Hare, Dina Abbott, and Michael Barke, "A Review of Slum Housing Policies in Mumbai," Gties 15:4 (1998), p. 279. 12 A.


pages: 325 words: 89,374

Municipal Dreams: The Rise and Fall of Council Housing by John Boughton

British Empire, deindustrialization, full employment, garden city movement, ghettoisation, housing crisis, Jane Jacobs, laissez-faire capitalism, manufacturing employment, negative equity, Neil Kinnock, neoliberal agenda, new economy, New Urbanism, profit motive, rent control, Right to Buy, rising living standards, starchitect, The Death and Life of Great American Cities, the market place, upwardly mobile, urban decay, urban planning, urban renewal, young professional

On one hand, the cottage suburbs presented a more idealistic and generous response to working-class housing needs, but pressures of space and affordability seemed to compel the tenement as a feasible solution. This contest between multi-storey living – densification in current jargon – and low-rise persisted, fought out in the competing visions of architects and planners and the conflicting priorities of politicians. After 1914, the political class would find that the Great War created a housing crisis among a working class that it both needed and feared more strongly than ever before. This compelled a new, larger and far more generous state operation to manage housing. And so, in 1919, the first great age of council house building began. 2 ‘The World of the Future’: The Interwar Period The ‘Homes and Property’ section of the Evening Standard describes the Dover House Estate as ‘a charming enclave on the western edge of Putney’.1 In 1919, the local middle classes looked far less favourably on this new LCC estate.

We can get the pram in here’. There was a toilet and a bathroom. I’d been used to a toilet in the garden. The kitchen had an Electrolux refrigerator, a New World gas stove, plenty of cupboards. There was a nice garden. It was like coming into a fortune. My wife said, ‘Start measuring for the lino’.4 Another expedient, begun under wartime emergency powers granted in 1939 but maintained through the post-war housing crisis, was requisitioning of empty properties to house those in need. A total of 71,493 properties were requisitioned during the war, and another 51,695 up to 1951.5 Some authorities, particularly Labour ones, used the powers enthusiastically. For example, in Hackney by 1950, 3,800 homes had been taken over to house those on the waiting list. In Wandsworth, it was 3,700. A Conservative government, with greater care for the interests of property, passed legislation in 1955 ending local authorities’ requisitioning powers and requiring requisitioned properties be returned or disposed of by 1960.

The anecdotal testimony was seemingly backed up by hard evidence: overall crime down by 13 per cent, criminal damage almost halved and car theft reduced by 70 per cent.49 Estates have needed regeneration and much good has been done. But, Carlisle City Council, having overseen the demolition of good council housing, soon came to identify a net annual shortfall of 708 affordable homes over the next five years.50 I doubt that Carlisle – far away from the overheated housing markets and relative affluence of the South-East – has suffered an excess of gentrification, but the Alice in Wonderland logic of tackling a housing crisis by destroying solid, genuinely affordable and much-needed council homes seems plain. Despite that criticism, it’s nevertheless important to make one simple observation. I’ve probably seen more council estates (many of them no longer ‘council’, of course) than most people in recent years and the vast majority of them look good: well-maintained, attractively landscaped, overwhelmingly – unless my experience is very unrepresentative or Panglossian – quiet and respectable.


pages: 565 words: 122,605

The Human City: Urbanism for the Rest of Us by Joel Kotkin

autonomous vehicles, blue-collar work, British Empire, carbon footprint, Celebration, Florida, citizen journalism, colonial rule, crony capitalism, deindustrialization, Deng Xiaoping, Downton Abbey, edge city, Edward Glaeser, financial independence, Frank Gehry, Gini coefficient, Google bus, housing crisis, illegal immigration, income inequality, informal economy, Jane Jacobs, labor-force participation, land reform, life extension, market bubble, mass immigration, McMansion, megacity, new economy, New Urbanism, Own Your Own Home, peak oil, pensions crisis, Peter Calthorpe, post-industrial society, RAND corporation, Richard Florida, rising living standards, Ronald Reagan, Seaside, Florida, self-driving car, Shenzhen was a fishing village, Silicon Valley, starchitect, Stewart Brand, Ted Nelson, the built environment, trade route, transit-oriented development, upwardly mobile, urban planning, urban renewal, urban sprawl, Victor Gruen, Whole Earth Catalog, women in the workforce, young professional

Scarcity and Frontiers: How Economies Have Developed Through Natural Resource Exploitation, Cambridge: Cambridge University Press. BARBOUR, Elisa. (2006, February). “Time to Work: Commuting Times and Modes of Transportation of California Workers,” Public Policy Institute of California, http://www.ppic.org/main/publication.asp?i=660. BARKHAM, Patrick. (2014, October 1). “Britain’s housing crisis: are garden cities the answer?,” The Guardian, http://www.theguardian.com/politics/2014/oct/01/britains-housing-crisis-are-gaden-cities-the-answer-ebbsfleet-kent-green-belt. BARRAGAN, Bianca. (2014, April 2). “Los Angeles is the Biggest Anti-Sprawl Success Story in the US,” Curbed Los Angeles, http://la.curbed.com/archives/2014/04/los_angeles_is_the_biggest_antisprawl_success_story_in_the_us.php. BARRIONUEVA, Alexei. (2010, September 5). “Educational Gaps Limit Brazil’s Reach,” New York Times, http://www.nytimes.com/2010/09/05/world/americas/05brazil.html.

“The New American household: 3 generations, 1 roof,” CNN Money, http://money.cnn.com/2012/04/03/real_estate/multi-generation-households/index.htm. CHRISTOPHER, A.J. and TARVER, James D. (June 1994). “Urbanization during Colonial Days in Sub-Saharan Africa,” Urbanization in Africa: A Handbook, Westport: Greenwood Press, 46–7. CHU, Ben. (2014, February 9). “Britain is suffering from a housing crisis—who is to blame and how can we fix it?,” Independent, http://www.independent.co.uk/property/house-and-home/property/britain-is-suffering-from-a-housing-crisis—who-is-to-blame-and-how-can-we-fix-it-9113329.html. CINCO RANCH LIFE. “Cinco Ranch History,” http://www.cincoranchlife.org/page/20251~312161/Cinco-Ranch-History. CITY LIFE. (2014, April 25). “Micro Units—The Newest Trend in Real Estate,” CitiesJournal, http://www.citiesjournal.com/micro-units-newest-trend-real-estate/.

The History of Rome, New York: Meridian Press. MONAGHAN, Tony. (2013, January 30). “Perth—Australia’s most diverse capital,” Committee for Perth, http://www.committeeforperth.com.au/pdf/Advocacy/ReleaseCulturalDiversityJan2013.pdf. MONTEFIORE, Simon Sebag. (2011). Jerusalem: The Biography, New York: Knopf. MOORE, Rowan. (2015, March 14). “Britain’s Housing crisis is a human disaster. Here are 10 ways to solve it,” The Guardian, http://www.theguardian.com/society/2015/mar/14/britain-housing-crisis-10-ways-solve-rowan-moore-general-election. MORGAN, Edward. (2012, August 14). “Sex (Or Not) and the Japanese Single,” New Geography, http://www.newgeography.com/content/003019-sex-or-not-and-japanese-single. MOROZOV, Evgeny. (2011, January 8). “A Walled Wide Web for Nervous Autocrats,” Wall Street Journal, http://online.wsj.com/news/articles/SB10001424052748704415104576065641376054226.


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The Theft of a Decade: How the Baby Boomers Stole the Millennials' Economic Future by Joseph C. Sternberg

Affordable Care Act / Obamacare, Airbnb, American Legislative Exchange Council, Asian financial crisis, banking crisis, Basel III, Bernie Sanders, blue-collar work, centre right, corporate raider, Detroit bankruptcy, Donald Trump, Edward Glaeser, employer provided health coverage, Erik Brynjolfsson, eurozone crisis, future of work, gig economy, Gordon Gekko, hiring and firing, Home mortgage interest deduction, housing crisis, job satisfaction, job-hopping, labor-force participation, low skilled workers, Lyft, Marc Andreessen, Mark Zuckerberg, minimum wage unemployment, mortgage debt, mortgage tax deduction, Nate Silver, new economy, obamacare, oil shock, payday loans, pension reform, quantitative easing, Richard Florida, Ronald Reagan, Saturday Night Live, Second Machine Age, sharing economy, Silicon Valley, sovereign wealth fund, TaskRabbit, total factor productivity, Tyler Cowen: Great Stagnation, uber lyft, unpaid internship, women in the workforce

Boomers confronting a bad job market have often faced an agonizing choice between struggling to find work in the area where they’ve lived for years, or having to sell houses that might now be worth less than they paid for them just to have a chance at moving somewhere else where jobs are more readily available. Unquestionably the Boomers were hammered by a housing crisis. But that doesn’t change the fact that the Millennials have been, too. Or more precisely, Millennials have been hammered by all the steps the Boomers took to try to rescue themselves from their own housing crisis. Meet Generation Rent We all know the stereotypes about Millennial living arrangements—the basement-dwelling, couch-surfing, with-parents-living stuff of Boomer parents’ nightmares. Well, it’s all kind of true. Here are the facts about Millennius domesticus: As of 2014, living with parent(s) was the most common living arrangement for young adults ages eighteen to thirty-four—for the first time in a hundred thirty years.

Over the past century, housing has been the primary form of wealth accumulation for America’s middle class. The Boomers wouldn’t be where they are today if it weren’t for homeownership, and that’s true even after the financial crisis erased trillions of dollars of housing equity and pushed millions of mortgages into foreclosure. That’s why it’s a pretty big problem that Millennials can’t buy houses. And yes, there really is a Millennial housing crisis. This is the one area of any survey of Millennial misfortune where Boomers are likely to have the least sympathy. Millennials, who were too young to have bought houses in large numbers during the boom, didn’t see large amounts of home equity wiped out in the 2007 housing meltdown. Boomers and Gen Xers did. Millennials didn’t directly suffer the emotional and financial traumas of foreclosures, and won’t have those black marks on their credit reports for years to come (although Millennials suffered alongside the rest of their families if their parents were foreclosed on).

Now millions of people could enjoy the stability of a salaried job, while also having the means to accumulate wealth every month with their mortgage payments. The housing market had helped create a new middle class—and with it, a new American economy. The problem is that in the 1990s, as they came into their own politically, the Boomers got greedy. It all started with what at the time seemed like a housing crisis afflicting the Boomers. The homeownership rate started a gentle decline from above 65 percent in the late 1970s to less than 64 percent in the mid-1980s.29 Far more worrying, homeownership among younger buyers ages twenty-five to forty-four fell during the 1980s from just above 60 percent in 1980 to just below 56 percent in 1990, a level lower than it had been in 1960. No one entirely understood why young-adult Boomers weren’t buying.


pages: 294 words: 77,356

Automating Inequality by Virginia Eubanks

autonomous vehicles, basic income, business process, call centre, cognitive dissonance, collective bargaining, correlation does not imply causation, deindustrialization, disruptive innovation, Donald Trump, Elon Musk, ending welfare as we know it, experimental subject, housing crisis, IBM and the Holocaust, income inequality, job automation, mandatory minimum, Mark Zuckerberg, mass incarceration, minimum wage unemployment, mortgage tax deduction, new economy, New Urbanism, payday loans, performance metric, Ronald Reagan, self-driving car, statistical model, strikebreaker, underbanked, universal basic income, urban renewal, War on Poverty, working poor, Works Progress Administration, young professional, zero-sum game

If not, the match disappears and the algorithm is run again to produce a new applicant for the opportunity. * * * According to the system’s designers and funders, coordinated entry upends the status quo in homeless services that privileged stronger clients. It builds new, deeper bonds between service providers throughout Los Angeles, leading to increased communication and resource sharing. It provides sophisticated, timely data about the nature of the housing crisis that can be used to shape more responsive policy-making. But most crucially, by matching homeless people to appropriate housing, it has the potential to save the lives of thousands of people. One of those people is Monique Talley. I met Monique, a round-faced, freckled African American woman, at the Downtown Women’s Center (DWC), a nearly 40-year-old organization dedicated to addressing the needs of poor and unhoused women.

The people in South LA have the same desires: a decent meal, a roof over their head, their kids getting a quality education. South LA is very family oriented. My grandmother saw five generations here.” Surrounded by flatlands and low warehouses full of stitching garment workers, the shelter has a dramatic view of downtown, floating like a jeweled island three miles north. Pathways to Home is trying to bridge the gap between South LA’s housing crisis and its thoroughly inadequate resources, offering beds to approximately 315 men and 115 women nightly. It is a low, large, beige building packed wall-to-wall with bunk beds with about two hand-spans of space between them. Despite the staff’s attempts to make everyone feel welcome and to preserve clients’ dignity, it feels like what it is: a warehouse for people. Pathways follows a harm reduction, housing first philosophy, case manager Richard Renteria explains as he gives me a tour.

“We started to discover within the first three months that people were getting upset when we started to try to re-engage them,” says Veronica Lewis of the Homeless Outreach Program Integrated Care System (HOPICS), also in South LA. “Like, ‘Where’s the housing?’ There was a period of time, a lull of people being unresponsive to us. People were upset because—you come out here, you’ve been collecting information, what is the outcome?” Their cynicism is not unwarranted. It is not the first time the homeless have been offered a magic-bullet solution to the seemingly intractable housing crisis in Los Angeles. “There’s a lot of services out there where they will meet with you, ask you all of these questions, promise you something, and never come back,” says Richard Renteria. “So, they got all this information to create this database, talk about how many thousands of people are homeless, [but] never come back to serve them.” * * * For Monique Talley, coordinated entry was a gift from God.


pages: 309 words: 96,434

Ground Control: Fear and Happiness in the Twenty First Century City by Anna Minton

Albert Einstein, Berlin Wall, Big bang: deregulation of the City of London, Boris Johnson, Broken windows theory, call centre, crack epidemic, credit crunch, deindustrialization, East Village, energy security, Francis Fukuyama: the end of history, ghettoisation, hiring and firing, housing crisis, illegal immigration, invisible hand, Jane Jacobs, Jaron Lanier, Kickstarter, moral panic, new economy, New Urbanism, race to the bottom, rent control, Richard Florida, Right to Buy, Silicon Valley, Steven Pinker, the built environment, The Death and Life of Great American Cities, The Spirit Level, trickle-down economics, University of East Anglia, urban decay, urban renewal, white flight, white picket fence, World Values Survey, young professional

So did the housing shortages predicted by Shelter, which have affected millions more than those officially defined as homeless, fuelling the housing crisis in the process. There are currently more than 1.67 million households on the waiting list for social housing in England, a staggering figure which reflects a 64 per cent increase since 1997. More than 600,000 of these households are homeless, living in overcrowded, temporary or other unsuitable accommodation.20 ‘Right to buy’ was a justifiably popular policy. It transferred wealth to the less well-off, though it also created clusters of poverty in places where the majority of tenants were unable to buy their homes. Yet its most significant legacy, which has so much bearing on today’s housing crisis, was not the selling off of council properties, but the Tory decision to forbid councils to reinvest the money they made from the sales to build more council housing.

Terry Schwarz believes policies like curfews and bans simply treat the symptoms of social problems and not the causes, an approach that permeates all the legislation concerning antisocial behaviour. In Britain rough sleeping barely existed before the late 1980s. But by 1989, all along the Strand, in the heart of London’s theatreland, homeless people were bedded down in one doorway after another. This sudden flood of people on to the streets was a result of the crash which followed the ‘Big Bang’ and the consequent housing crisis, when thousands of homes were repossessed. Benefit cuts and policies on mental health also played a role, with the 1980s witnessing the closure of the old mental asylums, replaced by what became known as ‘care in the community’. Pressures on the NHS, which hit mental health particularly hard, meant that rather than being cared for in the community, many with mental health problems slipped through the net – and on to the streets.

The press and the public have missed a radical change in housing. The process of introducing market forces into the part of the public sector which was once housing policy began with Mrs Thatcher and was stepped up by Labour. While the debate over health and education is fairly robust, there has been no debate over the future of housing. The result is effectively the end of social housing in Britain, a national housing crisis and the creation of new slums. HOW PUBLIC HOUSING WAS KILLED OFF In 1978, the last year before Mrs Thatcher came to power, the government built more than 100,000 council homes and the private sector built 150,000. 17 Since then the figures for private-sector house building have remained roughly stable – although that fell with the downturn – but the government builds hardly any, which is the simple reason why there is such a shortage of housing, not merely for people on low incomes but for many professionals.


pages: 321 words: 85,267

Suburban Nation by Andres Duany, Elizabeth Plater-Zyberk, Jeff Speck

A Pattern Language, American ideology, big-box store, car-free, Celebration, Florida, City Beautiful movement, desegregation, edge city, Frank Gehry, housing crisis, if you build it, they will come, income inequality, intermodal, Jane Jacobs, jitney, McMansion, New Urbanism, Peter Calthorpe, place-making, price mechanism, profit motive, Ralph Nader, Seaside, Florida, Silicon Valley, skinny streets, the built environment, The Death and Life of Great American Cities, The Great Good Place, transit-oriented development, urban planning, urban renewal, urban sprawl, white flight, working poor, Works Progress Administration

But even architects should remain skeptical of the power of well-tested traditional models in the face of extreme social isolation. Diggstown, in Norfolk, Virginia: a neighborhood-style retrofit of a previously distressed inner-city project that epitomizes HUD’s new standards THE MIDDLE-CLASS HOUSING CRISIS Virtually all the thought brought to bear on the housing crisis has been directed toward the urban poor, and rightly so, for they inhabit an environment that most would find unbearable. But the housing crisis is a middle-class issue, too. It has become increasingly difficult for the middle class to own satisfactory housing. In 1970, about 50 percent of all families could afford a median-priced home; by 1990, this number had dropped below 25 percent.4 There are many reasons behind this phenomenon, but the most significant factor is evident in the image on the left.

In recognition of the burdens imposed by multiple automobile ownership, there is now even a new type of loan, a “location-efficient mortgage,” that provides special terms to borrowers purchasing housing in pedestrian-friendly neighborhoods.ad The middle-class housing crisis is not new, and there has been no shortage of ideas designed to make the single-family house more affordable. The building industry and generations of architects have dedicated themselves to the task. The results—plastic plumbing, hollow doors, flimsy walls, vinyl cladding—are very clever, but all of them put together do not generate half the savings that can be achieved by allowing a family to own one car fewer. The problem is not one of architecture but of community planning, and as long as we continue to create places where walking, biking, and transit are pointless, we will continue to exacerbate the middle-class housing crisis. 4 THE PHYSICAL CREATION OF SOCIETY ENVIRONMENTAL CAUSES OF A SOCIAL DECLINE; DRIVERS VERSUS PEDESTRIANS; THE FOUR PREREQUISITES FOR STREET LIFE: MEANINGFUL DESTINATIONS, SAFE STREETS, COMFORTABLE STREETS, AND INTERESTING STREETS The history of a nation is only a history of its villages written large.

TWO WAYS TO GROW THE FIVE COMPONENTS OF SPRAWL A BRIEF HISTORY OF SPRAWL WHY VIRGINIA BEACH IS NOT ALEXANDRIA NEIGHBORHOOD PLANS VERSUS SPRAWL PLANS 2 - THE DEVIL IS IN THE DETAILS WHY TRAFFIC IS CONGESTED WHEN NEARBY IS STILL FAR AWAY THE CONVENIENCE STORE VERSUS THE CORNER STORE THE SHOPPING CENTER VERSUS MAIN STREET THE OFFICE PARK VERSUS MAIN STREET USELESS AND USEFUL OPEN SPACE WHY CURVING ROADS AND CUL-DE-SACS DO NOT MAKE MEMORABLE PLACES 3 - THE HOUSE THAT SPRAWL BUILT THE ODDITY OF AMERICAN HOUSING PRIVATE REALM VERSUS PUBLIC REALM THE SEGREGATION OF SOCIETY BY INCOME TWO ILLEGAL TYPES OF AFFORDABLE HOUSING TWO FORGOTTEN RULES OF AFFORDABLE HOUSING THE MIDDLE-CLASS HOUSING CRISIS 4 - THE PHYSICAL CREATION OF SOCIETY ENVIRONMENTAL CAUSES OF A SOCIAL DECLINE DRIVERS VERSUS PEDESTRIANS PREREQUISITES FOR STREET LIFE 5 - THE AMERICAN TRANSPORTATION MESS THE HIGHWAYLESS TOWN AND THE TOWNLESS HIGHWAY WHY ADDING LANES MAKES TRAFFIC WORSE THE AUTOMOBILE SUBSIDY 6 - SPRAWL AND THE DEVELOPER THE DECLINE OF THE AMERICAN DEVELOPER THE INSIDIOUS INFLUENCE OF THE MARKET EXPERTS QUESTIONABLE CONVENTIONAL WISDOM STRUGGLES WITH THE HOMEBUILDERS A VISIT TO THE NATIONAL ASSOCIATION OF HOME BUILDERS’ ANNUAL CONVENTION 7 - THE VICTIMS OF SPRAWL CUL-DE-SAC KIDS SOCCER MOMS BORED TEENAGERS STRANDED ELDERLY WEARY COMMUTERS BANKRUPT MUNICIPALITIES THE IMMOBILE POOR 8 - THE CITY AND THE REGION THE POSSIBILITY OF GOOD SUBURBS SUBURBS THAT HELP THE CITY THE EIGHT STEPS OF REGIONAL PLANNING THE ENVIRONMENTAL MOVEMENT AS A MODEL 9 - THE INNER CITY THINKING OF THE CITY IN TERMS OF ITS SUBURBAN COMPETITION THE AMENITY PACKAGE CIVIC DECORUM PHYSICAL HEALTH RETAIL MANAGEMENT MARKETING INVESTMENT SECURITY THE PERMITTING PROCESS 10 - HOW TO MAKE A TOWN REASONS NOT TO, AND REASONS TO DO SO ANYWAY REGIONAL CONSIDERATIONS MIXED-USE DEVELOPMENT CONNECTIVITY MAKING THE MOST OF A SITE THE DISCIPLINE OF THE NEIGHBORHOOD MAKING TRANSIT WORK THE STREETS THE BUILDINGS PARKING THE INEVITABLE QUESTION OF STYLE A NOTE FOR ARCHITECTS 11 - WHAT IS TO BE DONE THE VICTORY MYTH THE ROLE OF POLICY MUNICIPAL AND COUNTY GOVERNMENT REGIONAL GOVERNMENT STATE GOVERNMENT FEDERAL GOVERNMENT ARCHITECTS CITIZENS SUBURBAN NATION Acclaim for SUBURBAN NATION APPENDIX A - THE TRADITIONAL NEIGHBORHOOD DEVELOPMENT CHECKLIST APPENDIX B - THE CONGRESS FOR THE NEW URBANISM ACKNOWLEDGMENTS NOTES BIBLIOGRAPHY SOURCES OF ILLUSTRATIONS INDEX Notes Copyright Page PREFACE TO THE 10TH ANNIVERSARY EDITION THE STORY OF SUBURBAN NATION Now that Suburban Nation has managed to stay in print for a decade and sell close to 100,000 copies, it seems excusable to tell the story of how it came to be.


pages: 181 words: 50,196

The Rich and the Rest of Us by Tavis Smiley

affirmative action, Affordable Care Act / Obamacare, back-to-the-land, Bernie Madoff, Bernie Sanders, Buckminster Fuller, Corrections Corporation of America, Credit Default Swap, death of newspapers, deindustrialization, ending welfare as we know it, F. W. de Klerk, fixed income, full employment, housing crisis, Howard Zinn, income inequality, job automation, liberation theology, Mahatma Gandhi, mass incarceration, mega-rich, Nelson Mandela, new economy, obamacare, Occupy movement, plutocrats, Plutocrats, profit motive, Ralph Waldo Emerson, Ronald Reagan, shareholder value, Silicon Valley, Steve Jobs, traffic fines, trickle-down economics, War on Poverty, We are the 99%, white flight, women in the workforce, working poor

The call-and-response chanting came from a coalition of grassroots agencies operating under the banner “Take Back the Land, Madison.” The Wisconsin activists, who believe housing is a human right, seize and occupy abandoned homes for homeless families without consent. For years, consumer advocates, human-rights and political activists, and others have called on the Obama administration to aggressively investigate and prosecute bankers and lenders whose actions led to the worst housing crisis in decades. We now know that the housing and subprime mortgage bonanza was rife with fraud and deception. This complicated enterprise included bankers, appraisers, notaries, investors, and disreputable middlemen who fabricated, altered, and cobbled suspect documentation together to sell properties quickly—whether people could afford them or not. Yet, despite these criminal manipulations, far too few of these elite suspects have been investigated or prosecuted.

Our struggle is related to education, labor, and housing cuts—all of these struggles are intertwined.” Unoccupied, blighted, and foreclosed properties are “health hazards” to the community, Fleming said. Since no one’s forcing the banks to come to the table and discuss rates that poor and struggling people can afford, “the people of the community are house sitting or community sitting.” It’s called the “community economic development plan,” Fleming added. The housing crisis has endangered the American Dream—where every family can own a home or simply have a decent place to live and raise their families. Say what you will about the home occupiers’ tactics, they have the courage to speak truth to power—and they refuse to be powerless. They have the audacity and courage to take on a multibillion-dollar institution. Their strategies may be illegal, but so were the protests that preceded the American Revolution and many of the sit-ins and demonstrations that personified the civil-rights and women’s-rights movements.

Many regard lobbying as it is practiced today as little more than legalized bribery built on normalized corruption. Indeed, some elected officials manage against the odds to maintain their “Mr. Smith Goes to Washington” passion and purity. But too often, once lobbyists begin to exert their extraordinary influence, previously principled men and women sometimes become pawns in a game that only the spineless survive. This is why there has been such an absence of serious investigation into the housing crisis and no indictments against the multibillionaire bankers who profited from the subprime lending boom. In his 2012 State of the Union address, President Obama said that he plans to create a federal mortgage crisis unit charged with investigating the alleged wrongdoings of bankers related to real estate lending. That’s all fine and good. However, just weeks after this announcement, the administration revealed it had reached a $25 billion settlement deal with bankers.


The Making of a World City: London 1991 to 2021 by Greg Clark

Basel III, Berlin Wall, Big bang: deregulation of the City of London, Boris Johnson, British Empire, business climate, business cycle, capital controls, carbon footprint, congestion charging, corporate governance, cross-subsidies, deindustrialization, Dissolution of the Soviet Union, East Village, Fall of the Berlin Wall, financial innovation, financial intermediation, global value chain, haute cuisine, housing crisis, industrial cluster, intangible asset, Kickstarter, knowledge economy, knowledge worker, labour market flexibility, low skilled workers, manufacturing employment, Masdar, mass immigration, megacity, New Urbanism, offshore financial centre, Pearl River Delta, place-making, rent control, Robert Gordon, Silicon Valley, smart cities, sovereign wealth fund, trickle-down economics, urban planning, urban renewal, working poor

Available at www.smf.co.uk/files/2013/4149/ 4138/Tony_Travers_presentation_Chalk__talk_-_4_July.pdf. Accessed 2013 Mar 4. Travers T (2012b). Devo Max for London? Urban Government and Fiscal Autonomy. Presentation. Available at www2.lse.ac.uk/government/research/ resgroups/BGatLSE/Documents/Devo-max-for-London.pdf. Accessed 2013 Mar 14. Travers T (2013a). London’s housing crisis triggers a culture war. Evening Standard. Jan 29. Available at www.standard.co.uk/comment/comment/tony-travers-lon dons-housing-crisis-triggers-a-culture-war-8471038.html. Accessed 2013 March 1. Bibliography 217 Travers T (2013b). Tony Travers on how Ed Koch’s style paved the way for Britain’s mayors. The Guardian. Feb 1. Available at www.guardian.co.uk/world/2013/feb/ 01/ed-koch1?INTCMP=SRCH. Accessed 2013 Feb 27. Travers T (2014). Evolving London – The Future Shape of the Capital.

It is particularly gratifying that Greg sees London: World City with a legacy that persists, leading to a fresh agenda for 2021: updated challenges to be addressed if London, a quarter of a century on, is to retain and enhance its global xii Foreword leader status in the face of today’s competitor cities – the same intention and some familiar themes, although some of the challenges are new. Chapter 13 sets out eight ‘imperatives’ – critical policy priorities. They include a worsening housing crisis, seen as ‘perhaps the single major concern’: a worsening imbalance between need and supply, with issues of affordability, tenure and quality, in danger of becoming a serious drag on London’s future success. Related to this is the lack of any mechanism for relating London within its administrative boundary to its wider functional (in housing, labour market and transport terms) region in south-east England, requiring the creation of a fit-for-purpose governance structure: a challenge for the next Government.

Paul Cheshire, Professor of Economic Geography at LSE, has warned that the shortage of good-quality, affordable long-tenure accommodation may create 106 The evolution of London, 1991 to 2015 knock-on effects on salary demands and in effect render the city less competitive. There are also risks of serious price volatility brought about by the combination of inelastic supply and tied-up wealth (personal communication, 9 December 2013). There is no consensus on the appropriate spatial solutions to the housing crisis. On the one hand, the National Trust, the Campaign to Protect Rural England and suburban lobby groups have found allies in pro-city supporters of densification. Conversely, economists and opponents of the planning system support the social and commercial rationale behind housing development on underdeveloped land, including the possible creation of ‘garden cities’ in the south east (Travers, 2013b).


pages: 160 words: 6,876

Shaky Ground: The Strange Saga of the U.S. Mortgage Giants by Bethany McLean

activist fund / activist shareholder / activist investor, Affordable Care Act / Obamacare, collateralized debt obligation, crony capitalism, housing crisis, mortgage debt, negative equity, obamacare, race to the bottom

The analysis was very similar to that in a paper called “Fannie Mae Insolvency and Its Consequences” that was circulating among senior officials at the National Economic Council and the Treasury. Even the language was similar. “A government seizure is inevitable,” it began. It noted the same accounting concerns, and even ended with a version of the same conclusion: “A fully government owned guarantor of mortgage debt might be exactly what is called for given the current housing crisis . . . without the need to satisfy a fiduciary duty to shareholders, Fannie might finally be able to perform its affordable housing mission in a helpful and proactive manner.” The Monday after the Barron’s story ran, Fannie’s stock fell 13 percent. Then, in mid-July, stories appeared in both the Wall Street Journal and the New York Times. The Times wrote: “Senior Bush administration officials are considering a plan to have the government take over one or both of the companies and place them in a conservatorship if their problems worsen.”

Later, in a 1936 speech to the National Association of Real Estate Boards—which would become the politically powerful National Association of Realtors—Roosevelt said, “We have not yet found a satisfactory solution to one of the most fundamental of our economic problems—the provision for all American citizens of the kind of homes in which they have a right to live. I know you, with me, will not be content until a sound housing program is established for the whole nation.” The attempts to fix the housing crisis brought about by the Depression, which became the roots of the housing finance system we have today, actually began with President Herbert Hoover. In the summer of 1932, Congress passed the Federal Home Loan Bank Act; the idea was that federally backed regional banks would make cash advances to their local member banks, thereby encouraging those banks to lend. After Roosevelt took office in 1933, Congress passed the National Housing Act, which created the Federal Housing Administration.

Less than ten minutes later, Geithner fired back a letter saying that the GSEs’ own analysis showed that principal reduction could help up to half a million borrowers and save several billion dollars. The core difference was in their views of the risk of strategic defaults, which Treasury argued was minimal. “You have the power to help more struggling homeowners and heal the remaining damage from the housing crisis,” Geithner wrote to DeMarco. But DeMarco would not budge. Treasury officials, and at least some of the National Economic Council economists, thought DeMarco’s view was ridiculously narrow. Taxpayers, after all, would benefit from what benefited the broader economy. “The White House couldn’t believe it,” says a former official. “You’ve got the NEC, HUD, and Treasury saying, ‘These are the numbers,’ and this guy who is not even confirmed is completely blocking us.


pages: 393 words: 91,257

The Coming of Neo-Feudalism: A Warning to the Global Middle Class by Joel Kotkin

Admiral Zheng, Andy Kessler, autonomous vehicles, basic income, Bernie Sanders, call centre, Capital in the Twenty-First Century by Thomas Piketty, carbon footprint, Cass Sunstein, clean water, creative destruction, deindustrialization, demographic transition, don't be evil, Donald Trump, edge city, Elon Musk, European colonialism, financial independence, Francis Fukuyama: the end of history, gig economy, Gini coefficient, Google bus, guest worker program, Hans Rosling, housing crisis, income inequality, informal economy, Jane Jacobs, Jaron Lanier, Jeff Bezos, job automation, job satisfaction, Joseph Schumpeter, land reform, liberal capitalism, life extension, low skilled workers, Lyft, Mark Zuckerberg, market fundamentalism, Martin Wolf, mass immigration, megacity, Nate Silver, new economy, New Urbanism, Occupy movement, Parag Khanna, Peter Thiel, plutocrats, Plutocrats, post-industrial society, post-work, postindustrial economy, postnationalism / post nation state, precariat, profit motive, RAND corporation, Ray Kurzweil, rent control, Richard Florida, road to serfdom, Robert Gordon, Sam Altman, Satyajit Das, sharing economy, Silicon Valley, smart cities, Steve Jobs, Stewart Brand, superstar cities, The Death and Life of Great American Cities, The Future of Employment, The Rise and Fall of American Growth, Thomas L Friedman, too big to fail, trade route, Travis Kalanick, Uber and Lyft, uber lyft, universal basic income, unpaid internship, upwardly mobile, We are the 99%, Wolfgang Streeck, women in the workforce, working-age population, Y Combinator

Bring It,” The Conversation, October 11, 2017, https://theconversation.com/gentrification-bring-it-82107. 47 Kevin Baker, “The Death of a Once Great City,” Harper’s, July 2018, https://harpers.org/archive/2018/07/the-death-of-new-york-city-gentrification/; Theodore Dalrymple, “The Architect as Totalitarian,” City Journal, Autumn 2009, https://www.city-journal.org/html/architect-totalitarian-13246.html; Claire Berlinski, “The Architectural Sacking of Paris,” City Journal, Winter 2018, https://www.city-journal.org/html/architectural-sacking-paris-15655.html. 48 James Heartfield, “London’s Social Cleansing,” New Geography, May 13, 2012, http://www.newgeography.com/content/002824-london%E2%80%99s-social-cleansing. 49 Ibid.; Sara Malm, “Is buying a house just a pipe dream? Concrete tubes just over eight feet wide, with a bench that turns into a bed, could be your solution,” Daily Mail, January 15, 2018, http://www.dailymail.co.uk/news/article-5271411/8ft-concrete-tubes-solution-housing-crisis.html; James Heartfield, “Britain’s Housing Crisis: The Places People Live,” New Geography, January 28, 2013, http://www.newgeography.com/content/003432-britains-housing-crisis-the-places-people-live. 50 Maggie Shen King, An Excess Male (New York: Harper, 2017), 11. 51 Richard Florida, The Rise of the Creative Class (New York: Basic Books, 2002). 52 Office of the New York Comptroller Scott M. Stringer, “New York City’s Millennials in Recession and Recovery,” April 2016, https://comptroller.nyc.gov/wp-content/uploads/documents/NYC_Millennials_In_Recession_and_Recovery.PDF; Corinne Lestch, “NYC affordable housing is vanishing as rents skyrocket, incomes decline: report,” New York Daily News, April 23, 2014, https://www.nydailynews.com/new-york/nyc-rents-soar-incomes-decline-article-1.1765445; Patrick Clark, “The Exact Moment Big Cities Got Too Expensive for Millennials,” Bloomberg, July 15, 2015, https://www.bloomberg.com/news/articles/2015-07-15/the-exact-moment-big-cities-got-too-expensive-for-millennials?

CNN, May 6, 2017, https://money.cnn.com/2017/05/26/news/economy/mark-zuckerberg-universal-basic-income/index.html; Chris Weller, “Elon Musk doubles down on universal basic income: ‘It’s going to be necessary,’” Business Insider, February 13, 2017, https://www.businessinsider.com/elon-musk-universal-basic-income-2017-2; Patrick Caughill, “Another Silicon Valley Exec Joins the Ranks of Universal Basic Income Supporters,” Futurism, September 8, 2017, https://futurism.com/another-silicon-valley-exec-joins-the-ranks-of-universal-basic-income-supporters; Sam Altman, “Moving Forward on Basic Income,” Y Combinator, May 31, 2016, https://blog.ycombinator.com/moving-forward-on-basic-income/; Diane Francis, “The Beginning of the End of Work,” American Interest, March 19, 2018, https://www.the-american-interest.com/2018/03/19/beginning-end-work/. 14 “The YIMBY Guide to Bullying and Its Results: SB 827 Goes Down in Committee,” City Watch LA, April 19, 2018, https://www.citywatchla.com/index.php/los-angeles/15298-the-yimby-guide-to-bullying-and-its-results-sb-827-goes-down-in-committee; John Mirisch, “Tech Oligarchs and the California Housing Crisis,” California Political Review, April 15, 2018, http://www.capoliticalreview.com/top-stories/tech-Oligarchs-and-the-california-housing-crisis/; Joel Kotkin, “Giving Common Sense a Chance in California,” City Journal, April 26, 2018, https://www.city-journal.org/html/giving-common-sense-chance-california-15868.html. 15 Thomas Piketty, Capital in the Twenty-First Century, trans. Arthur Goldhammer (Cambridge, Mass.: Belknap/Harvard, 2014), 85. 16 VanderMey, “Why Are Young Billionaires So Boring?”

genericContentID=249797&channelID=311; Joel Kotkin, “The Progressives’ War on Suburbia,” New Geography, November 16, 2014, http://www.newgeography.com/content/004773-the-progressives-war-suburbia. 5 Patrick Condon, “Government should supply housing for up to 40 percent of Vancouver wage earners,” Think Pol, December 3, 2017, https://thinkpol.ca/2017/12/03/condon-govt-should-supply-housing-for-up-to-40-percent-of-vancouver-wage-earners/; Edward Ring, “The Density Delusion,” California Policy Center, August 20, 2019, https://californiapolicycenter.org/the-density-delusion/. 6 “A home truth for the Tories: fix the housing crisis or lose power for ever,” Spectator, April 21, 2018, https://www.spectator.co.uk/2018/04/a-home-truth-for-the-tories-fix-the-housing-crisis-or-lose-power-for-ever. 7 Joseph Chamie, “The Rise of One-Person Households,” Inter Press Service News Agency, February 22, 2017, http://www.ipsnews.net/2017/02/the-rise-of-one-person-households/; Eric Klinenberg, Going Solo: The Extraordinary Rise and Surprising Appeal of Living Alone (New York: Penguin, 2013), 38–39; Council on Contemporary Families, “Reminder: Marriage Is No Longer the Mode,” September 12, 2017, https://contemporaryfamilies.org/singles2017factsheet/. 8 Jan Woronoff, Japan: The Coming Social Crisis (Tokyo: Lotus Press, 1984), 349–50. 9 Choe Sang-Hun, “A Writer Evokes Loss on South Korea’s Path to Success,” New York Times, September 8, 2012, https://www.nytimes.com/2012/09/08/world/asia/shin-kyung-sook-mines-south-koreas-sense-of-loss.html. 10 “All the Single Ladies: China Leads World in Unmarried People—Report,” Sputnik International, December 21, 2016, https://sputniknews.com/art_living/201612211048842308-china-unmarried-people/; Chamie, “The Rise of One-Person Households.” 11 Joel Kotkin, “The Rise of Post-Familialism: Humanity’s Future,” Chapman University and Civil Service College of Singapore, 2012, https://www.chapman.edu/wilkinson/_files/the-rise-of-post-familialism.pdf. 12 Mary Eberstadt, “‘The Great Scattering’: How Identity Panic Took Root in the Void Once Occupied by Family Life,” Quillette, August 27, 2019, https://quillette.com/2019/08/27/the-great-scattering-how-identity-panic-took-root-in-the-void-once-occupied-by-family-life/. 13 Klinenberg, Going Solo; Liz Greene, “Why Millennials Are Choosing to Be Child-Free,” Role Reboot, February 6, 2019, http://www.rolereboot.org/culture-and-politics/details/2019-02-why-millennials-are-choosing-to-be-child-free/; Claire Cain Miller, “Americans Are Having Fewer Babies.


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$2.00 A Day: Living on Almost Nothing in America by Kathryn Edin, H. Luke Shaefer

Affordable Care Act / Obamacare, business cycle, clean water, ending welfare as we know it, future of work, Home mortgage interest deduction, housing crisis, impulse control, indoor plumbing, informal economy, low-wage service sector, mass incarceration, race to the bottom, randomized controlled trial, Ronald Reagan, The Future of Employment, War on Poverty, working poor, Works Progress Administration

Since 2000, more and more Americans have found that the price of an apartment is out of their reach. Those concerned about the affordable housing crisis often focus a spotlight on rising rents. Clearly, a few million additional government rental subsidy vouchers would help. In addition, there is a place for investment in the building or rehabbing of more affordable housing. There’s actually already an underutilized mechanism in place at the federal level that could help with this—the National Housing Trust Fund. The NHTF is supposed to act as a pot of money that could be tapped by states to help support the building of affordable housing developments. Yet the recent housing crisis derailed efforts to fully fund the NHTF, and the federal government has yet to build the program up. One idea to fund such an initiative is to limit the home mortgage interest deduction on mortgage values above a certain level, perhaps half a million or a million dollars, in effect shifting a subsidy away from very wealthy families to some of the very poorest ones.

In Chicago, as well as in virtually every other jurisdiction in the country, child welfare officials deem it inappropriate for a brother and sister to sleep in the same bedroom once they reach a certain age. At some point, if the authorities were to find out that Kaitlin and Cole were sharing a room, Jennifer would be at risk of losing custody due to “neglect.” By today’s standards of child well-being, Jennifer can’t move into a studio apartment to help balance her family’s budget. The most obvious manifestation of the affordable housing crisis is in rising rents. Between 1990 and 2013, rents rose faster than inflation in virtually every region of the country and in cities, suburbs, and rural areas alike. But there is another important factor at work here that is an even bigger part of the story than the hikes in rent: a fall in the earnings of renters. Between 2000 and 2012 alone, rents rose by 6 percent. During that same period, the real income of the middling renter in the United States fell 13 percent.

With so many of their citizens cut off from any legitimate access to a cash income, these places may seem unrecognizable as part of “America.” And yet they are America, as much as any other place in the country. Though these forgotten places are indeed a world apart, much of what the extreme poor in other regions experience is reflected in the experiences of these families, too. In the central Delta, welfare is just as dead as it is in the rest of the country, if not more so. The affordable housing crisis and the perils of doubling up are also richly evident in the Delta. So is the stubborn spirit of those with nothing to survive by any means necessary. But a key difference between other places and the economically distressed small towns and rural regions concentrated in the Deep South and Appalachia is the combination of a virtually nonexistent cash safety net and the virtual lack of any formal-sector jobs.


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House of Debt: How They (And You) Caused the Great Recession, and How We Can Prevent It From Happening Again by Atif Mian, Amir Sufi

"Robert Solow", Andrei Shleifer, asset-backed security, balance sheet recession, bank run, banking crisis, Ben Bernanke: helicopter money, break the buck, business cycle, Carmen Reinhart, collapse of Lehman Brothers, creative destruction, debt deflation, Edward Glaeser, en.wikipedia.org, financial innovation, full employment, high net worth, Home mortgage interest deduction, housing crisis, Joseph Schumpeter, Kenneth Rogoff, Kickstarter, liquidity trap, Long Term Capital Management, market bubble, Martin Wolf, money market fund, moral hazard, mortgage debt, negative equity, paradox of thrift, quantitative easing, Robert Shiller, Robert Shiller, school choice, shareholder value, the payments system, the scientific method, tulip mania, young professional, zero-sum game

In 2007 Tennessee ranked eleventh in the country in terms of the share of workers producing goods meant to be shipped to areas outside the state they were working in. From 2007 to 2009, one out every six Tennessee workers producing these goods lost their job. The sharp drop in household spending in California, Florida, Nevada, and New York directly affected Tennessee workers. We cannot be certain of the number of jobs in Tennessee that would have been saved by policy efforts to mitigate the housing crisis elsewhere. But the view that helping troubled home owners in California and Florida was “terrible public policy” from the perspective of Tennesseans is suspect. When it comes to problems associated with levered losses, it does not matter where you live. As we’ve said, the ripple effects on the labor market mean that we are all in this together. The previous chapter laid out the levered-losses theory that demonstrates why Senator Corker’s argument is flawed.

Debt forgiveness is exactly one such policy, and arguably the most effective, given its role in reducing foreclosures and the very large differences in MPCs between creditors and debtors.20 One might argue that it is not the job of a private bank to voluntarily write down mortgage principal for the wider good of the public. However, DeMarco’s position as head of the GSEs was different. The GSEs by this time were a public entity and effectively belonged to taxpayers. It was DeMarco’s responsibility to act in the wider interest of the American public and pursue principal write-downs. Unfortunately, that wasn’t the case, and the failure to respond adequately to the housing crisis was likely the biggest policy mistake of the Great Recession. Some have argued that debt restructuring would have had little benefit because spending out of housing wealth, even for indebted households, is too small to have made a significant contribution to GDP.21 This is a narrow view. As we explained in the first part of the book, the collapse in spending by indebted households infected the entire economy through foreclosures and employment.

While such government intervention would have violated the contracts signed between servicers and MBS investors, these contracts were not designed to deal with such a massive rise in mortgage delinquencies and therefore needed to be scrapped anyway. Further, such an intervention would have cost very little taxpayer money—only the trustees would have needed to be compensated. The proposal would have allowed for more efficient renegotiation of mortgages that would have reduced debt and left both home owners and MBS investors better off—at little taxpayer cost. Another proposal put forth at the beginning of the housing crisis was the allowance of mortgage cram-downs by judges in Chapter 13 bankruptcy. In a Chapter 13 bankruptcy, an individual with too much debt submits a debt payback plan to a bankruptcy trustee in order to reduce his overall debt burden.36 Chapter 13 bankruptcy allows people to reduce debt that is not explicitly secured by some collateral. Credit card debt falls into this category. However, in the case of a mortgage on a principal residence, Chapter 13 does not allow for a reduction of the principal balance and does not prevent foreclosures.37 The week before the 2008 election, soon-to-be Vice President Joseph Biden told Floridians, “If we can help Wall Street, folks, we sure can help Silver Springs Boulevard right here in Ocala.


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Underwater: How Our American Dream of Homeownership Became a Nightmare by Ryan Dezember

activist fund / activist shareholder / activist investor, Airbnb, business cycle, call centre, Cesare Marchetti: Marchetti’s constant, cloud computing, collateralized debt obligation, coronavirus, corporate raider, COVID-19, Credit Default Swap, credit default swaps / collateralized debt obligations, Donald Trump, Home mortgage interest deduction, housing crisis, interest rate swap, margin call, McMansion, mortgage debt, mortgage tax deduction, negative equity, rent control, rolodex, sharing economy, sovereign wealth fund, transaction costs

Many of these young adults will appreciate that they can live in a well-maintained, family-sized suburban home and send their children to good public schools without committing to decades of mortgage payments, tying up their savings in down payments, or risking entrapment in another market collapse. By renting, though, they forsake the method through which most Americans build wealth. Last decade’s housing crisis threatens a more lasting and far-reaching impact on American society than other historic market meltdowns because the previous crashes have generally been in the stock market and share prices mostly affect the rich. The behavior of voters and consumers might be swayed by the direction of stock prices, but most people don’t own much in the way of equities. When the masses suffer following a stock market crash, it’s usually because of the knock-on effects of recession, such as job loss or lessened access to credit, not because their tech stocks lost 40 percent.

Even if Phillips was winning in court, the reception from buyers for the finished product at San Carlos was not a good sign for other towers topping out along the beach. It was clear the air was whooshing out of the condo bubble, but I still hadn’t made the connection between surgeons trying to wriggle out of a regrettable investment over some mildew and my own fortunes. 12 OVER THE HEDGE A timeline of the housing crisis prepared by the Federal Reserve Bank of St. Louis points to February 27, 2007, as an early sign of the brewing calamity when Freddie Mac announced that it would no longer buy the riskiest types of subprime mortgages. For me, the first hint of trouble was the smell of hot garbage wafting over the hedge. It was coming from the house next door. The young couple who owned it were gone. They paid $153,000 for their house around the same time we’d bought ours, setting a new high-water mark in Audubon Place.

NOTES Much of the reporting for this book was undertaken by the author for newspaper articles published by the Mobile Register, which was renamed the Press-Register in late 2005, and The Wall Street Journal. Included in each chapter’s notes are the relevant articles in the order in which the reporting first appears in the narrative, along with more specific citations for work that was not produced by the author. 1. THIS IS THE ONE Ryan Dezember, “My 10-Year Odyssey Through America’s Housing Crisis,” Wall Street Journal, January 26, 2018. The collapse of the U.S. housing market wiped out Financial Crisis Inquiry Commission, “The Financial Crisis Inquiry Report,” New York: PublicAffairs, 2011, xv. At its depths, more than twelve million Americans CoreLogic, “New CoreLogic Data Shows Second Consecutive Quarterly Decline in Negative Equity,” news release, August 26, 2010. Some estimates put the number north of fifteen million Zillow, “Underwater Homeowners Sink Deeper, Even as Home Values Rise,” news release, March 20, 2015.


pages: 288 words: 83,690

How to Kill a City: The Real Story of Gentrification by Peter Moskowitz

affirmative action, Airbnb, Bay Area Rapid Transit, British Empire, clean water, collective bargaining, David Brooks, deindustrialization, Detroit bankruptcy, drive until you qualify, East Village, Edward Glaeser, Golden Gate Park, housing crisis, income inequality, Jane Jacobs, Kickstarter, Kitchen Debate, late capitalism, mortgage tax deduction, Naomi Klein, new economy, New Urbanism, private military company, profit motive, RAND corporation, rent control, Richard Florida, Ronald Reagan, school choice, Silicon Valley, starchitect, The Death and Life of Great American Cities, the High Line, trickle-down economics, urban planning, urban renewal, white flight, working poor, Works Progress Administration, young professional

But he warned the tenants that the landlord would likely start going after each tenant individually, attempting to sue them for nonexistent back rent, pressuring them to leave, hoping the stress would break them. Despite the warning, the day felt like a victory. For now, they’re safe, and each has placed a red sign in the window that in big block letters reads “No Buyouts.” New York City is in the midst of a housing crisis. New York is also, because of its liberal politics, its wealth, and its semi-strong welfare state, in possibly the best position, at least compared with other US cities, to handle a housing crisis. And unlike in other cities, where the electorate is still split on how to solve the gentrification problem (San Francisco mayor Ed Lee ran unopposed except by a few protest candidates who garnered low percentages of the vote and who were not backed by party money; mayors of other cities will not even mention the G-word), New Yorkers appear nearly united in their desire for a progressive solution.

Around the same time, Baruch College and New York 1 (a local news station) conducted a survey that found 65 percent of all New Yorkers feared being priced out of their homes in the next few years. The findings cut across economic and racial lines: low-income residents, Latinos, and black New Yorkers were more likely to be worried about rising rents, but everyone, including a majority of people making over $100,000 a year, feared they were next in line. This is what a housing crisis looks like. If the middle class and even some upper-income people can barely afford New York, what does it mean for the working class and the poor? My brother and sister-in-law are lucky they’re able to afford more, even if it does strain their budget to remain in this city. I am flexible. I’m young, I have money, and I have no immediate family. I can figure it out. Others only have one option: fight back.

The mayor says it’s the only option the broke New York City Housing Authority has to maintain its dilapidated housing stock, but activists see it as yet another private encroachment on public space. Even the city’s private developers have been pleasantly surprised by how pro-development the de Blasio administration is. His deputy mayor for housing and economic development, Alicia Glen, came not from a lefty think tank or nonprofit but from Goldman Sachs, where she oversaw $3 billion in investment in cities. In 2015, I got a chance to sit down with Glen and ask her about the city’s housing crisis. Our interview made it clear that she saw the need for action, but that her solution would not fundamentally challenge gentrification. De Blasio and Glen are progressives, but without challenging the fundamentals of real estate capitalism, their vision is severely limited. I asked her if she understood people’s concerns about being priced out of neighborhoods that were rezoned by the administration she works for.


pages: 479 words: 113,510

Fed Up: An Insider's Take on Why the Federal Reserve Is Bad for America by Danielle Dimartino Booth

Affordable Care Act / Obamacare, asset-backed security, bank run, barriers to entry, Basel III, Bernie Sanders, break the buck, Bretton Woods, business cycle, central bank independence, collateralized debt obligation, corporate raider, creative destruction, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, diversification, Donald Trump, financial deregulation, financial innovation, fixed income, Flash crash, forward guidance, full employment, George Akerlof, greed is good, high net worth, housing crisis, income inequality, index fund, inflation targeting, interest rate swap, invisible hand, John Meriwether, Joseph Schumpeter, liquidity trap, London Whale, Long Term Capital Management, margin call, market bubble, Mexican peso crisis / tequila crisis, money market fund, moral hazard, Myron Scholes, natural language processing, negative equity, new economy, Northern Rock, obamacare, price stability, pushing on a string, quantitative easing, regulatory arbitrage, Robert Shiller, Robert Shiller, Ronald Reagan, selection bias, short selling, side project, Silicon Valley, The Great Moderation, The Wealth of Nations by Adam Smith, too big to fail, trickle-down economics, yield curve

As far as they were concerned, I had nothing interesting or valuable to say. This presented my type A personality an immediate challenge. I arrived at work bursting to discuss alarming economic data erupting on all fronts. Stock market volatility, the collapsing subprime mortgage industry, and the mountain of household debt was unnerving. And not a sounding board for miles. My new colleagues shrugged, uninterested. They believed any housing crisis would be regional. After all, their boss Bernanke had said just that. Their indifference—and subtle hostility—was maddening. As far as I could tell, none of them watched CNBC in the morning. Of course they read the financial newspapers, if they bothered to check their mailboxes. I was often unnerved to find days of the Financial Times stacked up in someone’s box. How could anybody ignore the news in this quickly unraveling world?

However, once inside, I confronted an uncomfortable question: Why were so many of its highly-educated and well-paid economists oblivious as the worst financial crisis since the Great Depression was about to break over their heads? Why had Greenspan been so resolutely blind to the housing bubble his low-interest-rate policies had created? Why didn’t Bernanke sound an alarm instead of repeatedly opining that the housing crisis was “likely to be contained”? Why was Janet Yellen, then president of the Federal Reserve Bank of San Francisco, astonishingly clueless as the housing market in her region imploded? And later, why couldn’t Yellen—an economist known for her brilliant forecasting skills—foresee the consequences of the Fed’s disastrous zero-interest-rate policies after she succeeded Bernanke as Fed chairman?

In 2002, Bernanke, while on the Board of Governors, had paid tribute to Milton Friedman at a conference at the University of Chicago. Acknowledging Friedman’s work on the Depression and his criticism that the Fed’s tight monetary policy had deepened its deprivations for millions of Americans, Bernanke told Friedman, “We did it. We’re very sorry. But we promise not to do it again.” After years of downplaying the housing crisis, Bernanke had finally awakened to the imminent danger. The markets were in turmoil, with the S&P 500 Index down over 16 percent by the third week of January. On Monday, January 21, Martin Luther King Day, Bernanke went into his office believing dramatic action by the Fed was needed before the next FOMC meeting, scheduled for January 30. Though it was a holiday, an emergency videoconference of the FOMC was called for 6 P.M. that evening.


Hollow City by Rebecca Solnit, Susan Schwartzenberg

blue-collar work, Brownian motion, dematerialisation, Golden Gate Park, Haight Ashbury, housing crisis, informal economy, Jane Jacobs, Loma Prieta earthquake, low skilled workers, new economy, New Urbanism, pets.com, rent control, Silicon Valley, South of Market, San Francisco, The Death and Life of Great American Cities, union organizing, upwardly mobile, urban planning, urban renewal, wage slave

Gentrification by driving out the poor and working chosen to give their lives 150-year existence both a refuge class, is transforming the including those over to unlucrative pursuits such as ism, social experimentation, social service. But gentrification fin above water. Below is the rest of the shark: a 13 who have art, activis just the new American economy HOLLOW 14 in which most of us thing will be ble. faster, will CITY be poorer, a few will be more homogenous and more far richer, and every- controlled or controlla- The technology boom and the accompanying housing crisis have fast- forwarded San Francisco into the newest version of the American future, a version that also is being realized in Boston, Seattle, and other cities from New York and Atlanta to Denver and Portland. A decade ago Los Angeles looked like the future —urban warfare, segregation, despair, injustice and decay, open the new corruption— ^but future looks like San Francisco: a frenzy of financial speculation, covert coercions, overt erasures, a barrage of novelty-item restaurants, websites, technologies and trends, the despair of numbness of incessant work hours and homes and neighborhoods. this country is in the a ripple effect Napa and Sonoma sive the anxiety of destabilized jobs, Bay Area, along with 30 percent of the multimedia/ boom that started in Silicon Valley has pro- throughout the region from south of San Jose to in the north. ^ San Francisco has had the most expen- housing of any major American city in the nation for but in the past few years housing prices —^both skyrocketing, along with commercial rents. at a hectic pace, and they in turn generate sales two decades, and rents —have been New businesses are coming in new boutiques, restaurants and bars that displace earlier businesses, particularly nonprofits, and the industry's workers have been outbidding out from under tenants at a for rentals breakneck pace.

All over the city, and replaced with bigger ones, long-vacant built and into dot-com sold, old industrial buildings offices Program puts and upscale down buildings are being torn lots are being filled in, and former nonprofit condos offices turned As San Francisco's Urban Habitat lofts. "The growing gap between low wage and high wage it, workers and the scarcity of housing, especially affordable housing for low income households, is resulting in the displacement of by middle and high income households ties of color."^ San Francisco and ing this housing crisis new jobs without many in historically traffic by encouraging the influx of new technology was the sprawling suburban enterprises and live capital and an aggravation in the nation. of the first become both a bedroom community for the Val- highly paid workers and the capital of the next technological wave the Internet, aka multimedia, with biotechnology about to huge presence in Mission Bay.

Some people have focused on "newcomers," and a sardonic discussion of what consti- —how many years, what kind of habits— tutes a San Franciscan letters page of the SF Weekly for a while. yuppies, and there is definitely tension Some on both filled the people have focused on sides of that divide —those who know they are considered yuppies, and those who hate whoever qualifies as a yuppie in their eyes. Some people have said that it's not the fault of those who came here looking for a job that there's a housing crisis, and it's the local politicos, real estate speculators, greedy landlords and developers who should be targeted. Some human need —housing— exists largely as a need takes back seat to profit. My own a fault a system in which a basic free-market commodity, so that writing has been about culture and politics in other senses. I have written about senses of place, and the geography of culture, about HOLLOW CITY 34 specific issues Lately it and seems to sites, as well as about particular artists and movements.


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Evicted: Poverty and Profit in the American City by Matthew Desmond

affirmative action, Cass Sunstein, crack epidemic, Credit Default Swap, deindustrialization, desegregation, dumpster diving, ending welfare as we know it, fixed income, ghettoisation, glass ceiling, Gunnar Myrdal, housing crisis, informal economy, Jane Jacobs, jobless men, Kickstarter, late fees, mass incarceration, New Urbanism, payday loans, price discrimination, profit motive, rent control, statistical model, superstar cities, The Chicago School, The Death and Life of Great American Cities, thinkpad, upwardly mobile, working poor, young professional

The remaining 67 percent—2 of every 3 poor renting families—received no federal assistance.32 This drastic shortfall in government support, coupled with rising rent and utility costs alongside stagnant incomes, is the reason why most poor renting families today spend most of their income on housing.33 Imagine if we didn’t provide unemployment insurance or Social Security to most families who needed these benefits. Imagine if the vast majority of families who applied for food stamps were turned away hungry. And yet this is exactly how we treat most poor families seeking shelter. — A problem as big as the affordable-housing crisis calls for a big solution. It should be at the top of America’s domestic-policy agenda—because it is driving poor families to financial ruin and even starting to engulf families with moderate incomes. Today, over 1 in 5 of all renting families in the country spends half of its income on housing.34 America can and should work to make its cities livable again. Meaningful change comes in various shapes and sizes.

In 2013, the Bipartisan Policy Center estimated that expanding housing vouchers to all renting families below the 30th percentile in median income for their area would require an additional $22.5 billion, increasing total spending on housing assistance to around $60 billion. The figure is likely much less, as the estimate does not account for potential savings the expanded program would bring in the form of preventing homelessness, reducing health-care costs, and curbing other costly consequences of the affordable-housing crisis.56 It is not a small figure, but it is well within our capacity. We have the money. We’ve just made choices about how to spend it. Over the years, lawmakers on both sides of the aisle have restricted housing aid to the poor but expanded it to the affluent in the form of tax benefits for homeowners.57 Today, housing-related tax expenditures far outpace those for housing assistance. In 2008, the year Arleen was evicted from Thirteenth Street, federal expenditures for direct housing assistance totaled less than $40.2 billion, but homeowner tax benefits exceeded $171 billion.

See Philip Tegeler, Michael Hanley, and Judith Liben, “Transforming Section 8: Using Federal Housing Subsidies to Promote Individual Housing Choice and Desegregation,” Harvard Civil Rights–Civil Liberties Law Review 30 (1995): 451–86; Housing and Community Development Act of 1974, Pub. L. No. 93–383, § 101(a)(1), (c)(6), 88 Stat. 633, 633–34. 10. On foreclosures of rental property, see Gabe Treves, California Renters in the Foreclosure Crisis, Third Annual Report (San Francisco: Tenants Together, 2011); Vicki Been and Allegra Glashausser, “Tenants: Innocent Victims of the Foreclosure Crisis,” Albany Government Law Review 2 (2009); Matthew Desmond, “Housing Crisis in the Inner City,” Chicago Tribune, April 18, 2010; and Craig Karmin, Robbie Whelan, and Jeannette Neumann, “Rental Market’s Big Buyers,” Wall Street Journal, October 3, 2012. Real estate investment manuals promoted investing in foreclosed and damaged properties long before the crash. “Distressed properties can literally make you rich,” one advised in 1998. “Banks don’t like foreclosures. But real estate investors do, because foreclosures can be quick bargain buys.”


pages: 515 words: 132,295

Makers and Takers: The Rise of Finance and the Fall of American Business by Rana Foroohar

accounting loophole / creative accounting, activist fund / activist shareholder / activist investor, additive manufacturing, Airbnb, algorithmic trading, Alvin Roth, Asian financial crisis, asset allocation, bank run, Basel III, bonus culture, Bretton Woods, British Empire, business cycle, buy and hold, call centre, Capital in the Twenty-First Century by Thomas Piketty, Carmen Reinhart, carried interest, centralized clearinghouse, clean water, collateralized debt obligation, commoditize, computerized trading, corporate governance, corporate raider, corporate social responsibility, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, crony capitalism, crowdsourcing, David Graeber, deskilling, Detroit bankruptcy, diversification, Double Irish / Dutch Sandwich, Emanuel Derman, Eugene Fama: efficient market hypothesis, financial deregulation, financial intermediation, Frederick Winslow Taylor, George Akerlof, gig economy, Goldman Sachs: Vampire Squid, Gordon Gekko, greed is good, High speed trading, Home mortgage interest deduction, housing crisis, Howard Rheingold, Hyman Minsky, income inequality, index fund, information asymmetry, interest rate derivative, interest rate swap, Internet of things, invisible hand, John Markoff, joint-stock company, joint-stock limited liability company, Kenneth Rogoff, Kickstarter, knowledge economy, labor-force participation, London Whale, Long Term Capital Management, manufacturing employment, market design, Martin Wolf, money market fund, moral hazard, mortgage debt, mortgage tax deduction, new economy, non-tariff barriers, offshore financial centre, oil shock, passive investing, Paul Samuelson, pensions crisis, Ponzi scheme, principal–agent problem, quantitative easing, quantitative trading / quantitative finance, race to the bottom, Ralph Nader, Rana Plaza, RAND corporation, random walk, rent control, Robert Shiller, Robert Shiller, Ronald Reagan, Satyajit Das, Second Machine Age, shareholder value, sharing economy, Silicon Valley, Silicon Valley startup, Snapchat, Social Responsibility of Business Is to Increase Its Profits, sovereign wealth fund, Steve Jobs, technology bubble, The Chicago School, the new new thing, The Spirit Level, The Wealth of Nations by Adam Smith, Tim Cook: Apple, Tobin tax, too big to fail, trickle-down economics, Tyler Cowen: Great Stagnation, Vanguard fund, zero-sum game

You look at the cost-benefit analysis, and my dream is to take this issue, not just from the compassion argument, but to the finance ministers of the world, and say we cannot afford to not invest in the access to adequate, affordable nutrition for all of humanity.”69 It’s a laudable goal. However, tackling it will first require not only compassion from world leaders, but real change in Wall Street’s business model. In the midst of the housing crisis and Great Recession a few years back, I spent a lot of time traveling through the Inland Empire, a large metropolitan area in the middle of Southern California. It stretches an hour or two east of Los Angeles and Orange County, but is about as far away from the tony “OC” lifestyle as you can imagine. Made up primarily of San Bernardino and Riverside counties, the Inland Empire was at the heart of the subprime mortgage crisis and has yet to fully recover.

In the early 2000s, predatory lenders flocked to the area, offering dicey deals to the largely minority and lower-middle-class white populations who, unable to afford housing on the coast, still craved the American Dream of homeownership. It ended, as it did in so many neighborhoods and cities across America, in tears and massive foreclosures, turning entire cities into ghost towns of derelict properties. As recently as 2012, when I visited the Del Rosa neighborhood of San Bernardino, one of the hardest-hit cities in the housing crisis, remaining homeowners’ efforts to keep their properties up were being thwarted left and right. Groups of young men and school-age kids with pit bulls in tow hung out in front of corner bodegas at midday. For every well-kept bungalow with freshly cut grass and potted plants on the porch, there was an abandoned building spray-painted with gang graffiti or strewn with dirty mattresses and empty liquor bottles.

Home values began rebounding from their post-financial-crisis trough in the beginning of 2012, and by July 2015, home sales had increased to their highest pace in eight and a half years.6 But the percentage of Americans who can call themselves homeowners is still declining from its peak in 2004, and many experts expect it to fall further as credit continues to be tight, young people struggle with higher-than-average levels of unemployment, and baby boomers begin moving into retirement housing.7 Fixing this housing crisis, as Warren Buffett once told me, is a fundamental prerequisite for fixing our economy. And yet, nearly eight years after the crisis of 2008, we aren’t there yet. The national housing market is in recovery, but like the larger economic recovery, it is incredibly bifurcated. Sections of Washington, D.C., and Los Angeles are booming, while Detroit, Atlanta, and California’s Inland Empire are still coping with foreclosures and mortgages that are underwater.


White City, Black City: Architecture and War in Tel Aviv and Jaffa by Sharon Rotbard

British Empire, Buckminster Fuller, continuation of politics by other means, European colonialism, global village, housing crisis, illegal immigration, megastructure, New Urbanism, Pearl River Delta, Peter Eisenman, trade route, urban planning, urban renewal

Firstly, within the Jewish population, memory of their forced exile from Tel Aviv during World War I was still raw. The return had not proved any easier since many of the apartments in Jaffa had been destroyed in their absence or requisitioned by new Arab tenants. Secondly, floods of Jewish immigrants arriving from Eastern Europe after World War I (an immigration wave known as the ‘Third Aliya’) had only increased what was fast becoming a serious housing crisis.114 In the short period between September 1920 and May 1921 alone, 10,000 Jewish immigrants entered through the ‘Gates of Zion’ (or infested the ‘Bride of the Sea’, depending on one’s ethno-religious allegiance).115 Lastly, and most importantly however, was the ideological make-up of this latest batch; having survived their infancy in among the pales and pogroms of Tsarist Russia and their adolescence absorbing the revolutionary fervour of 1917, these immigrants were considerably more radical than previous influxes.

The ethnic and political polarization of the two populations, and their consolidation around their respective national projects, made it impossible to maintain a mixed urban environment. It was no longer possible to try to keep a mixed, double or in-between identity, like that of Yosef Eliyahu Chelouche. Jews had nothing to look for in Jaffa, and the city had been transformed from a cosmopolitan city into an Arab one. Jewish enclaves within Jaffa, such as the Feingold Houses in Manshieh, had gradually deteriorated, atrophied and been abandoned. The housing crisis in the region initially caused by the waves of immigrants from Europe had worsened due to the massive departure of the Jewish population from Jaffa, and soon, the whole region of Tel Aviv and Jaffa was swamped in tent encampments.129 As a result, Tel Aviv’s population in the 1920s multiplied twenty-fold, from 2,084 inhabitants at the beginning of the decade, to 42,000 at its end.130 Mass overcrowding encouraged more land acquisitions and the majority of deals for plots in what is today considered part of Tel Aviv were conducted during this period.

Neve Sha’anan was established in Jaffa in 1921 by a group of 400 Jews. Some were new immigrants, some were internal refugees having fled Arab neighbourhoods in the wake of the May Day riots, and nearly all were homeless, living in tents. In light of the increasingly untenable situation in Jaffa, which had been twitching with rancour ever since the Balfour Declaration in 1917, and the severe housing crisis developing in Tel Aviv, this displaced collective understood the necessity of starting over. The members of the association decided to unite as a collaborative corporation, to purchase a tract of land, and to build a new neighbourhood south of Tel Aviv. Neve Sha’anan in the 1930s, as seen from south to north-east. The New Central Station would be built in the exact boundaries of the orchards in the photograph three decades later.


pages: 384 words: 89,250

Made to Break: Technology and Obsolescence in America by Giles Slade

Albert Einstein, Alexey Pajitnov wrote Tetris, American ideology, Apple's 1984 Super Bowl advert, Buckminster Fuller, business cycle, Cass Sunstein, Charles Lindbergh, creative destruction, Douglas Engelbart, Douglas Engelbart, global village, housing crisis, indoor plumbing, invention of radio, Joseph Schumpeter, Marshall McLuhan, Mikhail Gorbachev, more computing power than Apollo, mutually assured destruction, Ralph Nader, rent control, Ronald Reagan, Silicon Valley, Steve Jobs, the market place, the medium is the message, Thorstein Veblen, unemployed young men, upwardly mobile, Vladimir Vetrov: Farewell Dossier, white picket fence, women in the workforce

More than a thousand urban residential foreclosures occurred every day.23 Throughout America, the homeless and unemployed collected in tent cities,hobo jungles,and Hoover Heights. World War II improved the situation greatly, as 16 million young service men and women shipped out to the European and Pacifi theaters. But this improvement was only temporary. After demobilization, the situation worsened again. In Chicago in 1946, for example, the housing crisis was so bad that over 100,000 veterans—mostly unemployed young men—were homeless.24 In their book Picture Windows: How the Suburbs Happened, Rosalyn Baxandall and Elizabeth Ewen eloquently illustrate just how acute the housing crisis had become:“In Atlanta,2,000 people answered an advertisement for one vacancy. A classifie ad in Omaha newspaper read, ‘Big Ice Box 7 by 17 feet. Could be fi ed up to live in.’”25 In 1933, under FDR, the federal government responded to the crisis with a series of experimental moves that would ultimately render old techniques and styles of housing construction obsolete.

They were one example of what the sociologist Sharon Zukin calls liminal spaces—public areas for meeting, mixing, and transit.33 For low-income inner-city tenants, these liminal spaces, including front stoops, hallways, parks, sidewalks, squares, bus stops, and train terminals, can be sites of uncomfortable interactions—elevator silences, excessive noise, physical aggression. Especially during a depression or other housing crisis, liminal spaces are always overcrowded. Unemployed adults spend long hours there, as do children, poor relatives, and newlyweds forced to bunk-in with family members because they cannot afford their own apartment. The appeal of the porchless suburban house was the escape it offered from intense, overcrowded interaction with one’s neighbors.34 Contrary to popular myth, the urban working class was not driven to Levittown by crime; it was lured there by the promise of space and privacy offered by a detached home.

There was no communal path, no common service area.”35 Alfred, who was the exact opposite of his gregarious brother, was obsessed with privacy in housing design and expressed his belief that it could be made compatible with the mass production of homes. “Without even a trial balloon you guess in advance just how far you could push and persuade [people] to take either open planning or living in a fis bowl until the landscaping grows to give them privacy.”36 After 1948,when the housing crisis eased somewhat,the Levitts committed themselves to constructing detached housing for veterans. They could hardly lose. The government guaranteed veterans’ mortgages and made them available without any down payment at all. So, just as competition was entering the Levitts’ new downscale market, Alfred redesigned the Cape Cod to make it attractive to a middle-class clientele. His newest design featured a ranch-style home available in four basic models.


pages: 317 words: 101,475

Chavs: The Demonization of the Working Class by Owen Jones

Asperger Syndrome, banking crisis, Berlin Wall, Boris Johnson, British Empire, call centre, collapse of Lehman Brothers, credit crunch, deindustrialization, Etonian, facts on the ground, falling living standards, first-past-the-post, ghettoisation, Gini coefficient, hiring and firing, housing crisis, illegal immigration, income inequality, informal economy, low skilled workers, low-wage service sector, mass immigration, Neil Kinnock, Occupy movement, pension reform, place-making, plutocrats, Plutocrats, race to the bottom, Right to Buy, rising living standards, The Bell Curve by Richard Herrnstein and Charles Murray, The Spirit Level, too big to fail, unpaid internship, upwardly mobile, We are the 99%, wealth creators, Winter of Discontent, women in the workforce, working-age population

After long arguing 'we're all middle class', the media and politicians started talking about the working class again, but in a racialized form. The problems of the 'white working class' were ascribed to their whiteness, rather than their class. argued against this false portrait. Indeed, working-class communities and workplaces are more likely to be ethnically diverse than their middle-class counterparts. Problems faced by working-class people who are white-s-like the housing crisis, the lack of good jobs, poor rights at work, declining living standards, safe communities--are to do with class, not race. These are problems shared by working-class people of all ethnic backgrounds. Where race does come into it is the fact that working-class people from ethnic minority backgrounds suffer from other forms of oppression and exploitation. The majority of British Bangladeshis and Pakistanis, for example, live in poverty, while black people are far more likely to be stopped by the police.

For the last thirty years, the dominant mantra has been that 'the market knows best', but the state's retreat from meeting the nation's housing needs in favour of market forces has shown how absurd this quasi-religious belief can be. Aside from the millions who are spending years of their lives on waiting lists, the number of people in temporary accommodation soared by a stunning 135 per cent between 2001 and 2008. And the government might not be spending much on social housing, but instead it spends £21 billion a year on housing benefit, much of which ends up subsidizing private landlords. With the housing crisis worsening year by year, and with accommn, dation so central to people's lives, why did a Labour government leave the whole policy to go to rot? I asked Hazel Blears, whose fonner department when in the Cabinet included responsibility for housing. She accepted that New Labour had failed to build sufficient capaciry.L but with caveats. 'I think that there needed to be a housing programme. I've never been entirely convinced that it should be a council house building programme.

There are some alienated, angry young people out there who take out some of their frustrations in anti-social ways. Things like crime and drug addiction are more common in working- class areas than in the average middle-class suburb. A working-class teenager is considerably more likely to give birth than her middle-class peer. But the reality is rather different from the vicious generalizations and victim-blaming that accompanies chav-hare. Poverty, unemploy- ment and a housing crisis provide fertile ground for a range of social problems. These are working-class communities that took the brunt of a class war first unleashed by Thatcher three decades ago. Indeed, it would be far more startling if life had gone on, much like before, even as the pillars of the community collapsed one by one. * * * Proclaiming that people are responsible for their situation makes it easier to oppose the social reforms that would otherwise be necessary to help them.


pages: 288 words: 64,771

The Captured Economy: How the Powerful Enrich Themselves, Slow Down Growth, and Increase Inequality by Brink Lindsey

"Robert Solow", Airbnb, Asian financial crisis, bank run, barriers to entry, Bernie Sanders, Build a better mousetrap, Capital in the Twenty-First Century by Thomas Piketty, Carmen Reinhart, Cass Sunstein, collective bargaining, creative destruction, Credit Default Swap, crony capitalism, Daniel Kahneman / Amos Tversky, David Brooks, diversified portfolio, Donald Trump, Edward Glaeser, endogenous growth, experimental economics, experimental subject, facts on the ground, financial innovation, financial intermediation, financial repression, hiring and firing, Home mortgage interest deduction, housing crisis, income inequality, informal economy, information asymmetry, intangible asset, inventory management, invisible hand, Jones Act, Joseph Schumpeter, Kenneth Rogoff, Kevin Kelly, knowledge worker, labor-force participation, Long Term Capital Management, low skilled workers, Lyft, Mark Zuckerberg, market fundamentalism, mass immigration, mass incarceration, medical malpractice, Menlo Park, moral hazard, mortgage debt, Network effects, patent troll, plutocrats, Plutocrats, principal–agent problem, regulatory arbitrage, rent control, rent-seeking, ride hailing / ride sharing, Robert Metcalfe, Ronald Reagan, Silicon Valley, Silicon Valley ideology, smart cities, software patent, too big to fail, total factor productivity, trade liberalization, transaction costs, tulip mania, Uber and Lyft, uber lyft, Washington Consensus, white picket fence, winner-take-all economy, women in the workforce

Heim, “Jobs and Income Growth of Top Earners and the Causes of Changing Income Inequality,” unpublished working paper, April 2012, https://web.williams.edu/Economics/wp/BakijaColeHeim JobsIncomeGrowthTopEarners.pdf. 4.See Tyler Cowen, “The Inequality That Matters,” American Interest 6, no. 3 (January 1, 2011), http://www.the-american-interest.com/2011/01/01/the-inequality-that-matters/. 5.http://equitablegrowth.org/equitablog/must-read-steve-teles-the-scourge-of-upward-redistribution-2/. 6.William Lazonick, “Profits without Prosperity,” Harvard Business Review (September 2014), https://hbr.org/2014/09/profits-without-prosperity. 7.See Robin Greenwood and David Scharfstein, “The Growth of Finance,” Journal of Economic Perspectives 27, no. 2 (Spring 2013): 3–28. 8.Justin Lahart, “Number of the Week: Finance’s Share of Economy Continues to Grow,” Wall Street Journal, December 10, 2011, http://blogs.wsj.com/economics/2011/12/10/number-of-the-week-finances-share-of-economy-continues-to-grow/. 9.General Accounting Office, “Financial Audit: Resolution Trust Corporation’s 1995 and 1994 Financial Statements,” July 1996, http://www.gao.gov/archive/1996/ai96123.pdf. 10.See David Min, “For the Last Time, Fannie and Freddie Didn’t Cause the Housing Crisis,” The Atlantic, December 16, 201l, http://www.theatlantic.com/business/archive/2011/12/for-the-last-time-fannie-and-freddie-didnt-cause-the-housing-crisis/250121/. 11.Charles W. Calomiris and Stephen H. Haber, Fragile by Design: The Political Origins of Banking Crises and Scarce Credit (Princeton, NJ: Princeton University Press, 2014), p. 207. 12.Calomiris and Haber, Fragile by Design, p. 253. 13.See Min, “For the Last Time, Fannie and Freddie Didn’t Cause the Housing Crisis.” 14.See Neil Bhutta, “GSE Activity and Mortgage Supply in Lower-Income and Minority Neighborhoods: The Effect of the Affordable Housing Goals,” Journal of Real Estate Finance and Economics 45, no. 1 (2012): 238–61. 15.


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Endless Money: The Moral Hazards of Socialism by William Baker, Addison Wiggin

Andy Kessler, asset allocation, backtesting, bank run, banking crisis, Berlin Wall, Bernie Madoff, Black Swan, Branko Milanovic, break the buck, Bretton Woods, BRICs, business climate, business cycle, capital asset pricing model, commoditize, corporate governance, correlation does not imply causation, credit crunch, Credit Default Swap, crony capitalism, cuban missile crisis, currency manipulation / currency intervention, debt deflation, Elliott wave, en.wikipedia.org, Fall of the Berlin Wall, feminist movement, fiat currency, fixed income, floating exchange rates, Fractional reserve banking, full employment, German hyperinflation, housing crisis, income inequality, index fund, inflation targeting, Joseph Schumpeter, Kickstarter, laissez-faire capitalism, land reform, liquidity trap, Long Term Capital Management, McMansion, mega-rich, money market fund, moral hazard, mortgage tax deduction, naked short selling, negative equity, offshore financial centre, Ponzi scheme, price stability, pushing on a string, quantitative easing, RAND corporation, rent control, reserve currency, riskless arbitrage, Ronald Reagan, school vouchers, seigniorage, short selling, Silicon Valley, six sigma, statistical arbitrage, statistical model, Steve Jobs, stocks for the long run, The Great Moderation, the scientific method, time value of money, too big to fail, upwardly mobile, War on Poverty, Yogi Berra, young professional

It sounds unthinkable, but the few who are beginning to do this will be better off than those who reach out for the government lifeline, prolonging high payments for 30 years. The outcome would be a shorter recession, for the housing market would quickly readjust rather than suffer from the agonizing slow-motion erosion in prices and perpetually high inventories that are occurring today. Socialism’s solution to the housing crisis is reminiscent of the Japanese perpetual recession, where a bear market in equities has run 19 years and counting. The moral hazard that has been built into the nation’s mortgage market is a function of the structure of the system, something that the liberal Keynesian economist Paul Krugman drives home in his nostalgic plea to return to a simpler, 1950s-style banking system. While this is true, it demotes the importance of Democrat-inspired programs that tilted the playing field to incentivize origination of mortgages on behalf of those with poor credit, and it also ignores the role of wrapping a government guarantee around this compromised product.

Copies circulate on various Internet sites, including http://www. berniemadoffsec.com/the-worlds-largest-hedge-fund-is-a-fraud.html. 13. Nassim Nicholas Taleb, The Black Swan:The Impact of the Highly Improbable (New York: Random House, 2007), 229–252. A sprightly discussion of this is in The Black Swan’s Chapter 15: “The Bell Curve, That Great Intellectual Fraud.” Notes 383 14. Zillow, The Majority of U.S. Homeowners Thinks Their Home is Insulated From the Housing Crisis (August 6, 2008), http://zillow.mediaroom.com/index. php?s=159&item=64. Chapter 3: The Rise and Fall of Hard Money 1. Laurence H. Meyer, Remarks by Governor Laurence H. Meyer, December 5, 2001, www.federalreserve.gov/boarddocs/speeches/2001/20011205/default. htm. 2. Murray N. Rothbard, The Case Against the Fed (Auburn, AL: Ludwig von Mises Institute, 1994), 42. 3. Ibid., 30. 4. Michael David Bordo, “The Classical Gold Standard: Some Lessons for Today,” Federal Reserve Bank of St.

., 202, 339–340 Business as a System of Power (Brady), 178 Butler, Robert, 335 Butler, Smedley, 86–88 Byrne, Patrick, 140 Caesar, Julius, 248 Caligula, 258–259 Calomiris, Charles, 212 Campos, Roel, 329 Capital Asset Pricing Model (CAPM), 72 Capitalism: democracy as threat: and economic stress, 233–235 overview, 232–233 Roman Empire as example, 235–236 evolution of, 241–243 INDEX Roman Empire as example building wealth, 243–245 collectivism, 252–256 money supply, 245–249 squandering wealth, 249–252 See also Roman Empire, decline of Carnegie Foundation, 178 Carter, Jimmy, 221, 230–231 The Case Against the Fed (Rothbard), 354 Cassidy, John, 118, 119 Cato Institute, 336 Catsoulis, Jeannette, 335 Center for a Responsible Budget (CFRB), 226–227 Center for Responsible Politics (CRP), 184–185, 186 Chavez, Hugo, 365 Chemical Bank, 55, 56 Choudhri, Ehsan, 94–95, 96, 98, 99 Chrysler, 235 Citibank, 124 Citicorp, 211 Citigroup, 57 Clifford Chance LLP, 318 Clinton, Bill, 186, 201, 330, 340 Clinton, Hilary, 202 Coleman, Thomas, 311 Community Reinvestment Act (CRA), 127, 147, 149, 212 Conant, Charles, 62, 280 Conda, Cesar, 160 Considius, Q., 248 Conspiracy of Fools (Eichenwald), 223 Council on Foundations, 176 Counterfeiting, 38, 53 Countrywide Financial, 212, 214 Cramer, Jim, 141–142, 143, 145–146, 289, 303 Crawford, Michael, 246 Credit Crisis of 2008–2009: forced lending, 128–133 Index overview, 116–121 “too big to fail” policy, 121–128 See also Housing Crisis Crispus, Gaius Sallustius, 248 Culture of irresponsibility: chilling of inquiry, 293–296 moral vacuum, 296–299 morality, 290–292 overview, 277–281 rationality, 285–290 secular society, 281–285 See also Moral hazard; Self-indulgence Cuneo, Jonathan W., 326–327 “Curveball,” 363 Damn Yankees, 303 Dawes Plan, 62 The Debt Deflation Theory of Great Depressions (Fisher), 131 Deflation: Making Sure “It” Doesn’t Happen Here (Bernanke), 117 Democracy Alliance, 185 Derivatives, 22.


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Algorithms of Oppression: How Search Engines Reinforce Racism by Safiya Umoja Noble

A Declaration of the Independence of Cyberspace, affirmative action, Airbnb, borderless world, cloud computing, conceptual framework, crowdsourcing, desegregation, Donald Trump, Edward Snowden, Filter Bubble, Firefox, Google Earth, Google Glasses, housing crisis, illegal immigration, immigration reform, information retrieval, Internet Archive, Jaron Lanier, Mitch Kapor, Naomi Klein, new economy, PageRank, performance metric, phenotype, profit motive, Silicon Valley, Silicon Valley ideology, Snapchat, Tim Cook: Apple, union organizing, women in the workforce, yellow journalism

In attendance was the journalist Julia Angwin, one of the investigators of the breaking story about courtroom sentencing software Northpointe, used for risk assessment by judges to determine the alleged future criminality of defendants.6 She and her colleagues determined that this type of artificial intelligence miserably mispredicted future criminal activity and led to the overincarceration of Black defendants. Conversely, the reporters found it was much more likely to predict that White criminals would not offend again, despite the data showing that this was not at all accurate. Sitting next to me was Cathy O’Neil, a data scientist and the author of the book Weapons of Math Destruction, who has an insider’s view of the way that math and big data are directly implicated in the financial and housing crisis of 2008 (which, incidentally, destroyed more African American wealth than any other event in the United States, save for not compensating African Americans for three hundred years of forced enslavement). Her view from Wall Street was telling: The math-powered applications powering the data economy were based on choices made by fallible human beings. Some of these choices were no doubt made with the best intentions.

See also Google PageRank; Kandis Ali, Kabir, 80 Alphabet, 34–35; cultural imperialism, 86; expansion into surveillance technologies, 28 Anderson, Benedict, 136 Angwin, Julia, 27 Anonymous (hacker group), 112, 194n4 Anti-Defamation League, 42, 44, 157, 160 “antidiversity” manifesto, 2 Apple: labor condition in China, 164, 199n43; profiling in store, 163 Arreola, Veronica, 155 artificial intelligence, 1–2, 148; financial and housing crisis of 2008 role, 27; future criminality predictions, 27 ArtStor, bias in metadata management, 145–47 Ascher, Diana, 29 Associated Press v. United States, 190n57 Baartman, Sara, 94–96, 100 Bagdikian, Ben, 41 Bar-Ilan, Judit, 47 Barlow, John Perry, 61 Baron, Jill, 134 Battelle, John, 148 Berger, John, 58 Berman, Sanford, 139, 143–44 bias. See advertising companies; algorithms; search engines; Twitter Bitch, 4, 181 Black, Diane, 135 Black feminism, 29–33, 92–93; antipornography rhetoric and scholarship, 100 black feminist technology studies (BFTS), 171–72 Black Girls (rock band), 69 Black Girls Code, 26, 64–65 ‘black girls’ search results, 17–21, 31, 49, 64, 66–68, 103, 160, 192n5; Chicago Urban League, 191n73; first search results, 3–4, 5; improvements, 10, 181–82; pornification, 11, 86 Black Lives Matter, 165 Black Looks (hooks), 92–94 Black Scholar, 11 Blanchette, Jean-François, 125, 128 Brandeis University report, 167 Brin, Sergey, 37, 38, 40–41, 44, 47 Brock, André, 17–21, 91, 151 Brown, Ronald, 104 Cabos-Owen, Julie, 119 Chicago Tribune, 134 Chicago Urban League, 191n73 Chin, Denny, 157 classification schemes, 150; Eurocentrism, 141; misrepresentations of women and people of color, 5, 138; racial classification, 136–37, 149.

., 89 purchasing products online, 175 racial and gender profiling, 28 racial categories: PubMed/MEDLINE, 95; South Africa, 95 The Racial Contract (Mills), 60 racial formation theory, 84 Racialicious (blog), 4 racism and sexism, 9, 186; application program interface (API), 187n5; Black people as a problem, 142–43; “colorblindness” and multiculturalism, 167–68; contributions of African Americans erased, 108; fantasy of postracialism, 108, 168; financial and housing crisis of 2008, 27; first search results, 5; future criminality of White and Black defendants, 27; #Gamergate comments, 63, 191n96; Google’s default settings, 88–89; history of enslavement and exploitation, 92, 96–98; impact of stereotypes, 105, 155; internet as a tool, 89; internet marginalization of Blacks and women, 58, 108, 165; Jezebel image, 70, 96, 98; male impact online, 58; Mammy or Sapphire image, 70, 98; n*gger application program interface (API), 4–5; race hierarchy theory, 79–80; recognition of, 25; search engine bias, 29, 31–32; traditional media images replicated, 55–56, 59.


pages: 265 words: 74,941

The Great Reset: How the Post-Crash Economy Will Change the Way We Live and Work by Richard Florida

banking crisis, big-box store, blue-collar work, business cycle, car-free, carbon footprint, collapse of Lehman Brothers, congestion charging, creative destruction, deskilling, edge city, Edward Glaeser, falling living standards, financial innovation, Ford paid five dollars a day, high net worth, Home mortgage interest deduction, housing crisis, if you build it, they will come, income inequality, indoor plumbing, interchangeable parts, invention of the telephone, Jane Jacobs, Joseph Schumpeter, knowledge economy, low skilled workers, manufacturing employment, McMansion, Menlo Park, Nate Silver, New Economic Geography, new economy, New Urbanism, oil shock, Own Your Own Home, pattern recognition, peak oil, Ponzi scheme, post-industrial society, postindustrial economy, reserve currency, Richard Florida, Robert Shiller, Robert Shiller, secular stagnation, Silicon Valley, Silicon Valley startup, social intelligence, sovereign wealth fund, starchitect, the built environment, The Wealth of Nations by Adam Smith, Thomas L Friedman, total factor productivity, urban decay, urban planning, urban renewal, white flight, young professional, Zipcar

It shows the enormous disparity between housing prices and wages that existed in the Sunbelt. Six regions, all in the Sunbelt, posted ratios of 15 or greater. Another twelve metropolitan areas, again all in the Sunbelt, had ratios above 10. Las Vegas’ ratio was 9, Miami’s 8.4, and Phoenix’s 7.2, all sky-high by any standard.9 With their debt-fueled economies driven by housing, it’s no surprise that the housing crisis has brought severe economic pain to many Sunbelt cities. According to a study by the Brookings Institution, of the twenty worst-performing regions in the country, fourteen were in the Sunbelt, including Las Vegas and Miami.10 Both Las Vegas and Phoenix saw their economic Stress Index value—a composite measure of economic hardship developed by the Associated Press—more or less double between December 2007 and March 2009.11 At the peak of the crisis the Sunbelt states and cities witnessed something that had once been unthinkable: after a century of unchecked growth, many locations had their first taste of mass outmigration and population decline.

We’ve seen the ways in which the importance of home ownership became overblown and began to undermine the economy; how it consumed an ever-larger share of income for far too many, constraining their lifestyle and sometimes even bankrupting them; and how it encouraged massive, unsustainable growth in places where land was cheap and the real estate economy dominant. We could well look back on this moment in history as a time when people lived like indentured servants, with their own homes as lord and master. For too many, the dream of home ownership turned into an economic trap, one of our own making. The most staggering damage caused by the housing crisis may not be the impact on the financial markets; it may be the long-run competitive disadvantage caused by the inability to relocate the labor force to where the jobs of the future lie. It’s not that home ownership per se is bad, it’s that home ownership on the scale it has grown to is plainly ill suited to today’s postindustrial economy. Letting go of it as the centerpiece of our collective aspirations might be among the healthiest, most liberating steps we can take.

The ongoing movement of higher-paid and higher-skilled talented people to megaregions and talent magnets is accelerating the demand for rental housing. Even though prices have declined somewhat, it’s still very expensive to buy a home in many of these places. More people have no choice but to rent in those cities. Renting is much more prevalent in metro areas such as New York, where 66 percent of residents are renters, as well as D.C. and Chicago, where more than half (56 and 51 percent, respectively) rent their homes.11 The housing crisis creates additional opportunities for rental housing. Across the country, there is an accumulation of foreclosed homes and failing condo projects that could be turned into rentals. With prices down 30 or 40 percent or more in some places, this kind of conversion increasingly makes economic sense. It becomes possible to assemble large numbers of units and capitalize on economies of scale. New building technologies and materials, as well as new energy-saving technology, offer long-run cost savings, while new strategies for delivering and managing rental housing hold even greater promise.


pages: 258 words: 71,880

Street Fighters: The Last 72 Hours of Bear Stearns, the Toughest Firm on Wall Street by Kate Kelly

bank run, buy and hold, collateralized debt obligation, corporate governance, corporate raider, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, Donald Trump, fixed income, housing crisis, index arbitrage, Long Term Capital Management, margin call, moral hazard, quantitative hedge fund, Renaissance Technologies, risk-adjusted returns, shareholder value, technology bubble, too big to fail, traveling salesman

But Buffett had friends at Bear, and surely he was concerned about the risk its failure posed to the entire financial system. This was the issue most bothering Geithner and Paulson that night. Bear wouldn’t fail in a vacuum, they knew. The crisis of confidence among lenders and clients would likely spread to the next most vulnerable firm—be it Lehman Brothers or Merrill Lynch. Both firms were thought to be overexposed to the housing crisis, Lehman had its large commercial real-estate portfolio as well as its sprawling mortgage-origination and packaging activities, and Merrill was invested heavily in enormous underwater investments in CDOs. If skeptical investors and frightened customers and lenders were able to sink Bear, a series of dominoes could fall after it—potentially taking down most or all of Wall Street. Paulson was envisaging a 1,000- to 2,000-point drop in the Dow if Bear’s meltdown were to have a ripple effect—a positively catastrophic outcome that would erase billions of dollars of wealth.

“Is this just the beginning?” “Well, our financial institutions, our banks and investment banks, are very strong,” Paulson said. “And I’m convinced that they’re going to come out of this situation very strong. Our markets are resilient. They’re flexible. I’m quite confident we’re going to work our way through this situation.” Apparently having exhausted his Bear questions, Stephanopoulos moved on to the housing crisis. It was a grueling television circuit. Paulson’s other two interviewers, Fox News anchor Chris Wallace and CNN’s Wolf Blitzer, grilled him about both the Fed loan and the state of the banking business in general. An overwhelming number of economists polled by the Wall Street Journal thought the economy was in a recession, they pointed out, and with Bear’s teetering status, the entire Wall Street business model seemed potentially at risk.

Paulson at Goldstein, Michael Grasso, Dick Great Depression Greenberg, Alan (“Ace”) Buffett’s friendship with Cayne’s relationship with as chairman Glickman’s relationship with market-risk gatherings of ousted as CEO partner memos issued by post-CEO role of spending curbs of Greenberger, Mala Greene, Maryann Greene, Tim Greenspan, Alan Greenwich Capital group Griffin, Ken Harrington, Donald Harrison, William Harriton, Richard Harvard University hedge funds Bear balance reduced by failure of see also specific funds Hernandez, Carlos High-Grade Structured Credit Strategies Enhanced Leverage Fund High-Grade Structured Credit Strategies Fund Hill, Jeremy Hogan, John Hom, Dennis housing boom housing crisis HSBC Iger, Bob IndyMac Federal Bank ING insurance, against debt default International Swaps and Derivatives Association investment banks: demise of discount window and see also specific investment banks IPOs (initial public offerings) Japan Jardine Strategic Holdings Limited J.C. Flowers & Co. Goldman team and J.P. Morgan Bear acquisition and Bear failure and Bear funding and collateral requested by cost cutting at as custodian due diligence team of Fed regulation of Greene’s negotiations with line of credit request and press release of profits of Saturday meetings with Katz, Ray Kelleher, Colm Kelly, Ray Kerry, John Kim, David Kim, Jessica Kissinger, Henry Kohlberg Kravis Roberts & Co.


pages: 188 words: 40,950

The Case for Universal Basic Income by Louise Haagh

back-to-the-land, basic income, battle of ideas, Bertrand Russell: In Praise of Idleness, bitcoin, blockchain, cryptocurrency, delayed gratification, Diane Coyle, full employment, future of work, housing crisis, income inequality, job-hopping, land reform, low skilled workers, Mark Zuckerberg, mini-job, moral hazard, new economy, offshore financial centre, precariat, race to the bottom, rent control, road to serfdom, Silicon Valley, Skype, smart contracts, trickle-down economics, universal basic income

., experienced volatile pay. See https://www.resolutionfoundation.org/app/uploads/2018/10/Irregular-payments-RF-REPORT.pdf 58. Cecchini, S. and Martínez, R., 2012, ‘Inclusive Social Protection in Latin America’, Economic Commission for Latin America, Santiago, Chile, pp. 107–8, 112–13. 59. Clair, A., Reeves, A., Loopstra, R., McKee, M., Dorling, D. and Stuckler, D., 2016, ‘The Impact of the Housing Crisis on Self-Reported Health in Europe’, European Journal of Public Health, 26 (5), 788–93. 60. This information was obtained in conversations with a public defence lawyer in Guernsey, in July 2017. 61. Standing, G., 2002, Beyond the New Paternalism, London: Verso; Haagh, ‘Basic Income, Social Democracy and Control over Time’. 62. Goodin, R.E., Rice, J.M., Parpo, A. and Eriksson, L., 2008, Discretionary Time: A New Measure of Freedom, Cambridge: Cambridge University Press; Goodin, R.E., 2001, ‘Work and Welfare’, British Journal of Political Science, 31, 13–39. 63.

., ‘The UK’s Shadow Economy: £40 billion Lost to Treasury’, Tax Justice Network, 20 May 2014. 7. Citizens’ Basic Income Trust, 2018, Basic Income – a Brief Introduction, p. 8. 8. For a short but concise critique, see https://www.theguardian.com/global/shortcuts/2017/oct/29/how-the-actual-magic-money-tree-works 9. https://www.independent.co.uk/news/business/news/private-landlords-taxpayer-money-housing-benefits-rent-housing-crisis-low-income-families-a7199111.html 10. The British social housing bill is much larger than in comparator countries where rent controls enable the public to save. In 2014, housing benefit spend in Denmark represented 5.3% (at DKK70 million) of combined housing and income transfer spend (on families, housing, income, unemployment and sickness benefits) (Statistisk Årbog, 2016, 68). In comparison, in the UK, housing benefit represented 24% (£26 billion) of the above posts (at about £132 billion) in 2015/6 (Department of Work and Pensions, Annual Report 2015/16). 11.


pages: 287 words: 81,970

The Dollar Meltdown: Surviving the Coming Currency Crisis With Gold, Oil, and Other Unconventional Investments by Charles Goyette

bank run, banking crisis, Ben Bernanke: helicopter money, Berlin Wall, Bernie Madoff, Bretton Woods, British Empire, Buckminster Fuller, business cycle, buy and hold, California gold rush, currency manipulation / currency intervention, Deng Xiaoping, diversified portfolio, Elliott wave, fiat currency, fixed income, Fractional reserve banking, housing crisis, If something cannot go on forever, it will stop - Herbert Stein's Law, index fund, Lao Tzu, margin call, market bubble, McMansion, money market fund, money: store of value / unit of account / medium of exchange, mortgage debt, oil shock, peak oil, pushing on a string, reserve currency, rising living standards, road to serfdom, Ronald Reagan, Saturday Night Live, short selling, Silicon Valley, transaction costs

See Treasury bonds Deflation bailout, effects on economic impact of myths about “pushing on a string” argument De Gaulle, Charles Deng Xiaoping Digital gold currencies GoldMoney Dollar as currency reserves deterioration, and oil-pricing alternatives devaluation and Fed overseas holdings Dollar standard benefits to U.S. global dumping of Economic collapse, signs of Economic crisis (2008- ) bailouts command economy threat credit crisis and dollar standard federal debt government actions. See Federal Reserve housing crisis impact of and interest rate cuts Iraq war, cost of and job losses See also specific topics e-gold Elements ETNs Emergency Economic Stabilization Act (2008), operation of Energy independence, myth of Energy trusts, recommendations Enerplus Resources Fund Trust (ERF) Engelhard England coinage debasement, impact of goldsmith as banker inflation and paper money See also Great Britain Erhard, Ludwig Ethanol Euros euro ETF (FXE) replace dollar Exchange-traded funds (ETFs) bond cautions about commodities-based foreign currency-based gold-based nationalization risk oil-based silver-based trading/operation of Exchange-traded notes (ETNs) commodities-based Elements ETNs Fannie Mae China/Japan holdings Federal debt amount of (2009) debt ceiling, increase foreign holders of hidden debt infinite horizon discounted value concept inflation as remedy interest expense on Medicare Part D, unfunded liability example monetizing debt percentage of GDP in trillions Federal deposit insurance Federal Reserve auditing of bailout funds cooling economy, actions for criticisms of system and debt monetization and devaluation of dollar federal funds rate fractional reserve banks inflation, creating by interest rate cuts and monetary policy and mortgage meltdown open market operations and Plunge Protection Team and politicized money public/private nature of secrecy related to stimulating economy, actions for as unconstitutional Federal Reserve Act (1913) Federal Reserve Notes Fiscal policy, defined Fisher, Richard Florin Food production demand, future view See also Commodities as investment Ford, Gerald Foreign currency, hard currencies Foreign currency as investment digital gold currencies exchange-traded funds (ETFs) speculative nature of Foster, Richard S.

., historical view Goldman Sachs GoldMoney Gold Reserve Act (1934) Goldsmiths, as bankers Gold standard abandoned, United States Bretton Woods agreement Grant, James Great Britain gold standard nationalization oil reserves of Great Depression Greenbacks Greenspan, Alan on dollars held abroad on housing bubble interest rate cuts on WIN program Gresham’s law Gross domestic product (GDP), federal debt in Gulf War Hard Assets Producer (HAP) fund Hard currencies Hayek, F.A. He Fan Hickey, Fred Hitler, Adolf Housing crisis and Fed and interest rate cuts jingle mail Hunt, Bunker Hunt, Herbert al-Husseini, Sadad Hyperinflation and “crack-up boom,” features of Israel past periods of political implication of Index-type fund, gold-based India, poverty, decline of Indian rupee ETF (ICN) Infinite horizon discounted value Inflation as alternative to taxation and coinage debasement core inflation rate and distortion of market double-digit.

He Fan Hickey, Fred Hitler, Adolf Housing crisis and Fed and interest rate cuts jingle mail Hunt, Bunker Hunt, Herbert al-Husseini, Sadad Hyperinflation and “crack-up boom,” features of Israel past periods of political implication of Index-type fund, gold-based India, poverty, decline of Indian rupee ETF (ICN) Infinite horizon discounted value Inflation as alternative to taxation and coinage debasement core inflation rate and distortion of market double-digit. See Hyperinflation Federal Reserve, creation of historical view inflationary recession and malinvestment as monetary phenomenon official explanations of persistence of and price ceilings and price increases as remedy to debt as remedy to inflation and stagflation as theft Interest rate cuts economic impact of and housing crisis to stimulate economy Interest rates and bond prices raising, to cool economy and stagflation Investment recommendations bonds commodities foreign currencies gold gold/silver ratio information/resources for investors oil silver Iran, oil, pricing in euros Iraq war cost of and global rejection of America nonsupporting countries IRS bank transactions, reporting to financial behavior, reporting to See also Taxation Isaac, William iShares COMEX Gold Trust (IAU) iShares Silver Trust (SLV) Israel, hyperinflation James II, King of England Japan Fannie and Freddie holdings yen payable Treasuries, call for Japanese yen ETF (FXY) Johnson, Chalmers Johnson, Lyndon B.


pages: 274 words: 81,008

The New Tycoons: Inside the Trillion Dollar Private Equity Industry That Owns Everything by Jason Kelly

activist fund / activist shareholder / activist investor, barriers to entry, Berlin Wall, call centre, carried interest, collective bargaining, corporate governance, corporate raider, Credit Default Swap, diversification, Fall of the Berlin Wall, family office, fixed income, Goldman Sachs: Vampire Squid, Gordon Gekko, housing crisis, income inequality, late capitalism, margin call, Menlo Park, Occupy movement, place-making, Rod Stewart played at Stephen Schwarzman birthday party, rolodex, Ronald Reagan, Rubik’s Cube, Sand Hill Road, shareholder value, side project, Silicon Valley, sovereign wealth fund

In 2006, Carlyle announced about $75 billion worth of takeovers, including three deals worth $10 billion or more. In 2007, the total dropped about 40 percent, to $44 billion. The largest deal was the $8.5 billion purchase of HD Supply, the contractor-oriented arm of Home Depot, according to data compiled by Bloomberg. Perhaps to underscore Conway’s own point, that deal turned into one of the more troubled of the boom era, struggling mightily in the teeth of the U.S. housing crisis. Conway is, at his core, a deal guy, and widely regarded as one of the smartest investors in private equity. He is affable and physically imposing, and while charming and self-effacing, he is arguably the most feared person inside the firm. A practicing Catholic who attends Mass most days, he grew up in New Hampshire and earned his undergraduate degree at Dartmouth. He went on to earn an MBA from the University of Chicago at night while working for a bank there.

In 2007, private-equity deals accounted for 20 percent of announced M&A transactions by dollar volume, Bloomberg data show. In 2009, at the depths of the credit crisis, private equity deals were less than 7 percent. By 2011, they’d regained their place, accounting for just less than 17 percent. Any explanation of the leveraged buyout boom of 2005 to 2007 inevitably includes the phrases “cheap debt” or “easy credit.” The parallels to what led to the housing crisis are hard to ignore. Just as financing was available for homebuyers to buy houses beyond what they thought they could afford, so too was debt available for private-equity firms to eye targets, bid up prices and buy companies that had previously been far beyond their reach. Part of it was the size of the equity funds they’d collected from pensions and endowments eager, and in some cases desperate, for the returns buyout firms had historically delivered.

What became Lexmark was a collection of office products units buried across IBM’s empire. CD&R paid $1.5 billion for the business and eventually took it public in 1995. CD&R has largely stuck with the business of carve-outs, buying Hertz with Carlyle from Ford and US Foods from Royal Ahold in well-timed deals, and the contractor supply business from Home Depot (called HD Supply), in a very poorly timed deal at the onset of the financial and housing crisis. In its modern iteration, CD&R has become a full- or part-time home for some of the highest-profile former chief executives of global companies, including Jack Welch, arguably the most famous CEO of all time. After Welch joined as a senior advisor in 2001, CD&R added A.G. Lafley, who ran Procter & Gamble, and former Tesco CEO Terence Leahy. Paul Pressler, the former Gap CEO, is a partner, as is Edward Liddy, who ran Allstate.


pages: 409 words: 125,611

The Great Divide: Unequal Societies and What We Can Do About Them by Joseph E. Stiglitz

"Robert Solow", accounting loophole / creative accounting, affirmative action, Affordable Care Act / Obamacare, agricultural Revolution, Asian financial crisis, banking crisis, Berlin Wall, Bernie Madoff, Branko Milanovic, Bretton Woods, business cycle, capital controls, Capital in the Twenty-First Century by Thomas Piketty, Carmen Reinhart, carried interest, clean water, collapse of Lehman Brothers, collective bargaining, computer age, corporate governance, credit crunch, Credit Default Swap, deindustrialization, Detroit bankruptcy, discovery of DNA, Doha Development Round, everywhere but in the productivity statistics, Fall of the Berlin Wall, financial deregulation, financial innovation, full employment, George Akerlof, ghettoisation, Gini coefficient, glass ceiling, global supply chain, Home mortgage interest deduction, housing crisis, income inequality, income per capita, information asymmetry, job automation, Kenneth Rogoff, Kickstarter, labor-force participation, light touch regulation, Long Term Capital Management, manufacturing employment, market fundamentalism, mass incarceration, moral hazard, mortgage debt, mortgage tax deduction, new economy, obamacare, offshore financial centre, oil shale / tar sands, Paul Samuelson, plutocrats, Plutocrats, purchasing power parity, quantitative easing, race to the bottom, rent-seeking, rising living standards, Ronald Reagan, school vouchers, secular stagnation, Silicon Valley, Simon Kuznets, The Chicago School, the payments system, Tim Cook: Apple, too big to fail, trade liberalization, transaction costs, transfer pricing, trickle-down economics, Turing machine, unpaid internship, upwardly mobile, urban renewal, urban sprawl, very high income, War on Poverty, Washington Consensus, We are the 99%, white flight, winner-take-all economy, working poor, working-age population

America sends a larger fraction of its citizens to prison than any other country, including China: with less than 5 percent of the world’s population, it has 25 percent of the world’s prisoners. But it is the poor, and African-Americans, who are most likely to spend their late teens and early twenties in prison, rather than at school.1 The article takes up the issue in the context of America’s housing crisis, and one aspect of it in particular: the “robo-signing crisis.” In their rush to issue bad mortgages, banks didn’t pay attention to record keeping. When the inevitable housing crisis arrived, and it came time to throw people out of the homes for which banks had gladly lent them money only a few years earlier, the banks’ records of who had repaid what were a mess. Many states have a system in which banks can simply sign an affidavit that they have examined the records and that the individual who is being declared in foreclosure does in fact owe the money alleged.

We could have prevented the mortgage crisis, if we had only more effectively enforced laws already on the books, regarding predatory and discriminatory lending—and if the Fed had lived up to its responsibilities in enforcing standards of lending in the mortgage market. “The One Housing Solution Left,” written with Mark Zandi, chief economist of Moody’s, argues that there were alternative ways of handling the housing crisis, after it emerged—borrowing an idea that had worked in the Great Depression and that would have cost the government nothing. Senator Jeff Merkley of Oregon introduced a bill, Rebuilding American Homeownership, which would have accomplished this. And there was even a strategy for doing this within the political constraints of the time. But we couldn’t get the Obama administration on board. Later the administration recognized its failure to do more for housing as one of its critical mistakes, both economically and politically.

Debts mount. Journalists record the human toll. Then comes bewilderment: How could we let this happen again? Officials promise to fix things. Something is done about the most egregious abuses. People move on, reassured that the crisis has abated, but suspecting that it will recur soon. The crisis that is about to break out involves student debt and how we finance higher education. Like the housing crisis that preceded it, this crisis is intimately connected to America’s soaring inequality, and how, as Americans on the bottom rungs of the ladder strive to climb up, they are inevitably pulled down—some to a point even lower than where they began. This new crisis is emerging even before the last one has been resolved, and the two are becoming intertwined. In the decades after World War II, homeownership and higher education became signs of success in America.


The Origins of the Urban Crisis by Sugrue, Thomas J.

affirmative action, business climate, collective bargaining, correlation coefficient, creative destruction, Credit Default Swap, deindustrialization, desegregation, Detroit bankruptcy, Ford paid five dollars a day, George Gilder, ghettoisation, Gunnar Myrdal, hiring and firing, housing crisis, income inequality, indoor plumbing, informal economy, invisible hand, job automation, jobless men, Joseph Schumpeter, labor-force participation, low-wage service sector, manufacturing employment, mass incarceration, New Urbanism, oil shock, pink-collar, postindustrial economy, rent control, Richard Florida, Ronald Reagan, side project, Silicon Valley, strikebreaker, The Bell Curve by Richard Herrnstein and Charles Murray, The Chicago School, union organizing, upwardly mobile, urban planning, urban renewal, War on Poverty, white flight, working-age population, Works Progress Administration

There were African American-run savings and loan associations that financed black homebuyers, but because they were undercapitalized, they made little impact. Blacks looking for their own homes were left to turn to loan sharks or to buy homes using land contracts at high interest rates.43 Urban Redevelopment Postwar highway and urban redevelopment projects further exacerbated Detroit’s housing crisis, especially for blacks. Detroit’s city planners promised that the proposed system of cross-city expressways would dramatically improve the city’s residential areas, as well as bolster the city’s economy. For the thousands of blacks who lived in the path of Detroit’s first expressways, both promises were false. Detroit’s highway planners were careful to ensure that construction of the new high-speed expressways would only minimally disrupt middle-class residential areas, but they had little such concern for black neighborhoods, especially those closest to downtown.

The debates over housing in the 1940s were to have profound ramifications for the fate of federal policy in the city for the next twenty years and would set the terms for debate on—and limit—the next generation of social policy, the Great Society.5 A New Deal in Housing From the 1930s through the early 1950s, the federal government, city officials, and housing reformers looked to an alternative to Detroit’s private market to solve the city’s housing crisis. In place of inferior accommodation for the poor, government-subsidized developments would be built throughout the city. The construction of public housing, argued its advocates, would eliminate the city’s overcrowded, dangerous slums. Not only would public housing offer workers and the poor clean, new, affordable shelter, it would serve as a tool of social engineering. Public housing, in the words of urban historian Robert Fairbanks, would “make better citizens.”

Official approval of segregation, he argued, “has a detrimental effect,” fostering “distrust and disbelief in government on the part of minority and liberal” groups, and giving “official sanction to the prejudices of others.”106 During the Cobo administration, DHC policy remained unrelentingly segregationist, as officials defended “the right of the landlord to operate his property as he wishes or take the tenants he wants to take in.”107 In response to pressure from civil rights orgnaizations, city officials began the token integration of public housing projects in 1953 and 1954, but not until 1956, after the Detroit Branch of the NAACP won a lawsuit that challenged the city’s racial policy, did the city open all public housing to blacks, and even then desegregation was haltingly slow. As late as the early 1960s, four public housing projects were virtually all-white, with token black residents, and two projects were all-black.108 The dilemma of the housing crisis for Detroit’s poor was still unresolved in the late 1950s. The city directed blacks needing homes to its already crowded center-city projects, and defended the concentration of blacks as the necessary consequence of slum removal. James Inglis, director of the City Housing Commission in 1949, stated that black housing projects were by necessity high-density because of the high land prices in the center-city areas where slum housing had been cleared.


Saving America's Cities: Ed Logue and the Struggle to Renew Urban America in the Suburban Age by Lizabeth Cohen

activist lawyer, affirmative action, Albert Einstein, anti-communist, British Empire, Buckminster Fuller, car-free, charter city, deindustrialization, desegregation, Edward Glaeser, garden city movement, ghettoisation, Henry Ford's grandson gave labor union leader Walter Reuther a tour of the company’s new, automated factory…, hiring and firing, housing crisis, income inequality, indoor plumbing, Jane Jacobs, land reform, megastructure, new economy, New Urbanism, Peter Eisenman, postindustrial economy, race to the bottom, rent control, Robert Gordon, rolodex, Ronald Reagan, the built environment, The Death and Life of Great American Cities, union organizing, upwardly mobile, urban decay, urban planning, urban renewal, Victor Gruen, Vilfredo Pareto, walkable city, War on Poverty, white flight, white picket fence, young professional

On the stand, Logue was confronted with tough questions about the financial practices, internal operations, and reform agenda of this organization that had revolutionized urban renewal in New York State, inspired similar initiatives elsewhere in the nation, and proved the pinnacle of the veteran redeveloper Logue’s already extensive career. After he led groundbreaking urban renewal efforts in the deteriorating cities of New Haven, Connecticut, in the 1950s, and Boston, Massachusetts, in the 1960s, Logue was hailed as the savior of New York State’s troubled cities—until the UDC’s sudden downfall. In his defense, Logue stressed the UDC’s undeniable accomplishments. Faced with an acute housing crisis and New York voters’ repeated rejection of referenda to remedy it, the UDC had innovated a new public-private funding approach. In place of old-style urban renewal, which depended on federal funds in ever shorter supply with the rising costs of the Vietnam War, Logue and Rockefeller had developed a new paradigm for urban revitalization. They had combined over a billion dollars’ worth of bond sales to private investors, state appropriations, and still-available, if dwindling, federal dollars to build over 33,000 units of housing, mostly for moderate- and low-income New Yorkers, through 117 residential projects in 50 different communities.

As I watched events unfold in New Orleans, the debates that animated Logue’s story—who’s in charge, who should have a say, who benefits, and who pays the bill—took on real-life resonance before my eyes. Similarly, the Great Recession of a few years later, with its massive wave of foreclosures and talk of shrinking cities, gave me another ringside seat from which to watch urban decline and strategies of revival. As my writing of this book neared its end, the urban housing crisis of our own time became more pressing. And the United States elected a real estate developer for its forty-fifth president, with yet unknown long-term consequences for urban policy. This history of making and keeping American cities viable remains relevant in the twenty-first century because many cities are still challenged by formidable problems. Today, urban America contends with a sharp contradiction.

Margaret’s keenness for modern design was interspersed in her letters with political commentary condemning racial segregation and endorsing liberal candidates in Smith’s mock Democratic Party convention, indicating that all were a part of a consistent worldview. A year later, as Margaret contemplated their next move to Hartford, she wrote, “I’d love a Lustron home,” referring to the innovative, prefabricated, porcelain-enameled steel houses developed to meet the housing crisis after World War II.120 Soon after the Logues returned to New Haven in 1953, they decided to build a new house in the modern style. They hired Chester Bowles’s son Ches, who had recently graduated from the Yale School of Architecture, to design it. “We live in the only modern house in our part of town,” Logue proudly reported to his Yale class secretary. A local paper described it as a “red-beamed, glass-walled house of somewhat Japanese design,” and in fact many of its features were inspired by a Japanese home designed by the modernist architect Junzo Yoshimura that was exhibited at the Museum of Modern Art in 1953.121 This was the first of three modern houses Ches Bowles would design for the Logues, the latter two built on Martha’s Vineyard.


pages: 519 words: 136,708

Vertical: The City From Satellites to Bunkers by Stephen Graham

1960s counterculture, Berlin Wall, Boris Johnson, Buckminster Fuller, Buy land – they’re not making it any more, Chelsea Manning, Commodity Super-Cycle, creative destruction, deindustrialization, digital map, drone strike, Edward Glaeser, Edward Snowden, energy security, Frank Gehry, ghettoisation, Google Earth, Gunnar Myrdal, high net worth, housing crisis, Howard Zinn, illegal immigration, Indoor air pollution, Intergovernmental Panel on Climate Change (IPCC), Jane Jacobs, late capitalism, low earth orbit, mass immigration, means of production, megacity, megastructure, moral panic, mutually assured destruction, new economy, New Urbanism, nuclear winter, oil shale / tar sands, planetary scale, plutocrats, Plutocrats, post-industrial society, Project Plowshare, rent control, Richard Florida, Right to Buy, Ronald Reagan, Skype, South China Sea, the built environment, The Death and Life of Great American Cities, trickle-down economics, urban decay, urban planning, urban renewal, urban sprawl, white flight, WikiLeaks, William Langewiesche

As in Manhattan, many of them are holding properties for large investments, and these sites will rarely, if ever, be inhabited by people at all. Such properties, the Observer’s Alex Preston argues, ‘have become lavishly upholstered safety deposit boxes’66 – buildings that consume iconic views for largely absentee owners while appreciating vast speculative profits. As in Vancouver and New York, many will remain unoccupied, their darkened façades and empty rooms looming arrogantly and absurdly over a population experiencing its worst housing crisis in living memory. London also provides a classic example of the ways in which simplistic critiques and representations of the supposed failures of vertically built mass social housing have paved the way for the proliferation of towers for the super-rich. Speaking of one of the forty-three-floor elite housing towers in Stratford, one legacy of London’s Olympics-based ‘regeneration’ in 2012, architecture critic Juston McGuirk ponders that the building is the ‘sort of high-rise that was supposed to be unpopular in this country [the UK], discredited architecturally and politically, at least when it was called council [social] housing.’67 In 2013, 85 per cent of all housing purchases in inner London – largely those in the higher and ‘super-high’ price brackets – were being snapped up by non-UK nationals (mainly nationals from China, Singapore, Malaysia, Russia and Hong Kong, places where London real estate agents hold lavish prebuild sales events).68 Such frenzied speculation, often as a means of anonymously recycling money derived from corruption in a city now widely regarded as the world capital of money laundering,69 is pushing already-astronomical prices further ‘into the stratosphere’.70 Startlingly, as in New York, the numbers of residential super-high towers in London are rapidly overtaking the more traditional towers of corporate and banking headquarters.

The report estimated that, for every floor upwards in London, market values for elite residential apartments per square foot increase by 1.5 per cent.74 Adding the name of a famous architect and fitting the unit out with balconies, exceptional space standards and super-high-end bathrooms, floors, kitchens and technology further compounds such increased profitability. Meanwhile, the totally inadequate production of affordable or social housing means that London’s poorer and middle-class populations are either displaced altogether or squeezed into ever more overcrowded and overpriced accommodation within the rest of London’s housing stock. Between 2012 and 2015, over 50,000 low-income families were physically displaced from inner London because of the housing crisis combined unprecedented cuts in welfare funding.75 Many low-wage workers who remain are pivotal to the functioning of the city, but are crammed into tiny, illegally rented and often dangerous spaces in attics, basements, sheds and garages. Often highly overcrowded, with no provision for decent sanitation or fire escapes, and with no official record on maps and statistical registers, such improvised dwellings become extremely vulnerable to fires.

See Danny Dorling, ‘How the Super Rich Got Richer: 10 Shocking Facts about Inequality’, Guardian, 15 September 2014. 66Alex Preston, ‘Room at the Top: London’s Super-Prime Housing Market’, Observer, 6 April, 2014. 67Justin McGuirk, ‘Unreal Estate’, Domus, 30 July 2012. 68Ed Hammond, ‘Foreigners Buy Nearly 75 per cent of Property in Inner London’, Financial Times, 3 August 2013. 69John Armitage, ‘London Property Boom Built on Dirty Money’, Independent, 4 March 2015. 70Preston, ‘Room at the Top’. 71Duncan Bowie quoted in Dave Hill, ‘Glistening Towers Can Beguile But Won’t Provide the Homes London Most Needs’, Guardian, 16 March 2014. 72Hillary Osborne, ‘New London Housing “Aimed at Wealthy” Creates Widening Affordability Gap’, Guardian, 11 November 2013. 73Sam Pizzigati, ‘Can a Great City Overdose on Billionaires?’, Too Much, 14 March 2014. 74Knight Frank, ‘Tall Towers’, London, 2012. See knightfrank.co.uk/research/tall-towers-2012-1101.aspx. 75Daniel Douglas, ‘Over 50,000 Families Shipped Out of London Boroughs in the Past Three Years due to Welfare Cuts and Soaring Rents’, Independent, 29 April 2015. 76Antonio Olivo, ‘Housing Crisis Drives Families into Overcrowded Living Conditions’, Chicago Tribune, 28 March 2010. 77Rowan Moore, ‘London Is Being Transformed with 230 Towers: Why the Lack of Consultation?’ Observer, 29 March 2014. 78Mira Bar-Hillel, ‘What Does the Skyrocketing Price of Property in the Capital Mean for Society?’ Independent, 1 June 2014. 79Ian Steadman, ‘Look to the Heygate Estate for What’s Wrong with London’s Housing’, New Statesman, 6 November 2013. 80Eddy Frankel, ‘The Changing Fortunes of the Balfron Tower’, Time Out, 26 May 2015. 81Ibid. 82Owen Hatherley, ‘Keep Calm and Carry On: The Sinister Message behind the Slogan That Seduced the Nation’, Guardian, 8 January, 2016. 83As we see in chapter 10, the marketing for the tower also stresses that the higher residents live in the tower, the cooler the prevailing air temperature. 84Quoted in Nauzer K.


pages: 537 words: 99,778

Dreaming in Public: Building the Occupy Movement by Amy Lang, Daniel Lang/levitsky

activist lawyer, Bay Area Rapid Transit, bonus culture, British Empire, clean water, cognitive dissonance, collective bargaining, corporate governance, corporate personhood, crowdsourcing, David Graeber, deindustrialization, different worldview, facts on the ground, glass ceiling, housing crisis, Kibera, late capitalism, mass incarceration, Naomi Klein, Nelson Mandela, Occupy movement, oil shale / tar sands, out of africa, plutocrats, Plutocrats, Port of Oakland, Rosa Parks, Saturday Night Live, Slavoj Žižek, structural adjustment programs, the medium is the message, too big to fail, trade liberalization, union organizing, upwardly mobile, urban renewal, War on Poverty, We are Anonymous. We are Legion, We are the 99%, white flight, working poor

Hungry and a bit drunk, he’d walked by at two in the morning, surprised to see the kitchen open and a cook making flapjacks. Oscar is living with friends, so the idea of escaping a full house and staying with the Ogawa community for the night was appealing. Though he didn’t think that there were very many people there in the same position as he, he did feel very welcome and at home. Oscar had been out of work since the housing crisis began three years ago. Though he considered Occupy Oakland a good start, he was skeptical about whether the system could be changed at all. He wasn’t sure if he would stay another night, though I did see him there later after sunset setting up a tent. The space had attracted some homeless people as well who seemed to have a mixture of practical and political reasons for being there. Kali, who was in his late thirties, boasted that he’d been the first person at Occupy Oakland; he’d been sleeping on a park bench on Broadway in front of the park on Sunday night anyway.

One of the speakers representing Move On, Charles Davidson, was someone I had interviewed in April at the US Uncut tax day demonstration.2 I remembered that at that time he expressed frustration at the national Move On organization, and was dissatisfied with some of their capitulations and their retreat on US wars and occupations. I asked him via email if he had a statement about the issue. Davidson wrote that the march was focused on budget cuts on healthcare, social programs and infrastructure, and on pressuring Congress to create jobs and address the housing crisis. Davidson also stressed that he did not trust the Democratic Party, and that he didn’t support Move On’s alliances with the party in general, but that he did support certain progressive Democrats such as Barbara Lee and Dennis Kucinich. He also stressed that there were many Move On members who’d been involved in political activism for years, and that the Occupy movement should try to embrace, rather than alienate, them and the union members that would be involved in the event.

Once again, we don’t look at the problem and blame the victims. People are living too long There have also been a rash of stories recently in the UK, scapegoating old people for just about every economic woe we have. First, there are too many pensioners and we can’t afford them – so they need to pay more, work for longer and get less.6 Then, a report by the Intergenerational Foundation told us that the housing crisis was down to these pesky old-timers living in houses that were ‘too big’ and were therefore off limits to young families.7 That’s right, it’s not a property bubble. It’s not that all the council houses were sold off to bribe some working-class people into thinking they were Tories. It’s nothing to do with extortionate house prices and unachievable deposits. No. As people get to the age where they have worked for perhaps 50 years, they are overnight made redundant.


pages: 566 words: 155,428

After the Music Stopped: The Financial Crisis, the Response, and the Work Ahead by Alan S. Blinder

"Robert Solow", Affordable Care Act / Obamacare, asset-backed security, bank run, banking crisis, banks create money, break the buck, Carmen Reinhart, central bank independence, collapse of Lehman Brothers, collateralized debt obligation, conceptual framework, corporate governance, Credit Default Swap, credit default swaps / collateralized debt obligations, Detroit bankruptcy, diversification, double entry bookkeeping, eurozone crisis, facts on the ground, financial innovation, fixed income, friendly fire, full employment, hiring and firing, housing crisis, Hyman Minsky, illegal immigration, inflation targeting, interest rate swap, Isaac Newton, Kenneth Rogoff, liquidity trap, London Interbank Offered Rate, Long Term Capital Management, market bubble, market clearing, market fundamentalism, McMansion, money market fund, moral hazard, naked short selling, new economy, Nick Leeson, Northern Rock, Occupy movement, offshore financial centre, price mechanism, quantitative easing, Ralph Waldo Emerson, Robert Shiller, Robert Shiller, Ronald Reagan, shareholder value, short selling, South Sea Bubble, statistical model, the payments system, time value of money, too big to fail, working-age population, yield curve, Yogi Berra

As we shall see, these three problems—plus a myriad of details—made mortgage modifications look economically difficult, legally problematic, and politically toxic. HAVEN’T WE SEEN THIS MOVIE BEFORE? Once before in history, America experienced the frightening double whammy of a megarecession coupled with sharp declines in home prices. That was during the Great Depression. Back then, President Franklin Roosevelt and Congress reacted to the housing crisis with a burst of policy activism that put the governments of 2007–2010 to shame. The New Deal housing programs included establishing the FHA to insure home mortgages, Fannie Mae (then the FNMA, a government agency) to create a secondary market in mortgages, the Federal Home Loan Banks to provide funds to mortgage lenders, and the Federal Savings and Loan Insurance Corporation to insure deposits at thrift institutions.

And I sketched a back-of-the-envelope calculation suggesting that the new HOLC, like the original, could turn a modest profit in the end. I was not alone in doing so. Economists Paul Davidson and Alex Pollock had the idea of reviving the HOLC before I did, and Senator Chuck Schumer (D-NY) advocated something similar. By coincidence, a few days later I attended a meeting of House Democratic leaders where the then-budding housing crisis was on the agenda. My HOLC idea came up in passing—but, believe me, only in passing. It was rejected instantly as being wildly too expensive. At that stage, the TARP was still eight months away, and neither politicians nor their constituents were thinking about committing hundreds of billions of dollars of public money. I often muse about how much better things might have been had Congress revived the HOLC idea back in 2008, when the foreclosure problem was much smaller than it subsequently, and predictably, became.

A highly publicized settlement with major banks over irregularities in the foreclosure process in February 2012 ironically increased the number of foreclosures, at least for a while, by breaking the legal logjam. The banking plan that Treasury Secretary Geithner sketched in his first major speech on February 10, 2009, had four main components. One of them was the bank stress tests. Two others were new programs meant to accomplish the original stated purposes of the TARP: buying troubled assets. The fourth was, in Geithner’s words, “a comprehensive plan to address the housing crisis.” Unfortunately, he also added, “We will announce the details of this plan in the next few weeks,” which led all hell to break loose in the jittery financial markets. After all, the new administration had been in office for three weeks already, and their plan was not complete! It took Geithner only eight more days to finish the job. The housing plan, ungrammatically named Making Home Affordable, was announced by the president in a February 18 speech.


pages: 209 words: 63,649

The Purpose Economy: How Your Desire for Impact, Personal Growth and Community Is Changing the World by Aaron Hurst

Airbnb, Atul Gawande, barriers to entry, big-box store, business process, call centre, carbon footprint, citizen journalism, commoditize, corporate social responsibility, crowdsourcing, disintermediation, Elon Musk, Firefox, glass ceiling, greed is good, housing crisis, informal economy, Jane Jacobs, jimmy wales, Khan Academy, Kickstarter, Lean Startup, longitudinal study, means of production, Mitch Kapor, new economy, pattern recognition, Peter Singer: altruism, Peter Thiel, QR code, Ray Oldenburg, remote working, Ronald Reagan, selection bias, sharing economy, Silicon Valley, Silicon Valley startup, Steve Jobs, TaskRabbit, Tony Hsieh, too big to fail, underbanked, women in the workforce, young professional, Zipcar

Whereas the Baby Boomers and Gen X “divorced” their professional lives from personal and civic arenas, Millennials have blurred the line between professional development and personal self-expression (for example, using social media to deliberately leverage their individuality) and eagerly seek out to reconcile their personal values and desire to serve others in a professional setting. Millennials were raised to believe that “they can be whatever they want to be” and don’t want to settle for a less-than-meaningful life. In a major study of Millennials, the Pew Research Center recently concluded: “Whatever toll a recession, a housing crisis, a financial meltdown and a pair of wars may have taken on the national psyche in the past few years, it appears to have hit the old harder than the young.…Millennials [are] confident, self-expressive, liberal, upbeat and open to change.”4 Millennials were not only born into a world of much more perceived affluence than prior generations, but also into one in which these values and aspirations were gaining traction.

Hurricanes Katrina and Sandy, the Deep Horizon oil spill, the visible campaigns against modern-day slavery, and the terrifying news of the rapidly melting polar ice caps have made the fragility of our planet painfully clear. The threat is no longer distant; we no longer look outside our immediate communities to see people suffering devastating consequences from our warming climate, the scarcity of freshwater, or the infiltration of our reservoirs by toxic wastes. The threats are omnipresent. The economic disaster and housing crisis of 2008—the “Great Recession”—has also forced many people and companies to change their behavior as consumers and employers. The impact of this recession still isn’t entirely clear, but Millennials, who came of age in this reality, developed a different set of priorities in response to this new context. Visa reported that the use of debit cards has surpassed that of credit cards, indicating a shifting comfort with debt from previous generations.


Global Financial Crisis by Noah Berlatsky

accounting loophole / creative accounting, asset-backed security, banking crisis, Bretton Woods, capital controls, Celtic Tiger, centre right, circulation of elites, collapse of Lehman Brothers, collateralized debt obligation, corporate raider, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, deindustrialization, Doha Development Round, energy security, eurozone crisis, financial innovation, Food sovereignty, George Akerlof, God and Mammon, Gordon Gekko, housing crisis, illegal immigration, income inequality, market bubble, market fundamentalism, mass immigration, moral hazard, new economy, Northern Rock, purchasing power parity, quantitative easing, race to the bottom, regulatory arbitrage, reserve currency, Robert Shiller, Robert Shiller, Ronald Reagan, shareholder value, South China Sea, structural adjustment programs, too big to fail, trade liberalization, transfer pricing, working poor

THE GLOBAL FINANCIAL CRISIS The Global Financial Crisis Other Books of Related Interest: At Issue Series The American Housing Crisis Introducing Issues with Opposing Viewpoints Series Globalization Opposing Viewpoints Series Consumerism Debt The Global Financial Crisis Noah Berlatsky, Book Editor Christine Nasso, Publisher Elizabeth Des Chenes, Managing Editor © 2010 Greenhaven Press, a part of Gale, Cengage Learning Gale and Greenhaven Press are registered trademarks used herein under license. For more information, contact: Greenhaven Press 27500 Drake Rd. Farmington Hills, MI 48331-3535 Or you can visit our Internet site at gale.cengage.com ALL RIGHTS RESERVED. No part of this work covered by the copyright herein may be reproduced, transmitted, stored, or used in any form or by any means graphic, electronic, or mechanical, including but not limited to photocopying, recording, scanning, digitizing, taping, Web distribution, information networks, or information storage and retrieval systems, except as permitted under Section 107 or 108 of the 1976 United States Copyright Act, without the prior written permission of the publisher.

The Weakness of Banking Regulations Caused the Crisis Vince Cable Some British banks have grown too big to fail, and perhaps too big for regulators to handle. Yet they want freedom from regulation and freedom to persue high risk investments. But the British taxpayer should not be responsible for financial risks taken outside the nation’s borders. 42 5. Low Interest Rates Caused the Crisis Tito Boeri and Luigi Guiso 53 The housing crisis was fueled by the actions of the chairman of the Federal Reserve, Alan Greenspan, who kept interest rates low. These circumstances encouraged people to borrow too much to pay for homes they could not afford. 6. Abandoning the Gold Standard Caused the Crisis Dominic Lawson 59 If currency is not backed by gold, politicians and bankers will simply print money, resulting in inflation and a cycle of boom and bust.


pages: 229 words: 61,482

The Gig Economy: The Complete Guide to Getting Better Work, Taking More Time Off, and Financing the Life You Want by Diane Mulcahy

Affordable Care Act / Obamacare, Airbnb, Amazon Mechanical Turk, basic income, Clayton Christensen, cognitive bias, collective bargaining, creative destruction, David Brooks, deliberate practice, diversification, diversified portfolio, fear of failure, financial independence, future of work, gig economy, helicopter parent, Home mortgage interest deduction, housing crisis, job satisfaction, Kickstarter, loss aversion, low skilled workers, Lyft, mass immigration, mental accounting, minimum wage unemployment, mortgage tax deduction, negative equity, passive income, Paul Graham, remote working, risk tolerance, Robert Shiller, Robert Shiller, Silicon Valley, Snapchat, TaskRabbit, Uber and Lyft, uber lyft, universal basic income, wage slave, Y Combinator, Zipcar

The top 1 percent tie up only 9 percent of their net worth in their primary residence. According to Wolff, both the increasing gap in wealth inequality and the financially fragile state of the middle class stems from their overinvestment in their homes. The overconcentration in housing and the high levels of debt the middle class carry in their homes hurt them badly in the Great Recession and housing crisis of 2008. Wolff looked particularly at the years 2007 to 2013 to assess the impact of these two events and found that they hurt the broad middle class the most: “The sharp fall in median net worth and the rise in overall wealth inequality over these years are traceable primarily to the high leverage of middle-class families and the high share of homes in their portfolio.” A recent report from the Pew Research Center also concluded that the differences in the percentage of housing that the upper and middle classes hold in their portfolios are increasing the wealth gap.

Housing has delivered persistently low rates of return relative to other asset classes like stocks and mutual funds.5 The middle class has overinvested in an asset that underperforms. The long-term rate of return (from 1983–2013) for financial assets like stocks has been about 9 percent, compared to the 3.5 percent return on residential real estate over that same time period. During the Great Recession and housing crisis (2007–2010), residential real estate returns fell by about 7 percent, twice as much as financial assets returns, which declined by only 3.7 percent. And real estate has been slow to recover. After the recession, from 2010–2013, residential real estate returned nearly 5 percent, but financial assets have delivered more than double the returns—over 12 percent. In every economic scenario—long term, crash, and recovery—it’s been better to hold financial assets than residential real estate.


pages: 436 words: 114,278

Crude Volatility: The History and the Future of Boom-Bust Oil Prices by Robert McNally

American energy revolution, Asian financial crisis, banking crisis, barriers to entry, Bretton Woods, collective bargaining, credit crunch, energy security, energy transition, housing crisis, hydraulic fracturing, index fund, Induced demand, interchangeable parts, invisible hand, joint-stock company, market clearing, market fundamentalism, moral hazard, North Sea oil, oil rush, oil shale / tar sands, oil shock, peak oil, price discrimination, price stability, sovereign wealth fund, transfer pricing

Causes and Consequences of the Oil Shock of 2007–2008. San Diego, Calif.: UC San Diego, Department of Economics, 2009. Hammes, David, and Douglas Wills. Black Gold: The End of Bretton Woods and the Oil Price Shocks of the 1970s. Available at SSRN: http://ssrn.com/abstract=388283. Harrington, Mark. “Oil Credit Crunch Could Be Worse than the Housing Crisis.” CNBC Commentary. January 14, 2016. http://www.cnbc.com/2016/01/14/oil-credit-crunch-could-be-worse-than-the-housing-crisis-commentary.html. Harvey, Fiona. “World’s Climate Pledges Not Yet Enough to Avoid Dangerous Warming–UN.” Guardian, October 30, 2015. http://www.theguardian.com/environment/2015/oct/30/worlds-climate-pledges-likely-to-lead-to-less-than-3c-of-warming-un. Heil, Emily. “Heard on the Hill: Bar Brawl.” Roll Call, November 4, 2009. http://www.rollcall.com/issues/55_53/-40292-1.html Helbing, Hans H., and James E.

The Bank for International Settlements noted an “intense debate” about how falling oil prices would impact economies, flagging in particular the high debt burden of the oil and gas sector, which had grown by 250 percent from 2006 to 2015 and stood at roughly $2.5 trillion.99 Some worried that crashing oil prices could trigger a banking crisis and downturn as the Lehman crisis had spectacularly done six years earlier. “Oil credit crunch could be worse than the housing crisis,” blared one commentary headline on CNBC.100 Others noted that while the oil crisis was leading to losses at Wall Street banks that had lent producers sizable sums, comparisons with the mortgage crisis were overblown as the scale, complexity, and direct economic impacts were less severe in the case of shale oil debt.101 Whatever the true extent of the risk, crashing oil prices in January and early February 2016 exhibited a reminder that there is a downside to price busts, even for economies that ought to benefit from cheaper oil prices.


pages: 349 words: 114,914

We Were Eight Years in Power: An American Tragedy by Ta-Nehisi Coates

affirmative action, Affordable Care Act / Obamacare, Bernie Madoff, Bernie Sanders, Broken windows theory, Charles Lindbergh, crack epidemic, crony capitalism, David Brooks, deindustrialization, desegregation, Donald Trump, fear of failure, Ferguson, Missouri, Gunnar Myrdal, housing crisis, Howard Zinn, income inequality, jitney, low skilled workers, mandatory minimum, mass incarceration, moral panic, new economy, obamacare, payday loans, phenotype, Ronald Reagan, Rosa Parks, single-payer health, The Bell Curve by Richard Herrnstein and Charles Murray, War on Poverty, white flight

A month after Obama entered the White House, a CNBC personality named Rick Santelli took to the trading floor of the Chicago Mercantile Exchange and denounced the president’s efforts to help homeowners endangered by the housing crisis. “How many of you people want to pay for your neighbor’s mortgage that has an extra bathroom and can’t pay their bills?” Santelli asked the assembled traders. He asserted that Obama should “reward people that could carry the water” as opposed to those who “drink the water,” and denounced those in danger of foreclosure as “losers.” Race was implicit in Santelli’s harangue—the housing crisis and predatory lending had devastated black communities and expanded the wealth gap—and it culminated with a call for a “Tea Party” to resist the Obama presidency. In fact, right-wing ideologues had been planning just such a resistance for decades.

And since the late 1970s, William Julius Wilson and other sociologists following in his wake have noted the disproportionate effect that the decline in “hardworking” manufacturing jobs has had on African American communities. And if anyone should be angered by the devastation wreaked by the financial sector and a government that declined to prosecute the perpetrators, it is African Americans—the housing crisis was one of the primary drivers in the past twenty years of the wealth gap between black families and their country. But the cultural condescension and economic anxiety of black people is not news. Toiling blacks are in their proper state; toiling whites raise the specter of white slavery. Moreover, a narrative of long-neglected working-class black voters, injured by globalization and the financial crisis, forsaken by out-of-touch politicians, and rightfully suspicious of a return of Clintonism, does not serve to cleanse the conscience of white people for having elected Donald Trump.


pages: 317 words: 71,776

Inequality and the 1% by Danny Dorling

Affordable Care Act / Obamacare, banking crisis, battle of ideas, Bernie Madoff, Big bang: deregulation of the City of London, Boris Johnson, Branko Milanovic, buy and hold, call centre, Capital in the Twenty-First Century by Thomas Piketty, centre right, collective bargaining, conceptual framework, corporate governance, credit crunch, David Attenborough, David Graeber, delayed gratification, Dominic Cummings, double helix, Downton Abbey, en.wikipedia.org, Etonian, family office, financial deregulation, full employment, Gini coefficient, high net worth, housing crisis, income inequality, land value tax, longitudinal study, low skilled workers, lump of labour, mega-rich, Monkeys Reject Unequal Pay, Mont Pelerin Society, mortgage debt, negative equity, Neil Kinnock, Occupy movement, offshore financial centre, plutocrats, Plutocrats, precariat, quantitative easing, race to the bottom, Robert Shiller, Robert Shiller, TaskRabbit, The Spirit Level, The Wealth of Nations by Adam Smith, trickle-down economics, unpaid internship, very high income, We are the 99%, wealth creators, working poor

One prepared in 2011 shows that a few years earlier the top 1 per cent had more than a third of all wealth in the US, and the bottom 90 per cent barely a quarter. Figure 4.7 reproduces the same data. The authors of the original graphic noted that the bottom 60 per cent of Americans had 65 per cent of their net worth tied up in their homes. The top 1 per cent, in contrast, had just 10 per cent of their wealth locked up in the bricks and mortar of their property. Consequently: ‘The housing crisis has no doubt further swelled the share of total net worth held by the super-rich.’99 Taxing the rich through their property holdings alone may not be enough. Figure 4.7 Wealth in the USA: it’s the Inequality, Stupid By 2012 it had become apparent that these graphics, publicised widely in the US during 2011, were badly out of date. Using data for 2010, Edward Nathan Wolff of the University of New York showed that the bottom 40 per cent of US households were now usually in debt, with their debts averaging $14,800 non-home wealth per household; in contrast the middle 20 per cent had wealth averaging only $12,200 per household (a quarter less than in 1983); the next 20 per cent had $100,700 per household; and the top 20 per cent $1.7 million each on average (almost double the figure for 1983 in real terms).

Allen, ‘Home Buyers Left Behind in Britain’s Two-Speed Housing Market’, Financial Times, 18 January 2014. 44. M. Griffith, ‘Foreign Demand Comes with Risks’ (letter), Financial Times, 5 March 2014. 45. B. Goldacre, ‘Generation Game’ (letter), The Times, 29 November 2013. 46. M. Duell, ‘All Aboard My New Home! The Shipping Containers Being Rented Out for £75 a Week to Try to Solve London’s Chronic Housing Crisis’, Daily Mail, 9 October 2013. 47. N. Shaxson, J. Christensen and N. Mathiason, ‘Inequality: You Don’t Know the Half of It’, Tax Justice Network, 19 July 2012, at taxjustice.net. 48. L. Slater, ‘Keeping Up with the Zahoors: Inside the Super-Rich World of Londongrad’, Times Magazine, 23 November 2013, p. 41. 49. M. Seamark, ‘Blairs Paid £1.35m in Cash for Home Number SEVEN: Splashed Out on a Four-Storey Georgian Townhouse for Son Nicky’, Daily Mail, 2 February 2013. 50.


pages: 242 words: 71,943

Strong Towns: A Bottom-Up Revolution to Rebuild American Prosperity by Charles L. Marohn, Jr.

2013 Report for America's Infrastructure - American Society of Civil Engineers - 19 March 2013, A Pattern Language, American Society of Civil Engineers: Report Card, bank run, big-box store, Black Swan, Bretton Woods, British Empire, business cycle, call centre, cognitive dissonance, complexity theory, corporate governance, Detroit bankruptcy, Donald Trump, en.wikipedia.org, facts on the ground, Ferguson, Missouri, global reserve currency, housing crisis, index fund, Jane Jacobs, Jeff Bezos, low skilled workers, mass immigration, mortgage debt, Network effects, new economy, New Urbanism, paradox of thrift, Paul Samuelson, pensions crisis, Ponzi scheme, quantitative easing, reserve currency, the built environment, The Death and Life of Great American Cities, trickle-down economics, Upton Sinclair, urban planning, urban renewal, walkable city, white flight, women in the workforce, yield curve, zero-sum game

After all, I had been advising cities on making multimillion-dollar infrastructure investments for some time and felt confident in my approach. I agreed with the city’s engineer’s recommendation to, essentially, go big or go home: make the larger strategic investments now and the city was going to have financial rewards in the future. It was option (c), with my hunch that the bypass would prove to be the most profitable. I was at a total loss when the results were presented. This was before the 2008 housing crisis, thus optimism was built into these calculations. Even so, for every dollar potentially to be invested by Pequot Lakes, here is the projected return on investment in each scenario: Through Town Alternative Required Improvements: –$7.34 Required and Maintenance Improvements: –$34.32 Required, Maintenance, and Growth Improvements: –$46.63 Bypass Alternative Required Improvements: +$1.43 Required and Maintenance Improvements: –$3.11 Required, Maintenance, and Growth Improvements: –$12.62 The city of Pequot Lakes was expected to lose money on all but one scenario.

With the enthusiastic support of contractors, developers, trade unions, and others involved in the business of construction, the ASCE regularly calls for large increases in all levels of infrastructure spending. They boldly cite the obvious benefits of more infrastructure, claims that are parroted nearly unquestioned by politicians and media outlets. For example, in 2011, as governments everywhere were having their budgets hammered by the lingering effects of the housing crisis that began three years earlier, the ASCE published a report called Failure to Act,8 an analysis of the economic impacts of infrastructure investment trends. In this report, the ASCE detailed the hundreds of billions our failing infrastructure is costing American families and businesses. At that point, ASCE estimated that families and businesses had lost $130 billion due just from deficiencies in transportation systems.


pages: 320 words: 87,853

The Black Box Society: The Secret Algorithms That Control Money and Information by Frank Pasquale

Affordable Care Act / Obamacare, algorithmic trading, Amazon Mechanical Turk, American Legislative Exchange Council, asset-backed security, Atul Gawande, bank run, barriers to entry, basic income, Berlin Wall, Bernie Madoff, Black Swan, bonus culture, Brian Krebs, business cycle, call centre, Capital in the Twenty-First Century by Thomas Piketty, Chelsea Manning, Chuck Templeton: OpenTable:, cloud computing, collateralized debt obligation, computerized markets, corporate governance, Credit Default Swap, credit default swaps / collateralized debt obligations, crowdsourcing, cryptocurrency, Debian, don't be evil, drone strike, Edward Snowden, en.wikipedia.org, Fall of the Berlin Wall, Filter Bubble, financial innovation, financial thriller, fixed income, Flash crash, full employment, Goldman Sachs: Vampire Squid, Google Earth, Hernando de Soto, High speed trading, hiring and firing, housing crisis, informal economy, information asymmetry, information retrieval, interest rate swap, Internet of things, invisible hand, Jaron Lanier, Jeff Bezos, job automation, Julian Assange, Kevin Kelly, knowledge worker, Kodak vs Instagram, kremlinology, late fees, London Interbank Offered Rate, London Whale, Marc Andreessen, Mark Zuckerberg, mobile money, moral hazard, new economy, Nicholas Carr, offshore financial centre, PageRank, pattern recognition, Philip Mirowski, precariat, profit maximization, profit motive, quantitative easing, race to the bottom, recommendation engine, regulatory arbitrage, risk-adjusted returns, Satyajit Das, search engine result page, shareholder value, Silicon Valley, Snapchat, social intelligence, Spread Networks laid a new fibre optics cable between New York and Chicago, statistical arbitrage, statistical model, Steven Levy, the scientific method, too big to fail, transaction costs, two-sided market, universal basic income, Upton Sinclair, value at risk, WikiLeaks, zero-sum game

As information technology improved, lobbyists could tell a seductive story: regulators were no longer necessary. Sophisticated investors could vet their purchases.20 Computer models could identify and mitigate risk. But the replacement of regulation by automation turned out to be as fanciful as flying cars or space colonization. 106 THE BLACK BOX SOCIETY Machine Dreams Consider the role of computer models in a critical part of the housing crisis: mortgage-backed securities. While investors may not be interested in any one particular mortgagor’s stream of payments, an aggregation of such payments can be marketed as a far more stable income source (or security) than, say, any one loan. Think, for instance, of the stream of payments coming out of a small city. It might seem risky to give any one household a loan; the breadwinner might fall ill, they might declare bankruptcy, they may hit the lottery and pay off the loan tomorrow (denying the investor a steady stream of interest payments).

to Matt Taibbi’s coruscating outrage in Griftopia, the genre has reflected the manners and mores of the time. Journalists and legal scholars help the persistent to peer into fi nance’s black box. They need a stronger voice in a regulatory process too often dominated by the few who profit from opacity. To be sure, there are many conscientious souls working on Wall Street. But their voices and values matter little if they can be summarily overruled by their bosses. The aftermath of the housing crisis has exposed a critical mass of unethical and hugely costly deals. It has created a presumption of suspicion for large firms—particularly those that now enjoy “too big to fail” status. Black box finance ranges from the crude to the cunning, the criminal to the merely complex. Countless narratives and analyses of the crisis have tried to pin down whether bankers, mortgage brokers, regulators, and insurers knew or should have known that the mortgage industrial complex was building a house of cards.

They should not be afraid to alert regulators when such liabilities appear to be too interconnected or destabilizing. Although 50 separate states run Medicaid programs, antifraud programs appear to be unifying these once-disparate sources of data. The data miners can also compare findings of noteworthy activity in the Medicare program across states.159 Functionality of this kind, spotting repeated patterns of mortgage fraud around the country, would have been very helpful in the run-up to the housing crisis. Just as a network of fusion centers can readily transmit suspicious patterns of criminal intelligence horizontally (to other state- or local-level agencies) or vertically (to national agencies), state Medicaid Integrity Programs both empower and are empowered by rapid data flows.160 The Medicare-Medicaid Data Match Program breaks down the barriers between the surveillance and analysis done by each program.161 Its successes should be a model for the entities now comprising the Financial Stability Oversight Council (FSOC), which may be able to find efficiencies (and new insights) by sharing data.


pages: 756 words: 120,818

The Levelling: What’s Next After Globalization by Michael O’sullivan

"Robert Solow", 3D printing, Airbnb, algorithmic trading, bank run, banking crisis, barriers to entry, Bernie Sanders, bitcoin, Black Swan, blockchain, Boris Johnson, Branko Milanovic, Bretton Woods, British Empire, business cycle, business process, capital controls, Celtic Tiger, central bank independence, cloud computing, continuation of politics by other means, corporate governance, credit crunch, cryptocurrency, deglobalization, deindustrialization, disruptive innovation, distributed ledger, Donald Trump, eurozone crisis, financial innovation, first-past-the-post, fixed income, Geoffrey West, Santa Fe Institute, Gini coefficient, global value chain, housing crisis, income inequality, Intergovernmental Panel on Climate Change (IPCC), knowledge economy, liberal world order, Long Term Capital Management, longitudinal study, market bubble, minimum wage unemployment, new economy, Northern Rock, offshore financial centre, open economy, pattern recognition, Peace of Westphalia, performance metric, private military company, quantitative easing, race to the bottom, reserve currency, Robert Gordon, Robert Shiller, Robert Shiller, Ronald Reagan, Scramble for Africa, secular stagnation, Silicon Valley, Sinatra Doctrine, South China Sea, South Sea Bubble, special drawing rights, supply-chain management, The inhabitant of London could order by telephone, sipping his morning tea in bed, the various products of the whole earth, The Rise and Fall of American Growth, The Wealth of Nations by Adam Smith, Thomas Kuhn: the structure of scientific revolutions, total factor productivity, trade liberalization, tulip mania, Valery Gerasimov, Washington Consensus

., manufacturing of aerospace equipment, recruitment agencies, luxury goods, or technology and telecom providers), it came from the use of financial products and services to leverage underlying economic activity. Formally, in national accounts, financial products are treated as activity, though in reality they simply involve the purchase and reallocation of risk, and by 2007, this risk was not well allocated. The housing crisis was a great case in point. Cheap money boosted house prices, high house prices boosted transaction leverages, and exotic and ultimately dangerous derivative instruments magnified the impact of the housing sector on the economy. All the while, banks made money at each of these turns, and by 2006 nearly 40 percent of all the earnings of corporate America came from finance (as an aside, technology now occupies this role, and potentially, from a regulatory point of view, technology may be the new banking sector).

Then, also, Ireland needs to develop more acumen in the governance and management of state-related enterprises, needs to approach them from a position of principle (i.e., that education and health are public goods), and needs to better oversee the state’s role as an economic actor and procurer of services. The second issue is that Ireland still regularly suffers from imbalances in its economy, the most obvious one today being that house prices and rental charges are higher than during its bubble period, and that there is a resulting housing crisis. Ireland’s overheated property market is one area where it can learn from other small countries. In the past it has found it too easy to copy the policy model of the United Kingdom and has ignored the lessons of other small open countries (notably, the Scandinavian banking crisis of the 1990s came to the notice of Irish policy makers only after the collapse of the Celtic Tiger). Brexit will, naturally, change this.

In practice, this will demand lots of innovations in the area that policy wonks call “macroprudential policy”—that is, efforts to reduce financial risks to an economic system. For example, if eurozone interest rates were very low by the standards of the Irish economy and produced a housing bubble, the Irish central bank then could increase the deposit-to-loan ratio on mortgages or the finance ministry could increase the tax on property transactions so as to dampen the risk of a housing bubble. In a sign that Ireland has not fully learned the lessons of its housing crisis, it is now enduring its second housing bubble in ten years, with housing affordability very stretched and homelessness a very public social problem. Allowing, encouraging, and helping individual states to use policy tools like this would allow them to exist in the eurozone in a more stable way. Such policies could be coordinated by the EU Treasury. Part of its mandate would be recognition that not all eurozone economies are created equal and that many of them behave differently under different conditions (France is less sensitive to fluctuations in the euro than Germany, for example).


World Cities and Nation States by Greg Clark, Tim Moonen

active transport: walking or cycling, Asian financial crisis, Berlin Wall, Big bang: deregulation of the City of London, Boris Johnson, business climate, cleantech, congestion charging, corporate governance, deindustrialization, Deng Xiaoping, financial independence, financial intermediation, Francis Fukuyama: the end of history, full employment, global supply chain, global value chain, high net worth, housing crisis, immigration reform, income inequality, informal economy, Kickstarter, knowledge economy, low skilled workers, megacity, new economy, New Urbanism, Norman Mailer, open economy, Pearl River Delta, rent control, Richard Florida, Silicon Valley, smart cities, sovereign wealth fund, special economic zone, stem cell, supply-chain management, The Wealth of Nations by Adam Smith, trade route, transaction costs, transit-oriented development, upwardly mobile, urban planning, urban renewal, urban sprawl, War on Poverty, zero-sum game

Available at www.lite.fae.unicamp.br/revista/gohn. html. Accessed 2016 Feb 12. Guedes, O. (2012). É urgente renegociar a dívida de São Paulo. Escola de Governo: Artigos. Available at http://www.escoladegoverno.org.br/artigos/1984‐qe‐urgente‐renegociar‐a‐divida‐ de‐sao‐pauloq. Accessed 2016 Feb 12. Holmes, C. (2016). São Paulo Is Betting Better Urban Planning Can Solve a Housing Crisis. Next City. Available at https://nextcity.org/features/view/sao‐paulo‐housing‐crisis‐master‐ plan‐zeis‐haddad‐habitat‐iii. Accessed 2016 Feb 12. IBGE (2016). Population projection for Brazil and federal units. Available at http://www.ibge. gov.br/apps/populacao/projecao/index.html. Accessed 2016 Jan 20. Jovem Pam (2014). Dilma elogia resultado de privatização do aeroporto de Guarulhos, SP. Jovem Pam. Available at http://jovempan.uol.com.br/noticias/brasil/sao‐paulo/dilma‐elogia‐resultado‐ de‐privatizacao‐do‐aeroporto‐de‐guarulhos‐sp.html.

There has been no broad framework resembling a ‘national urban policy’ in the US for over 30 years, with national urban programmes instead focusing upon small‐area‐based initiatives for community‐led housing and eco­ nomic development. The federal government did previously play a substantial role in investing in affordable housing programmes and many of these were uti­ lised in New York City. The gradual loss of this investment stream into New York over the past 20 years has contributed to New York’s affordable housing crisis. The federal tier has also withdrawn from many financing responsibilities and focused primarily on security, immigration and healthcare challenges. Instead, it is the federal support that New York City tends to receive in response to major crises that emerges as a recurrent theme of this chapter. There have been three such major crises since 2000: the terrorist attacks of 9/11, the 2008 global financial crisis and subsequent recession and Hurricane Sandy in 2012.


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Stress Test: Reflections on Financial Crises by Timothy F. Geithner

Affordable Care Act / Obamacare, asset-backed security, Atul Gawande, bank run, banking crisis, Basel III, Bernie Madoff, Bernie Sanders, break the buck, Buckminster Fuller, Carmen Reinhart, central bank independence, collateralized debt obligation, correlation does not imply causation, creative destruction, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, currency manipulation / currency intervention, David Brooks, Doomsday Book, eurozone crisis, financial innovation, Flash crash, Goldman Sachs: Vampire Squid, housing crisis, Hyman Minsky, illegal immigration, implied volatility, Kickstarter, London Interbank Offered Rate, Long Term Capital Management, margin call, market fundamentalism, Martin Wolf, McMansion, Mexican peso crisis / tequila crisis, money market fund, moral hazard, mortgage debt, Nate Silver, negative equity, Northern Rock, obamacare, paradox of thrift, pets.com, price stability, profit maximization, pushing on a string, quantitative easing, race to the bottom, RAND corporation, regulatory arbitrage, reserve currency, Saturday Night Live, savings glut, selection bias, short selling, sovereign wealth fund, The Great Moderation, The Signal and the Noise by Nate Silver, Tobin tax, too big to fail, working poor

And by ensuring the system could sustain depression-like losses, we thought we could make a depression less likely. But I wasn’t ready to provide much detail yet. We hadn’t figured out how the stress test would work. And the rest of my speech was just as vague. I would announce a new program to buy some of the distressed assets that were weighing down banks, while acknowledging that it wasn’t ready. I would promise “a comprehensive plan to address the housing crisis,” with little further explanation. And I would signal that we would not allow any more Lehman-style failures, a crucial commitment designed to prevent an even more chaotic run, but that line was hedged and buried in my twenty-sixth paragraph. As the President had promised, this would be my moment in the sun. The world wanted to see American leadership. The markets wanted to see a credible plan.

I wanted him to be able to do big things, too, but my immediate ambitions were narrower, dominated by the imperatives of the crisis. We needed to design a strategy to fix the broken financial system and a large fiscal stimulus package to arrest the economic free fall. We had to figure out a way to save the dying U.S. auto industry in order to prevent a regional depression in the industrial Midwest. We had to devise a plan to deal with the escalating housing crisis in order to protect millions of families at risk of foreclosure. At a time when the federal deficit was soaring past $1 trillion for the first time, we would also have to send Congress a budget laying out our tax and spending priorities, and demonstrating how we intended to limit the red ink once the economy recovered. Presidential transitions are usually a confused mess of jockeying for jobs and groping for ideas, but this one would be consumed by the economic emergency.

At my farewell dinner at the Fed, Jeff Lacker had quipped that my colleagues had considered giving me one of our Maiden Lane vehicles as a going-away present, since they probably wouldn’t exceed the Fed’s $25 gift limit. At the time, those assets were distressed enough to make the joke funny. The markets had welcomed TARP, but they no longer believed that TARP was big enough to fill the system’s capital hole. The President had pledged to use at least $50 billion to address the housing crisis, so we now had about $300 billion left to repair the financial system. Fortunately, we wouldn’t need TARP money to recapitalize Fannie and Freddie, because the separate authority Hank had gotten to put capital into them was essentially unlimited; otherwise, they were hemorrhaging so badly they could have drained most of the cash we had left. But the rest of the financial system was bleeding, too.


pages: 200 words: 72,182

Nickel and Dimed: On (Not) Getting by in America by Barbara Ehrenreich

business process, full employment, housing crisis, income inequality, McMansion, place-making, post-work, sexual politics, telemarketer, union organizing, wage slave, women in the workforce, working poor, zero day

This seems like a prudent and thrifty decision at the moment, but it turns out to be a major mistake. I decide there must be something I am doing wrong, some cue I am missing. Budgie's owners had been confident that Apartment Search would find me a place. When I call another friend of a friend, a professor at a college in St. Paul who has briefed me on the Twin Cities' industrial history, he concedes to being aware of an affordable-housing “crisis” but has no idea what I should do. Those rental agents who are kind enough to talk to me all recommend the same thing: find a motel that rents by the week and stay there until something opens up.[24] So, through multiple calls, I arrive at a list of eleven motels in the Twin Cities area, all of them of the non-brand-name variety, offering weekly rates. The rates, though, are not anybody's definition of “affordable,” ranging from $200 a week at the Hill View in Shakopee to $295 at the Twin Lakes in southern Minneapolis, and many of these places are full.

But rents were also skyrocketing in the touristically challenged city of Minneapolis, where the last bits of near-affordable housing lie deep in the city, while job growth has occurred on the city's periphery, next to distinctly unaffordable suburbs. Insofar as the poor have to work near the dwellings of the rich—as in the case of so many service and retail jobs—they are stuck with lengthy commutes or dauntingly expensive housing. If there seems to be general complacency about the low-income housing crisis, this is partly because it is in no way reflected in the official poverty rate, which has remained for the past several years at a soothingly low 13 percent or so. The reason for the disconnect between the actual housing nightmare of the poor and “poverty,” as officially defined, is simple: the official poverty level is still calculated by the archaic method of taking the bare-bones cost of food for a family of a given size and multiplying this number by three.


pages: 232 words: 77,956

Private Island: Why Britain Now Belongs to Someone Else by James Meek

Affordable Care Act / Obamacare, Berlin Wall, business continuity plan, call centre, clean water, Deng Xiaoping, Etonian, HESCO bastion, housing crisis, illegal immigration, Martin Wolf, medical bankruptcy, Mikhail Gorbachev, post-industrial society, pre–internet, price mechanism, Right to Buy, risk tolerance, road to serfdom, Ronald Reagan, Rubik’s Cube, Skype, sovereign wealth fund, Washington Consensus, working poor

Thatcher and her successors have done all they can to sell off the nation’s bricks and mortar, only to be forced to rent it back, at inflated prices, from the people they sold it to. Before Right to Buy, the government spent a pound on building homes for every pound it spent on rent subsidies. Now, for every pound it spends on housing benefit, it puts five pence towards building. The response of the current government to the housing crisis is to try to make it worse. It is taking steps to increase house prices, without taking steps to increase supply. The coalition’s two most explicit interventions in the housing market have been to restrict supply and raise prices: the first when it cut, by two-thirds, the grant given to housing associations to build new homes, and the second with its mocking parody of Right to Buy, ‘Help to Buy’, offering already well-off people cheap loans to overbid for overpriced houses they couldn’t otherwise afford.

To settle for history as wheel rather than ascent, in which it will eventually be time for Dickens to come around again. There is a substantive obstacle in the way of that descent back into squalor: there is no neat way to separate the shortage of social housing from the shortage of housing in general. The government is pulling back in the face of a market that is failing across the board. Matt Griffith, author of an incisive paper for the think tank IPPR about the housing crisis, We Must Fix It, points out that the interconnecting problems afflicting the private housebuilding industry do not reflect a deeper economic malaise; they are the deeper economic malaise. Britain’s established housebuilders, Griffith reckons, no longer have housebuilding as their primary function. They’ve essentially become dealers in land. Griffith estimates British housebuilders have enough land to build 1.5 million houses.


pages: 206 words: 9,776

Rebel Cities: From the Right to the City to the Urban Revolution by David Harvey

Bretton Woods, business cycle, collateralized debt obligation, commoditize, creative destruction, David Graeber, deindustrialization, financial innovation, Guggenheim Bilbao, Hernando de Soto, housing crisis, illegal immigration, indoor plumbing, invisible hand, Jane Jacobs, late capitalism, Long Term Capital Management, market bubble, market fundamentalism, means of production, moral hazard, mortgage debt, mortgage tax deduction, New Urbanism, Ponzi scheme, precariat, profit maximization, race to the bottom, Robert Shiller, Robert Shiller, special economic zone, the built environment, the High Line, The Wealth of Nations by Adam Smith, transcontinental railway, urban planning, We are the 99%, William Langewiesche, Works Progress Administration

And it was pretty clear to almost anyone who thought about it- including, it turns o ut, Robert Sh iller- that something was going badly wrong in US housing m arkets after 200 1 or so. But he saw it as exceptional rather than system ic.6 Shiller could well claim, of course, that all of the above other exam ­ ples were merely regional events. B u t then so, from t h e standpoint of the people of Brazil or China, was the housing crisis of 2007-09. The epi­ center was the US southwest and Florida ( with some spillover in G eorgia), along with a few other hot-spots (the grumbling foreclosure crises that began in the late 1 9 90s in poor areas in older cities like Balt imore and C leveland were too local and "unimportant" be cause those affected were African-A mericans and m inorities). Internationally, Spain and Ireland were badly caught out, as was Britain , though to a lesser extent.

See The Right to the City ( Lefebvre) Cheney, Dick, 53 Dubai, 1 2 Chicago, 22, 32, 55, 57, 1 1 5, 1 1 6, 1 1 8, DUMBO, New York City, 78 151 Chile, 57, 85, 1 3 1 , 1 53, 1 64. See also Eastern Europe, 140 Santiago China, xiv, 1 1 - 1 5 passim, 1 9 , 44, 46, 57-65, 1 24, 1 33; bill i onaires, 1 5 ; Ecologistes, Lx Egypt, 1 64. See also Cairo 7he Eigh teenth Bruma ire of Louis consumerism, 3 9 , 6 1 ; exception Napoleon (Marx) , 37 to global ant iwar protests, 1 1 6; El Alto, Bolivia, 79, 1 1 6, 1 1 7, 1 3 1 , urbanization, xv, 1 1 - 1 2, 1 9; US housing crisis and, 3 1 ; World El Alto, Rebel City ( Lazar) , 144 -50 Bank and, 29. See also Beijing; Chongqing; Guangdong; Shanghai; Shenzen Chongqing, 64, 1 36 Christiania, Copenhagen, 78 City of God, 1 00 Class Struggles in France ( Marx) , 37 1 4 1 - 5 1 passim passim Elyachar, Jul ia, 20- 2 1 Engels, Friedrich, 4, 1 6- 1 8 passim, 5 3 Environmental Protection Agency (EPA), 1 60 Escobar, Arturo, 142 European Central Bank, 24 Cleveland, 1 3, 3 1 , 56, 83 European Union, 29 Clinton, Bill, 45, 53, 54, 56 Euskadi Ta Askatasuna ( ETA) , 1 00 Cochabamba, Bolivia, 82-83, 1 1 6, 142, Excluded Workers Congress, 1 3 1 -32, 143, 149 1 37, 1 5 1 Cold War, 9, 1 24 Columbia University, 23-24 Commonwealth ( Hardt and Negri), 1 52 The Comm unis t Manifesto (Marx and Engels), 53 Copenhagen, 78 Fallujah, Iraq, 1 1 7 Fannie Mae, 39, 4 1 , 45, 47, 49, 5 1 Federal Emergency Management Agency ( FEMA), 1 60 Federal Home Mortgage Corporation.


pages: 280 words: 74,559

Fully Automated Luxury Communism by Aaron Bastani

"Robert Solow", autonomous vehicles, banking crisis, basic income, Berlin Wall, Bernie Sanders, Bretton Woods, capital controls, cashless society, central bank independence, collapse of Lehman Brothers, computer age, computer vision, David Ricardo: comparative advantage, decarbonisation, dematerialisation, Donald Trump, double helix, Elon Musk, energy transition, Erik Brynjolfsson, financial independence, Francis Fukuyama: the end of history, future of work, G4S, housing crisis, income inequality, industrial robot, Intergovernmental Panel on Climate Change (IPCC), Internet of things, Isaac Newton, James Watt: steam engine, Jeff Bezos, job automation, John Markoff, John Maynard Keynes: technological unemployment, Joseph Schumpeter, Kevin Kelly, Kuiper Belt, land reform, liberal capitalism, low earth orbit, low skilled workers, M-Pesa, market fundamentalism, means of production, mobile money, more computing power than Apollo, new economy, off grid, pattern recognition, Peter H. Diamandis: Planetary Resources, post scarcity, post-work, price mechanism, price stability, private space industry, Productivity paradox, profit motive, race to the bottom, RFID, rising living standards, Second Machine Age, self-driving car, sensor fusion, shareholder value, Silicon Valley, Simon Kuznets, Slavoj Žižek, stem cell, Stewart Brand, technoutopianism, the built environment, the scientific method, The Wealth of Nations by Adam Smith, Thomas Malthus, transatlantic slave trade, Travis Kalanick, universal basic income, V2 rocket, Watson beat the top human players on Jeopardy!, Whole Earth Catalog, working-age population

The Haringey Development Vehicle While not as economically far-reaching as the collapse of Carillion, or absurd as the East Coast Main Line, the rise and fall of the Haringey Development Vehicle (HDV) in north London offers another example of the neoliberal meat grinder in action. A joint effort coordinated by the local Labour council and property developer Lendlease, its intention was to respond to the twin problems of the housing crisis and central government reducing local budgets as the result of austerity. In this respect it mirrors outsourcing. There the solution to unemployment is jobs whose wages increase poverty, while the HDV wanted to build homes that ordinary people could not afford. In a London borough where the average home was already fifteen times the median wage, the HDV wasn’t a solution to the housing crisis – it entrenched it. This feedback loop is no accident. Neoliberalism reduces the capacity of public bodies to spend money while simultaneously intensifying social problems like homelessness and poverty.


pages: 249 words: 77,342

The Behavioral Investor by Daniel Crosby

affirmative action, Asian financial crisis, asset allocation, availability heuristic, backtesting, bank run, Black Swan, buy and hold, cognitive dissonance, colonial rule, compound rate of return, correlation coefficient, correlation does not imply causation, Daniel Kahneman / Amos Tversky, diversification, diversified portfolio, Donald Trump, endowment effect, feminist movement, Flash crash, haute cuisine, hedonic treadmill, housing crisis, IKEA effect, impulse control, index fund, Isaac Newton, job automation, longitudinal study, loss aversion, market bubble, market fundamentalism, mental accounting, meta analysis, meta-analysis, Milgram experiment, moral panic, Murray Gell-Mann, Nate Silver, neurotypical, passive investing, pattern recognition, Ponzi scheme, prediction markets, random walk, Richard Feynman, Richard Thaler, risk tolerance, Robert Shiller, Robert Shiller, science of happiness, Shai Danziger, short selling, South Sea Bubble, Stanford prison experiment, Stephen Hawking, Steve Jobs, stocks for the long run, Thales of Miletus, The Signal and the Noise by Nate Silver, tulip mania, Vanguard fund

Buy and hold makes sense for most people most of the time, but this is no guarantee that your timeline or context will make it sound advice for you in particular. Of rules and their exceptions Thus, the student of market psychology finds himself at an awkward crossroads. He understands that market timing is typically ineffectual, but is also aware of times in history when broad market levels have become obviously and grossly disconnected from any measure of fundamental value. From the Roaring 20s and the Nifty Fifty to the Tech Bubble and the Housing Crisis, periods of mania have been relatively frequent, easy to spot with typical valuation metrics and have had dramatic wealth-destroying effects. If the rule is “don’t time the market,” is it possible that there are ever exceptions to the rule? I believe that there are and that consistent with our behavioral emphasis on contrarianism, they are infrequent, painful to implement and will run directly contrary to what feels right.

A similar feedback loop can be initiated, often more violently, when news is bad. The 1973 oil crisis resulted in rumors that toilet paper would be in short supply. These rumors led to subsequent runs on the grocery story where fearful citizens stocked up. This led to, you guessed it, an actual shortage of toilet paper that was wholly a consequence of perception. More consequentially, this was evident in the housing crisis of the late 2000s. As housing prices began their precipitous decline, more and more homeowners found themselves underwater, meaning that the market value of the home was less than the mortgage. This provides ample reason for the homeowner to walk away from the home, declare bankruptcy and be free of the whole affair. Walking away means that homes are not taken care of and causes a glut of supply, both of which decrease prices and cause further walking away.


pages: 246 words: 74,341

Financial Fiasco: How America's Infatuation With Homeownership and Easy Money Created the Economic Crisis by Johan Norberg

accounting loophole / creative accounting, bank run, banking crisis, Bernie Madoff, Black Swan, business cycle, capital controls, central bank independence, collateralized debt obligation, creative destruction, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, David Brooks, diversification, financial deregulation, financial innovation, helicopter parent, Home mortgage interest deduction, housing crisis, Howard Zinn, Hyman Minsky, Isaac Newton, Joseph Schumpeter, Long Term Capital Management, market bubble, Martin Wolf, Mexican peso crisis / tequila crisis, millennium bug, money market fund, moral hazard, mortgage tax deduction, Naomi Klein, new economy, Northern Rock, Own Your Own Home, price stability, Ronald Reagan, savings glut, short selling, Silicon Valley, South Sea Bubble, The Wealth of Nations by Adam Smith, too big to fail

Fannie hoped that, by buying such mortgages, it would encourage other banks and mortgage institutions to lend more and more along similar lines. The project would be launched nationally in the spring. In the same year, Fannie set itself the goal of doubling its profits in five years, and its employees were rewarded with stock options when that goal was achieved. In 1999, Steven Holmes noted in the New York Times that, by pushing through such projects, the administration could cause a repeat of the housing crisis of the 1980s: In moving, even tentatively, into this new area of lending, Fannie Mae is taking on significantly more risk, which may not pose any difficulties during flush economic times. But the government-subsidized corporation may run into trouble in an economic downturn, prompting a government rescue similar to that of the savings and loan industry in the 1980s.24 But there was nothing tentative about the actions of Fannie Mae.

See also discrimination against minorities multiple purchases, 7, 9 second mortgages, 6-7 See also housing policy Hoover, Herbert, 101-5, 109 New Deal policies and policies of, 106 Hortlund, Per, 143 Housing and Urban Development (HUD), lending expansion under Cisneros, 29-36 housing bubble, 5-10, 17-18, 113 riding the bubble, 55-58, 134-35 warning signs of impending trouble, 40-43, 70-75 housing crisis of 1980s, 33 housing policy Cisneros and, 23-25 Community Reinvestment Act and, 26-28 expanded homeownership, 23-28 exposure to risk, 24-25, 29-30, 40-43 geographic variations, 7-9 government homeownership projects, 25-28 lending community and, 25-28 monitoring of loans made, 34 ownership society and, 24, 36-40 stretching HUD rules and requirements, 29-36 subprime mortgages and, 24, 29-36 warning signs of impending trouble, 40-43 housing prices, 8, 9-10 HUD.


pages: 240 words: 73,209

The Education of a Value Investor: My Transformative Quest for Wealth, Wisdom, and Enlightenment by Guy Spier

Albert Einstein, Atul Gawande, Benoit Mandelbrot, big-box store, Black Swan, Checklist Manifesto, Clayton Christensen, Daniel Kahneman / Amos Tversky, Exxon Valdez, Gordon Gekko, housing crisis, information asymmetry, Isaac Newton, Kenneth Arrow, Long Term Capital Management, Mahatma Gandhi, mandelbrot fractal, Nelson Mandela, NetJets, pattern recognition, pre–internet, random walk, Ronald Reagan, South Sea Bubble, Steve Jobs, winner-take-all economy, young professional, zero-sum game

During the tech bubble of the late 1990s, lousy companies were talked up and sold to an unsuspecting public. For example, analysts like Henry Blodget at Merrill Lynch were wildly bullish about Internet stocks, dressing up pigs with lipstick. Years later, the same thing happened at credit-rating agencies where analysts issued blindly positive ratings for the CMOs and CDOs that would ultimately lead to the housing crisis. As for me, my 18 gut-wrenching months at D. H. Blair had destroyed my clean copybook and brought my career to an absolute low. The résumé and reputation I had built for myself at Oxford and Harvard had been reduced to dust. And reputation in business—especially the investing world—is everything. For years after I left D. H. Blair, I felt so sullied by the experience that it was as if I couldn’t wash the dirt off my hands.

., 149, 157–60 Fabozzi, Frank, 18–19 Fairfax Financial Holdings, 35, 140 Fannie Mac, 53–5 Farmer Mac, 53–7 fee structures, hedge fund, 46–7, 67, 73–4, 79–80 Feldman, Andrew, 23 financial crisis of 2008–2009, 21, 57, 101 and addiction to Bloomberg, 118 and Aquamarine Fund, 86–99, 192 and behavioral finance, 107–9 and finding balance, 121–2 and inner scorecard, 80 and redemption policies, 47 Fooled by Randomness (Taleb), 136 Ford, Henry, 45 Fortescue Metals Group, 97 Fosha, Diana, 17 Freddie Mac, 53–5, 90 Gabelli, Mario, 73 Gage, Phineas, 102 Gates, Bill, 61, 78–9, 83, 124, 176 Gawande, Atul, 151–4 GEICO, 38, 164 Girard, Joe, 61 GLIDE Foundation, 69–70, 75–6, 175 Goldman Sachs, 7–8, 30–1 Gotham Partners, 54 Graham, Benjamin, 1, 18–19, 30, 36–7, 50, 79, 106, 146 greed, 3, 8, 16, 50, 112, 189, 193 Green, William, 85, 195 Greenblatt, Joel, 53, 106 Greene, Robert, 171 Guerin, Rick, 82, 93 Hamlet (Shakespeare), 5 Harvard Business School (HBS), 5–7, 9, 21–2, 28–9, 42, 49, 128, 130, 184 Hawkins, David, 66 Hemingway, Ernest, 17 heroes, modeling habits of, 39–40, 46, 67, 71, 96, 113, 115–16, 176–7 Hill, Napoleon, 35 Hindi, Orly, 180 Hohn, Chris, 49–50, 51, 144 Hölldobler, Bert, 104 housing crisis, 17, 90. See also financial crisis of 2008–2009 How I Raised Myself from Failure to Success in Selling (Bettger), 6 How to Win Friends and Influence People (Carnegie), 35 Hughes, Stephen, 167–9 Influence: Science and Practice (Cialdini), 148 Influence: The Psychology of Persuasion (Cialdini), 60 inner growth and meaning, 187–94 Intelligent Investor, The (Graham), 1, 19, 30, 79 investing checklist for, 151–70 as a game, 123–32 guideline for checking stock prices, 135–7 guideline for researching, 140 guideline for responding to sales pitches, 137–9 guideline for talking to management, 139–40 guidelines for buying and selling, 145–8 guidelines for discussing, 144–5, 148–50 rules and tools for, 133–50 use of the phrase “value investing,” 187 See also value investing IPOs (initial public offerings), 9–10, 129, 138–9 J.


pages: 232 words: 71,965

Dead Companies Walking by Scott Fearon

bank run, Bernie Madoff, business cycle, corporate raider, creative destruction, crony capitalism, Donald Trump, Eugene Fama: efficient market hypothesis, fear of failure, Golden Gate Park, hiring and firing, housing crisis, index fund, Jeff Bezos, Joseph Schumpeter, late fees, McMansion, moral hazard, new economy, pets.com, Ponzi scheme, Ronald Reagan, short selling, Silicon Valley, Snapchat, South of Market, San Francisco, Steve Jobs, survivorship bias, Upton Sinclair, Vanguard fund, young professional

Just a few months before I visited Embarcadero Center, a money manager in Los Angeles named Robert Chapman had taken advantage of BMHC’s plummeting stock price to acquire more than 7 percent of the company. Chapman has never been shy about criticizing the managers of businesses he invests in, but he was particularly pointed with the brass at BMHC. He took to publicly calling out Rob as “San Francisco’s own $6 Million Man” and urged the company to reduce “its bloated cost structure.”* Even as the housing crisis became a clear supercycle event, BMHC—again, a low-margin commodity and service provider with its roots in Boise, Idaho—kept its tony corporate headquarters on the San Francisco waterfront. That fact alone, even more than the firm’s increasingly gruesome finances, convinced me to short its stock. Relatively speaking, the expense of maintaining the San Francisco office might have been small compared to BMHC’s overall budget, but the symbolism of it was enormous.

It displayed a leadership that was, quite literally, out of touch. Responsible managers would have already moved themselves into much humbler surroundings. There was no reason Rob and his fellow executives couldn’t conduct their business in a low-cost industrial park or even some modest mobile offices tucked into the corner of one of the dozens of lumber supply yards the company owned. That would have not only saved crucial overhead expenses during the housing crisis, it would have shown the world—and their own employees—that they were going to do everything it took to weather the downturn, even if it meant living and working (gasp!) outside of San Francisco. Eventually, in early 2009, BMHC did move its headquarters back to its original hometown of Boise, Idaho. But by then, it was too late to save the business. The New York Stock Exchange had already delisted its stock.


pages: 278 words: 82,069

Meltdown: How Greed and Corruption Shattered Our Financial System and How We Can Recover by Katrina Vanden Heuvel, William Greider

Asian financial crisis, banking crisis, Bretton Woods, business cycle, buy and hold, capital controls, carried interest, central bank independence, centre right, collateralized debt obligation, conceptual framework, corporate governance, creative destruction, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, declining real wages, deindustrialization, Exxon Valdez, falling living standards, financial deregulation, financial innovation, Financial Instability Hypothesis, fixed income, floating exchange rates, full employment, housing crisis, Howard Zinn, Hyman Minsky, income inequality, information asymmetry, John Meriwether, kremlinology, Long Term Capital Management, margin call, market bubble, market fundamentalism, McMansion, money market fund, mortgage debt, Naomi Klein, new economy, offshore financial centre, payday loans, pets.com, plutocrats, Plutocrats, Ponzi scheme, price stability, pushing on a string, race to the bottom, Ralph Nader, rent control, Robert Shiller, Robert Shiller, Ronald Reagan, savings glut, sovereign wealth fund, structural adjustment programs, The Great Moderation, too big to fail, trade liberalization, transcontinental railway, trickle-down economics, union organizing, wage slave, Washington Consensus, women in the workforce, working poor, Y2K

More than half of all refinance loans made to African-Americans in 2006 were subprime, according to an analysis by the advocacy group ACORN. That’s nearly twice the rate among white borrowers. Among low-income black borrowers, 62 percent of refinance loans were subprime, more than twice the rate among low-income whites. “It actually started in communities like Atlanta,” says Nikitra Bailey, a Center for Responsible Lending researcher who has studied the Southeastern U.S. housing crisis. “A lot of our older African-Americans were house rich but cash poor. So lenders came up with these scams to siphon the wealth away.” It’s a loss black America can scarcely afford, because black wealth has long been enormously dependent on home equity. In 1967, the year before the Mitchells bought their house, homes accounted for 67 percent of black wealth, compared with 40 percent of white wealth.

They will reach fruition when politicians and other leaders swallow their bruised egos and rethink their supine posture, arm in arm with Wall Street. That looks improbable at the moment. But voters can help them change their minds. The Suicide Solution B A R B A R A E H R E N R E I C H July 28, 2008 Afew days beforeCongress passed its housing bill,Car-lene Balderrama of Taunton, Massachusetts, found her own solution to the housing crisis. Just a little over two hours in advance of the time her mortgage company, PHH Corporation—may its name live in infamy—was to auction off her home, Balderrama killed herself with her husband’s rifle. This is not the kind of response to hard times that James Grant had in mind when he wrote his July 19 Wall Street Journal essay titled “Why No Outrage?” “One might infer from the lack of popular anger,” the famed Wall Street contrarian wrote, “that the credit crisis was God’s fault rather than the doing of the bankers and the rating agencies and the government’s snoozing watchdogs.”


pages: 362 words: 83,464

The New Class Conflict by Joel Kotkin

2013 Report for America's Infrastructure - American Society of Civil Engineers - 19 March 2013, affirmative action, Affordable Care Act / Obamacare, American Society of Civil Engineers: Report Card, Bob Noyce, California gold rush, Capital in the Twenty-First Century by Thomas Piketty, carbon footprint, creative destruction, crony capitalism, David Graeber, deindustrialization, don't be evil, Downton Abbey, Edward Glaeser, Elon Musk, energy security, falling living standards, future of work, Gini coefficient, Google bus, housing crisis, income inequality, informal economy, Internet of things, Jane Jacobs, Jaron Lanier, Jeff Bezos, job automation, John Markoff, John von Neumann, Joseph Schumpeter, Kevin Kelly, labor-force participation, low-wage service sector, Marc Andreessen, Mark Zuckerberg, mass affluent, McJob, McMansion, medical bankruptcy, Nate Silver, New Economic Geography, new economy, New Urbanism, obamacare, offshore financial centre, Paul Buchheit, payday loans, Peter Calthorpe, plutocrats, Plutocrats, post-industrial society, RAND corporation, Ray Kurzweil, rent control, rent-seeking, Report Card for America’s Infrastructure, Richard Florida, Silicon Valley, Silicon Valley ideology, Steve Jobs, technoutopianism, The Death and Life of Great American Cities, Thomas L Friedman, too big to fail, transcontinental railway, trickle-down economics, Tyler Cowen: Great Stagnation, upwardly mobile, urban planning, urban sprawl, War on Poverty, women in the workforce, working poor, young professional

Michael Boyajian, “The Death of the American Sunbelt,” Room Eight, July 19, 2010, http://www.r8ny.com/blog/judgeboyajian/the_death_of_the_american_sunbelt.html; Matthew O’Brien, “Why Is the American Dream Dead in the South?” Atlantic, January 26, 2014, http://www.theatlantic.com/business/archive/2014/01/why-is-the-american-dream-dead-in-the-south/283313. 67. Jed Kolko, “Metros Clobbered by the Housing Crisis Are Growing Again,” CityLab, March 14, 2013, http://www.citylab.com/housing/2013/03/metros-clobbered-housing-crisis-are-growing-again/4991; Joel Kotkin, “Forget What the Pundits Tell You, Coastal Cities Are Old News—It’s the Sunbelt That’s Booming,” Daily Beast, March 1, 2014, http://www.thedailybeast.com/articles/2014/03/01/forget-what-the-pundits-tell-you-coastal-cities-are-old-news-it-s-the-sunbelt-that-s-booming.html. 68. Ralph Bivins, “Boom On!


pages: 273 words: 83,802

Hostile Environment: How Immigrants Became Scapegoats by Maya Goodfellow

Boris Johnson, British Empire, call centre, collective bargaining, colonial rule, creative destruction, deindustrialization, Donald Trump, European colonialism, falling living standards, G4S, housing crisis, illegal immigration, low skilled workers, mass immigration, megacity, moral panic, open borders, race to the bottom, Right to Buy, Scientific racism, Winter of Discontent, working poor

‘Russian oligarchs’ or ‘Saudi billionaires’ are denounced for buying up expensive properties from afar, leaving them vacant and selling them on for an enormous profit. The super-rich do exacerbate and help sustain the severe housing crisis; they treat housing like financial assets and help incentivise companies to build luxury, cash-cow apartments which only the very few can afford to live in. But focusing on specific nationalities like this ‘others’ inequality; rich Britons who play this same property investment game disappear, making it seem like it’s primarily outside influence that is the cause of unaffordable house prices. But these people buying and selling homes like they’re a commodity aren’t the only reason for the housing crisis. Factors such as land values and how planning permission is designed – determined largely by policy decisions – have played a huge part in the lack of affordable homes in the UK.


pages: 263 words: 80,594

Stolen: How to Save the World From Financialisation by Grace Blakeley

"Robert Solow", activist fund / activist shareholder / activist investor, asset-backed security, balance sheet recession, bank run, banking crisis, banks create money, Basel III, basic income, battle of ideas, Berlin Wall, Big bang: deregulation of the City of London, bitcoin, Bretton Woods, business cycle, call centre, capital controls, Capital in the Twenty-First Century by Thomas Piketty, Carmen Reinhart, central bank independence, collapse of Lehman Brothers, collective bargaining, corporate governance, corporate raider, credit crunch, Credit Default Swap, cryptocurrency, currency peg, David Graeber, debt deflation, decarbonisation, Donald Trump, eurozone crisis, Fall of the Berlin Wall, falling living standards, financial deregulation, financial innovation, Financial Instability Hypothesis, financial intermediation, fixed income, full employment, G4S, gender pay gap, gig economy, Gini coefficient, global reserve currency, global supply chain, housing crisis, Hyman Minsky, income inequality, inflation targeting, Intergovernmental Panel on Climate Change (IPCC), Kenneth Rogoff, Kickstarter, land value tax, light touch regulation, low skilled workers, market clearing, means of production, money market fund, Mont Pelerin Society, moral hazard, mortgage debt, negative equity, neoliberal agenda, new economy, Northern Rock, offshore financial centre, paradox of thrift, payday loans, pensions crisis, Ponzi scheme, price mechanism, principal–agent problem, profit motive, quantitative easing, race to the bottom, regulatory arbitrage, reserve currency, Right to Buy, rising living standards, risk-adjusted returns, road to serfdom, savings glut, secular stagnation, shareholder value, Social Responsibility of Business Is to Increase Its Profits, sovereign wealth fund, the built environment, The Great Moderation, too big to fail, transfer pricing, universal basic income, Winter of Discontent, working-age population, yield curve, zero-sum game

In the context of stagnating wages, the gap between income and expenditure would be covered by personal borrowing. 1988 was the first year ever that consumers’ expenditure exceeded their incomes.30 The Lawson boom — the economic boom named after the Chancellor who presided over it — saw tax cuts, a reduction in interest rates (once the union movement had been dealt with, of course), and an across-the-board increase in household borrowing and spending. Growth increased in the short-term, before collapsing in an equally large bust when interest rates had to be hiked again to keep the UK in the Exchange Rate Mechanism. In a mini precursor to 2008, a housing crisis ensued. But it wasn’t long before stability was restored, and debt began to climb once again — and it didn’t stop climbing for nearly two decades. The genius of basing demand on private debt was that it allowed people to buy more, propelling economic growth, whilst also directing a greater portion of peoples’ income towards interest payments and fees that went to financiers.31 Under this system, individuals would use the tools provided to them by financial markets to weather the storms created by changes in the business cycle, making a tidy profit for the finance sector in the process.32 In this way, “privatised Keynesianism” replaced the Keynesian model of demand management that governed the post-war consensus.33 Had this model relied only on unsecured lending, like credit cards or student loans, it wouldn’t have lasted very long.

People who took out these loans were assured that they would always be able to refinance their mortgage when the teaser rates expired. But at the beginning of 2007, refinancing became more difficult, and many consumers found themselves stuck with high interest payments that they couldn’t afford. House prices levelled off in 2006 and then began to fall. Defaults escalated, and banks began to worry. Had the trouble ended at US mortgages, we may have been left with a US, and perhaps a UK, housing crisis. But by 2007, mortgages were no longer just mortgages. The debt that had been created by the banks in the boom between the 1980s and 2007 had been transformed into the plumbing of the entire global financial system. Every day, millions of dollars’ worth of mortgages were packaged up into securities, traded on financial markets, insured, bet against, and repackaged into a seemingly endless train of financial intermediation.


pages: 488 words: 144,145

Inflated: How Money and Debt Built the American Dream by R. Christopher Whalen

Albert Einstein, bank run, banking crisis, Black Swan, Bretton Woods, British Empire, business cycle, buy and hold, California gold rush, Carmen Reinhart, central bank independence, commoditize, conceptual framework, corporate governance, corporate raider, creative destruction, cuban missile crisis, currency peg, debt deflation, falling living standards, fiat currency, financial deregulation, financial innovation, financial intermediation, floating exchange rates, Fractional reserve banking, full employment, global reserve currency, housing crisis, interchangeable parts, invention of radio, Kenneth Rogoff, laissez-faire capitalism, liquidity trap, means of production, money: store of value / unit of account / medium of exchange, moral hazard, mutually assured destruction, non-tariff barriers, oil shock, Paul Samuelson, payday loans, plutocrats, Plutocrats, price stability, pushing on a string, quantitative easing, rent-seeking, reserve currency, Ronald Reagan, special drawing rights, The Chicago School, The Great Moderation, too big to fail, trade liberalization, transcontinental railway, Upton Sinclair, women in the workforce

Rising prices and falling purchasing power forced many American households to use the power of two wage earners to make the purchase of a home a reality. And many Americans through the mid-1990s through 2007 saw the value of their homes rise dramatically, in some cases more than 100 percent over that period, leading to many people thinking of homes as speculative investment vehicles instead of a place to live. But the most striking fact coming out of the housing crisis for this author is that despite the 25 to 35 percent drop in value for many homes in major metropolitan areas, the cost of replacing many existing homes is above the current market value—grim testament to the reality of the underlying rate of inflation in the United States. The Greenspan Legacy Contemporary observers writing accounts of the collapse of the subprime debt bubble blame Greenspan and the members of the Federal Open Market Committee for the crisis.

But as the growth potential of the U.S. economy wanes and the baby boomers reach retirement age, all the while refusing to rein in their insatiable desire for consumption, the ability of the American economy to fulfill the dreams of workers around the world is in doubt. How we deal with the uniquely American problem of a global fiat currency will define the destiny of America and the world in the next century and beyond. One of the issues raised by the subprime housing crisis of 2007–2009 that is not often discussed in the media or economic circles is how the increasingly hollow U.S. economy will look without the positive effect of a constantly buoyant housing market. Josh Rosner believes that the positive influence of the baby boom in the decades following WWII is now becoming a serious drag on future U.S. economic growth. He explains: There are three issues or “headwinds” as I like to describe them, factors that were once positives for the economy or tailwinds, but are now a drag on the economy.

Stevenson, Adlai Stewart, John Fat Years and the Lean Stewart, William Silver Knight (pamphlet) Stillman, James Stock investment New Era theory perspective, change Stock markets human nature, impact purchases (financing), short-term loans (usage) Stocks, decline Strong, Benjamin Bankers Trust Company exit Delano/House meeting Morgan control replacement Strong, William Subprime debt bubble, blame Subprime Debt Crisis (2008) Subprime debt crisis, Fed/Treasury assistance Subprime financial crisis, perspective (Raynes) Subprime housing crisis (2007-2009), issues Suez Canal, closing (1956) Sugar Equalization Board Summers, Larry Swanberg, W.A. Sylla, Richard Systemic risk, moral dilemma Szymczak, M.S. Taft, William Howard government debt Taleb, Nassim Tammany Hall Roosevelt, impact Tansil, Charles Callan America Goes to War Tariffs competitiveness, FDR promise FDR maintenance imposition increase protection, increase reduction FDR endorsement Hoover opposition Republican party position Tariffs for revenue only Taxes FDR increase reduction, passage Tennessee Iron & Coal Company U.S.


pages: 83 words: 23,805

City 2.0: The Habitat of the Future and How to Get There by Ted Books

active transport: walking or cycling, Airbnb, Albert Einstein, big-box store, carbon footprint, cleantech, collaborative consumption, crowdsourcing, demand response, housing crisis, Induced demand, Internet of things, Jane Jacobs, jitney, Kibera, Kickstarter, Kitchen Debate, McMansion, megacity, New Urbanism, openstreetmap, ride hailing / ride sharing, self-driving car, sharing economy, Silicon Valley, smart cities, smart grid, the built environment, The Death and Life of Great American Cities, urban planning, urban renewal, urban sprawl, walkable city, Zipcar

“Either consciously or subconsciously, [people] are realizing that that involves the public realm, the commons, sharing goods and services and infrastructure. And I think that kind of bleeds into your personal life.” This move back into city centers also coincided with the Great Recession. Those big houses and multiple cars, it turns out, were beyond many of our means. And it’s no coincidence, Turner says, that Airbnb — a company founded around shared housing — was born in 2008, just as the United States was entering a recession built on a housing crisis. For many Airbnb hosts, the spare rooms they rented through the service helped them keep their homes. City living, for all its allure, is expensive, but the sharing economy makes it possible for more people, whether they’re sharing a car because they can’t afford to own one, or a bike because they’ve got nowhere to store it. We’re also witnessing a shift toward sharing because of technology.


pages: 92

The Liberal Moment by Nick Clegg, Demos (organization : London, England)

banking crisis, credit crunch, failed state, housing crisis, income inequality, mass immigration, mass incarceration, Right to Buy, smart grid, too big to fail, Winter of Discontent

They stoked a housing bubble that has now collapsed, causing tens of thousands of repossessions and a consumer credit boom that contributed to the recession. House building levels at one point fell to the lowest level since the Second World War. There are almost one million fewer social homes than in 1991 and the waiting list has rocketed to 1.8m families. Labour has let down low income families – the very people who hoped Labour would protect them. Both the housing bubble and the social housing crisis developed because of Labour’s reluctance to disperse economic and political power. Social housing is disappearing because of the nationally-imposed Right to Buy and Whitehall restrictions on councils’ ability to invest in building new homes to replace those sold off. Both were introduced by the Conservatives but Labour did almost nothing to reverse the trends, even imposing extra constraints on councils in relation to the Decent Homes investment.


pages: 291 words: 90,200

Networks of Outrage and Hope: Social Movements in the Internet Age by Manuel Castells

access to a mobile phone, banking crisis, call centre, centre right, citizen journalism, cognitive dissonance, collective bargaining, conceptual framework, crowdsourcing, currency manipulation / currency intervention, disintermediation, en.wikipedia.org, housing crisis, income inequality, microcredit, Mohammed Bouazizi, Occupy movement, offshore financial centre, Port of Oakland, social software, statistical model, We are the 99%, web application, WikiLeaks, World Values Survey, young professional, zero-sum game

They were unanimously opposed to the government’s budget cuts, and asked instead for taxation of the rich and of the corporations. There was widespread denunciation of the unemployment of millions of young people who had no prospects of finding a decent job. On April 7, 2011, thousands of youth had demonstrated in Madrid following the call of “Youth Without a Future,” an Internet-based campaign to defend their rights to education, work and housing. There had also been a protest against the housing crisis in general and against the shortage of affordable housing for young people in particular. One important contingent of the 15-M movement came from the youth involved in the “V as Vivienda (Housing)” campaign in the months preceding the movement. There were particularly virulent protests against mortgage foreclosures and evictions of elderly and families in need, who had been trapped by the banks in subprime loans that they would have to continue to pay for the rest of their lives, even after having lost their homes.

There were multiple proposals of various natures, voted on in the General Assemblies, but little effort to translate them into a policy campaign going beyond combating the effects of mortgage foreclosures or financial abuses on borrowers and consumers. The list of most frequently mentioned demands debated in various occupations hints at the extraordinary diversity of the movement’s targets: controlling financial speculation, particularly high frequency trading; auditing the Federal Reserve; addressing the housing crisis; regulating overdraft fees; controlling currency manipulation; opposing the outsourcing of jobs; defending collective bargaining and union rights; reducing income inequality; reforming tax law; reforming political campaign finance; reversing the Supreme Court’s decision allowing unlimited campaign contributions from corporations; banning bailouts of companies; controlling the military-industrial complex; improving the care of veterans; limiting terms for elected politicians; defending freedom on the Internet; assuring privacy on the Internet and in the media; combating economic exploitation; reforming the prison system; reforming health care; combating racism, sexism, and xenophobia; improving student loans; opposing the Keystone pipeline and other environmentally predatory projects; enacting policies against global warming; fining and controlling BP and similar oil spillers; enforcing animal rights; supporting alternative energy sources; critiquing personal leadership and vertical authority, beginning with a new democratic culture in the camps; and watching out for co-optation in the political system (as happened with the Tea Party).


pages: 290 words: 87,549

The Airbnb Story: How Three Ordinary Guys Disrupted an Industry, Made Billions...and Created Plenty of Controversy by Leigh Gallagher

Airbnb, Amazon Web Services, barriers to entry, Ben Horowitz, Bernie Sanders, cloud computing, crowdsourcing, don't be evil, Donald Trump, East Village, Elon Musk, housing crisis, iterative process, Jeff Bezos, Jony Ive, Justin.tv, Lyft, Marc Andreessen, Mark Zuckerberg, medical residency, Menlo Park, Network effects, Paul Buchheit, Paul Graham, performance metric, Peter Thiel, RFID, Sam Altman, Sand Hill Road, Saturday Night Live, sharing economy, side project, Silicon Valley, Silicon Valley startup, South of Market, San Francisco, Startup school, Steve Jobs, TaskRabbit, the payments system, Tony Hsieh, Travis Kalanick, uber lyft, Y Combinator, yield management

Condo associations and residents in many cities, meanwhile, have protested the parade of transient visitors Airbnb has suddenly created in their buildings and the changes they have brought to their neighborhoods. Among other things, these opponents say that Airbnb is teeming with professional real estate operators who have hoarded housing units to turn them into full-time use on Airbnb. They claim this has kept housing off the market and worsened an affordable-housing crisis in many markets. In a handful of cities, including New York and San Francisco, they are legislating to curb the company’s growth. And the bigger Airbnb gets, the louder and tougher the fight. Over the years, Airbnb has also dealt with all the unintended consequences of putting strangers together, including ransackings, attacks, and lapses in responsibility on the part of its hosts that have led to tragic accidents of the worst possible kind.

Over time, an anti-Airbnb alliance started to form made up of elected officials, affordable-housing activists, and representatives of the hotel union and the hotel industry, whose arguments against Airbnb then were the same that they are today: Airbnb traffic can inhibit quality of life for neighbors, who didn’t sign up for having transient tourists parading through their buildings. It creates safety issues both by providing access to residential buildings to strangers and by failing to comply with traditional hotel-safety regulations. Perhaps most critically, they said the proliferation of units dedicated solely to renting out on Airbnb—so-called illegal hotels—removes housing from a market that is already in a serious affordable-housing crisis, driving prices up further for everyone. A much bigger blow came in the fall of 2013, when New York State attorney general Eric Schneiderman served Airbnb with a subpoena, saying he was going after illegal hotels and seeking records of transactions for some fifteen thousand Airbnb hosts in New York City. Airbnb took the rare move of fighting the subpoena, filing a motion to block the request, alleging it was too broad and too invasive of its customers’ privacy.


pages: 279 words: 90,888

The Lost Decade: 2010–2020, and What Lies Ahead for Britain by Polly Toynbee, David Walker

banking crisis, battle of ideas, Boris Johnson, call centre, car-free, centre right, collective bargaining, congestion charging, corporate governance, crony capitalism, David Attenborough, Dominic Cummings, Donald Trump, Downton Abbey, energy transition, Etonian, first-past-the-post, G4S, gender pay gap, gig economy, Gini coefficient, global village, high net worth, housing crisis, income inequality, industrial robot, Intergovernmental Panel on Climate Change (IPCC), James Dyson, manufacturing employment, mass immigration, moral panic, mortgage debt, North Sea oil, offshore financial centre, payday loans, pension reform, quantitative easing, Right to Buy, Saturday Night Live, selection bias, smart meter, Uber for X, urban renewal, working-age population

Leicester’s stock of 38,000 council dwellings had fallen to 21,000 through the enforced sales; now there were 6,000 people on the city’s waiting list for a council tenancy. The only homes the council could afford to build were for private sale. Sir Peter Soulsby, the city’s Labour leader, said, ‘At the very least right to buy ought to be suspended in cities like Leicester until we have dealt with the housing crisis.’ Councils showed enterprise by creating arm’s-length companies that were able to borrow outside the usual restrictions. Eventually, the meagre numbers – only 1,900 new council dwellings completed in 2015–16 – proved unacceptable even to ministers. Their next move wasn’t so much a U-turn as a grudging acceptance that councils were irreplaceable as builders; sotto voce, ministers told councils they could borrow more, and the pace of construction quickened.

One example: it acquired 250 acres of a 605-acre site at Fairham in Nottinghamshire to develop as new homes and employment space, in collaboration with Rushcliffe council and private companies. The council’s target of 13,000 new dwellings by 2028 will contribute towards the 300,000 a year target as England’s minimum. A coalition of housing groups put a figure on what it would take to end the housing crisis: £14.6 billion a year for ten years to build 1.45 million dwellings for social rent or shared ownership. That is well within reach, since governments can borrow capital cheaply against property assets that stay on its books. Glories of the Garden Some signals are green/amber. ‘Declinism’ is a British tradition, and Ipsos’s Bobby Duffy and other surveyors of opinion deplore a tendency to overdo the gloom.


pages: 598 words: 172,137

Who Stole the American Dream? by Hedrick Smith

Affordable Care Act / Obamacare, Airbus A320, airline deregulation, anti-communist, asset allocation, banking crisis, Bonfire of the Vanities, British Empire, business cycle, business process, clean water, cloud computing, collateralized debt obligation, collective bargaining, commoditize, 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, industrial cluster, informal economy, invisible hand, Joseph Schumpeter, Kenneth Rogoff, Kitchen Debate, knowledge economy, knowledge worker, laissez-faire capitalism, late fees, Long Term Capital Management, low cost airline, low cost carrier, manufacturing employment, market fundamentalism, Maui Hawaii, mega-rich, MITM: man-in-the-middle, mortgage debt, negative equity, new economy, Occupy movement, Own Your Own Home, Paul Samuelson, Peter Thiel, Plutonomy: Buying Luxury, Explaining Global Imbalances, Ponzi scheme, Powell Memorandum, Ralph Nader, RAND corporation, Renaissance Technologies, reshoring, rising living standards, Robert Bork, 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

They knew I could not afford that loan. —ELISEO GUARDADO, subprime borrower The banks are playing to brokers who specialize in driving people into loans that people don’t understand…. They take a product that was exotic and move it to the category of a weapon—seriously. These loans go from being an exotic product to a hand grenade…. —KATHRYN KELLER, mortgage broker WHEN YOU THINK OF THE HOUSING CRISIS and millions of Americans being foreclosed out of their homes, you don’t imagine a bright, successful thirty-year-old like Bre Heller. When I met her, Heller was still reeling from the forced sale of her home in Orlando, Florida, stuck with a mountain of debt and furious at her bank. She didn’t seem like a typical victim. She’s street smart, quick as a whip with numbers, and a picture of cool composure.

They filed suit, but with WaMu gone, there was no one to pay. The terms of JPMorgan Chase’s buyout barred lawsuits against either WaMu or JPMorgan Chase. The same happened to several pension funds for police and teachers in Detroit, Ontario, and Pompano Beach, Florida, which had invested in WaMu and were stuck with millions of shares of worthless WaMu common stock and bonds. Fraud but Almost No Prosecution What is striking about the housing crisis is that unlike the savings and loan scandal of the 1980s, where hundreds of bank officials and board members went to jail on felony charges, only relatively low-level officers have been criminally prosecuted in the housing bust. Only belatedly have a few high-level government officials even acknowledged massive deception. Late in 2010, Alan Greenspan conceded that fraud had played a central role in the crisis, though he did not say whether the Fed’s lax oversight had contributed.

For what folks in this state have been spending on the Iraq war, we could be giving health care to nearly 450,000 of your neighbors, hiring nearly 30,000 new elementary school teachers, and making college more affordable for over 300,000 students.” Clinton spelled out the benefits nationwide for average Americans if $1 trillion spent on Iraq went instead to domestic programs. “That is enough,” Clinton declared, “to provide health care for all 47 million uninsured Americans and quality pre-kindergarten for every American child, solve the housing crisis once and for all, make college affordable for every American student, and provide tax relief to tens of millions of middle-class families.” Increasingly, members of Congress have been pressing Obama to apply this economic logic to Afghanistan. Tea Party Republicans in the House have joined liberal Democrats in calling for defense cuts and faster withdrawal from Afghanistan. Several national security experts have offered a foreign policy rationale: Reverse mission creep and go back to the original anti-terrorism mission in Afghanistan and forget about building Afghan democracy.


Debtor Nation: The History of America in Red Ink (Politics and Society in Modern America) by Louis Hyman

asset-backed security, bank run, barriers to entry, Bretton Woods, business cycle, card file, central bank independence, computer age, corporate governance, credit crunch, declining real wages, deindustrialization, diversified portfolio, financial independence, financial innovation, fixed income, Gini coefficient, Home mortgage interest deduction, housing crisis, income inequality, invisible hand, late fees, London Interbank Offered Rate, market fundamentalism, means of production, mortgage debt, mortgage tax deduction, p-value, pattern recognition, profit maximization, profit motive, risk/return, Ronald Reagan, Silicon Valley, statistical model, technology bubble, the built environment, transaction costs, union organizing, white flight, women in the workforce, working poor, zero-sum game

For Great Society policymakers and promoters, the problems of inequality were framed as a problem of credit access rather than job access. More credit, and not higher wages, would be enough to solve the problems of America’s cities. Toward that end, federal policy fashioned the financial innovation that made possible America’s debt explosion—the asset-backed security—that expanded well beyond its original purpose. Solving the urban crisis would require solving the housing crisis. But to fix the housing crisis, radical financial innovation would have to occur to maintain the capital flows into mortgages. As the urban riots became the urban crisis, however, mortgage markets had a crisis of their own. American mortgage markets had abruptly frozen—the so-called Credit Crunch of 1966—as investors rapidly withdrew their deposits from banks and put their money in the securities markets. Stocks and bonds offered greater returns than the Federal Reserve–regulated rates available at banks3 Without these deposits, banks could not lend mortgage money.

Capital markets became a central source of funds, as the older institutional investor and small depositor arrangements had collapsed in the face of rising interest rates and shifting savings practices. By 1970, withdrawals at savings and loan institutions exceeded deposits nearly every month.43 The president of the Mortgage Bankers of America, Robert Pease, declared at their annual convention that, “except for FNMA, there is almost no money available for residential housing. We are in a real honest-to-goodness housing crisis!”44 On average in 1971, $50 million worth of mortgages flowed from the capital markets through mortgage-backed securities into American housing each month. SECURING DEBT 233 In both the cities and suburbs, mortgage-backed securities provided new sources of mortgage funds. While direct mortgage assignment collapsed, mortgage-backed securities provided the financing to dramatically increase the new housing programs in America’s cities.


pages: 443 words: 98,113

The Corruption of Capitalism: Why Rentiers Thrive and Work Does Not Pay by Guy Standing

3D printing, Airbnb, Albert Einstein, Amazon Mechanical Turk, Asian financial crisis, asset-backed security, bank run, banking crisis, basic income, Ben Bernanke: helicopter money, Bernie Sanders, Big bang: deregulation of the City of London, bilateral investment treaty, Bonfire of the Vanities, Boris Johnson, Bretton Woods, business cycle, Capital in the Twenty-First Century by Thomas Piketty, carried interest, cashless society, central bank independence, centre right, Clayton Christensen, collapse of Lehman Brothers, collective bargaining, credit crunch, crony capitalism, crowdsourcing, debt deflation, declining real wages, deindustrialization, disruptive innovation, Doha Development Round, Donald Trump, Double Irish / Dutch Sandwich, ending welfare as we know it, eurozone crisis, falling living standards, financial deregulation, financial innovation, Firefox, first-past-the-post, future of work, gig economy, Goldman Sachs: Vampire Squid, Growth in a Time of Debt, housing crisis, income inequality, information retrieval, intangible asset, invention of the steam engine, investor state dispute settlement, James Watt: steam engine, job automation, John Maynard Keynes: technological unemployment, labour market flexibility, light touch regulation, Long Term Capital Management, lump of labour, Lyft, manufacturing employment, Mark Zuckerberg, market clearing, Martin Wolf, means of production, mini-job, Mont Pelerin Society, moral hazard, mortgage debt, mortgage tax deduction, Neil Kinnock, non-tariff barriers, North Sea oil, Northern Rock, nudge unit, Occupy movement, offshore financial centre, oil shale / tar sands, open economy, openstreetmap, patent troll, payday loans, peer-to-peer lending, plutocrats, Plutocrats, Ponzi scheme, precariat, quantitative easing, remote working, rent control, rent-seeking, ride hailing / ride sharing, Right to Buy, Robert Gordon, Ronald Coase, Ronald Reagan, Sam Altman, savings glut, Second Machine Age, secular stagnation, sharing economy, Silicon Valley, Silicon Valley startup, Simon Kuznets, sovereign wealth fund, Stephen Hawking, Steve Ballmer, structural adjustment programs, TaskRabbit, The Chicago School, The Future of Employment, the payments system, The Rise and Fall of American Growth, Thomas Malthus, Thorstein Veblen, too big to fail, Travis Kalanick, Uber and Lyft, Uber for X, uber lyft, Y Combinator, zero-sum game, Zipcar

In central London, a third of residential sales are to foreigners, as homes or for letting. As other buyers are pushed down the housing chain, inflation at the top of the market ripples down. This has contributed to the escalation of house prices and rents, making housing unaffordable for most wage-earners. Between 2010 and 2015, London house prices leapt by about 50 per cent. And while the housing crisis in London is most acute, prices have also risen steeply in the rest of the country. The previous trend towards more people owning their homes has gone into steep reverse. More are living in overcrowded or inadequate accommodation; more young adults are living with parents, unable to set up a household of their own; and homelessness is increasing, including among families with children. In Britain and elsewhere, low interest rates and tax breaks have propelled property prices to levels that have put home ownership out of reach for many and, coupled with the abolition or erosion of rent controls, generated an increasingly expensive private rental market.

In Britain and elsewhere, low interest rates and tax breaks have propelled property prices to levels that have put home ownership out of reach for many and, coupled with the abolition or erosion of rent controls, generated an increasingly expensive private rental market. Landlordism has become a feature of global rentier capitalism. It has not been resurrected by chance or by free markets. The UK’s present housing crisis has its origins in Thatcher’s decision in the 1980s to give council tenants the ‘right to buy’ their homes at a substantial discount, a subsidy scheme that decimated the stock of social housing. Nearly 2 million tenants have since taken advantage of the scheme. Financial liberalisation also meant mortgages became easier to obtain. Home ownership peaked in 2003, when 71 per cent of homes in England were owned outright or with a mortgage.


pages: 333 words: 99,545

Why We Get the Wrong Politicians by Isabel Hardman

affirmative action, Boris Johnson, crowdsourcing, deskilling, Donald Trump, gender pay gap, housing crisis, John Bercow, old-boy network

Unless the council’s environmental health department decided that the flat was uninhabitable, she wasn’t even near the start of getting a transfer to a bigger property. To qualify for a priority move, she would have to be severely disabled, with a mobility problem. The young woman obviously felt relieved that Buck had listened and promised to do what she could. But she still left looking utterly hopeless. For another couple with a housing crisis, something needed to be done immediately. The woman was due to give birth the following day and they had been evicted without warning by their private landlord. Buck was again very firm, explaining that as the pair had moved to Westminster North from another part of the country, the local council had no duty to house them. But she was horrified that no one had taken into consideration the fact that the woman was about to give birth.

But the fight was so bruising for those in government, especially Eric Pickles, who was then Communities Secretary, and Theresa May, who observed it from a distance in the Home Office before entering Number 10 herself in 2016, that they privately vowed never again to have a serious stand-off with an organisation that represented so many people likely to vote Conservative. Consequently, ministers have dodged seriously considering reforms that could help build more homes and solve Britain’s housing crisis, such as reviewing the protections for the Green Belt. Another green and pleasant policy scuppered by a different sort of lobbying group was a 2011 plan to part-privatise the Forestry Commission, which manages more than 150,000 hectares of Britain’s forests. Ministers insisted that protection for the forests would remain in place, but the plans to raise around £250 million from the sale caused a row that spread quicker than a forest fire.


pages: 379 words: 99,340

The Revolt of the Public and the Crisis of Authority in the New Millennium by Martin Gurri

Affordable Care Act / Obamacare, Albert Einstein, anti-communist, Arthur Eddington, Ayatollah Khomeini, bitcoin, Black Swan, Burning Man, business cycle, citizen journalism, Climategate, Climatic Research Unit, collective bargaining, creative destruction, crowdsourcing, currency manipulation / currency intervention, dark matter, David Graeber, death of newspapers, en.wikipedia.org, Erik Brynjolfsson, facts on the ground, Francis Fukuyama: the end of history, Frederick Winslow Taylor, full employment, housing crisis, income inequality, Intergovernmental Panel on Climate Change (IPCC), invention of writing, job-hopping, Mohammed Bouazizi, Nate Silver, Occupy movement, Port of Oakland, Republic of Letters, Ronald Reagan, Skype, Steve Jobs, the scientific method, The Signal and the Noise by Nate Silver, too big to fail, traveling salesman, University of East Anglia, urban renewal, War on Poverty, We are the 99%, WikiLeaks, young professional

Revolution, in 2011, meant denunciation. Actual change was left for someone else. Manuel Castells, a sympathetic observer, perused the online records of the Occupy sites’ general assemblies, and compiled a roster of changes the participants expected to work on the world. It made exhausting reading. …controlling financial speculation, particularly high frequency trading; auditing the Federal Reserve; addressing the housing crisis; regulating overdraft fees; controlling currency manipulation; opposing the outsourcing of jobs; defending collective bargaining and union rights; reducing income inequality; reforming tax law; reforming political campaign finance; reversing the Supreme Court’s decision allowing unlimited campaign contributions from corporations; banning bailouts of companies; controlling the military-industrial complex; improving the care of veterans; limiting terms for elected politicians; defending freedom on the Internet; assuring privacy on the Internet and in the media; combating economic exploitation; reforming the prison system; reforming health care; combating racism, sexism, and xenophobia; improving student loans; opposing the Keystone pipeline and other environmentally predatory projects; enacting policies against global warming; fining and controlling BP and similar oil spillers; enforcing animal rights; supporting alternative energy sources; critiquing personal leadership and vertical authority, beginning with a new democratic culture in the camps; and watching out for cooptation in the political system…[72] The action words used for these improvements of the status quo connoted negation and elimination: “reform,” “control,” “reverse,” “limit,” “combat,” “fine,” “critique.”

The late modernist urge to intervene, with its aimless meandering, has been interpreted by the public as either tyranny or corruption – never, somehow, as the ineffectual pose of a kindly uncle. Yet government interventions have chased public grievances. Ormerod’s endless list of parliamentary claims of competence can find a mirror image in the equally endless expectations of government culled by Manuel Castells from Occupier statements: …controlling financial speculation, particularly high frequency trading; auditing the Federal Reserve; addressing the housing crisis; regulating overdraft fees; controlling currency manipulation; opposing the outsourcing of jobs; defending collective bargaining and union rights; reducing income inequality; reforming tax law; reforming political campaign finance; reversing the Supreme Court’s decision allowing unlimited campaign contributions from corporations; banning bailouts of companies; controlling the military-industrial complex; improving the care of veterans; limiting terms for elected politicians; defending freedom on the Internet…[185] The public has judged government on government’s own terms, but added bad intentions.


pages: 391 words: 97,018

Better, Stronger, Faster: The Myth of American Decline . . . And the Rise of a New Economy by Daniel Gross

2013 Report for America's Infrastructure - American Society of Civil Engineers - 19 March 2013, Affordable Care Act / Obamacare, Airbnb, American Society of Civil Engineers: Report Card, asset-backed security, Bakken shale, banking crisis, BRICs, British Empire, business cycle, business process, business process outsourcing, call centre, Carmen Reinhart, clean water, collapse of Lehman Brothers, collateralized debt obligation, commoditize, creative destruction, credit crunch, currency manipulation / currency intervention, demand response, Donald Trump, Frederick Winslow Taylor, high net worth, housing crisis, hydraulic fracturing, If something cannot go on forever, it will stop - Herbert Stein's Law, illegal immigration, index fund, intangible asset, intermodal, inventory management, Kenneth Rogoff, labor-force participation, LNG terminal, low skilled workers, Mark Zuckerberg, Martin Wolf, Maui Hawaii, McMansion, money market fund, mortgage debt, Network effects, new economy, obamacare, oil shale / tar sands, oil shock, peak oil, plutocrats, Plutocrats, price stability, quantitative easing, race to the bottom, reserve currency, reshoring, Richard Florida, rising living standards, risk tolerance, risk/return, Silicon Valley, Silicon Valley startup, six sigma, Skype, sovereign wealth fund, Steve Jobs, superstar cities, the High Line, transit-oriented development, Wall-E, Yogi Berra, zero-sum game, Zipcar

Indeed there are signs that progress is already being made in tackling some of the most thorny problems America faces—without explosive, fundamental change. Take housing. Falling house prices, excess supply, and the mortgage mess have been a millstone around the economy’s neck since 2007. The crisis has destroyed household wealth, ravaged banks’ balance sheets, and sapped consumers of their desire and ability to consume, borrow, and invest. The housing crisis turned out to be like Hanukkah: we were told it was going to last for a year, but it will probably last a good eight years. Residential investment morphed from a force that supercharged growth between 2001 and 2006 to one that sandbagged it. In its reports the Commerce Department points out how much each sector contributed to or detracted from growth. In 2008 declining residential investment reduced growth by 1.62 percent, and in 2009 the reduction was 0.72 percent.

., 1, 54, 99–100, 104, 120, 122, 125, 219 Commercial Paper Funding Facility, 34 Committee on Foreign Investment in the United States, 96 competition, 3, 19, 21, 23, 80, 83, 106–7, 167, 194, 204, 228 efficiency economy and, 62, 68, 77 efficient consumers and, 193, 196 inports and, 131–32, 137, 141 North Dakota and, 148, 161 and reshoring and insourcing, 169, 179 Congress, U.S., 14, 19, 23–24, 125, 146 deficits and, 221–22 economic decline and, 3, 10 health care reform and, 5–6 U.S. credit rating and, 1–2 Congressional Budget Office, 31 Connecticut, 50, 86, 105, 140, 146, 151, 161–62, 212 efficient consumers and, 187–88 Conservation and Recreation Department, Mass., 66 construction, 174 efficient consumers and, 190–91 housing crisis and, 219–20 infrastructure and, 205–6, 209, 211, 213 North Dakota and, 152–53, 155–56 Consumer Price Index, 187 consumers, consumerism, consumption, 2, 25, 28, 81, 101, 111, 216, 219 coal and, 102–3 economic pessimism and, 22–23 efficiency economy and, 64–65, 68, 73–75, 78, 223–24 exports and, 98–99, 104–5, 107, 110, 119, 128, 130–31, 147, 154, 164 FDI and, 83, 89–90, 92–93 indebtedness and, 9–10, 53–57 inports and, 131–32, 136–37, 141, 143, 147, 227 North Dakota and, 151, 153–54 and reshoring and insourcing, 169, 172, 175, 177 restructuring and, 44–45, 53–59 supersizing and, 202, 204, 209 see also efficient consumers Cooper, Bill, 105 Cooper, Stephen, 44 CoreLogic, 190 corporations, 1, 9–10, 60, 139–43, 163–67, 169–85, 192–206, 225 comparisons between consumers and, 181, 185, 189, 195 and costs of labor, 164–67 economic optimism and, 23–24 economic pessimism and, 22–23 efficiency economy and, 63–68, 71, 75–76, 80–81, 158, 172, 223 efficient consumers and, 181–85, 192–96 exports and, 98, 103, 108–10, 112–14, 116–17, 131, 177 FDI and, 82–96 global, 22, 24, 71, 95 inports and, 132, 135–37, 139–42, 144, 146–47, 202–3, 227 job growth and, 218–19 North Dakota and, 152–53, 155, 157–60 recoveries and, 17–18, 21, 215 and reshoring and insourcing, 167, 169–79 restructuring and, 44–45, 47–49, 52–53, 57–58, 81, 166 supersizing and, 199–206, 209–10 taxes on, 146–47, 163 timely policy decisions and, 28, 30, 34 U.S. economic importance and, 227–28 Costner, Kevin, 129–30 Coty, 71 Coulomb Technologies, 211 Council of Economic Advisers, 31 Cowan, Lynn, 203 Creation Technologies, 67 credit, 32–36, 94, 194 booms in, 21, 29, 56, 62 crisis in, 2, 4, 23, 26, 48, 53 exports and, 112–13 restructuring and, 49, 51, 53–56, 58 timely policy decisions and, 29, 32–33, 35–36, 42–43 credit cards, 34, 183–85 restructuring and, 54–56 credit ratings, 1–2, 11, 52 Credit Suisse, 137, 223 Davis, Fred, 90–91 debt, 1, 19–20, 23–24, 60, 185 CIT Group and, 48–49 consumers and, 9–10, 53–57 crises and, 6, 29, 216 efficiency economy and, 62–63, 72, 78 efficient consumers and, 181, 189, 193, 196 Erie Canal and, 205–6 FDI and, 82, 94 national, 2, 5, 11, 217 North Dakota and, 155–56 restructuring and, 45–59, 78 strengthening recovery and, 215–16 timely policy decisions and, 32–34, 36, 39, 42 see also loans, lending, lenders debt ceiling extensions, 2, 217 Dedrick, Jason, 140 Defense Department, U.S., 109 deficits: budget, 2, 6, 10, 64–65, 217, 221–22 efficiency economy and, 64–65 trade, 102, 107, 168, 221–22 Delphi, 46 demand, 18, 31, 45, 57, 101, 132, 178, 221 efficiency economy and, 60, 62, 72–74, 223 exports and, 99, 104, 107–10, 116, 119 North Dakota and, 153–54, 159 supersizing and, 206, 208 Deming, W.


pages: 311 words: 99,699

Fool's Gold: How the Bold Dream of a Small Tribe at J.P. Morgan Was Corrupted by Wall Street Greed and Unleashed a Catastrophe by Gillian Tett

accounting loophole / creative accounting, asset-backed security, bank run, banking crisis, Black-Scholes formula, Blythe Masters, break the buck, Bretton Woods, business climate, business cycle, buy and hold, collateralized debt obligation, commoditize, creative destruction, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, diversification, easy for humans, difficult for computers, financial innovation, fixed income, housing crisis, interest rate derivative, interest rate swap, Kickstarter, locking in a profit, Long Term Capital Management, McMansion, money market fund, mortgage debt, North Sea oil, Northern Rock, Renaissance Technologies, risk tolerance, Robert Shiller, Robert Shiller, Satyajit Das, short selling, sovereign wealth fund, statistical model, The Great Moderation, too big to fail, value at risk, yield curve

This stuff could go up in smoke!” King was not particularly surprised by the intervention. After all, Dimon was a hands-on manager with strong knowledge of the market, who had no qualms about disturbing his employees’ holidays if he considered a matter urgent. And by the autumn of 2006, Dimon thought the housing sector was becoming just that. In the spring of 2006, national house prices had started to slide. “A housing crisis approaches,” a column in Barron’s magazine boldly declared by August, pointing out that the median price of new homes had dropped almost 3 percent in the previous eight months, while sales of new homes had fallen 10 percent, leaving new home inventories at record levels. “The national median price of housing will probably fall by close to 30 percent in the next three years [based on] simple reversion to the mean,” it added, meaning that the fast-rising home prices of the past few years were the result of a bubble.

See also Hughes, Chris, Simonian, Haig, and Thal-Larsen, Peter, “Corroded to the Core: How a Staid Swiss Bank Let Ambitions Lead It into Folly,” Financial Times (April 21, 2008). “In the world I operate in”: Interview with Blythe Masters, February 2007, on womenworking2000.com. No author cited. http://www.womenworking2000.com/feature/index.php?id=94. Ten: Tremors In October 2006, Bill King, the man: Tully, Shawn, “Jamie Dimon’s Swat Team,” Fortune (September 15, 2008). Supplemented with author interviews. “A housing crisis approaches”: Witter Lon, “The No-Money-Down Disaster,” Barron’s (August 21, 2006). “Builders that built speculative homes”: Editorial comment, “Pop! Goes the U.S. Real Estate Bubble,” Toronto Star (September 6, 2006). “When even Toll Brothers, the high-end builder”: Shilling, A. Gary, “Implosion: When Even Toll Brothers, the High-end Builder, Suffers Cancelations, You Know the Real Estate Boom Is Over,” Forbes (June 19, 2006).


Mindf*ck: Cambridge Analytica and the Plot to Break America by Christopher Wylie

4chan, affirmative action, Affordable Care Act / Obamacare, availability heuristic, Berlin Wall, Bernie Sanders, big-box store, Boris Johnson, British Empire, call centre, Chelsea Manning, chief data officer, cognitive bias, cognitive dissonance, colonial rule, computer vision, conceptual framework, cryptocurrency, Daniel Kahneman / Amos Tversky, desegregation, Dominic Cummings, Donald Trump, Downton Abbey, Edward Snowden, Elon Musk, Etonian, first-past-the-post, Google Earth, housing crisis, income inequality, indoor plumbing, information asymmetry, Internet of things, Julian Assange, Lyft, Marc Andreessen, Mark Zuckerberg, Menlo Park, move fast and break things, move fast and break things, Network effects, new economy, obamacare, Peter Thiel, Potemkin village, recommendation engine, Renaissance Technologies, Robert Mercer, Ronald Reagan, Rosa Parks, Sand Hill Road, Scientific racism, Shoshana Zuboff, side project, Silicon Valley, Skype, uber lyft, unpaid internship, Valery Gerasimov, web application, WikiLeaks, zero-sum game

He was occasionally accompanied by colleagues, but the entire arrangement was kept secret from the rest of the CA teams—and perhaps Palantir itself. I can’t speculate about why, but the Palantir staff received Cambridge Analytica database logins and emails with fairly obvious pseudonyms like “Dr. Freddie Mac” (after the mortgage company that was bailed out by the federal government in the 2008 housing crisis). I do know that after Palantir data scientists started building their own Facebook harvesting apps and scrapers, Nix asked them to stay after hours to keep working on applications that could replicate the Facebook data Kogan was getting—without the need for Kogan. It was no longer simply Facebook apps that were being used. Cambridge Analytica began testing innocuous-looking browser extensions, such as calculators and calendars, that pulled access to the user’s Facebook session cookies, which in turn allowed the company to log in to Facebook as the target user to harvest their data and that of their friends.

What were the Americans thinking? Like many of their fellow Canadians, they took pleasure in smugly shaking their heads at their backward neighbors. Canadians have a hard time understanding populism because, unlike America or Britain, it has never had any Rupert Murdoch–owned media. There is no Fox News or The Sun in Canada. Because of its more risk-conscious banking system, the country did not experience a housing crisis or financial crash. And unlike the rest of the OECD, Canada is the outlier where patriotism and support for immigration actually correlate positively with each other. So I would find myself repeating the same conversation over and over to baffled Canadians who simply could not understand how Brexit or Trump were even possible. Pierre Trudeau, Canada’s prime minister in the late 1960s and 1970s, once said that living so close to the United States was like “sleeping with an elephant.


pages: 349 words: 98,868

Nervous States: Democracy and the Decline of Reason by William Davies

active measures, Affordable Care Act / Obamacare, Amazon Web Services, bank run, banking crisis, basic income, business cycle, Capital in the Twenty-First Century by Thomas Piketty, citizen journalism, Climategate, Climatic Research Unit, Colonization of Mars, continuation of politics by other means, creative destruction, credit crunch, decarbonisation, deindustrialization, discovery of penicillin, Dominic Cummings, Donald Trump, drone strike, Elon Musk, failed state, Filter Bubble, first-past-the-post, Frank Gehry, gig economy, housing crisis, income inequality, Isaac Newton, Jeff Bezos, Johannes Kepler, Joseph Schumpeter, knowledge economy, loss aversion, low skilled workers, Mahatma Gandhi, Mark Zuckerberg, mass immigration, meta analysis, meta-analysis, Mont Pelerin Society, mutually assured destruction, Northern Rock, obamacare, Occupy movement, pattern recognition, Peace of Westphalia, Peter Thiel, Philip Mirowski, planetary scale, post-industrial society, quantitative easing, RAND corporation, Ray Kurzweil, Richard Florida, road to serfdom, Robert Mercer, Ronald Reagan, sentiment analysis, Silicon Valley, Silicon Valley startup, smart cities, statistical model, Steve Jobs, the scientific method, Turing machine, Uber for X, universal basic income, University of East Anglia, Valery Gerasimov, We are the 99%, WikiLeaks, women in the workforce, zero-sum game

., Martin Luther, 21, 224 knowledge economy, 84, 85, 88, 151–2, 217 known knowns, 132, 138 Koch, Charles and David, 154, 164, 174 Korean War (1950–53), 178 Kraepelin, Emil, 139 Kurzweil, Ray, 183–4 Labour Party, 5, 6, 65, 80, 81, 221 Lagarde, Christine, 64 Le Bon, Gustave, 8–12, 13, 15, 16, 20, 24, 25, 38 Le Pen, Marine, 27, 79, 87, 92, 101–2 Leadbeater, Charles, 84 Leeds, West Yorkshire, 85 Leicester, Leicestershire, 85 Leviathan (Hobbes), 34, 39, 45 liberal elites, 20, 58, 88, 89, 161 libertarianism, 15, 151, 154, 158, 164, 173, 196, 209, 226 Liberty Fund, 158 Libya, 143 lie-detection technology, 136 life expectancy, 62, 68–71, 72, 92, 100–101, 115, 224 Lindemann, Frederick Alexander, 1st Viscount Cherwell, 138 Lloyds Bank, 29 London, England bills of mortality, 68–71, 75, 79–80, 81, 89, 127 Blitz (1940–41), 119, 143, 180 EU referendum (2016), 85 Great Fire (1666), 67 Grenfell Tower fire (2017), 10 and gross domestic product (GDP), 77, 78 housing crisis, 84 insurance sector, 59 knowledge economy, 84 life expectancy, 100 newspapers, early, 48 Oxford Circus terror scare (2017), ix–x, xiii, 41 plagues, 67–71, 75, 79–80, 81, 89, 127 Unite for Europe march (2017), 23 London School of Economics (LSE), 160 loss aversion, 145 Louis XIV, King of France, 73, 127 Louisiana, United States, 151, 221 Ludwig von Mises Institute, 154 MacLean, Nancy, 158 Macron, Emmanuel, 33 mainstream media, 197 “Make America Great Again,” 76, 145 Manchester, England, 85 Mann, Geoff, 214 maps, 182 March For Our Lives (2018), 21 March for Science (2017), 23–5, 27, 28, 210, 211 marketing, 14, 139–41, 143, 148, 169 Mars, 175, 226 Marxism, 163 Massachusetts Institute of Technology (MIT), 179 Mayer, Jane, 158 McCarthy, Joseph, 137 McGill Pain Questionnaire, 104 McKibben, William “Bill,” 213 Megaface, 188–9 memes, 15, 194 Menger, Carl, 154 mental illness, 103, 107–17, 139 mercenaries, 126 Mercer, Robert, 174, 175 Mexico, 145 Million-Man March (1995), 4 mind-reading technology, 136 see also telepathy Mirowski, Philip, 158 von Mises, Ludwig, 154–63, 166, 172, 173 Missing Migrants Project, 225 mobilization, 5, 7, 126–31 and Corbyn, 81 and elections, 81, 124 and experts, 27–8 and Internet, 15 and Le Bon’s crowd psychology, 11, 12, 16, 20 and loss, 145 and Napoleonic Wars, xv, 127–30, 141, 144 and Occupy movement, 5 and populism, 16, 22, 60 and violence, opposition to, 21 Moniteur Universel, Le, 142 monopoly on violence, 42 Mont Pelerin Society, 163, 164 moral emotion, 21 morphine, 105 multiculturalism, 84 Murs, Oliver “Olly,” ix Musk, Elon, 175, 176, 178, 183, 226 Nanchang, Jiangxi, 13 Napoleonic Wars (1803–15), 126–30 chappe system, 129, 182 and conscription, 87, 126–7, 129 and disruption, 170–71, 173, 174, 175, 226 and great leader ideal, 146–8 and intelligence, 134 and mobilization, xv, 126–30, 141, 144 and nationalism, 87, 128, 129, 144, 183, 211 and propaganda, 142 Russia, invasion of (1812), 128, 133 Spain, invasion of (1808), 128 National Aeronautics and Space Administration (NASA), 23, 175 National Audit Office (NAO), 29–30 national citizenship, 71 National Defense Research Committee, 180 National Health Service (NHS), 30, 93 National Park Service, 4 National Security Agency (NSA), 152 national sovereignty, 34, 53 nationalism, 87, 141, 210–12 and conservatism, 144 and disempowerment, 118–19 and elites, 22–3, 60–61, 145 ethnic, 15 and health, 92, 211–12, 224 and imagined communities, 87 and inequality, 78 and loss, 145 and markets, 167 and promises, 221 and resentment, 145, 197, 198 and war, 7, 20–21, 118–19, 143–6, 210–11 nativism, 61 natural philosophy, 35–6 nature, 86 see also environment Nazi Germany (1933–45), 137, 138, 154 Netherlands, 48, 56, 129 Neurable, 176 neural networking, 216 Neuralink, 176 neurasthenia, 139 Neurath, Otto, 153–4, 157, 160 neurochemistry, 108, 111, 112 neuroimaging, 176–8, 181 Nevada, United States, 194 new atheism, 209 New Orleans, Louisiana, 151 New Right, 164 New York, United States and climate change, 205 and gross domestic product (GDP), 78 housing crisis, 84 JFK Airport terror scare (2016), x, xiii, 41 knowledge economy, 84 September 11 attacks (2001), 17, 18 New York Times, 3, 27, 85 newspapers, 48, 71 Newton, Isaac, 35 Nietzsche, Friedrich, 217 Nixon, Robert, 206 no-platforming, 22, 208 Nobel Prize, 158–9 non-combatants, 43, 143, 204 non-violence, 224 North Atlantic Treaty Organization (NATO), 123, 145, 214 North Carolina, United States, 84 Northern Ireland, 43, 85 Northern League, 61 Northern Rock, 29 Norwich, Norfolk, 85 nostalgia, xiv, 143, 145, 210, 223 “Not in my name,” 27 nuclear weapons, 132, 135, 137, 180, 183, 192, 196, 204 nudge techniques, 13 Obama, Barack, 3, 24, 76, 77, 79, 158, 172 Obamacare, 172 objectivity, xiv, 13, 75, 136, 223 and crowd-based politics, 5, 7, 24–5 and death, 94 and Descartes, 37 and experts, trust in, 28, 32, 33, 51, 53, 64, 86, 89 and Hayek, 163, 164, 170 and markets, 169, 170 and photography, 8 and Scientific Revolution, 48, 49 and statistics, 72, 74, 75, 82, 88 and telepathic communication, 179 and war, 58, 125, 134, 135, 136, 146 Occupy movement, 5, 10, 24, 61 Oedipus complex, 109 Office for National Statistics, 63, 133 Ohio, United States, 116 oil crisis (1973), 166 “On Computable Numbers” (Turing), 181 On War (Clausewitz), 130 Open Society and Its Enemies, The (Popper), 171 opiates, 105, 116, 172–3 opinion polling, 65, 80–81, 191 Orbán, Viktor, 87, 146 Organisation for Economic Co-operation and Development (OECD), 72 Oxford, Oxfordshire, 85 Oxford Circus terror scare (2017), ix–x, xiii, 41 Oxford University, 56, 151 OxyContin, 105, 116 pacifism, 8, 20, 44, 151 pain, 102–19, 172–3, 224 see also chronic pain painkillers, 104, 105, 116, 172–3 Palantir, 151, 152, 175, 190 parabiosis, 149 Paris climate accord (2015), 205, 207 Paris Commune (1871), 8 Parkland attack (2018), 21 Patriot Act (2001), 137 Paul, Ronald, 154 PayPal, 149 Peace of Westphalia (1648), 34, 53 peer reviewing, 48, 139, 195, 208 penicillin, 94 Pentagon, 130, 132, 135, 136, 214, 216 pesticides, 205 Petty, William, 55–9, 67, 73, 85, 167 pharmacology, 142 Pielke Jr., Roger, 24, 25 Piketty, Thomas, 74 Pinker, Stephen, 207 plagues, 56, 67–71, 75, 79–80, 81, 89, 95 pleasure principle, 70, 109, 110, 224 pneumonia, 37, 67 Podemos, 5, 202 Poland, 20, 34, 60 Polanyi, Michael, 163 political anatomy, 57 Political Arithmetick (Petty), 58, 59 political correctness, 20, 27, 145 Popper, Karl, 163, 171 populism xvii, 211–12, 214, 220, 225–6 and central banks, 33 and crowd-based politics, 12 and democracy, 202 and elites/experts, 26, 33, 50, 152, 197, 210, 215 and empathy, 118 and health, 99, 101–2, 224–5 and immediate action, 216 in Kansas (1880s), 220 and markets, 167 and private companies, 174 and promises, 221 and resentment, 145 and statistics, 90 and unemployment, 88 and war, 148, 212 Porter, Michael, 84 post-traumatic stress disorder (PTSD), 111–14, 117, 209 post-truth, 167, 224 Potsdam Conference (1945), 138 power vs. violence, 19, 219 predictive policing, 151 presidential election, US (2016), xiv and climate change, 214 and data, 190 and education, 85 and free trade, 79 and health, 92, 99 and immigration, 79, 145 and inequality, 76–7 and Internet, 190, 197, 199 “Make America Great Again,” 76, 145 and opinion polling, 65, 80 and promises, 221 and relative deprivation, 88 and Russia, 199 and statistics, 63 and Yellen, 33 prisoners of war, 43 promises, 25, 31, 39–42, 45–7, 51, 52, 217–18, 221–2 Propaganda (Bernays), 14–15 propaganda, 8, 14–16, 83, 124–5, 141, 142, 143 property rights, 158, 167 Protestantism, 34, 35, 45, 215 Prussia (1525–1947), 8, 127–30, 133–4, 135, 142 psychiatry, 107, 139 psychoanalysis, 107, 139 Psychology of Crowds, The (Le Bon), 9–12, 13, 15, 16, 20, 24, 25 psychosomatic, 103 public-spending cuts, 100–101 punishment, 90, 92–3, 94, 95, 108 Purdue, 105 Putin, Vladimir, 145, 183 al-Qaeda, 136 quality of life, 74, 104 quantitative easing, 31–2, 222 quants, 190 radical statistics, 74 RAND Corporation, 183 RBS, 29 Reagan, Ronald, 15, 77, 154, 160, 163, 166 real-time knowledge, xvi, 112, 131, 134, 153, 154, 165–70 Reason Foundation, 158 Red Vienna, 154, 155 Rees-Mogg, Jacob, 33, 61 refugee crisis (2015–), 60, 225 relative deprivation, 88 representative democracy, 7, 12, 14–15, 25–8, 61, 202 Republican Party, 77, 79, 85, 154, 160, 163, 166, 172 research and development (R&D), 133 Research Triangle, North Carolina, 84 resentment, 5, 226 of elites/experts, 32, 52, 61, 86, 88–9, 161, 186, 201 and nationalism/populism, 5, 144–6, 148, 197, 198 and pain, 94 Ridley, Matt, 209 right to remain silent, 44 Road to Serfdom, The (Hayek), 160, 166 Robinson, Tommy, ix Roosevelt, Franklin Delano, 52 Royal Exchange, 67 Royal Society, 48–52, 56, 68, 86, 133, 137, 186, 208, 218 Rumsfeld, Donald, 132 Russian Empire (1721–1917), 128, 133 Russian Federation (1991–) and artificial intelligence, 183 Gerasimov Doctrine, 43, 123, 125, 126 and information war, 196 life expectancy, 100, 115 and national humiliation, 145 Skripal poisoning (2018), 43 and social media, 15, 18, 199 troll farms, 199 Russian Revolution (1917), 155 Russian SFSR (1917–91), 132, 133, 135–8, 155, 177, 180, 182–3 safe spaces, 22, 208 Sands, Robert “Bobby,” 43 Saxony, 90 scarlet fever, 67 Scarry, Elaine, 102–3 scenting, 135, 180 Schneier, Bruce, 185 Schumpeter, Joseph, 156–7, 162 Scientific Revolution, 48–52, 62, 66, 95, 204, 207, 218 scientist, coining of term, 133 SCL, 175 Scotland, 64, 85, 172 search engines, xvi Second World War, see World War II securitization of loans, 218 seismology, 135 self-employment, 82 self-esteem, 88–90, 175, 212 self-harm, 44, 114–15, 117, 146, 225 self-help, 107 self-interest, 26, 41, 44, 61, 114, 141, 146 Semi-Automatic Ground Environment (SAGE), 180, 182, 200 sentiment analysis, xiii, 12–13, 140, 188 September 11 attacks (2001), 17, 18 shell shock, 109–10 Shrecker, Ted, 226 Silicon Fen, Cambridgeshire, 84 Silicon Valley, California, xvi, 219 and data, 55, 151, 185–93, 199–201 and disruption, 149–51, 175, 226 and entrepreneurship, 149–51 and fascism, 203 and immortality, 149, 183–4, 224, 226 and monopolies, 174, 220 and singularity, 183–4 and telepathy, 176–8, 181, 185, 186, 221 and weaponization, 18, 219 singularity, 184 Siri, 187 Skripal poisoning (2018), 43 slavery, 59, 224 smallpox, 67 smart cities, 190, 199 smartphone addiction, 112, 186–7 snowflakes, 22, 113 social indicators, 74 social justice warriors (SJWs), 131 social media and crowd psychology, 6 emotional artificial intelligence, 12–13, 140–41 and engagement, 7 filter bubbles, 66 and propaganda, 15, 18, 81, 124 and PTSD, 113 and sentiment analysis, 12 trolls, 18, 20–22, 27, 40, 123, 146, 148, 194–8, 199, 209 weaponization of, 18, 19, 22, 194–5 socialism, 8, 20, 154–6, 158, 160 calculation debate, 154–6, 158, 160 Socialism (Mises), 160 Society for Freedom in Science, 163 South Africa, 103 sovereignty, 34, 53 Soviet Russia (1917–91), 132, 133, 135–8, 177, 180, 182–3 Spain, 5, 34, 84, 128, 202 speed of knowledge, xvi, 112, 124, 131, 134, 136, 153, 154, 165–70 Spicer, Sean, 3, 5 spy planes, 136, 152 Stalin, Joseph, 138 Stanford University, 179 statactivism, 74 statistics, 62–91, 161, 186 status, 88–90 Stoermer, Eugene, 206 strong man leaders, 16 suicide, 100, 101, 115 suicide bombing, 44, 146 superbugs, 205 surveillance, 185–93, 219 Sweden, 34 Switzerland, 164 Sydenham, Thomas, 96 Syriza, 5 tacit knowledge, 162 talking cure, 107 taxation, 158 Tea Party, 32, 50, 61, 221 technocracy, 53–8, 59, 60, 61, 78, 87, 89, 90, 211 teenage girls, 113, 114 telepathy, 39, 176–9, 181, 185, 186 terrorism, 17–18, 151, 185 Charlottesville attack (2017), 20 emergency powers, 42 JFK Airport terror scare (2016), x, xiii, 41 Oxford Circus terror scare (2017), ix–x, xiii, 41 September 11 attacks (2001), 17, 18 suicide bombing, 44, 146 vehicle-ramming attacks, 17 war on terror, 131, 136, 196 Thames Valley, England, 85 Thatcher, Margaret, 154, 160, 163, 166 Thiel, Peter, 26, 149–51, 153, 156, 174, 190 Thirty Years War (1618–48), 34, 45, 53, 126 Tokyo, Japan, x torture, 92–3 total wars, 129, 142–3 Treaty of Westphalia (1648), 34, 53 trends, xvi, 168 trigger warnings, 22, 113 trolls, 18, 20–22, 27, 40, 123, 146, 148, 194–8, 199, 209 Trump, Donald, xiv and Bannon, 21, 60–61 and climate change, 207 and education, 85 election campaign (2016), see under presidential election, US and free trade, 79 and health, 92, 99 and immigration, 145 inauguration (2017), 3–5, 6, 9, 10 and inequality, 76–7 “Make America Great Again,” 76, 145 and March for Science (2017), 23, 24, 210 and media, 27 and opinion polling, 65, 80 and Paris climate accord, 207 and promises, 221 and relative deprivation, 88 and statistics, 63 and Yellen, 33 Tsipras, Alexis, 5 Turing, Alan, 181, 183 Twitter and Corbyn’s rallies, 6 and JFK Airport terror scare (2016), x and Oxford Circus terror scare (2017), ix–x and Russia, 18 and sentiment analysis, 188 and trends, xvi and trolls, 194, 195 Uber, 49, 185, 186, 187, 188, 191, 192 UK Independence Party, 65, 92, 202 underemployment, 82 unemployment, 61, 62, 72, 78, 81–3, 87, 88, 203 United Kingdom austerity, 100 Bank of England, 32, 33, 64 Blitz (1940–41), 119, 143, 180 Brexit (2016–), see under Brexit Cameron government (2010–16), 33, 73, 100 Center for Policy Studies, 164 Civil Service, 33 climate-gate (2009), 195 Corbyn’s rallies, 5, 6 Dunkirk evacuation (1940), 119 education, 85 financial crisis (2007–9), 29–32, 100 first past the post, 13 general election (2015), 80, 81 general election (2017), 6, 65, 80, 81, 221 Grenfell Tower fire (2017), 10 gross domestic product (GDP), 77, 79 immigration, 63, 65 Irish hunger strike (1981), 43 life expectancy, 100 National Audit Office (NAO), 29 National Health Service (NHS), 30, 93 Office for National Statistics, 63, 133 and opiates, 105 Oxford Circus terror scare (2017), ix–x, xiii, 41 and pain, 102, 105 Palantir, 151 Potsdam Conference (1945), 138 quantitative easing, 31–2 Royal Society, 138 Scottish independence referendum (2014), 64 Skripal poisoning (2018), 43 Society for Freedom in Science, 163 Thatcher government (1979–90), 154, 160, 163, 166 and torture, 92 Treasury, 61, 64 unemployment, 83 Unite for Europe march (2017), 23 World War II (1939–45), 114, 119, 138, 143, 180 see also England United Nations, 72, 222 United States Bayh–Dole Act (1980), 152 Black Lives Matter, 10, 225 BP oil spill (2010), 89 Bush Jr. administration (2001–9), 77, 136 Bush Sr administration (1989–93), 77 Bureau of Labor, 74 Central Intelligence Agency (CIA), 3, 136, 151, 199 Charlottesville attack (2017), 20 Civil War (1861–5), 105, 142 and climate change, 207, 214 Clinton administration (1993–2001), 77 Cold War, see Cold War Defense Advanced Research Projects Agency (DARPA), 176, 178 Defense Intelligence Agency, 177 drug abuse, 43, 100, 105, 115–16, 131, 172–3 education, 85 Federal Bureau of Investigation (FBI), 137 Federal Reserve, 33 Fifth Amendment (1789), 44 financial crisis (2007–9), 31–2, 82, 158 first past the post, 13 Government Accountability Office, 29 gross domestic product (GDP), 75–7, 82 health, 92, 99–100, 101, 103, 105, 107, 115–16, 158, 172–3 Heritage Foundation, 164, 214 Iraq War (2003–11), 74, 132 JFK Airport terror scare (2016), x, xiii, 41 Kansas populists (1880s), 220 libertarianism, 15, 151, 154, 158, 164, 173 life expectancy, 100, 101 March For Our Lives (2018), 21 March for Science (2017), 23–5, 27, 28, 210 McCarthyism (1947–56), 137 Million-Man March (1995), 4 National Aeronautics and Space Administration (NASA), 23, 175 National Defense Research Committee, 180 National Park Service, 4 National Security Agency (NSA), 152 Obama administration (2009–17), 3, 24, 76, 77, 79, 158 Occupy Wall Street (2011), 5, 10, 61 and opiates, 105, 172–3 and pain, 103, 105, 107, 172–3 Palantir, 151, 152, 175, 190 Paris climate accord (2015), 205, 207 Parkland attack (2018), 21 Patriot Act (2001), 137 Pentagon, 130, 132, 135, 136, 214, 216 presidential election (2016), see under presidential election, US psychiatry, 107, 111 quantitative easing, 31–2 Reagan administration (1981–9), 15, 77, 154, 160, 163, 166 Rumsfeld’s “unknown unknowns” speech (2002), 132 Semi-Automatic Ground Environment (SAGE), 180, 182, 200 September 11 attacks (2001), 17, 18 Tea Party, 32, 50, 61, 221 and torture, 93 Trump administration (2017–), see under Trump, Donald unemployment, 83 Vietnam War (1955–75), 111, 130, 136, 138, 143, 205 World War I (1914–18), 137 World War II (1939–45), 137, 180 universal basic income, 221 universities, 151–2, 164, 169–70 University of Cambridge, 84, 151 University of Chicago, 160 University of East Anglia, 195 University of Oxford, 56, 151 University of Vienna, 160 University of Washington, 188 unknown knowns, 132, 133, 136, 138, 141, 192, 212 unknown unknowns, 132, 133, 138 “Use of Knowledge in Society, The” (Hayek), 161 V2 flying bomb, 137 vaccines, 23, 95 de Vauban, Sébastien Le Prestre, Marquis de Vauban, 73 vehicle-ramming attacks, 17 Vesalius, Andreas, 96 Vienna, Austria, 153–5, 159 Vietnam War (1955–75), 111, 130, 136, 138, 143, 205 violence vs. power, 19, 219 viral marketing, 12 virtual reality, 183 virtue signaling, 194 voice recognition, 187 Vote Leave, 50, 93 Wainright, Joel, 214 Wales, 77, 90 Wall Street, New York, 33, 190 War College, Berlin, 128 “War Economy” (Neurath), 153–4 war on drugs, 43, 131 war on terror, 131, 136, 196 Watts, Jay, 115 weaponization, 18–20, 22, 26, 75, 118, 123, 194, 219, 223 weapons of mass destruction, 132 wearable technology, 173 weather control, 204 “What Is An Emotion?”

., Martin Luther, 21, 224 knowledge economy, 84, 85, 88, 151–2, 217 known knowns, 132, 138 Koch, Charles and David, 154, 164, 174 Korean War (1950–53), 178 Kraepelin, Emil, 139 Kurzweil, Ray, 183–4 Labour Party, 5, 6, 65, 80, 81, 221 Lagarde, Christine, 64 Le Bon, Gustave, 8–12, 13, 15, 16, 20, 24, 25, 38 Le Pen, Marine, 27, 79, 87, 92, 101–2 Leadbeater, Charles, 84 Leeds, West Yorkshire, 85 Leicester, Leicestershire, 85 Leviathan (Hobbes), 34, 39, 45 liberal elites, 20, 58, 88, 89, 161 libertarianism, 15, 151, 154, 158, 164, 173, 196, 209, 226 Liberty Fund, 158 Libya, 143 lie-detection technology, 136 life expectancy, 62, 68–71, 72, 92, 100–101, 115, 224 Lindemann, Frederick Alexander, 1st Viscount Cherwell, 138 Lloyds Bank, 29 London, England bills of mortality, 68–71, 75, 79–80, 81, 89, 127 Blitz (1940–41), 119, 143, 180 EU referendum (2016), 85 Great Fire (1666), 67 Grenfell Tower fire (2017), 10 and gross domestic product (GDP), 77, 78 housing crisis, 84 insurance sector, 59 knowledge economy, 84 life expectancy, 100 newspapers, early, 48 Oxford Circus terror scare (2017), ix–x, xiii, 41 plagues, 67–71, 75, 79–80, 81, 89, 127 Unite for Europe march (2017), 23 London School of Economics (LSE), 160 loss aversion, 145 Louis XIV, King of France, 73, 127 Louisiana, United States, 151, 221 Ludwig von Mises Institute, 154 MacLean, Nancy, 158 Macron, Emmanuel, 33 mainstream media, 197 “Make America Great Again,” 76, 145 Manchester, England, 85 Mann, Geoff, 214 maps, 182 March For Our Lives (2018), 21 March for Science (2017), 23–5, 27, 28, 210, 211 marketing, 14, 139–41, 143, 148, 169 Mars, 175, 226 Marxism, 163 Massachusetts Institute of Technology (MIT), 179 Mayer, Jane, 158 McCarthy, Joseph, 137 McGill Pain Questionnaire, 104 McKibben, William “Bill,” 213 Megaface, 188–9 memes, 15, 194 Menger, Carl, 154 mental illness, 103, 107–17, 139 mercenaries, 126 Mercer, Robert, 174, 175 Mexico, 145 Million-Man March (1995), 4 mind-reading technology, 136 see also telepathy Mirowski, Philip, 158 von Mises, Ludwig, 154–63, 166, 172, 173 Missing Migrants Project, 225 mobilization, 5, 7, 126–31 and Corbyn, 81 and elections, 81, 124 and experts, 27–8 and Internet, 15 and Le Bon’s crowd psychology, 11, 12, 16, 20 and loss, 145 and Napoleonic Wars, xv, 127–30, 141, 144 and Occupy movement, 5 and populism, 16, 22, 60 and violence, opposition to, 21 Moniteur Universel, Le, 142 monopoly on violence, 42 Mont Pelerin Society, 163, 164 moral emotion, 21 morphine, 105 multiculturalism, 84 Murs, Oliver “Olly,” ix Musk, Elon, 175, 176, 178, 183, 226 Nanchang, Jiangxi, 13 Napoleonic Wars (1803–15), 126–30 chappe system, 129, 182 and conscription, 87, 126–7, 129 and disruption, 170–71, 173, 174, 175, 226 and great leader ideal, 146–8 and intelligence, 134 and mobilization, xv, 126–30, 141, 144 and nationalism, 87, 128, 129, 144, 183, 211 and propaganda, 142 Russia, invasion of (1812), 128, 133 Spain, invasion of (1808), 128 National Aeronautics and Space Administration (NASA), 23, 175 National Audit Office (NAO), 29–30 national citizenship, 71 National Defense Research Committee, 180 National Health Service (NHS), 30, 93 National Park Service, 4 National Security Agency (NSA), 152 national sovereignty, 34, 53 nationalism, 87, 141, 210–12 and conservatism, 144 and disempowerment, 118–19 and elites, 22–3, 60–61, 145 ethnic, 15 and health, 92, 211–12, 224 and imagined communities, 87 and inequality, 78 and loss, 145 and markets, 167 and promises, 221 and resentment, 145, 197, 198 and war, 7, 20–21, 118–19, 143–6, 210–11 nativism, 61 natural philosophy, 35–6 nature, 86 see also environment Nazi Germany (1933–45), 137, 138, 154 Netherlands, 48, 56, 129 Neurable, 176 neural networking, 216 Neuralink, 176 neurasthenia, 139 Neurath, Otto, 153–4, 157, 160 neurochemistry, 108, 111, 112 neuroimaging, 176–8, 181 Nevada, United States, 194 new atheism, 209 New Orleans, Louisiana, 151 New Right, 164 New York, United States and climate change, 205 and gross domestic product (GDP), 78 housing crisis, 84 JFK Airport terror scare (2016), x, xiii, 41 knowledge economy, 84 September 11 attacks (2001), 17, 18 New York Times, 3, 27, 85 newspapers, 48, 71 Newton, Isaac, 35 Nietzsche, Friedrich, 217 Nixon, Robert, 206 no-platforming, 22, 208 Nobel Prize, 158–9 non-combatants, 43, 143, 204 non-violence, 224 North Atlantic Treaty Organization (NATO), 123, 145, 214 North Carolina, United States, 84 Northern Ireland, 43, 85 Northern League, 61 Northern Rock, 29 Norwich, Norfolk, 85 nostalgia, xiv, 143, 145, 210, 223 “Not in my name,” 27 nuclear weapons, 132, 135, 137, 180, 183, 192, 196, 204 nudge techniques, 13 Obama, Barack, 3, 24, 76, 77, 79, 158, 172 Obamacare, 172 objectivity, xiv, 13, 75, 136, 223 and crowd-based politics, 5, 7, 24–5 and death, 94 and Descartes, 37 and experts, trust in, 28, 32, 33, 51, 53, 64, 86, 89 and Hayek, 163, 164, 170 and markets, 169, 170 and photography, 8 and Scientific Revolution, 48, 49 and statistics, 72, 74, 75, 82, 88 and telepathic communication, 179 and war, 58, 125, 134, 135, 136, 146 Occupy movement, 5, 10, 24, 61 Oedipus complex, 109 Office for National Statistics, 63, 133 Ohio, United States, 116 oil crisis (1973), 166 “On Computable Numbers” (Turing), 181 On War (Clausewitz), 130 Open Society and Its Enemies, The (Popper), 171 opiates, 105, 116, 172–3 opinion polling, 65, 80–81, 191 Orbán, Viktor, 87, 146 Organisation for Economic Co-operation and Development (OECD), 72 Oxford, Oxfordshire, 85 Oxford Circus terror scare (2017), ix–x, xiii, 41 Oxford University, 56, 151 OxyContin, 105, 116 pacifism, 8, 20, 44, 151 pain, 102–19, 172–3, 224 see also chronic pain painkillers, 104, 105, 116, 172–3 Palantir, 151, 152, 175, 190 parabiosis, 149 Paris climate accord (2015), 205, 207 Paris Commune (1871), 8 Parkland attack (2018), 21 Patriot Act (2001), 137 Paul, Ronald, 154 PayPal, 149 Peace of Westphalia (1648), 34, 53 peer reviewing, 48, 139, 195, 208 penicillin, 94 Pentagon, 130, 132, 135, 136, 214, 216 pesticides, 205 Petty, William, 55–9, 67, 73, 85, 167 pharmacology, 142 Pielke Jr., Roger, 24, 25 Piketty, Thomas, 74 Pinker, Stephen, 207 plagues, 56, 67–71, 75, 79–80, 81, 89, 95 pleasure principle, 70, 109, 110, 224 pneumonia, 37, 67 Podemos, 5, 202 Poland, 20, 34, 60 Polanyi, Michael, 163 political anatomy, 57 Political Arithmetick (Petty), 58, 59 political correctness, 20, 27, 145 Popper, Karl, 163, 171 populism xvii, 211–12, 214, 220, 225–6 and central banks, 33 and crowd-based politics, 12 and democracy, 202 and elites/experts, 26, 33, 50, 152, 197, 210, 215 and empathy, 118 and health, 99, 101–2, 224–5 and immediate action, 216 in Kansas (1880s), 220 and markets, 167 and private companies, 174 and promises, 221 and resentment, 145 and statistics, 90 and unemployment, 88 and war, 148, 212 Porter, Michael, 84 post-traumatic stress disorder (PTSD), 111–14, 117, 209 post-truth, 167, 224 Potsdam Conference (1945), 138 power vs. violence, 19, 219 predictive policing, 151 presidential election, US (2016), xiv and climate change, 214 and data, 190 and education, 85 and free trade, 79 and health, 92, 99 and immigration, 79, 145 and inequality, 76–7 and Internet, 190, 197, 199 “Make America Great Again,” 76, 145 and opinion polling, 65, 80 and promises, 221 and relative deprivation, 88 and Russia, 199 and statistics, 63 and Yellen, 33 prisoners of war, 43 promises, 25, 31, 39–42, 45–7, 51, 52, 217–18, 221–2 Propaganda (Bernays), 14–15 propaganda, 8, 14–16, 83, 124–5, 141, 142, 143 property rights, 158, 167 Protestantism, 34, 35, 45, 215 Prussia (1525–1947), 8, 127–30, 133–4, 135, 142 psychiatry, 107, 139 psychoanalysis, 107, 139 Psychology of Crowds, The (Le Bon), 9–12, 13, 15, 16, 20, 24, 25 psychosomatic, 103 public-spending cuts, 100–101 punishment, 90, 92–3, 94, 95, 108 Purdue, 105 Putin, Vladimir, 145, 183 al-Qaeda, 136 quality of life, 74, 104 quantitative easing, 31–2, 222 quants, 190 radical statistics, 74 RAND Corporation, 183 RBS, 29 Reagan, Ronald, 15, 77, 154, 160, 163, 166 real-time knowledge, xvi, 112, 131, 134, 153, 154, 165–70 Reason Foundation, 158 Red Vienna, 154, 155 Rees-Mogg, Jacob, 33, 61 refugee crisis (2015–), 60, 225 relative deprivation, 88 representative democracy, 7, 12, 14–15, 25–8, 61, 202 Republican Party, 77, 79, 85, 154, 160, 163, 166, 172 research and development (R&D), 133 Research Triangle, North Carolina, 84 resentment, 5, 226 of elites/experts, 32, 52, 61, 86, 88–9, 161, 186, 201 and nationalism/populism, 5, 144–6, 148, 197, 198 and pain, 94 Ridley, Matt, 209 right to remain silent, 44 Road to Serfdom, The (Hayek), 160, 166 Robinson, Tommy, ix Roosevelt, Franklin Delano, 52 Royal Exchange, 67 Royal Society, 48–52, 56, 68, 86, 133, 137, 186, 208, 218 Rumsfeld, Donald, 132 Russian Empire (1721–1917), 128, 133 Russian Federation (1991–) and artificial intelligence, 183 Gerasimov Doctrine, 43, 123, 125, 126 and information war, 196 life expectancy, 100, 115 and national humiliation, 145 Skripal poisoning (2018), 43 and social media, 15, 18, 199 troll farms, 199 Russian Revolution (1917), 155 Russian SFSR (1917–91), 132, 133, 135–8, 155, 177, 180, 182–3 safe spaces, 22, 208 Sands, Robert “Bobby,” 43 Saxony, 90 scarlet fever, 67 Scarry, Elaine, 102–3 scenting, 135, 180 Schneier, Bruce, 185 Schumpeter, Joseph, 156–7, 162 Scientific Revolution, 48–52, 62, 66, 95, 204, 207, 218 scientist, coining of term, 133 SCL, 175 Scotland, 64, 85, 172 search engines, xvi Second World War, see World War II securitization of loans, 218 seismology, 135 self-employment, 82 self-esteem, 88–90, 175, 212 self-harm, 44, 114–15, 117, 146, 225 self-help, 107 self-interest, 26, 41, 44, 61, 114, 141, 146 Semi-Automatic Ground Environment (SAGE), 180, 182, 200 sentiment analysis, xiii, 12–13, 140, 188 September 11 attacks (2001), 17, 18 shell shock, 109–10 Shrecker, Ted, 226 Silicon Fen, Cambridgeshire, 84 Silicon Valley, California, xvi, 219 and data, 55, 151, 185–93, 199–201 and disruption, 149–51, 175, 226 and entrepreneurship, 149–51 and fascism, 203 and immortality, 149, 183–4, 224, 226 and monopolies, 174, 220 and singularity, 183–4 and telepathy, 176–8, 181, 185, 186, 221 and weaponization, 18, 219 singularity, 184 Siri, 187 Skripal poisoning (2018), 43 slavery, 59, 224 smallpox, 67 smart cities, 190, 199 smartphone addiction, 112, 186–7 snowflakes, 22, 113 social indicators, 74 social justice warriors (SJWs), 131 social media and crowd psychology, 6 emotional artificial intelligence, 12–13, 140–41 and engagement, 7 filter bubbles, 66 and propaganda, 15, 18, 81, 124 and PTSD, 113 and sentiment analysis, 12 trolls, 18, 20–22, 27, 40, 123, 146, 148, 194–8, 199, 209 weaponization of, 18, 19, 22, 194–5 socialism, 8, 20, 154–6, 158, 160 calculation debate, 154–6, 158, 160 Socialism (Mises), 160 Society for Freedom in Science, 163 South Africa, 103 sovereignty, 34, 53 Soviet Russia (1917–91), 132, 133, 135–8, 177, 180, 182–3 Spain, 5, 34, 84, 128, 202 speed of knowledge, xvi, 112, 124, 131, 134, 136, 153, 154, 165–70 Spicer, Sean, 3, 5 spy planes, 136, 152 Stalin, Joseph, 138 Stanford University, 179 statactivism, 74 statistics, 62–91, 161, 186 status, 88–90 Stoermer, Eugene, 206 strong man leaders, 16 suicide, 100, 101, 115 suicide bombing, 44, 146 superbugs, 205 surveillance, 185–93, 219 Sweden, 34 Switzerland, 164 Sydenham, Thomas, 96 Syriza, 5 tacit knowledge, 162 talking cure, 107 taxation, 158 Tea Party, 32, 50, 61, 221 technocracy, 53–8, 59, 60, 61, 78, 87, 89, 90, 211 teenage girls, 113, 114 telepathy, 39, 176–9, 181, 185, 186 terrorism, 17–18, 151, 185 Charlottesville attack (2017), 20 emergency powers, 42 JFK Airport terror scare (2016), x, xiii, 41 Oxford Circus terror scare (2017), ix–x, xiii, 41 September 11 attacks (2001), 17, 18 suicide bombing, 44, 146 vehicle-ramming attacks, 17 war on terror, 131, 136, 196 Thames Valley, England, 85 Thatcher, Margaret, 154, 160, 163, 166 Thiel, Peter, 26, 149–51, 153, 156, 174, 190 Thirty Years War (1618–48), 34, 45, 53, 126 Tokyo, Japan, x torture, 92–3 total wars, 129, 142–3 Treaty of Westphalia (1648), 34, 53 trends, xvi, 168 trigger warnings, 22, 113 trolls, 18, 20–22, 27, 40, 123, 146, 148, 194–8, 199, 209 Trump, Donald, xiv and Bannon, 21, 60–61 and climate change, 207 and education, 85 election campaign (2016), see under presidential election, US and free trade, 79 and health, 92, 99 and immigration, 145 inauguration (2017), 3–5, 6, 9, 10 and inequality, 76–7 “Make America Great Again,” 76, 145 and March for Science (2017), 23, 24, 210 and media, 27 and opinion polling, 65, 80 and Paris climate accord, 207 and promises, 221 and relative deprivation, 88 and statistics, 63 and Yellen, 33 Tsipras, Alexis, 5 Turing, Alan, 181, 183 Twitter and Corbyn’s rallies, 6 and JFK Airport terror scare (2016), x and Oxford Circus terror scare (2017), ix–x and Russia, 18 and sentiment analysis, 188 and trends, xvi and trolls, 194, 195 Uber, 49, 185, 186, 187, 188, 191, 192 UK Independence Party, 65, 92, 202 underemployment, 82 unemployment, 61, 62, 72, 78, 81–3, 87, 88, 203 United Kingdom austerity, 100 Bank of England, 32, 33, 64 Blitz (1940–41), 119, 143, 180 Brexit (2016–), see under Brexit Cameron government (2010–16), 33, 73, 100 Center for Policy Studies, 164 Civil Service, 33 climate-gate (2009), 195 Corbyn’s rallies, 5, 6 Dunkirk evacuation (1940), 119 education, 85 financial crisis (2007–9), 29–32, 100 first past the post, 13 general election (2015), 80, 81 general election (2017), 6, 65, 80, 81, 221 Grenfell Tower fire (2017), 10 gross domestic product (GDP), 77, 79 immigration, 63, 65 Irish hunger strike (1981), 43 life expectancy, 100 National Audit Office (NAO), 29 National Health Service (NHS), 30, 93 Office for National Statistics, 63, 133 and opiates, 105 Oxford Circus terror scare (2017), ix–x, xiii, 41 and pain, 102, 105 Palantir, 151 Potsdam Conference (1945), 138 quantitative easing, 31–2 Royal Society, 138 Scottish independence referendum (2014), 64 Skripal poisoning (2018), 43 Society for Freedom in Science, 163 Thatcher government (1979–90), 154, 160, 163, 166 and torture, 92 Treasury, 61, 64 unemployment, 83 Unite for Europe march (2017), 23 World War II (1939–45), 114, 119, 138, 143, 180 see also England United Nations, 72, 222 United States Bayh–Dole Act (1980), 152 Black Lives Matter, 10, 225 BP oil spill (2010), 89 Bush Jr. administration (2001–9), 77, 136 Bush Sr administration (1989–93), 77 Bureau of Labor, 74 Central Intelligence Agency (CIA), 3, 136, 151, 199 Charlottesville attack (2017), 20 Civil War (1861–5), 105, 142 and climate change, 207, 214 Clinton administration (1993–2001), 77 Cold War, see Cold War Defense Advanced Research Projects Agency (DARPA), 176, 178 Defense Intelligence Agency, 177 drug abuse, 43, 100, 105, 115–16, 131, 172–3 education, 85 Federal Bureau of Investigation (FBI), 137 Federal Reserve, 33 Fifth Amendment (1789), 44 financial crisis (2007–9), 31–2, 82, 158 first past the post, 13 Government Accountability Office, 29 gross domestic product (GDP), 75–7, 82 health, 92, 99–100, 101, 103, 105, 107, 115–16, 158, 172–3 Heritage Foundation, 164, 214 Iraq War (2003–11), 74, 132 JFK Airport terror scare (2016), x, xiii, 41 Kansas populists (1880s), 220 libertarianism, 15, 151, 154, 158, 164, 173 life expectancy, 100, 101 March For Our Lives (2018), 21 March for Science (2017), 23–5, 27, 28, 210 McCarthyism (1947–56), 137 Million-Man March (1995), 4 National Aeronautics and Space Administration (NASA), 23, 175 National Defense Research Committee, 180 National Park Service, 4 National Security Agency (NSA), 152 Obama administration (2009–17), 3, 24, 76, 77, 79, 158 Occupy Wall Street (2011), 5, 10, 61 and opiates, 105, 172–3 and pain, 103, 105, 107, 172–3 Palantir, 151, 152, 175, 190 Paris climate accord (2015), 205, 207 Parkland attack (2018), 21 Patriot Act (2001), 137 Pentagon, 130, 132, 135, 136, 214, 216 presidential election (2016), see under presidential election, US psychiatry, 107, 111 quantitative easing, 31–2 Reagan administration (1981–9), 15, 77, 154, 160, 163, 166 Rumsfeld’s “unknown unknowns” speech (2002), 132 Semi-Automatic Ground Environment (SAGE), 180, 182, 200 September 11 attacks (2001), 17, 18 Tea Party, 32, 50, 61, 221 and torture, 93 Trump administration (2017–), see under Trump, Donald unemployment, 83 Vietnam War (1955–75), 111, 130, 136, 138, 143, 205 World War I (1914–18), 137 World War II (1939–45), 137, 180 universal basic income, 221 universities, 151–2, 164, 169–70 University of Cambridge, 84, 151 University of Chicago, 160 University of East Anglia, 195 University of Oxford, 56, 151 University of Vienna, 160 University of Washington, 188 unknown knowns, 132, 133, 136, 138, 141, 192, 212 unknown unknowns, 132, 133, 138 “Use of Knowledge in Society, The” (Hayek), 161 V2 flying bomb, 137 vaccines, 23, 95 de Vauban, Sébastien Le Prestre, Marquis de Vauban, 73 vehicle-ramming attacks, 17 Vesalius, Andreas, 96 Vienna, Austria, 153–5, 159 Vietnam War (1955–75), 111, 130, 136, 138, 143, 205 violence vs. power, 19, 219 viral marketing, 12 virtual reality, 183 virtue signaling, 194 voice recognition, 187 Vote Leave, 50, 93 Wainright, Joel, 214 Wales, 77, 90 Wall Street, New York, 33, 190 War College, Berlin, 128 “War Economy” (Neurath), 153–4 war on drugs, 43, 131 war on terror, 131, 136, 196 Watts, Jay, 115 weaponization, 18–20, 22, 26, 75, 118, 123, 194, 219, 223 weapons of mass destruction, 132 wearable technology, 173 weather control, 204 “What Is An Emotion?”


pages: 335 words: 98,847

A Bit of a Stretch: The Diaries of a Prisoner by Chris Atkins

Boris Johnson, butterfly effect, collapse of Lehman Brothers, crowdsourcing, Donald Trump, Elon Musk, forensic accounting, G4S, housing crisis, illegal immigration, index card, Mark Zuckerberg, Milgram experiment, Panopticon Jeremy Bentham, payday loans

Gary finishes his sentence in a week and a half, and we toast our good fortune, both believing that our darkest days will soon be over. I feel as if I’ve been cut free from a sunken wreck and am starting the long swim back to the surface. 9 Courtrooms and Cheeseburgers In which Gary and I both get stuck in Wandsworth. We refuse to ride the bang-up, and wage admin warfare with the authorities. Things I learn: 1) The Offender Management Unit can’t count 2) How to conceive in prison 3) A novel way to solve the housing crisis We score a partial victory for Gary, but my prospects take a turn for the worse. 11 January I’m shortly due back in court for my confiscation hearing. I am desperate to know what’s going on, but can’t raise my lawyer on the phone. Danielle lets me nip out of the inductions to call, and I eventually speak to my lawyer’s assistant, who clearly learnt her bedside manner from Dr Harold Shipman.

He’s completely bald, talks in a camp cockney accent, and got three years for some fairly unusual housebreaking. ‘I’d only jemmy empty flats. I’d change the locks quick-smart and then put the address on Gumtree.’ He would only accept offers from foreigners, and insist they pay the first three months’ rent upfront in cash. He would hand over the keys, ditch his phone and then leave them to it. It’s a very twenty-first-century crime, and Carney is adamant that he was simply helping to solve London’s housing crisis. 20 January It’s finally time for my confiscation hearing at Southwark. I’m woken at 6 a.m. by an officer tapping on the door. I assume that it’s a Listener call-out, and stumble out of bed asking who the contact is. The screw tells me that I’m due in court, and I get ready in the dark to avoid waking Gary. I eat a bowl of muesli and chuck the remainder in the loo, realising too late that I’ve thrown my spoon in as well.


pages: 104 words: 30,990

The Centrist Manifesto by Charles Wheelan

2013 Report for America's Infrastructure - American Society of Civil Engineers - 19 March 2013, affirmative action, Affordable Care Act / Obamacare, American Society of Civil Engineers: Report Card, Bernie Madoff, Bretton Woods, centre right, clean water, creative destruction, David Brooks, delayed gratification, demand response, Home mortgage interest deduction, housing crisis, income inequality, invisible hand, obamacare, profit maximization, Ralph Nader, rent-seeking, Report Card for America’s Infrastructure, Ronald Reagan, Ronald Reagan: Tear down this wall, stem cell, the scientific method, transcontinental railway, Walter Mischel

The fact that Bill Gates and Warren Buffett are eligible for a government housing subsidy is indefensible. That is how we achieve smaller, smarter government. Restore fiscal sanity. We cannot continue to borrow massively from the rest of the world. Our mounting debt is unfair to future generations, leaves the nation dangerously beholden to foreign creditors, and puts the financial system at risk. As we should have learned from our own housing crisis and the Greek debt crisis, when markets lose confidence, the plunge is fast and devastating. When will investors lose confidence in American debt? I have no idea—but we will be caught by surprise when it happens. There is never a memo announcing that a financial crisis will begin in six weeks. Our overall goal must be to bring the budget back in balance. We must do two crucial things to make that happen: Reform entitlements.


pages: 408 words: 108,985

Rewriting the Rules of the European Economy: An Agenda for Growth and Shared Prosperity by Joseph E. Stiglitz

Airbnb, balance sheet recession, bank run, banking crisis, barriers to entry, Basel III, basic income, Berlin Wall, bilateral investment treaty, business cycle, business process, Capital in the Twenty-First Century by Thomas Piketty, central bank independence, collapse of Lehman Brothers, collective bargaining, corporate governance, corporate raider, corporate social responsibility, creative destruction, credit crunch, deindustrialization, discovery of DNA, diversified portfolio, Donald Trump, eurozone crisis, Fall of the Berlin Wall, financial intermediation, Francis Fukuyama: the end of history, full employment, gender pay gap, George Akerlof, gig economy, Gini coefficient, hiring and firing, housing crisis, Hyman Minsky, income inequality, inflation targeting, informal economy, information asymmetry, intangible asset, investor state dispute settlement, invisible hand, Isaac Newton, labor-force participation, liberal capitalism, low skilled workers, market fundamentalism, mini-job, moral hazard, non-tariff barriers, offshore financial centre, open economy, patent troll, pension reform, price mechanism, price stability, purchasing power parity, quantitative easing, race to the bottom, regulatory arbitrage, rent-seeking, Robert Shiller, Robert Shiller, Ronald Reagan, selection bias, shareholder value, Silicon Valley, sovereign wealth fund, TaskRabbit, too big to fail, trade liberalization, transaction costs, transfer pricing, trickle-down economics, tulip mania, universal basic income, unorthodox policies, zero-sum game

Europe has recently adopted a Youth Guarantee, “a commitment by all Member States to ensure that all young people under the age of 25 years receive a good quality offer of employment, continued education, apprenticeship, and/or traineeship within a period of four months of becoming unemployed or leaving formal education.”12 It is too soon to judge its success, but so far, youth unemployment rates in some countries remain stubbornly high. DECENT HOUSING The post-crisis recession had huge consequences on housing for many Europeans. High unemployment and cuts in salaries and state support meant many could not afford to pay their rent or mortgage. Between 2008 and 2013, more than four million Europeans were estimated to have faced evictions.13 The recession brought to a head a housing crisis that had been festering for years. Europe has become increasingly urbanized, and the availability and affordability of housing, especially for those with limited income, have become major problems in most large cities. In many urban areas, the price of residential housing has risen sharply since the 1980s. Likewise, the average fraction of income spent on housing has also increased significantly, especially for those whose incomes have fallen or stagnated, and for those at the bottom of the income distribution.

See also public sector doctrines relating to (see economic doctrines) employment programs, 229, 274–80 globalization role of, 305 lending, 183–84 public banks, 116–18, 184–86; 183–184 role in research and development, 23, 100, 312 societal role of, 8 government bonds, 171–72, 182 Greece Austerity Doctrine and, 17 bond interest rates, 80 as crisis country, 35, 36 debt restructuring and, 57–58 depressed investment and, 108 ECB pressure on, 77 economic adjustment and, 55–56 Gini coefficient for, 47 health care in, 242 investment ratio of, 104 privatization in, 21–22 Troika policies and, 37 Troika structural reforms and, 70 unemployment levels of, 31 wage reduction in, 39–40 Growth Pact, Stability and. See Stability and Growth Pact Harmonised Index of Consumer Prices (HICP), 64 headline inflation, 82 health care, 241–43 home mortgages affordability of, 231, 233–35 public option for, 183–84, 233–34 rising costs of, 230 housing crisis. See also home mortgages affordable housing, 235–37 land use and property taxes, 231–33 overview of, 229–31 Human Development Index, 126 Human Rights, Office of the High Commissioner for, 247 Human Rights, Universal Declaration of (1948), 237 HypoVereinsbank, 164 IMF (International Monetary Fund), 36 incentives CEO and executive, 137–38 corporate governance and, 127 for excessive patenting, 146 proposals for reforming, 140 providing, for innovations, 147 worker-owned businesses and, 142 income, raising minimum wages, 265–68 restoring workers’ bargaining power, 262–65 universal basic income, 251–54 India, 131, 252, 253, 275 industrial policies, 273–74 inequality austerity related to, 49–50 corporation power leading to, 128 data supporting patterns of, 6, 7 globalization mismanagement and, 303–4 large corporations and, 19–20 macroeconomic framework creating, 46–47 market power contributing to, 129 as socioeconomic characteristic, 2 unemployment and, 31, 49–50, 275 inequality, growing (post-mid 1970s) contributing factors, 219–21 data supporting patterns of, 6, 7 decline in labor shares, 216, 217 economic background, 215–16 equitable society, achieving, 223–24 globalization, 219, 220–21, 221–23 income inequalities, 217–18, 218 rising poverty, 218–19, 219 welfare state and, 216–17 inflation Austerity Doctrine related to, 17 fears about, 44, 51–52, 58 -fighting mandate of ECB, 72–73, 75–76 low, or deflation proposals, 82–84 Price Stability Doctrine and, 18–19 informal workers, 247–48 information technology sector, 129 inheritance taxes, 188, 190–91 Initiative for Policy Dialogue, xv innovation -based economy, 128, 149 intellectual property rights and, 143–45, 147 in market economies, 135–36 insurance.


pages: 300 words: 106,520

The Nanny State Made Me: A Story of Britain and How to Save It by Stuart Maconie

banking crisis, basic income, Bernie Sanders, bitcoin, Boris Johnson, British Empire, cognitive dissonance, collective bargaining, Corn Laws, David Attenborough, Desert Island Discs, don't be evil, Downton Abbey, Elon Musk, Etonian, failed state, Francis Fukuyama: the end of history, full employment, G4S, Gordon Gekko, greed is good, helicopter parent, hiring and firing, housing crisis, job automation, Mark Zuckerberg, market fundamentalism, Marshall McLuhan, North Sea oil, Own Your Own Home, plutocrats, Plutocrats, rent control, Right to Buy, road to serfdom, Silicon Valley, The Chicago School, universal basic income, Winter of Discontent

Portillo’s defeat at the 1997 election, turfed out on live TV in the small hours, warmed many British hearts like nothing since the 1966 World Cup win or a Morecambe and Wise Christmas Special circa 1974. As his unseating was announced at the count in Enfield, he smiled thinly. At the time, we wondered what he had to look so pleased about. Now we know. Relieved (albeit briefly) of the burden of office and with time on his soft hands, he could now really make a killing as the most gallingly ubiquitous man on British television. But when I saw a trailer for Channel 5’s Our Housing Crisis – Who’s to Blame? presented by one Michael Portillo, my mixed feelings became a heady cocktail of annoyance and awe with perhaps a dash of admiration at his chutzpah. Of the many reasons, some sartorial, that I am loath to warm to Mr Portillo in the way softer hearts have, foremost is that I remember him for what he once was, one of the most viciously relishing of the young Thatcherites, the man who opined in 1993 that we should forensically examine health, education and social security (in other words, the heart of the welfare state) ‘from which the public sector could withdraw altogether’.

What O’Hagan seems to be saying is that no man is an island, that the notion of communities supported by local government is vital to maintaining the wellbeing of people. As this is a Christian notion, it is possibly enormously and embarrassingly unfashionable. But make no mistake, we need to get back to it. Not just in the sphere of housing, but across the span of our national life. To stay with social housing for now, the conclusions Danny Dorling put in his lecture to the LSE seem cogent and powerful to me. The answer to our housing crisis is in a massive programme of social housing building, the removal of all the financial incentives of Right to Buy, the removal of attractive financial incentives to become a private landlord, proper rent regulation, short-hold tenancies to be made illegal, and furthermore the compulsory purchase of buildings left unoccupied for more than a reasonable time. As Dorling concludes, ‘We should live in a country where you have a choice whether to rent or buy and it doesn’t make much odds either way.


pages: 782 words: 187,875

Big Debt Crises by Ray Dalio

Asian financial crisis, asset-backed security, bank run, banking crisis, basic income, Ben Bernanke: helicopter money, break the buck, Bretton Woods, British Empire, business cycle, capital controls, central bank independence, collateralized debt obligation, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, currency manipulation / currency intervention, currency peg, declining real wages, European colonialism, fiat currency, financial innovation, German hyperinflation, housing crisis, implied volatility, intangible asset, Kickstarter, large denomination, manufacturing employment, margin call, market bubble, market fundamentalism, money market fund, money: store of value / unit of account / medium of exchange, moral hazard, mortgage debt, Northern Rock, Ponzi scheme, price stability, private sector deleveraging, purchasing power parity, pushing on a string, quantitative easing, refrigerator car, reserve currency, short selling, sovereign wealth fund, too big to fail, transaction costs, universal basic income, value at risk, yield curve

The stimulus totaled $787 billion, with $288 billion specifically set aside for tax reductions, $144 billion for state and local governments, $105 billion for infrastructure, and the rest for federal spending programs. Notably, the tax reduction was funneled to taxpayers within days—a virtually instantaneous stimulus. The infrastructure spending, on the other hand, would take years to ramp up as projects needed to be scoped and planned for, so it mattered less in the short term. On February 18, the administration announced a plan worth up to $275 billion to address the housing crisis. With the goal of helping “as many as nine million American homeowners refinance their mortgages or avert foreclosure,” the Homeowner Affordability and Stability Plan offered $75 billion in direct spending to keep at-risk homeowners in their homes. It also provided incentives to lenders to alter the terms of their loans to troubled borrowers to make them more affordable. And it gave Fannie Mae and Freddie Mac an additional $200 billion in financing.

–New York Times December 3, 2007 Mortgage Relief Impact May Be Limited “The Bush administration’s effort to help at least some people in danger of defaulting on their subprime mortgages could affect only a small share of those who took out such loans during the final two years of the housing bubble, industry analysts said today.” –New York Times December 5, 2007 Wall Street Firms Subpoenaed in Subprime Inquiry -New York Times December 11, 2007 Mortgage Crisis Forces the Closing of a Fund “Losses on investments weakened by the deepening housing crisis have forced Bank of America to close a multibillion-dollar high-yield fund, the largest of its kind, after wealthy investors withdrew billions of dollars in assets.” –New York Times December 11, 2007 Fed Cuts Rate a Quarter Point; Stocks Dive -New York Times December 12, 2007 Fed Leads Drive to Strengthen Bank System “A day after the Federal Reserve disappointed investors with a modest cut in interest rates, central banks in North America and Europe announced on Wednesday the most aggressive infusion of capital into the banking system since the terrorist attacks of September 2001.“ –New York Times December 13, 2007 3 Big Banks See No Relief as Write-Offs Mount Up –Bloomberg December 14, 2007 Investors Shrug Off Global Cash Injection -New York Times December 19, 2007 E.C.B.

–New York Times February 10, 2009 Secretary Geithner Introduces Financial Stability Plan –Treasury Press Release February 10, 2009 Stocks Slide as New Bailout Disappoints -New York Times February 10, 2009 There wasn’t much of a surprise… “The key takeaway for the members and staff present at the briefing seems to have been that the Treasury’s plan was at its infancy and far from where members of Congress expected it to be.” –BDO February 13, 2009 Stimulus Plan Approved by Congress -New York Times February 17, 2009 Signing Stimulus, Obama Doesn’t Rule Out More -New York Times February 18, 2009 $275 Billion Plan Seeks to Address Housing Crisis “President Obama announced a plan on Wednesday to help as many as nine million American homeowners refinance their mortgages or avert foreclosure.” –New York Times February 20, 2009 Markets Close Lower as Fears Over Banks Persist -New York Times February 20, 2009 The Eve of Nationalization? “While nationalization seems to us the best option it is still extremely dangerous. The goal of nationalization is to re-capitalize these institutions in an acceptable way, while sustaining the basic underlying infrastructure of the financial system.”


The Transformation Of Ireland 1900-2000 by Diarmaid Ferriter

anti-communist, Bob Geldof, British Empire, Celtic Tiger, collective bargaining, deliberate practice, edge city, falling living standards, financial independence, ghettoisation, greed is good, hiring and firing, housing crisis, immigration reform, income per capita, land reform, manufacturing employment, moral panic, New Journalism, New Urbanism, offshore financial centre, open economy, postnationalism / post nation state, sensible shoes, the market place, upwardly mobile, urban renewal, wage slave, women in the workforce

In 1900 Sir Charles Cameron, the city’s Medical Officer, drew attention to the malnourishment of mothers and to the fact that infant mortality among the labouring classes was five times higher than those of the upper classes, and he recommended the clearing of certain slum areas. While Dublin Corporation had acquired powers in the late nineteenth century to regulate private housing in the context of sanitation, they had only tinkered at the margins of the housing crisis, as had the small Dublin Artisans Dwelling Company and the Iveagh Trust. In 1911, 22.9 per cent of Dublin’s population lived in one-room tenements with the only large centres of population getting near that figure being Finsbury in London (14.8) and Glasgow (13.2).57 In contrast, it has been suggested Ireland’s rural labourers were: among the best housed of their class in Western Europe … as late as 1921 it was reported that 48,000 cottages had been provided in rural Ireland since 1883, with a total expenditure of £8.5 million, whereas under the urban housing acts only £5 million had been spent and just 10,000 houses built.58 In 1903 the Mansion House Conference on housing had suggested the provision of new housing on the outskirts of the city, and Dublin Corporation was faced with the problem of a small rateable base because of the subsequent drift to the suburbs.

In 1911, 22.9 per cent of Dublin’s population lived in one-room tenements with the only large centres of population getting near that figure being Finsbury in London (14.8) and Glasgow (13.2).57 In contrast, it has been suggested Ireland’s rural labourers were: among the best housed of their class in Western Europe … as late as 1921 it was reported that 48,000 cottages had been provided in rural Ireland since 1883, with a total expenditure of £8.5 million, whereas under the urban housing acts only £5 million had been spent and just 10,000 houses built.58 In 1903 the Mansion House Conference on housing had suggested the provision of new housing on the outskirts of the city, and Dublin Corporation was faced with the problem of a small rateable base because of the subsequent drift to the suburbs. Reform of Dublin’s urban problems was hampered by the complexity of the relationship between the ownership of land and property and municipal politics, and the low rateable value of much of the property in the city.59 Undoubtedly, some members of the Corporation did well out of the housing crisis, though it has been argued that the role of the slum owners within nationalist politics has been exaggerated, given the links between the Irish Parliamentary Party and the Town Tenants League.60 The early years of the century saw the beginning of many debates about moving the population out to the suburbs and there were policy debates about the nature and location of housing. The historical geographer Ruth McManus has suggested that as well as borrowing ideas from Europe there was much blurring of the distinction between public and private housing, and that ‘both speculative builders and Dublin Corporation needed each other’.

Corcoran listed a catalogue of failure: no diminution in the problem of purely precarious employment, or in the abuse of strong drink; and he suggested the school attendance of Ireland in city and country ‘is a national scandal … here and in many other ways, there is room enough for trained social workers; a thousand could find ample scope for well-directed energy in Dublin alone’.136 The lack of appetite for confronting the housing crisis in the city was also noted, highlighting the divide between the rural and urban housing experiences. Labourers Acts had ensured that rural labourers made progress in the housing league during these years – indeed, it is not an exaggeration to term it a social revolution, in the sense that it was the first large-scale public-housing scheme in the country, with up to a quarter of a million housed under the Labourers Acts up to 1921.


pages: 425 words: 117,334

City on the Verge by Mark Pendergrast

big-box store, clean water, Community Supported Agriculture, crowdsourcing, desegregation, edge city, Edward Glaeser, global village, housing crisis, hydraulic fracturing, income inequality, Jane Jacobs, jitney, liberation theology, mass incarceration, McMansion, New Urbanism, openstreetmap, Richard Florida, the built environment, The Death and Life of Great American Cities, the High Line, transatlantic slave trade, transit-oriented development, urban planning, urban renewal, urban sprawl, walkable city, white flight, young professional

In late 1945, the Ku Klux Klan surged into the spotlight (or firelight) yet again with a rally atop Stone Mountain, featuring a three-hundred-foot-wide cross lit by fuel oil, visible from sixty miles away, “to let the niggers know the war is over and that the Klan is back,” as one attendee said. Dozens of Atlanta policemen joined. In White Flight: Atlanta and the Making of Modern Conservatism, historian Kevin Kruse documents Atlanta’s postwar battle over housing. “The end of World War II brought a severe housing crisis to Atlanta, as thousands of veterans returned home to discover the city had not only failed to build new homes during their absence but actually started to destroy old ones.” In 1946, as more African Americans began to move west of Ashby Street (now renamed Joseph E. Lowery Boulevard), a neo-Nazi group, the Columbians, posted signs reading, “Zoned as a White Community,” featuring their lightning insignia.

A coalition of the business elite and politicians has always ruled Atlanta, as Clarence Stone observed in his classic 1989 book, Regime Politics: Governing Atlanta, 1946–1988. The concern has been for “what one actor can do for another,” Stone wrote. “Instead of promoting redistribution toward equality, such a system perpetuates inequality.” Members of the black middle and upper classes have thrived, but the hapless and often hopeless poor, of any racial or ethnic group, have not. Although the BeltLine project alone cannot solve Atlanta’s affordable housing crisis, it does have a mandate to provide 5,600 affordable units along the loop over the twenty-five-year time span of the tax allocation district (TAD), and after ten years, it had funded only a tenth of those, largely because of the impact of the Great Recession. During my research, I took part in a sparsely attended meeting of the Atlanta BeltLine Affordable Housing Advisory Board (BAHAB), charged with advising BeltLine organizations on affordable housing issues.


pages: 701 words: 199,010

The Crisis of Crowding: Quant Copycats, Ugly Models, and the New Crash Normal by Ludwig B. Chincarini

affirmative action, asset-backed security, automated trading system, bank run, banking crisis, Basel III, Bernie Madoff, Black-Scholes formula, business cycle, buttonwood tree, Carmen Reinhart, central bank independence, collapse of Lehman Brothers, collateralized debt obligation, collective bargaining, corporate governance, correlation coefficient, Credit Default Swap, credit default swaps / collateralized debt obligations, delta neutral, discounted cash flows, diversification, diversified portfolio, family office, financial innovation, financial intermediation, fixed income, Flash crash, full employment, Gini coefficient, high net worth, hindsight bias, housing crisis, implied volatility, income inequality, interest rate derivative, interest rate swap, John Meriwether, Kickstarter, liquidity trap, London Interbank Offered Rate, Long Term Capital Management, low skilled workers, margin call, market design, market fundamentalism, merger arbitrage, Mexican peso crisis / tequila crisis, Mitch Kapor, money market fund, moral hazard, mortgage debt, Myron Scholes, negative equity, Northern Rock, Occupy movement, oil shock, price stability, quantitative easing, quantitative hedge fund, quantitative trading / quantitative finance, Ralph Waldo Emerson, regulatory arbitrage, Renaissance Technologies, risk tolerance, risk-adjusted returns, Robert Shiller, Robert Shiller, Ronald Reagan, Sam Peltzman, Sharpe ratio, short selling, sovereign wealth fund, speech recognition, statistical arbitrage, statistical model, survivorship bias, systematic trading, The Great Moderation, too big to fail, transaction costs, value at risk, yield curve, zero-coupon bond

The housing market collapse, the collapse of Bear Stearns, Lehman Brothers, many commercial banks, and Freddie and Fannie badly disrupted capital markets. Funds in the business of providing leveraged liquidity were in the thick of the storm. JWMP was no exception. The troubling signs began early in 2008. January and February are typically good for fixed-income relative-value funds, because banks window-dress their balance sheets near the fiscal year’s end in November and December.2 The housing crisis made 2008 an exception. JWMP started the year with its worst-ever monthly return: −4.14% in January 2008. February was even worse, at −5.25%. By the end of February, JWMP began to unwind some of its risk. The Bear and the Gorilla Attack Then came the institutional bank run on Bear Stearns in March 2008. Bear Stearns, a major prime broker and liquidity provider for hedge funds, was heading for bankruptcy.

In the case of a defaulted home loan, if the loan was originally for $600,000 and the borrower defaulted with 0% down, then the bank presumably should value the loan at the home’s value, which in a declining real estate market might be much less than $600,000. These writeoffs will lower the bank’s capital ratio and if large enough, will wipe out their equity making the bank insolvent (that is, assets are worth less than liabilities). Simple Answer to Puzzles Some people have proposed that to solve the banking and housing crisis, the U.S. government should simply have all banks renegotiate every mortgage to the current value of housing and have the government reimburse them. How much might this cost? Take a home owner who took out a home loan of $600,000 at 6% interest rates and the monthly mortgage payment was $3,597.40. Let’s suppose that this particular home owner cannot afford the monthly payment any longer. Thus, one option to the government is to rewrite the interest amount on the loan to something like 2% below market rates.

“The Credit Rating Agencies.” Journal of Economic Perspectives, Spring 2010. Woodward, Susan E. and Robert E. Hall. “Consumer Confusion in the Mortgage Market: Evidence of Less than a Perfectly Transparent and Competitive Market.” American Economic Review, May 2010. Wuffli, Peter. “Salomon Global Banking Conference.” UBS Presentation by CFO, October 28, 1998. Young, Ashley N. “The Real Estate Agent’s Role in the Housing Crisis: A Proposal for Ethical Reform.” Georgetown Journal of Legal Ethics, Summer 2011. Zingales, Luigi. “Overall Impact of TARP on Financial Stability.” Oral Testimony before the Congressional Oversight Panel, March 4, 2011. Zuckerman, G., J. Hagerty, and D. Gauthier-Villars. “Impact of Mortgage Crisis Spreads; Dow Tumbles 2.8% as Fallout Intensifies; Moves by Central Banks.” Wall Street Journal, August 10, 2007.


pages: 388 words: 125,472

The Establishment: And How They Get Away With It by Owen Jones

anti-communist, Asian financial crisis, bank run, battle of ideas, Big bang: deregulation of the City of London, bonus culture, Boris Johnson, Bretton Woods, British Empire, call centre, capital controls, Capital in the Twenty-First Century by Thomas Piketty, centre right, citizen journalism, collapse of Lehman Brothers, collective bargaining, don't be evil, Edward Snowden, Etonian, eurozone crisis, falling living standards, Francis Fukuyama: the end of history, full employment, G4S, glass ceiling, hiring and firing, housing crisis, inflation targeting, Intergovernmental Panel on Climate Change (IPCC), investor state dispute settlement, James Dyson, laissez-faire capitalism, light touch regulation, market fundamentalism, mass immigration, Monroe Doctrine, Mont Pelerin Society, moral hazard, Neil Kinnock, night-watchman state, Northern Rock, Occupy movement, offshore financial centre, old-boy network, open borders, plutocrats, Plutocrats, popular capitalism, profit motive, quantitative easing, race to the bottom, rent control, road to serfdom, Ronald Reagan, shareholder value, short selling, sovereign wealth fund, stakhanovite, statistical model, The Wealth of Nations by Adam Smith, transfer pricing, union organizing, unpaid internship, Washington Consensus, wealth creators, Winter of Discontent

There was little sense of this in the media portrayal: it was as though his triumph was somehow illegitimate because it depended on the votes of trade-union members. Quite how intolerable the Establishment regarded any deviation from the political consensus was illustrated by the reaction to three commitments Ed Miliband made in September 2013 that went against the political grain. Responding to a housing crisis that had left 5 million people on waiting lists and house-building at a record low, Miliband pledged action against construction firms that hoarded land while waiting for it to increase in value. Next, in a reversal of New Labour and the Conservatives’ commitment to ever-lower corporation tax, he promised a tax hike on big companies, which would go to fund tax breaks for struggling small businesses.

While these non-government organizations could previously spend up to £989,000 a year before a general election, it was now to be slashed to £390,000, and would include everything from staff costs to public meetings. But the definition of ‘non-party campaigning’ was so vague that it covered pretty much any issue, ranging from calling for more resources for treating cancer to dealing with the affordable-housing crisis. Charity trustees, known to be fearful of anything with legal implications – they are, after all, saddled with strict legal obligations they have to abide by19 – would move to stop campaigns that scrutinize power. The Trades Union Congress suggested this could make organizing their 2014 annual congress or holding a demonstration in election year a criminal offence. Because of fears that political blogs could be affected by the Bill, even the right-wing Guido Fawkes blog came out in opposition.


pages: 424 words: 121,425

How the Other Half Banks: Exclusion, Exploitation, and the Threat to Democracy by Mehrsa Baradaran

access to a mobile phone, affirmative action, asset-backed security, bank run, banking crisis, banks create money, barriers to entry, British Empire, call centre, Capital in the Twenty-First Century by Thomas Piketty, cashless society, credit crunch, David Graeber, disintermediation, disruptive innovation, diversification, failed state, fiat currency, financial innovation, financial intermediation, Goldman Sachs: Vampire Squid, housing crisis, income inequality, Internet Archive, invisible hand, Kickstarter, M-Pesa, McMansion, microcredit, mobile money, moral hazard, mortgage debt, new economy, Own Your Own Home, payday loans, peer-to-peer lending, price discrimination, profit maximization, profit motive, quantitative easing, race to the bottom, rent-seeking, Ronald Reagan, Ronald Reagan: Tear down this wall, savings glut, the built environment, the payments system, too big to fail, trade route, transaction costs, unbanked and underbanked, underbanked, union organizing, white flight, working poor

He argued in 2000 at the Cato institute that “study after study has shown that Fannie Mae and Freddie Mac are failing to do even as much as banks and S&Ls in providing financing for affordable housing, including minority and low income housing.” Mike Konczal, “No, Marco Rubio, Government Did Not Cause the Housing Crisis,” Washington Post: Wonkblog, February 13, 2003, accessed March 17, 2015, www.washingtonpost.com/blogs/wonkblog/wp/2013/02/13/no-marco-rubio-government-did-not-cause-the-housing-crisis/. 76. Elizabeth Laderman and Carolina Reid, “CRA Lending during the Subprime Meltdown,” Federal Reserve Bank of San Francisco, February 2009, 115, accessed March 17, 2015, www.frbsf.org/community-development/files/cra_lending_during_subprime_meltdown.pdf. 77. Timothy F. Geithner, Stress Test: Reflections on a Financial Crisis (New York: Crown, 2014) 391–392.


pages: 457 words: 125,224

The Lie of the Land by Amanda Craig

financial independence, glass ceiling, Google Earth, housing crisis, illegal immigration, pink-collar

It’s almost a year since it happened, and the police have got no further with what the papers called the Headless Corpse Mystery, but there are ever so many things I’d be wondering if I were investigating it, she thinks. Knowing how to use a maul to chop off the head must mean it was someone used to woodcutting, for instance. Of course the house had to be re-let. There are too many properties locked up and falling to pieces, and even if the housing crisis is less deep here, they should still be lived in. Tore is a good landlord, unlike old Sir Jerry; he grew up poor himself, and even if he’s rich now, he knows the importance of a home. Without people in them to see when the roof leaks or there’s a flood, a house can go to rot and ruin in months. Sally looks out of her window, where the skies have darkened from dark orange to plum to deep violet, like heated copper cooling.

Quentin launches into his familiar rant. ‘Marta’s living all on her own up in a vast six-bedroomed house in Hampstead worth millions while we’re slumming it here.’ ‘It’s her home. You can’t ask her to sell up just so we can have a better life.’ ‘That’s the problem with the property market in this country,’ Quentin says. ‘If it weren’t for old ladies rattling round enormous houses, there’d be no housing crisis.’ ‘We like Oma, don’t we, Xan?’ ‘Yes,’ says Xan, yawning, and glaring at his stepfather. I must send my UCAS form off, he thinks, hazily, but that life of study and lectures is increasingly remote to him. Whenever he starts to think of his future Katya’s image interrupts it. ‘You like this? You like it?’ she whispers, and he murmurs over and over, ‘Yes.’ ‘Xan? Xan,’ his mother says patiently.


pages: 497 words: 123,778

The People vs. Democracy: Why Our Freedom Is in Danger and How to Save It by Yascha Mounk

affirmative action, Affordable Care Act / Obamacare, Andrew Keen, basic income, battle of ideas, Boris Johnson, Branko Milanovic, Bretton Woods, business cycle, Capital in the Twenty-First Century by Thomas Piketty, carried interest, Cass Sunstein, central bank independence, centre right, clean water, cognitive bias, conceptual framework, David Brooks, deindustrialization, demographic transition, desegregation, Donald Trump, en.wikipedia.org, Francis Fukuyama: the end of history, German hyperinflation, gig economy, Gini coefficient, Home mortgage interest deduction, housing crisis, income inequality, invention of the printing press, invention of the steam engine, investor state dispute settlement, job automation, Joseph Schumpeter, land value tax, low skilled workers, Lyft, manufacturing employment, Mark Zuckerberg, mass immigration, mortgage tax deduction, Naomi Klein, new economy, offshore financial centre, open borders, Parag Khanna, plutocrats, Plutocrats, post-materialism, price stability, ride hailing / ride sharing, rising living standards, Ronald Reagan, Rosa Parks, secular stagnation, sharing economy, Thomas L Friedman, Tyler Cowen: Great Stagnation, Uber and Lyft, uber lyft, universal basic income, upwardly mobile, World Values Survey, zero-sum game

As the process of gentrification advances, many people who grew up in urban areas are pushed out—and wind up being cut off from both their support networks and the economic opportunities offered by major cities.37 Many people who have grown up in less affluent rural areas, meanwhile, remain permanently locked out of the most productive regions in the country, making it even more difficult for them to better their lot. In short, the exorbitant cost of housing is now one of the most important reasons for the stagnation of living standards across North America and Western Europe. If defeating populism hinges in part on making citizens more optimistic about the future, a radical reorientation of housing policy is urgently needed.38 One important way to address the housing crisis is, quite simply, to increase the stock of available homes. The process of obtaining permits should be made much easier, and disputes about them resolved much more quickly.39 Towns and villages should have less power to veto developments in their jurisdiction.40 States should do more to help in the construction of new apartments, whether directly through the addition of new units of public housing or indirectly through financial assistance to local municipalities.41 Finally, the introduction of land value taxes—which levy the same charge on a patch of land irrespective of whether its owner lets it lie barren or decides to erect a building on it—would provide a strong incentive to build new homes.42 A different tax system could also improve the distribution of housing.

In fact, even residents of rural towns that happen to be especially attractive are increasingly pushed out of their communities. See Olivia Rudgard, “One in Ten British Adults Now a Second-Home Owner,” Telegraph, August 18, 2017, http://www.telegraph.co.uk/news/2017/08/18/one-ten-british-adults-now-second-home-owner/. 38. David Adler, “Why Housing Matters,” unpublished manuscript. 39. In the United Kingdom, where the housing crisis is especially acute, there have recently been some moves toward speeding up the planning process. See “Fast Track Applications to Speed Up Planning Process and Boost Housebuilding,” Gov.uk, February 18, 2016, https://www.gov.uk/government/news/fast-track-applications-to-speed-up-planning-process-and-boost-housebuilding; and Patrick Wintour and Rowena Mason, “Osborne’s Proposals to Relax Planning System a ‘Retreat from Localism,’” Guardian, July 10, 2015, https://www.theguardian.com/society/2015/jul/10/osbornes-proposals-relax-planning-system-retreat-localism. 40.


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The Arsenal of Democracy: FDR, Detroit, and an Epic Quest to Arm an America at War by A. J. Baime

banking crisis, British Empire, Charles Lindbergh, Ford paid five dollars a day, Henry Ford's grandson gave labor union leader Walter Reuther a tour of the company’s new, automated factory…, housing crisis, interchangeable parts, Louis Blériot, mass immigration, means of production, Silicon Valley, strikebreaker

She found the place filthy—garments on clotheslines freezing even in April, little kids roaming free and covered in ringworm. Cold medicines and aspirin were as rare and valuable as blocks of gold. “If there were any better place to go we’d certainly pull out,” she wrote in her diary, “but I don’t think you can find anything much different within driving distance of the plant.” Edsel realized that the housing crisis could throw a wrench into the bomber production process. If workers could not find an adequate place to live, or if they could not get to work, the bombers wouldn’t roll. He reached out to his contacts in Washington, pleading for help. His pleadings quickly reached the White House. The President imagined a government-financed “Bomber City” alongside Willow Run, an entire city freshly built with government money.

Sam, [>]–[>] Gozo Island, US military base on, [>] Graham, Marvin, [>] Graham, Roscoe, [>] Grand Cross of the German Eagle, [>] Great Depression Bennett during, [>]–[>] ending of, by war production, [>], [>] and exodus of blacks from the South, [>] impacts in Europe, [>] impacts on auto industry, [>]–[>] living conditions during, [>] reduction in size of military during, [>] Great Lakes Naval Base, [>] Greece, takeover by Nazi Germany, [>] Gregorie, Bob, [>], [>] Grosse Pointe, Michigan, EF and family in, [>], [>], [>], [>] Guadalcanal, American army success at, [>] Guardian Building, Detroit, [>] guns and ammunition GM production of, [>], [>]–[>], [>] inaccessible, at Pearl Harbor, [>] production of, in 1942, [>] Roosevelt’s production goals for 1942, [>] US, government orders for, 1940, [>] gyrocompasses, [>] Hail Columbia (B-24 Liberator), during Operation Tidal Wave, [>], [>] Hall, Ed, [>] Hamburg, Germany, bombing of, [>] hard-steel dies, use of at Ford, [>] Harff, Anthony, [>] Harris, Arthur “Butch,” [>] Hartford Courant, article on Willow Run, [>] Harvey, Bill, [>] heat-treating airplane components, [>] heavy bombers emphasis on, by Knudsen, [>] FDR’s demand for focus on, [>], [>] mass production approach, [>], [>] popularizing of in US culture, [>] production efforts, [>], [>], [>], [>]–[>], [>] recognition of importance to Allied success, [>], [>] role during D-Day invasion, [>] superchargers for, [>] See also B-17 Flying Fortress bomber; B-24 Liberator; Combined Bomber Offensive; Willow Run bomber plant Heinkel bombers, [>] Henderson, Nevile, [>] Hennessy, Patrick, [>] Henning, Harold, [>]–[>] Henry Ford (final B-24 Liberator), [>] Henry Ford Hospital, [>], [>]–[>] Hickam Airfield, Pearl Harbor, bombing of, [>] high-altitude experiments, [>]–[>], [>] Highland Park factory (Ford) diversity of labor force at, [>] production of M7 anti-aircraft guns, [>] production volume and efficiency at, [>] size, [>] Himmler, Heinrich, [>]–[>], [>] Hitler, Adolf admiration for HF, [>], [>], [>]–[>], [>], [>] admiration for Lindbergh, [>] assassination attempt, [>] declining health, [>] desire to destroy Manhattan skyline, [>] desire to stay in good graces of US, [>] dismissal of reports about US production of four-engine bombers, [>] employment of slave labor, [>] impact of 1944 Allied bombings on, [>]–[>] implementation of Volksmotorisierung (Fordism), [>] Mein Kampf, [>] military buildup, [>] payment for trucks produced by Ford of France, [>] reading of The International Jew: The World’s Foremost Problem, [>] refusal to capitulate, [>] rise to power, [>] suicide, [>] view of American resolve and skill, [>], [>] See also Nazi Germany Hogan, Elmer “One Round,” [>] Holland, invasion by Nazi Germany, [>]–[>], [>] Hoover, J. Edgar, [>], [>], [>]. See also Bugas, John; FBI (Federal Bureau of Investigation) Hopkins, Harry exhaustion, [>]–[>] on FDR’s belief in role of bombings to victory, [>] with FDR when learning of Pearl Harbor attack, [>] reports on delays in heavy bomber production, [>] Hotchkiss school, William Ford at, [>]–[>] housing crisis, Willow Run, [>]–[>], [>], [>] Hudson Motor Car Company, frames for the B-26 “Widowmaker” Marauder, [>] Hudson’s Department Store, [>] Hull, Cordell, [>], [>], [>]–[>] hydraulic brakes, [>]–[>] Ickes, Harold “Old Curmudgeon,” [>]–[>], [>] incendiary bombs, [>] The International Jew: The World’s Foremost Problem, [>] iron ore, mining of, in Michigan, [>] Italy, declaration of war on the US, [>] Iwanowa, Elsa, [>] Jackson (Mississippi) Daily News, on Detroit Race Riot of 1943, [>] Japan air attack on Pearl Harbor, [>] initial Allied victories against, [>] successes following US entry into war, [>] surrender to Allies, [>] US actions to thwart growing militarism of, [>]–[>] US declaration of war on, [>] war with, FDR’s early recognition of likelihood of, [>] JB-2 Loon, [>] Jeep (Willys-Overland) and hiring of Sorensen as chief executive, [>] production of at the Rouge plant, [>] Jeffries, Edward, [>]–[>], [>] Jeschonnek, Hans, [>] Jews.


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The Frackers: The Outrageous Inside Story of the New Billionaire Wildcatters by Gregory Zuckerman

activist fund / activist shareholder / activist investor, addicted to oil, American energy revolution, Asian financial crisis, Bakken shale, Bernie Sanders, Buckminster Fuller, corporate governance, corporate raider, credit crunch, energy security, Exxon Valdez, housing crisis, hydraulic fracturing, Kickstarter, LNG terminal, margin call, Maui Hawaii, North Sea oil, oil rush, oil shale / tar sands, oil shock, peak oil, Peter Thiel, reshoring, self-driving car, Silicon Valley, sovereign wealth fund, Steve Jobs, urban decay

Wall Street was in its death throes at the time, so few paid much attention to the Statoil deal, but it was one more sign that global energy companies were becoming convinced the shale revolution was for real. For McClendon, the Statoil agreement was reassurance that all was well with his company. “Everything except macro events” was “really going our way,” according to McClendon.1 But Chesapeake shares kept falling, setting off alarm bells at the banks that had lent McClendon hundreds of millions of dollars. During the first week of October, as an intensifying housing crisis seemed likely to lead to a U.S. recession and pressure energy prices, Chesapeake tumbled to just twenty-two dollars a share. The lenders decided they needed to act. Late in the afternoon of October 8, a Goldman Sachs executive in the firm’s private wealth group called McClendon, reaching him in his Oklahoma City office. The Goldman manager relayed disturbing news: The Chesapeake shares that McClendon had used as collateral had dropped so dramatically that they no longer held enough value to back the approximately $300 million that McClendon had borrowed from the investment bank.

Articulate and outgoing, she made an annual salary of nearly $120,000 in the years leading up to 2008. That year, as she turned thirty-four years old, she had seven employees reporting to her and she seemed on the fast track at work. Liz and her husband, Matthew, a truck driver, bought a home in a nearby town for $365,000 dollars. It featured fruit and magnolia trees and was across the street from the elementary school their two daughters attended. Then the housing crisis hit. As the local real estate market crumbled, Irish’s income evaporated. She made less than $40,000 in 2009. By the summer of 2010, she had earned less than $5,000 that entire year. Liz and her husband had neglected to build much of a nest egg and ran into trouble paying their bills. Soon they lost their home and faced thousands of dollars of additional bills. “Everything I had done in my adult life was in real estate,” Liz says.


pages: 504 words: 129,087

The Ones We've Been Waiting For: How a New Generation of Leaders Will Transform America by Charlotte Alter

"side hustle", 4chan, affirmative action, Affordable Care Act / Obamacare, basic income, Berlin Wall, Bernie Sanders, carbon footprint, clean water, collective bargaining, Columbine, corporate personhood, correlation does not imply causation, Credit Default Swap, crowdsourcing, David Brooks, Donald Trump, double helix, East Village, ending welfare as we know it, Fall of the Berlin Wall, feminist movement, Ferguson, Missouri, financial deregulation, Francis Fukuyama: the end of history, gig economy, glass ceiling, Google Hangouts, housing crisis, illegal immigration, immigration reform, income inequality, Intergovernmental Panel on Climate Change (IPCC), job-hopping, Kevin Kelly, knowledge economy, Lyft, mandatory minimum, Marc Andreessen, Mark Zuckerberg, mass incarceration, McMansion, medical bankruptcy, move fast and break things, move fast and break things, Nate Silver, obamacare, Occupy movement, passive income, pre–internet, race to the bottom, RAND corporation, Ronald Reagan, sexual politics, Silicon Valley, single-payer health, Snapchat, TaskRabbit, too big to fail, Uber and Lyft, uber lyft, universal basic income, unpaid internship, We are the 99%, white picket fence, working poor, Works Progress Administration

Affordable housing was one of his biggest challenges. Svante had spent time in a homeless shelter, he had watched his mom struggle to make rent, and he was a twenty-four-year-old with four roommates. So he had little patience for the NIMBYism (“Not In My Back Yard”) of homeowners who flooded community meetings to oppose building more affordable housing in their neighborhoods. NIMBYism, Svante thought, was the biggest reason for the affordable housing crisis in Ithaca and around the country. Otherwise progressive people—people who had Greenpeace stickers on their hybrid cars—would create “firestorms” to protect their property values, he said. Their demands sounded reasonable: they’d say things like “We don’t want to change the character of the neighborhood,” or “Quality of life is important to us,” or “It’s the traffic!” In truth, he thought, they just didn’t want poor people moving next door.

to oppose building more: Jeff Stein, “Long-simmering Fight over Affordable Housing Plan Ends amid Mayor’s Emotional Plea,” Ithaca Voice, August 27, 2014, ithacavoice.com/2014/08/long-simmering-fight-affordable-housing-plan-ends-amid-ithaca-mayors-emotional-plea/. could have spent elsewhere: David Marchan, “Time for a New Vision,” Ithaca.com, March 13, 2019, ithaca.com/opinion/guest_opinions/time-for-a-new-vision/article_8dff857c-45ae-11e9-ba3b-57834ca9d289.html. $40 million affordable housing plan: Sarah Mervosh, “Minneapolis, Tackling Housing Crisis and Inequity, Votes to End Single-Family Zoning,” The New York Times, December 13, 2018, nytimes.com/2018/12/13/us/minneapolis-single-family-zoning.html held by people under forty: Andrew Dunn, “Millennials Are About to Control the City Council. How will They Change Charlotte?” CharlotteAgenda.com, November 30, 2017, charlotteagenda.com/110521/millennials-control-city-council-will-change-charlotte/.


pages: 515 words: 142,354

The Euro: How a Common Currency Threatens the Future of Europe by Joseph E. Stiglitz, Alex Hyde-White

bank run, banking crisis, barriers to entry, battle of ideas, Berlin Wall, Bretton Woods, business cycle, buy and hold, capital controls, Carmen Reinhart, cashless society, central bank independence, centre right, cognitive dissonance, collapse of Lehman Brothers, collective bargaining, corporate governance, correlation does not imply causation, credit crunch, Credit Default Swap, currency peg, dark matter, David Ricardo: comparative advantage, disintermediation, diversified portfolio, eurozone crisis, Fall of the Berlin Wall, fiat currency, financial innovation, full employment, George Akerlof, Gini coefficient, global supply chain, Growth in a Time of Debt, housing crisis, income inequality, incomplete markets, inflation targeting, information asymmetry, investor state dispute settlement, invisible hand, Kenneth Arrow, Kenneth Rogoff, knowledge economy, light touch regulation, manufacturing employment, market bubble, market friction, market fundamentalism, Martin Wolf, Mexican peso crisis / tequila crisis, money market fund, moral hazard, mortgage debt, neoliberal agenda, new economy, open economy, paradox of thrift, pension reform, pensions crisis, price stability, profit maximization, purchasing power parity, quantitative easing, race to the bottom, risk-adjusted returns, Robert Shiller, Robert Shiller, Ronald Reagan, savings glut, secular stagnation, Silicon Valley, sovereign wealth fund, the payments system, The Rise and Fall of American Growth, The Wealth of Nations by Adam Smith, too big to fail, transaction costs, transfer pricing, trickle-down economics, Washington Consensus, working-age population

A German bank may lend to a party in a third country, and some (possibly other) party in that third country lends to Spain. 45 ILO data for 2015. See ILO, World Employment Social Outlook—Trends 2016, available at http://www.ilo.org/global/research/global-reports/weso/2016/WCMS_443480/lang--en/index.htm. This situation, where there has been a deficiency of aggregate demand, has persisted for a long time. Indeed, one of the reasons that the Fed encouraged the reckless lending that led to the housing crisis was to make up for what would otherwise have been a weak aggregate demand within the United States. Ben Bernanke, former chairman of the Federal Reserve, referred to the situation as a “savings glut.” See “The Global Saving Glut and the U.S. Current Account Deficit,” Remarks by Governor Ben S. Bernanke at the Sandridge Lecture, Virginia Association of Economists, Richmond, Virginia, March 10, 2005, available at http://www.federalreserve.gov/boardDocs/Speeches/2005/200503102/default.htm.

Though central banks are only supposed to lend to solvent but illiquid institutions, necessarily, in doing so, they are putting their judgment against that of the market. 27 In the United States, almost all of the hundreds of billions of bailout dollars went to help the banks and their bondholders and shareholders. A negligible amount went to help homeowners, even though the crisis had begun as a housing crisis. The administration and the Fed believed in trickle-down economics: throw enough money at the banks, and the whole economy will benefit. It would have been far better for the economy had they tried a larger dose of trickle-up economics: help the homeowners, and everyone will benefit. 28 The Troika, in effect, threatened to bankrupt Ireland if the government tried to make bondholders bear some of the costs of bank restructuring.


Super Continent: The Logic of Eurasian Integration by Kent E. Calder

3D printing, air freight, Asian financial crisis, Berlin Wall, blockchain, Bretton Woods, business intelligence, capital controls, Capital in the Twenty-First Century by Thomas Piketty, cloud computing, colonial rule, Credit Default Swap, cuban missile crisis, deindustrialization, demographic transition, Deng Xiaoping, disruptive innovation, Doha Development Round, Donald Trump, energy transition, European colonialism, failed state, Fall of the Berlin Wall, Gini coefficient, housing crisis, income inequality, industrial cluster, industrial robot, interest rate swap, intermodal, Internet of things, invention of movable type, inventory management, John Markoff, liberal world order, Malacca Straits, Mikhail Gorbachev, mittelstand, money market fund, moral hazard, new economy, oil shale / tar sands, oil shock, purchasing power parity, quantitative easing, reserve currency, Ronald Reagan, seigniorage, smart cities, smart grid, South China Sea, sovereign wealth fund, special drawing rights, special economic zone, supply-chain management, Thomas L Friedman, trade liberalization, trade route, transcontinental railway, UNCLOS, UNCLOS, union organizing, Washington Consensus, working-age population, zero-sum game

Just three days later, on September 10, Lehman Brothers posted a $3.93 billion third-quarter loss, after write-downs on toxic mortgages of $5.6 billion, and put itself up for sale the next day. Its shares dropped precipitously, by 42 percent, to $4.22, in a single day.48 Two Asian firms—the Korean Development Bank and an unnamed Chinese bank—together with London’s Barclays courted Lehman Brothers as potential suitors. They terminated discussions, however, on sensing the magnitude of its troubles, including exposure to the US housing crisis.49 Lehman 64 chapter 3 looked to Bank of America as a potential buyer, but on September 15 BOA agreed to purchase Merrill Lynch instead, for $50 billion. Lehman Brothers, without a white knight, collapsed into bankruptcy with $613 billion in debts, precipitating the largest US corporate bankruptcy ever. One day later, on September 16, the Federal Reserve announced an $85 billion rescue package to save AIG from bankruptcy, out of fear that its bankruptcy, following on from Lehman, would result in all-out Wall Street chaos.

The sharp drop in the stock’s value came in light of Lehman’s near $4 billion loss revealed on the previous day. See David Ellis, “Lehman Suffers Nearly $4 Billion Loss,” CNN Money, September 10, 2008, http://​money​.cnn​.com/​2008/​09/​10/​ news/​companies/​lehman. 49. The KDB deal fell apart because KDB and Lehman could not agree on specific terms and market conditions. The deal could have potentially exposed KDB to fallout from the US housing crisis. And KDB reportedly wanted to pay only one-third of Lehman’s asking price. See Tina Wang, “For Lehman, a Deal with KDB Appears Dead,” Forbes, September 10, 2008, http://​www​.forbes​.com/​2008/​09/​10/​lehman​-korean​-bank​-markets​ -equity​-cx​_tw​_0910markets3​.html. 50. On the chronology of the Lehman crisis, see “Timeline: Key Events in Financial Crisis,” USA Today, September 8, 2013, http://​www​.usatoday​.com/​story/​money/​ business/​2013/​09/​08/​chronology​-2008​-financial​-crisis​-lehman/​2779515/; and “The Fall of Lehman Brothers,” Market Watch, http://​projects​.marketwatch​.com/​fall​-of​-lehman​ -brothers​-timeline/​#0. 51.


pages: 200 words: 54,897

Flash Boys: Not So Fast: An Insider's Perspective on High-Frequency Trading by Peter Kovac

bank run, barriers to entry, bash_history, Bernie Madoff, computerized markets, computerized trading, Flash crash, housing crisis, index fund, locking in a profit, London Whale, market microstructure, merger arbitrage, prediction markets, price discovery process, Sergey Aleynikov, Spread Networks laid a new fibre optics cable between New York and Chicago, transaction costs, zero day

When Lewis tells us “the price volatility within each trading day in the U.S. stock market between 2010 and 2013 was nearly 40 percent higher than the volatility between 2004 and 2006,” it’s not clear what data source he is using. But it is clear that these are cherry-picked statistics: Why 2004 to 2006? Why not include 2003? And why compare to 2010, 2011, and 2012, with the European debt crisis threatening to blow apart Europe in a way that the U.S. housing crisis couldn’t?[57] The answer is that the data fits his argument best when you slice it this way. The period from 2004 to 2006 comprises the quietest years on record – there were absolutely zero days where the market dropped by 2% or more, and only two days in those three years where the market rose by 2%. For contrast, in 2003 alone the market had 15 days where it rose or fell more than 2%. In 2002, there were more than 50 such days.


pages: 220

Startupland: How Three Guys Risked Everything to Turn an Idea Into a Global Business by Mikkel Svane, Carlye Adler

Airbnb, Ben Horowitz, Burning Man, business process, call centre, Chuck Templeton: OpenTable:, cloud computing, credit crunch, David Heinemeier Hansson, Elon Musk, housing crisis, Jeff Bezos, Kickstarter, Menlo Park, remote working, Ruby on Rails, Sand Hill Road, Silicon Valley, Silicon Valley startup, Skype, software as a service, South of Market, San Francisco, Steve Jobs, subscription business, Tesla Model S, web application

Alex had his own financial woes, due to taxes owed on estimated income that was never realized from his previous company, Araneum, which had folded and therefore never earned what he expected. Morten, caught up in the real estate bubble, also had monetary concerns. He had left a high-income job for one with no pay and at the same time was trying to pay a mortgage on an apartment that was under water thanks to the housing crisis. He talked with urgency about the importance of paying off this mortgage as fast as possible. It may have been self-imposed pressure, but to him it was very real and very pressing. We had initially agreed that we would forgo any sort of salary while we were building the product, but at a certain point Morten decided he couldn’t continue this way. He needed the certainty of having a regular salary, and although it was an extremely modest salary, it was still a lot for a company with no money.


pages: 173 words: 52,725

How to Be Right: In a World Gone Wrong by James O'Brien

Boris Johnson, clockwatching, collective bargaining, death of newspapers, Donald Trump, game design, housing crisis, mass immigration, plutocrats, Plutocrats, post-industrial society, QAnon, ride hailing / ride sharing, sexual politics, young professional

Pockets of resistance at the Guardian and elsewhere were preaching almost pointlessly to the choir, while the likes of Kelvin MacKenzie at the Sun and latterly Paul Dacre at the Daily Mail, inarguably the two most powerful and toxic propagandists of the last 30 years, were offering up generous portions of xenophobic fire and brimstone on a daily basis. It wasn’t just that immigration might be a factor in sundry perceived problems. Immigration was the problem. Take, for example, a few hardy perennials: immigrants undercut our wages, immigrants put a strain on public services and immigrants are responsible for the housing crisis. These are widely held and not particularly racist convictions, but even if you allow that they are partly true, which is not at all clear, immigration can never account for either the existence or the scale of the perceived problems. To be temporarily trite, substitute the three instances of the word ‘immigrants’ above for the word ‘people’ and you will see that exclusively blaming the former for the travails of the latter only helps to excuse the employers who aren’t paying decent wages, the politicians who are underfunding the public sector and the property developers who aren’t building houses.


End the Fed by Ron Paul

affirmative action, Bernie Madoff, Bernie Sanders, Bretton Woods, business cycle, crony capitalism, currency manipulation / currency intervention, fiat currency, Fractional reserve banking, hiring and firing, housing crisis, illegal immigration, invisible hand, Khyber Pass, Long Term Capital Management, market bubble, means of production, moral hazard, Ponzi scheme, price mechanism, reserve currency, road to serfdom, Robert Gordon, Ronald Reagan, too big to fail, tulip mania, Y2K

Instead of looking at these—the consumer prices, which nobody in this country really believes, we need to talk about the distortion, the malinvestment, the misdirection, the bad information that is gotten from artificially low interest rates. In many ways, some people refer to you as a price fixer, you know, because you fix interest rates. The market is powerful, and usually overwhelms and does come into play, but when the Fed fixes an interest rate at 1 percent, that is price-fixing. At the end of your testimony, you suggested that we should address this housing crisis, and we should have rules that would address deceptive lending practices. And I just think that is not the answer at all. The real deception is when we distort the value of money, when we create money out of thin air. We have no savings. Yet there’s so-called capital. There’s money available. But it comes from what you have to do and the pressures put on you. So I think we have to get back to the very fundamentals of where this problem comes from.


pages: 198 words: 52,089

Dream Hoarders: How the American Upper Middle Class Is Leaving Everyone Else in the Dust, Why That Is a Problem, and What to Do About It by Richard V. Reeves

affirmative action, Affordable Care Act / Obamacare, assortative mating, Bernie Sanders, Branko Milanovic, Capital in the Twenty-First Century by Thomas Piketty, circulation of elites, cognitive dissonance, desegregation, Donald Trump, Downton Abbey, full employment, ghettoisation, glass ceiling, helicopter parent, Home mortgage interest deduction, housing crisis, income inequality, knowledge economy, land value tax, longitudinal study, mortgage tax deduction, obamacare, Occupy movement, plutocrats, Plutocrats, positional goods, race to the bottom, randomized controlled trial, unpaid internship, upwardly mobile, War on Poverty, We are the 99%, working-age population, zero-sum game

Matthew Yglesias, “A Massachusetts State Legislator Has a Big Idea to Ease the Urban Rent Crisis,” Vox, April 6, 2016 (www.vox.com/2016/4/6/11370258/honan-zoning-reform-bill). 46. Richard Reeves and Dimitrios Halikias, “How Land Use Regulations are Zoning Out Low-Income Families,” Social Mobility Memos (blog), August 16, 2016 (www.brookings.edu/blog/social-mobility-memos/2016/08/16/zoning-as-opportunity-hoarding/). 47. Amanda Kolson Hurley, “Will U.S. Cities Design Their Way Out of the Affordable Housing Crisis,” Next City, January 18, 2016 (https://nextcity.org/features/view/cities-affordable-housing-design-solution-missing-middle). 48. Lee Anne Fennell, “Homes Rule,” review of The Homevoter Hypothesis: How Home Values Influence Local Government Taxation, School Finance, and Land-Use Policies, by William A. Fischell, Yale Law Journal 112 (November 2002): p. 662 (www.yalelawjournal.org/pdf/353_7truk8nn.pdf). 49.


pages: 190 words: 56,531

Where We Are: The State of Britain Now by Roger Scruton

bitcoin, blockchain, business cycle, Corn Laws, Donald Trump, Downton Abbey, Fellow of the Royal Society, fixed income, garden city movement, George Akerlof, housing crisis, invention of the printing press, invisible hand, Khartoum Gordon, mass immigration, Naomi Klein, New Journalism, old-boy network, open borders, payday loans, Peace of Westphalia, sceptred isle, The Wealth of Nations by Adam Smith, Thorstein Veblen, too big to fail, web of trust

The nineteenth-century cities were built either as collections of suburbs or as model industrial settlements, such as Robert Owen’s New Lanark in Scotland, and the Cadbury family’s Bourneville near Birmingham. They grew from a subconscious sense that to build is to intrude on nature, and that the intrusion must always be apologized for. As the cities expanded so too did the apology, an attitude that led at last to the ‘garden city’ movement of Sir Ebenezer Howard. That movement is alive today, one force in the great controversy over land use precipitated by our housing crisis. And it illustrates a singular fact about the British people, which is that they are unhappy if they are not living on the ground.22 However poor they are, British people will avoid high-rise apartment blocks and strive to live where they can open a door onto their piece of territory. The building societies and friendly societies came about in order to satisfy this need to settle in a place of one’s own, and ultimately to retire there, growing flowers in front of the house and vegetables behind.


Firefighting by Ben S. Bernanke, Timothy F. Geithner, Henry M. Paulson, Jr.

Asian financial crisis, asset-backed security, bank run, Basel III, break the buck, Build a better mousetrap, business cycle, Carmen Reinhart, collapse of Lehman Brothers, collateralized debt obligation, creative destruction, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, Doomsday Book, financial deregulation, financial innovation, housing crisis, Hyman Minsky, income inequality, invisible hand, Kenneth Rogoff, labor-force participation, light touch regulation, London Interbank Offered Rate, Long Term Capital Management, margin call, money market fund, moral hazard, mortgage debt, negative equity, Northern Rock, pets.com, price stability, quantitative easing, regulatory arbitrage, Robert Shiller, Robert Shiller, savings glut, short selling, sovereign wealth fund, special drawing rights, The Great Moderation, too big to fail

Congress was never enthusiastic about a dramatically more powerful housing strategy, and Tim and most of those in the Obama administration also believed that additional dollars spent on unemployment benefits, infrastructure projects, payroll tax cuts, and aid to states would have more economic bang for the buck—while raising fewer dilemmas about fairness—than a new wave of programs aimed narrowly at home owners. Solving the economic crisis was a necessary condition for solving the housing crisis, while the reverse was not necessarily true. In the end, a long and steady economic recovery might be the most successful housing program. Home prices stabilized after the Great Recession ended, gradually eliminating trillions of dollars of negative equity, lifting millions of underwater home owners above water. The better economy made almost everything better. U.S. annual auto sales had plunged to 10 million in 2009, but they were back up to pre-crisis levels of 17 million by 2015.


pages: 443 words: 51,804

Handbook of Modeling High-Frequency Data in Finance by Frederi G. Viens, Maria C. Mariani, Ionut Florescu

algorithmic trading, asset allocation, automated trading system, backtesting, Black-Scholes formula, Brownian motion, business process, buy and hold, continuous integration, corporate governance, discrete time, distributed generation, fixed income, Flash crash, housing crisis, implied volatility, incomplete markets, linear programming, mandelbrot fractal, market friction, market microstructure, martingale, Menlo Park, p-value, pattern recognition, performance metric, principal–agent problem, random walk, risk tolerance, risk/return, short selling, statistical model, stochastic process, stochastic volatility, transaction costs, value at risk, volatility smile, Wiener process

While we have tested for unit root nonstationarity in Table 6.5 and that hypothesis was rejected we cannot guarantee that the data does not possess other types of nonstationarity. There is currently no other type of nonstationarity that may be tested. Second, looking at several years for which we have an idea of what the results should look like we notice that our hypotheses were confirmed. Specifically, in 2001 and partially in 2002, we expect to see high parameter values due to the end of the dot-com bubble. Again in 2008, we expect to see high values due to the housing crisis and the subsequent market crash in September 2008. Surprisingly, the most reliable confirmation is in the Levy Flight parameter values, they are all much smaller than 2.0 ‘‘the normal behavior’’ parameter value. 137 6.4 Results and Discussions 3.2 3 2.8 2.6 2.4 2.2 2 1.8 1.6 1 1.5 2 2.5 3 3.5 4 3.5 3 2.5 2 1.5 1 1 1.5 2 2.5 3 3.5 4 3.5 3 2.5 2 1.5 1 1 1.5 2 2.5 3 3.5 4 −1 −1.2 −1.4 −1.6 −1.8 −2 −2.2 −2.4 −2.6 −2.8 −3 −1 −1.2 −1.4 −1.6 −1.8 −2 −2.2 −2.4 −2.6 −2.8 −3 −1 −1.2 −1.4 −1.6 −1.8 −2 −2.2 −2.4 −2.6 −2.8 −3 1 1.5 2 2.5 3 3.5 4 1 1.5 2 2.5 3 3.5 4 1 1.5 2 2.5 3 3.5 4 FIGURE 6.3 Hurst and DFA regression plots for a sample of three stocks.

See also Value at risk (VaR) High parameter values, 136 High trading activity, 42 Hilbert space, 387 Hillebrand, Eric, xiii, 75 HL estimator, 263. See also VaRHL Hölder constants, 358 Hölder continuous real-valued function, 350 Hölder continuous real-valued function with exponent δ, 351 Hölder’s inequality, 391, 395 Hölder spaces, 349, 355, 367, 388–390, 411 Homotopy perturbation method, 379–380 Housing crisis, 136 Hu–Kercheval method, 164 Hull–White process, 400 Hurst analysis, 130–131, 132 results of, 141 Hurst exponent, 125, 126, 132 values of, 138 Hurst index, 221. See also Implied Hurst index Hurst index estimation, Whittle-based approach for, 225–226 Hurst parameter(s), 121–122, 125, 135, 220, 221 Hurst parameter analysis, 136 Hurst parameter estimates, 132 Hurst parameter estimators, 229 Hurst regression plots, 137 Hyperbolic distributions, 171 IBM DFA and Hurst methods applied to, 147 Lévy flight parameter for, 343 IBM time series, 257 i.i.d. data, 172.


pages: 850 words: 254,117

Basic Economics by Thomas Sowell

affirmative action, air freight, airline deregulation, American Legislative Exchange Council, bank run, barriers to entry, big-box store, British Empire, business cycle, clean water, collective bargaining, colonial rule, corporate governance, correlation does not imply causation, cross-subsidies, David Brooks, David Ricardo: comparative advantage, declining real wages, Dissolution of the Soviet Union, diversified portfolio, European colonialism, fixed income, Fractional reserve banking, full employment, global village, Gunnar Myrdal, Hernando de Soto, hiring and firing, housing crisis, income inequality, income per capita, index fund, informal economy, inventory management, invisible hand, John Maynard Keynes: technological unemployment, joint-stock company, Just-in-time delivery, Kenneth Arrow, knowledge economy, labor-force participation, land reform, late fees, low cost airline, low cost carrier, low skilled workers, means of production, Mikhail Gorbachev, minimum wage unemployment, moral hazard, offshore financial centre, oil shale / tar sands, payday loans, price discrimination, price stability, profit motive, quantitative easing, Ralph Nader, rent control, road to serfdom, Ronald Reagan, Silicon Valley, surplus humans, The Bell Curve by Richard Herrnstein and Charles Murray, The Chicago School, The Wealth of Nations by Adam Smith, Thomas Kuhn: the structure of scientific revolutions, Thomas Malthus, transcontinental railway, Vanguard fund, War on Poverty

{47} Bay Area Economics, San Francisco Housing DataBook, p. 56. {48} Ray A. Smith, “Study Sees Record Industrial Space Vacancies,” Wall Street Journal, January 7, 2004, p. B6. {49} Joel F. Brenner and Herbert M. Franklin, Rent Control in North America and Four European Countries (Washington: The Potomac Institute, 1977), p. 4. {50} Ibid., p. 69. {51} Thomas Hazlett, “Rent Controls and the Housing Crisis,” Resolving the Housing Crisis: Government Policy, Decontrol and the Public Interest, edited by M. Bruce Johnson (San Francisco: Pacific Institute for Public Policy Research, 1982), pp. 282–283. {52} William Tucker, The Excluded Americans, p. 163. {53} Diana Geddes, “The Doors Have Closed on Furnished Accommodation,” The Times of London, January 24, 1975, p. 11. {54} William Tucker, Zoning, Rent Control and Affordable Housing (Washington: Cato Institute, 1991), p. 21

., Rude Awakenings: What the Homeless Crisis Tells Us (San Francisco: ICS Press, 1991), p. 123. {57} Joseph Berger, “For Some Landlords, Real Money in the Homeless,” New York Times, February 9, 2013, p. A15. {58} Laurie P. Cohen, “Home Free: Some Rich and Famous of New York City Bask in Shelter of Rent Law,” Wall Street Journal, March 21, 1994, p. A1. {59} Nicole Gelinas, “Is There a New York Housing Crisis?” City Journal, Summer 2006, pp. 62, 64. {60} Joseph Berger, “For Some Landlords, Real Money in the Homeless,” New York Times, February 9, 2013, p. A1. {61} Matt Smith, “Legends in Our Own Minds,” SF Weekly, January 30, 2002, p. 13. {62} William Tucker, “How Rent Control Drives Out Affordable Housing,” Policy Analysis, number 274, May 21, 1997. {63} Milton Friedman and George Stigler, “Roofs or Ceilings?


pages: 196 words: 55,862

Riding for Deliveroo: Resistance in the New Economy by Callum Cant

Airbnb, call centre, collective bargaining, deskilling, Elon Musk, future of work, gig economy, housing crisis, illegal immigration, information asymmetry, invention of the steam engine, Mark Zuckerberg, means of production, new economy, Pearl River Delta, race to the bottom, ride hailing / ride sharing, sharing economy, Silicon Valley, strikebreaker, union organizing, Winter of Discontent, women in the workforce

Workers on mopeds do the bulk of the work and are often migrants with significant financial commitments. On the other hand, workers on bicycles tend to work more erratically and are often topping up insufficient primary sources of income – be that a student loan or another job. They also tend to be younger UK nationals. Some workers are under so much pressure that they drop out of renting entirely and enter ‘property guardian’ arrangements in an effort to sidestep the escalating housing crisis. These two groups, when they cooperate, can form a strong coalition, despite their significant cultural, racial, linguistic, political, and economic differences. Women workers, however, are often excluded due to the internal culture of the workforce. The workers’ organization that emerges and reemerges out of this technical and social class composition is characterized by a collective class antagonism on the issues of wages and conditions.


How to Be Black by Baratunde Thurston

affirmative action, carbon footprint, Columbine, dark matter, desegregation, drone strike, housing crisis, phenotype, plutocrats, Plutocrats, Rosa Parks, shareholder value, supply-chain management, the scientific method, transatlantic slave trade

The subsequent state-sponsored or -supported discrimination and terrorism—I’m thinking environmental racism, police brutality, lynchings, separate and unequal schooling, neighborhood redlining, et cetera—have also cast a long shadow over the current black experience in the United States. One in fifteen black male adults is behind bars (compared to one in a hundred U.S. adults overall);* black household wealth averages just one-twentieth that of whites,* having fallen precipitously after the housing crisis; black people in Texas have a habit of finding themselves under the wheels of trucks driven by racists; and then there’s BET. There is no shortage of issues for which a black person in America can justifiably get mad. The Angry Negro is the personification of that Black Rage. As The Angry Negro, you are committing yourself to a life of hate. You are agreeing to be always disagreeable. You are shameless.


The Great Crash 1929 by John Kenneth Galbraith

Bernie Madoff, business cycle, Everybody Ought to Be Rich, full employment, housing crisis, invention of the wheel, joint-stock company, margin call, market fundamentalism, short selling, South Sea Bubble, the market place

But the government did nothing, and less than nothing, delivering instead low interest rates, deregulation, and clear signals that laws would not he enforced. This was fuel for fires. The Greenspan Doctrine held that bubbles cannot be prevented, that the governments task is merely to clean up afterward. The Greenspan practice was to create one bubble after another, until finally one came along so vast that it destroyed the system on the way by. At its source, our crisis is a housing crisis, and not one of too little housing but of too much. It springs from a predatory attack on the safeguards that had for decades kept housing finance safe and stable. In the early 2000s the Bush administration sent clear signals that regulations on mortgages would not be enforced. The signals were not subtle: on one occasion the director of the Office of Thrift Supervision came to a press conference with copies of the Federal Register and a chain saw.


pages: 254 words: 61,387

This Could Be Our Future: A Manifesto for a More Generous World by Yancey Strickler

basic income, big-box store, Capital in the Twenty-First Century by Thomas Piketty, Cass Sunstein, cognitive dissonance, corporate governance, Daniel Kahneman / Amos Tversky, David Graeber, Donald Trump, Doomsday Clock, effective altruism, Elon Musk, financial independence, gender pay gap, global supply chain, housing crisis, Ignaz Semmelweis: hand washing, invention of the printing press, invisible hand, Jeff Bezos, job automation, John Maynard Keynes: Economic Possibilities for our Grandchildren, John Nash: game theory, Joi Ito, Joseph Schumpeter, Kickstarter, Louis Pasteur, Mark Zuckerberg, medical bankruptcy, new economy, Oculus Rift, off grid, offshore financial centre, Ralph Nader, RAND corporation, Richard Thaler, Ronald Reagan, self-driving car, shareholder value, Silicon Valley, Simon Kuznets, Snapchat, Social Responsibility of Business Is to Increase Its Profits, stem cell, Steve Jobs, The Wealth of Nations by Adam Smith, Thomas Kuhn: the structure of scientific revolutions, Travis Kalanick, universal basic income, white flight

In the 1980s and 1990s numerous restrictions on banks were removed, including prohibitions on banks having branches in multiple states (this change was key to the bank branch takeover of New York City). In 1999 a bill was signed into law that removed long-standing restrictions on the size and operations of banks that had been in place since the Great Depression. The deregulatory changes contributed to multiple financial crises (including Enron and the 2008 housing crisis) within a decade of their passing. These changes were made possible by the political donations and influence of the Maximizing Class. Financial maximization was the underlying motive behind all of these changes. The rational choice was whichever option made the most money. That was what mattered. THE ENTREPRENEURIAL STATE It’s common belief today that government and private companies are like Tom and Jerry: natural enemies.


100 Baggers: Stocks That Return 100-To-1 and How to Find Them by Christopher W Mayer

bank run, Bernie Madoff, business cycle, buy and hold, cloud computing, disintermediation, Dissolution of the Soviet Union, dumpster diving, Edward Thorp, hindsight bias, housing crisis, index fund, Jeff Bezos, market bubble, Network effects, new economy, oil shock, passive investing, peak oil, shareholder value, Silicon Valley, Stanford marshmallow experiment, Steve Jobs, survivorship bias, The Great Moderation, The Wisdom of Crowds

He cited growing cash earnings and the logic of Pearson’s deal making. • NVR Inc. (NVR). This is the clear Outsider among homebuilders. Murray Stahl at Horizon-Kinetics wrote about it late in 2013. He summed up its outstanding features: NVR is somewhat of an oddity within the homebuilding industry. It chose not to enter rapidly growing markets such as in California and Arizona, it remained solidly profitable throughout the housing crisis and currently has more cash than debt. This conservative management approach has led the company to also repurchase nearly half of its shares outstanding during the course of the last decade. If you ever want to own a homebuilder, you should start with this one. • Exxon Mobil (XOM). Thorndike cited a long, 35-year, track record. It’s big and boring. And it feels played out to me. The stock has been a dog for five years.


Frommer's Paris 2013 by Kate van Der Boogert

Airbnb, airport security, British Empire, Chuck Templeton: OpenTable:, clean water, eurozone crisis, haute couture, Honoré de Balzac, housing crisis, music of the spheres, place-making, starchitect, sustainable-tourism, urban renewal

There’s even a new music festival called We Love Green. Bicycling is a popular means of transportation in Paris. © Markel Redondo Tackling the housing crisis is another one of the key points on Delanoë’s agenda for the next couple of years. Housing prices in Paris have been increasing for years and demand greatly outweighs supply. The new social housing initiatives that the mayor is experimenting with incorporate many of his ideas about sustainable development, but they might drastically change Paris’s beloved skyline. Challenging a 1977 by-law that limits the height of buildings within Paris to 37m (121 ft.), he is convinced that tower blocks offer the best solution to the housing crisis. Several sites, including Porte de la Chapelle in the 18e and the Masséna-Bruneseau district of the 13e, have been chosen as potential locations for 50m (164 ft.) and 200m (656 ft.) towers.


pages: 261 words: 64,977

Pity the Billionaire: The Unexpected Resurgence of the American Right by Thomas Frank

Affordable Care Act / Obamacare, bank run, big-box store, bonus culture, business cycle, collateralized debt obligation, collective bargaining, commoditize, Credit Default Swap, credit default swaps / collateralized debt obligations, crony capitalism, Deng Xiaoping, financial innovation, housing crisis, invisible hand, Kickstarter, money market fund, Naomi Klein, obamacare, payday loans, profit maximization, profit motive, road to serfdom, Robert Bork, Ronald Reagan, shareholder value, strikebreaker, The Chicago School, The Myth of the Rational Market, Thorstein Veblen, too big to fail, union organizing, Washington Consensus, white flight, Works Progress Administration

Republican Party elections of 1994 and elections of 2008 and elections of 2010 and expectations of, in 2008 TARP and Tea Party and revival of Return of Depression Economics, The (Krugman) Rivera, David Road to Serfdom, The (Hayek) Romer, Christina Romney, Mitt Roosevelt, Franklin Beck and “forgotten man” and Obama and RFC and Ryan and Rothenberg, Stu Rubin, Robert Rules for Radical Conservatives (“Kahane”) “ruling class” Rush Limbaugh Is a Big Fat Idiot (Franken) Ryan, Paul same-sex marriage Samuelson, Robert Santelli, Rick Saving Freedom (DeMint) Schlesinger, Arthur Schwarzenegger, Arnold Schweikert, David Schweitzer, Mark Securities and Exchange Commission (SEC) Seldes, Gilbert Sex Pistols Shane, Scott Shlaes, Amity shock therapy Slouching Towards Gomorrah (Bork) “Small Business Bill of Rights” small business. See also entrepreneurship bailouts and Democrats failure to capture outrage of failure and as front for big business health reform and housing crisis and job creation and as ordinary Americans populist heroism and regulation and Small Business Week social classes. See also Country Class; “Ruling Class” class war and Depression and obfuscation of social insurance socialism socialist realism Social Security software industry Soros, George Soviet Union Spread This Wealth (Duke) “Star Spangled Banner” Steinbeck, John Stewart, Jon stimulus Strange Death of Republican America, The (Blumenthal) strikes Summers, Larry supply-side revolution Susman, Warren Swados, Harvey Sweden Taibbi, Matt TARP.


pages: 257 words: 64,763

The Great American Stickup: How Reagan Republicans and Clinton Democrats Enriched Wall Street While Mugging Main Street by Robert Scheer

banking crisis, Bernie Madoff, Bernie Sanders, business cycle, collateralized debt obligation, corporate governance, Credit Default Swap, credit default swaps / collateralized debt obligations, facts on the ground, financial deregulation, fixed income, housing crisis, invisible hand, Long Term Capital Management, mega-rich, mortgage debt, new economy, old-boy network, Ponzi scheme, profit motive, Ralph Nader, Ronald Reagan, too big to fail, trickle-down economics

Key to its effectiveness was the seemingly simple wall it erected between the commercial banks entrusted with depositors’ funds—and insured by the government’s Federal Deposit Insurance Corporation (FDIC), the agency created by Glass-Steagall—and the wilder antics of basically unregulated Wall Street investment banks like Goldman Sachs. In 1982, Reagan signed the Garn-St. Germain Depository Institutions Act, easing regulation of savings and loans and, in the eyes of critics such as Paul Krugman, paving the way for the S&L collapse in the 1980s as well as the subprime housing crisis decades later. Nevertheless, Reagan made clear even then that this was not the biggest target on his list:Unfortunately, this legislation does not deal with the important question of delivery of other services, including securities activities by banks and other depository institutions. But I’m advised that many in the Congress want to put this question at the top of the banking deregulatory agendas next year, and I would strongly endorse such an initiative and hope that at the same time, the Congress will consider other proposals for more comprehensive deregulation which the administration advanced during the 97th Congress.


pages: 261 words: 70,584

Retirementology: Rethinking the American Dream in a New Economy by Gregory Brandon Salsbury

Albert Einstein, asset allocation, buy and hold, carried interest, Cass Sunstein, credit crunch, Daniel Kahneman / Amos Tversky, diversification, estate planning, financial independence, fixed income, full employment, hindsight bias, housing crisis, loss aversion, market bubble, market clearing, mass affluent, Maui Hawaii, mental accounting, mortgage debt, mortgage tax deduction, negative equity, new economy, RFID, Richard Thaler, risk tolerance, Robert Shiller, Robert Shiller, side project, Silicon Valley, Steve Jobs, the rule of 72, Yogi Berra

If we truly want to plan correctly for retirement, we need to address the mistakes we have made, and may still be making, with regard to how we think about money, how we feel about money, and how we behave with money. In developing this book, our research team conducted nearly a dozen focus group interviews with pre-retirees and retirees, ranging in ages from 25 to 70. Our researchers posed a number of questions on topics such as the housing crisis, family issues, overspending, investor behavior, and more. Some of the responses are included in relevant chapters throughout the book and specifically identified as findings from our focus group research. In other cases, hypothetical names, people, and situations have been used to illustrate points. For example, Retirementology introduces some one-of-a-kind terms, descriptions, and scenarios, which have been created to help you better understand a number of the behaviors associated with investor psychology.


pages: 218 words: 67,930

Me! Me! Me! by Daniel Ruiz Tizon

Bob Geldof, death of newspapers, housing crisis, Live Aid, Stephen Hawking, young professional

Similarly, just this morning, I was in the café when a woman walked right past the au fresco seating dragging her trolley behind her in a straight line. You can't pull a shopping trolley in a straight line. Not in Lambeth. Not with the state of these pavements. I don’t understand how so many people fail to see that. These end of life shopping fears are made even bigger by the capital’s worsening housing crisis. Today’s private rentals market is full of studios that have now dispensed with providing the hallway they at least used to offer until the late noughties. If you want to be sure of getting that hallway, you’re really looking at paying more than a £1000 a month now. This means many private renters like me now have to make do without a space that once served as a valuable buffer zone between the entrance to your flat and the rest of your overpriced home.


pages: 239 words: 69,496

The Wisdom of Finance: Discovering Humanity in the World of Risk and Return by Mihir Desai

activist fund / activist shareholder / activist investor, Albert Einstein, Andrei Shleifer, assortative mating, Benoit Mandelbrot, Brownian motion, capital asset pricing model, carried interest, Charles Lindbergh, collective bargaining, corporate governance, corporate raider, discounted cash flows, diversified portfolio, Eugene Fama: efficient market hypothesis, financial innovation, follow your passion, George Akerlof, Gordon Gekko, greed is good, housing crisis, income inequality, information asymmetry, Isaac Newton, Jony Ive, Kenneth Rogoff, longitudinal study, Louis Bachelier, moral hazard, Myron Scholes, new economy, out of africa, Paul Samuelson, Pierre-Simon Laplace, principal–agent problem, Ralph Waldo Emerson, random walk, risk/return, Robert Shiller, Robert Shiller, Ronald Coase, Silicon Valley, Steve Jobs, Thales and the olive presses, Thales of Miletus, The Market for Lemons, The Nature of the Firm, The Wealth of Nations by Adam Smith, Tim Cook: Apple, transaction costs, zero-sum game

So, it turns into a bad investment for the homeowner. The real curiosity is that the lender would be better off if the owner did the extension, but lenders often hesitate to make the compromises required to make the owner have the right incentives. The shadow of that preexisting commitment prevents the owner from doing the things he needs to do. This idea of debt overhang, in part, is why the housing crisis was so scary—with nearly one in five owners underwater in 2009, we might have seen many more neighborhoods with highly levered homes just continue to deteriorate because of these crazy incentives. What’s the answer? Well, the lender should accept a loss on its loan so that the homeowner will return to a setting where it’s possible to pursue projects that are in the homeowner’s own best interests.


pages: 237 words: 66,545

The Money Tree: A Story About Finding the Fortune in Your Own Backyard by Chris Guillebeau

"side hustle", Bernie Madoff, Ethereum, financial independence, global village, hiring and firing, housing crisis, passive income, race to the bottom, rent-seeking, ride hailing / ride sharing, Steve Jobs, telemarketer

” * * * — Jake tailed Preena out of Jan’s office again as they walked back to their desks. He was determined to regroup on yet another failure in front of the team, and this time he had an idea—but it turned out that she had one, too. “Hey, Jake.” She stopped him before they split off to work on separate tasks. “There’s something I wanted to talk with you about on Friday. With your housing crisis and those loans coming due, I figured you’re in need of extra money.” He nodded. “Yeah, I was hoping for a money tree to sprout from the ground and solve all my problems, but . . .” “Ha. Well, you’re not the only one with money on your mind!” she said. Preena told him that she was learning to make and sell handcrafted jewelry and had already earned a few thousand dollars since starting.


Once the American Dream: Inner-Ring Suburbs of the Metropolitan United States by Bernadette Hanlon

big-box store, correlation coefficient, deindustrialization, desegregation, edge city, feminist movement, housing crisis, illegal immigration, informal economy, longitudinal study, low skilled workers, low-wage service sector, manufacturing employment, McMansion, New Urbanism, Silicon Valley, statistical model, The Chicago School, transit-oriented development, urban sprawl, white flight, working-age population, zero-sum game

I identify four contributing forces: housing market dynamics, the new suburban demographic, labormarket restructuring, and metropolitan fragmentation. The housing stock in many aging inner-ring suburbs is outdated. The older houses are being left behind for newer, larger houses on the outer fringes. Development of pristine, greenfield sites is occurring, but redeveloping older inner-ring suburban communities takes much more time. With a housing crisis gripping many parts of the United States, the sustainability of consistent growth and development in the outer ring is called into question. This lack of capital investment in the housing stock is detrimental to many aging suburbs, and the high rates of housing foreclosures in poorer minority inner-ring suburbs are devastating. Suburbs are becoming increasingly more diverse. Immigrants and nonwhites are often excluded from higher-income outer suburbs and can only afford to live in vulnerable suburbs in the inner ring.


pages: 300 words: 78,475

Third World America: How Our Politicians Are Abandoning the Middle Class and Betraying the American Dream by Arianna Huffington

American Society of Civil Engineers: Report Card, Bernie Madoff, Bernie Sanders, call centre, carried interest, citizen journalism, clean water, collateralized debt obligation, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, crony capitalism, David Brooks, extreme commuting, Exxon Valdez, full employment, greed is good, housing crisis, immigration reform, invisible hand, knowledge economy, laissez-faire capitalism, late fees, market bubble, market fundamentalism, Martin Wolf, medical bankruptcy, microcredit, new economy, New Journalism, offshore financial centre, Ponzi scheme, post-work, Report Card for America’s Infrastructure, Richard Florida, Ronald Reagan, Rosa Parks, single-payer health, smart grid, The Wealth of Nations by Adam Smith, too big to fail, transcontinental railway, trickle-down economics, winner-take-all economy, working poor, Works Progress Administration

The void is filled by the fear that America is becoming a nation of haves and have-nots—and that millions are in danger of becoming permanent members of the have-nots. Forget Freddy Krueger. The real nightmare is not happening on Elm Street. It’s happening on Main Street. And it’s not scantily clad teens being slashed—it’s jobs and incomes and stability and quality of life.1 It’s our future. And we’re afraid—very afraid—that the worst may not be over, and that the real economy, as opposed to the one on Wall Street, is still melting down. The housing crisis is still raging. The first run of foreclosures was because of subprime loans; the second run is because of people thrown out of work. And the government’s loan modification programs won’t be of any help with this round of foreclosures. As Newsweek’s Nancy Cook pointed out, “If you’re unemployed, you don’t qualify for a loan modification.” And then there is the coming commercial property crisis and a potential credit card meltdown.


pages: 322 words: 77,341

I.O.U.: Why Everyone Owes Everyone and No One Can Pay by John Lanchester

asset-backed security, bank run, banking crisis, Berlin Wall, Bernie Madoff, Big bang: deregulation of the City of London, Black-Scholes formula, Blythe Masters, Celtic Tiger, collateralized debt obligation, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, Daniel Kahneman / Amos Tversky, diversified portfolio, double entry bookkeeping, Exxon Valdez, Fall of the Berlin Wall, financial deregulation, financial innovation, fixed income, George Akerlof, greed is good, hedonic treadmill, hindsight bias, housing crisis, Hyman Minsky, intangible asset, interest rate swap, invisible hand, Jane Jacobs, John Maynard Keynes: Economic Possibilities for our Grandchildren, John Meriwether, Kickstarter, laissez-faire capitalism, light touch regulation, liquidity trap, Long Term Capital Management, loss aversion, Martin Wolf, money market fund, mortgage debt, mortgage tax deduction, mutually assured destruction, Myron Scholes, negative equity, new economy, Nick Leeson, Norman Mailer, Northern Rock, Own Your Own Home, Ponzi scheme, quantitative easing, reserve currency, Right to Buy, risk-adjusted returns, Robert Shiller, Robert Shiller, Ronald Reagan, shareholder value, South Sea Bubble, statistical model, The Great Moderation, the payments system, too big to fail, tulip mania, value at risk

When houses are completely unoccupied and can be broken into, they are an immediate magnet for vandals, crack smokers, firebugs, you name it; sometimes the power is cut off, sometimes the water, and sometimes one but not the other, leading to a simple and easy and devastating form of havoc for happy vandals—just turn on a tap and walk away. I came to Baltimore because it is the subject of the only sustained work of art I’ve seen attempting to describe the lives lead in this urban desolation: David Simon’s HBO series The Wire. From the point of view of writing about the housing crisis, it was almost an arbitrary choice. All across America a boom turned into a bust; foreclosures on housing loans are a pandemic. (The difference between a pandemic and an epidemic: a pandemic is everywhere at the same time.) This is one form of “deleveraging”: the withdrawal of credit from people who often weren’t in a position to repay it in the first place. It hit everywhere: Rust Belt cities, which had been struggling against population decline and associated problems for decades; Sunbelt areas, which had experienced sharp population growth in the new millennium, much of it from new migrants—the highest rate of repossession filings in the United States in the first six months of 2009 was in Nevada; exurbs sprawling out from urban areas all over the country; traditional boom-and-bust hot spots such as Florida.


pages: 236 words: 77,735

Rigged Money: Beating Wall Street at Its Own Game by Lee Munson

affirmative action, asset allocation, backtesting, barriers to entry, Bernie Madoff, Bretton Woods, business cycle, buy and hold, buy low sell high, California gold rush, call centre, Credit Default Swap, diversification, diversified portfolio, estate planning, fiat currency, financial innovation, fixed income, Flash crash, follow your passion, German hyperinflation, High speed trading, housing crisis, index fund, joint-stock company, money market fund, moral hazard, Myron Scholes, passive investing, Ponzi scheme, price discovery process, random walk, risk tolerance, risk-adjusted returns, risk/return, stocks for the long run, stocks for the long term, too big to fail, trade route, Vanguard fund, walking around money

The expansion had not only been occurring for several years, but the standards were being lowered too, so the mortgage people could keep making money. Loan officers were not given pink slips and let go, more were hired! Instead of the realization as in 1994 that there were simply not enough people who could put 5 percent down, we just started doing cash out loans for 125 percent of the already over-inflated value of houses. It was so far removed from the days I worked at the mortgage company that year that the news describing the housing crisis was simply unrecognizable from that awesome year driving around California in a yellow moving truck. As a postscript, the credit card I still have from that company was sold this year to another firm. Clearly, my old place didn’t want anything to do with credit cards in the end. What can we learn from this and how do we play it? Higher-than-market interest rates were a teaser to increase deposits.


pages: 280 words: 73,420

Crapshoot Investing: How Tech-Savvy Traders and Clueless Regulators Turned the Stock Market Into a Casino by Jim McTague

algorithmic trading, automated trading system, Bernie Madoff, Bernie Sanders, Bretton Woods, buttonwood tree, buy and hold, computerized trading, corporate raider, creative destruction, credit crunch, Credit Default Swap, financial innovation, fixed income, Flash crash, High speed trading, housing crisis, index arbitrage, locking in a profit, Long Term Capital Management, margin call, market bubble, market fragmentation, market fundamentalism, Myron Scholes, naked short selling, pattern recognition, Ponzi scheme, quantitative trading / quantitative finance, Renaissance Technologies, Ronald Reagan, Sergey Aleynikov, short selling, Small Order Execution System, statistical arbitrage, technology bubble, transaction costs, Vanguard fund, Y2K

In fact, their buying portended the end of the recession three months later. The actual nature of a recovery was a matter of intense debate among bulls, bears, and super bears even before many recognized that the recession had ended. The most optimistic economists, and there were not many of them, predicted a V-shaped economic rebound, meaning that economic activity would pick up as quickly as it had come down in 2007 and 2008 during the credit and housing crisis. In their view, the market rally reflected this outcome and thus was behaving rationally by bouncing back up like a super ball. The conventional view was a pessimistic one. This broad camp argued that the recovery would be U-shaped, with slow gross domestic product (GDP) growth and high unemployment into the early years of the next decade. In their view, the stock markets were prematurely optimistic, the result of wishful thinking as opposed to solid earnings.


pages: 280 words: 79,029

Smart Money: How High-Stakes Financial Innovation Is Reshaping Our WorldÑFor the Better by Andrew Palmer

Affordable Care Act / Obamacare, algorithmic trading, Andrei Shleifer, asset-backed security, availability heuristic, bank run, banking crisis, Black-Scholes formula, bonus culture, break the buck, Bretton Woods, call centre, Carmen Reinhart, cloud computing, collapse of Lehman Brothers, collateralized debt obligation, computerized trading, corporate governance, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, Daniel Kahneman / Amos Tversky, David Graeber, diversification, diversified portfolio, Edmond Halley, Edward Glaeser, endogenous growth, Eugene Fama: efficient market hypothesis, eurozone crisis, family office, financial deregulation, financial innovation, fixed income, Flash crash, Google Glasses, Gordon Gekko, high net worth, housing crisis, Hyman Minsky, implied volatility, income inequality, index fund, information asymmetry, Innovator's Dilemma, interest rate swap, Kenneth Rogoff, Kickstarter, late fees, London Interbank Offered Rate, Long Term Capital Management, longitudinal study, loss aversion, margin call, Mark Zuckerberg, McMansion, money market fund, mortgage debt, mortgage tax deduction, Myron Scholes, negative equity, Network effects, Northern Rock, obamacare, payday loans, peer-to-peer lending, Peter Thiel, principal–agent problem, profit maximization, quantitative trading / quantitative finance, railway mania, randomized controlled trial, Richard Feynman, Richard Thaler, risk tolerance, risk-adjusted returns, Robert Shiller, Robert Shiller, short selling, Silicon Valley, Silicon Valley startup, Skype, South Sea Bubble, sovereign wealth fund, statistical model, Thales of Miletus, transaction costs, Tunguska event, unbanked and underbanked, underbanked, Vanguard fund, web application

Add in persistently low interest rates, which have eaten into banks’ net interest margins, and Oliver Wyman, a consultancy, has estimated that US banks lose money on 37 percent of consumer accounts. The rich will still pay their way in this sort of environment, thanks to larger account balances and the prospect of higher-margin activities such as investment advice. But the economics of banking the poor is far less attractive than it was. And, of course, there is the hangover from the housing crisis. Just as entrepreneurs could use their houses as collateral to fund their businesses, the poor could use housing to gain access to credit. According to the Federal Reserve Bank of New York, between 1999 and the end of the third quarter of 2008, when Lehman Brothers imploded, American consumers went from owing their creditors $4.6 trillion to owing them $12.7 trillion. Mortgages and home equity lines of credit accounted for $6.7 trillion of this increase.3 Money washed toward less creditworthy borrowers in particular.


pages: 251 words: 76,128

Borrow: The American Way of Debt by Louis Hyman

asset-backed security, barriers to entry, big-box store, business cycle, cashless society, collateralized debt obligation, credit crunch, deindustrialization, deskilling, diversified portfolio, financial innovation, Ford paid five dollars a day, Home mortgage interest deduction, housing crisis, income inequality, market bubble, McMansion, mortgage debt, mortgage tax deduction, Network effects, new economy, Paul Samuelson, plutocrats, Plutocrats, price stability, Ronald Reagan, statistical model, technology bubble, transaction costs, women in the workforce

Banks offering such loans collapsed at twice the rate of banks that did not.28 Locales with the highest proportion of lending—in Texas, for instance, mortgage bonds backed 53 percent of all loans—were hardest hit.29 Luckily for banks, the bulk of that lending was insured, which, even if it doomed the insurance companies, saved the banks. President Herbert Hoover launched a group to study the housing crisis in 1931, the White House Conference on Home Building and Home Ownership, whose ideas would provide the seedbed for many ideas we usually attribute to the New Deal. Hoover inaugurated the conference by reminding the attendees about the meaning of housing: “Those immortal ballads, Home, Sweet Home; My Old Kentucky Home; and the Little Gray Home in the West, were not written about tenements or apartments.


pages: 330 words: 77,729

Big Three in Economics: Adam Smith, Karl Marx, and John Maynard Keynes by Mark Skousen

"Robert Solow", Albert Einstein, banking crisis, Berlin Wall, Bretton Woods, business climate, business cycle, creative destruction, David Ricardo: comparative advantage, delayed gratification, experimental economics, financial independence, Financial Instability Hypothesis, full employment, Hernando de Soto, housing crisis, Hyman Minsky, inflation targeting, invisible hand, Isaac Newton, John Maynard Keynes: Economic Possibilities for our Grandchildren, John Maynard Keynes: technological unemployment, Joseph Schumpeter, Kenneth Arrow, laissez-faire capitalism, liberation theology, liquidity trap, means of production, microcredit, minimum wage unemployment, money market fund, open economy, paradox of thrift, Pareto efficiency, Paul Samuelson, price stability, pushing on a string, rent control, Richard Thaler, rising living standards, road to serfdom, Robert Shiller, Robert Shiller, rolodex, Ronald Coase, Ronald Reagan, school choice, secular stagnation, Simon Kuznets, The Chicago School, The Wealth of Nations by Adam Smith, Thomas Malthus, Thorstein Veblen, Tobin tax, unorthodox policies, Vilfredo Pareto, zero-sum game

In her work about Soviet Russia in the 1930s entitled Everyday Stalinism, Sheila Fitzpatrick countered the old conventional view held by Sidney and Beatrice Webb and George Bernard Shaw that the Soviet system during the 1930s was a glorious "new civilization." On the contrary, Fitzpatrick wrote, "With the abolition of the market, shortages of food, clothing, and all kinds of consumer goods became endemic. As peasants fled the collective villages, major cities were soon in the grip of an acute housing crisis, with families jammed for decades in tiny single rooms in communal apartments. ... It was a world of privation, overcrowding, endless queues, and broken families, in which the regime's promises of future socialist abundance rang hollow. . . . Government bureaucracy often turned everyday life into a nightmare" (Fitzpatrick 1999, dustjacket). Nations Grow Faster Under Economic Freedom In addition, recent studies comparing the economic growth of nations and their degree of freedom have confirmed Mises's thesis.


pages: 230 words: 79,229

Respectable: The Experience of Class by Lynsey Hanley

Berlin Wall, cuban missile crisis, David Brooks, delayed gratification, Etonian, full employment, housing crisis, illegal immigration, invisible hand, liberation theology, low skilled workers, mutually assured destruction, Neil Kinnock, Norman Mailer, Own Your Own Home, Right to Buy, Ronald Reagan, strikebreaker, upwardly mobile, Winter of Discontent

., ‘British Manual Workers: From Producers to Consumers, c. 1950–2000’, University of Oxford Discussion Papers in Economic and Social History, no. 74 (December 2008), p. 25 3. Social Exclusion Task Force, ‘Aspiration and Attainment amongst Young People in Deprived Communities’, Cabinet Office: short studies, published December 2008 4. Meek, J., ‘Where will we live?’, London Review of Books, vol. 6, no. 1, 9 January 2014, pp. 7–16 5. Dorling, D., All That Is Solid: The Great Housing Crisis (Penguin, 2014) 6. Baggini, J., Welcome to Everytown: A Journey into the English Mind (Granta Books, 2007), p. 50 7. Ware, V., ‘Towards a sociology of resentment: a debate on class and whiteness’, Sociological Research Online, 2008 8. Jones, O., Chavs: The Demonization of the Working Class (Verso, 2011), p. 223 9. Pearce, J., and Milne, E-J., ‘Research findings: community and participation on Bradford’s traditionally white estates’, Joseph Rowntree Foundation, 2010, p. 38 10.


pages: 252 words: 72,473

Weapons of Math Destruction: How Big Data Increases Inequality and Threatens Democracy by Cathy O'Neil

Affordable Care Act / Obamacare, Bernie Madoff, big data - Walmart - Pop Tarts, call centre, carried interest, cloud computing, collateralized debt obligation, correlation does not imply causation, Credit Default Swap, credit default swaps / collateralized debt obligations, crowdsourcing, Emanuel Derman, housing crisis, I will remember that I didn’t make the world, and it doesn’t satisfy my equations, illegal immigration, Internet of things, late fees, mass incarceration, medical bankruptcy, Moneyball by Michael Lewis explains big data, new economy, obamacare, Occupy movement, offshore financial centre, payday loans, peer-to-peer lending, Peter Thiel, Ponzi scheme, prediction markets, price discrimination, quantitative hedge fund, Ralph Nader, RAND corporation, recommendation engine, Rubik’s Cube, Sharpe ratio, statistical model, Tim Cook: Apple, too big to fail, Unsafe at Any Speed, Upton Sinclair, Watson beat the top human players on Jeopardy!, working poor

The operations we performed on numbers translated into trillions of dollars sloshing from one account to another. At first I was excited and amazed by working in this new laboratory, the global economy. But in the autumn of 2008, after I’d been there for a bit more than a year, it came crashing down. The crash made it all too clear that mathematics, once my refuge, was not only deeply entangled in the world’s problems but also fueling many of them. The housing crisis, the collapse of major financial institutions, the rise of unemployment—all had been aided and abetted by mathematicians wielding magic formulas. What’s more, thanks to the extraordinary powers that I loved so much, math was able to combine with technology to multiply the chaos and misfortune, adding efficiency and scale to systems that I now recognized as flawed. If we had been clear-headed, we all would have taken a step back at this point to figure out how math had been misused and how we could prevent a similar catastrophe in the future.


pages: 333 words: 76,990

The Long Good Buy: Analysing Cycles in Markets by Peter Oppenheimer

"Robert Solow", asset allocation, banking crisis, banks create money, barriers to entry, Berlin Wall, Big bang: deregulation of the City of London, Bretton Woods, business cycle, buy and hold, Cass Sunstein, central bank independence, collective bargaining, computer age, credit crunch, debt deflation, decarbonisation, diversification, dividend-yielding stocks, equity premium, Fall of the Berlin Wall, financial innovation, fixed income, Flash crash, forward guidance, Francis Fukuyama: the end of history, George Akerlof, housing crisis, index fund, invention of the printing press, Isaac Newton, James Watt: steam engine, joint-stock company, Joseph Schumpeter, Kickstarter, liberal capitalism, light touch regulation, liquidity trap, Live Aid, market bubble, Mikhail Gorbachev, mortgage debt, negative equity, Network effects, new economy, Nikolai Kondratiev, Nixon shock, oil shock, open economy, price stability, private sector deleveraging, Productivity paradox, quantitative easing, railway mania, random walk, Richard Thaler, risk tolerance, risk-adjusted returns, Robert Shiller, Robert Shiller, Ronald Reagan, savings glut, secular stagnation, Simon Kuznets, South Sea Bubble, special economic zone, stocks for the long run, technology bubble, The Great Moderation, too big to fail, total factor productivity, trade route, tulip mania, yield curve

The move towards independence of central banks was also an important contributing factor to the perceived stability of the economic cycle. 2000–2007. This was one of the best cycles in terms of earnings growth for all the major equity markets but it offered some of the lowest returns for investors. The problem was that much of the strong profit growth in this cycle was partly driven by very strong earnings in the financial sector, which, driven by increased leverage, became illusory in the aftermath of the US sub-prime housing crisis. 2008–now. This is the post-financial crisis cycle and the longest so far (discussed in more detail in chapter 9), but it is rather different from other cycles for several reasons. First, the phases of the cycle, particularly outside of the US, were heavily distorted by the rolling nature of the global financial crisis and its subsequent waves following the initial problems in the US housing market in 2007/2008.


pages: 246 words: 76,561

Radical Cities: Across Latin America in Search of a New Architecture by Justin McGuirk

A Pattern Language, agricultural Revolution, dark matter, Donald Trump, Enrique Peñalosa, extreme commuting, facts on the ground, Guggenheim Bilbao, Hernando de Soto, housing crisis, illegal immigration, income per capita, informal economy, Jane Jacobs, Kickstarter, lateral thinking, mass immigration, microcredit, Milgram experiment, neoliberal agenda, New Urbanism, place-making, Silicon Valley, starchitect, technoutopianism, unorthodox policies, urban decay, urban planning, urban renewal, urban sprawl, Washington Consensus

U-TT devised a series of densely programmed buildings, housing gyms and other facilities alongside offices connected directly to key metro stations. But when U-TT refused to join the official United Socialist Party of Venezuela, the government kicked them off the project and handed the plans over to their own contractor. In the end most of the buildings were turned into apartment blocks, appropriated to ease the housing crisis. The community facilities were ditched and the buildings now have a cheap, shoddy feel. But Brillembourg is phlegmatic. Laughing, he calls them ‘exquisite corpses’ – one part U-TT and one part standard-issue contractor, the kind that siphons the cream of the budget into an offshore account. That’s how things work here. The fact that U-TT refused to join the party was partly a matter of principle, but mainly one of realpolitik.


pages: 237 words: 74,109

Uncanny Valley: A Memoir by Anna Wiener

autonomous vehicles, back-to-the-land, basic income, blockchain, Burning Man, call centre, charter city, cloud computing, cognitive bias, cognitive dissonance, commoditize, crowdsourcing, cryptocurrency, Extropian, future of work, Golden Gate Park, housing crisis, Jane Jacobs, job automation, knowledge worker, Lean Startup, means of production, medical residency, new economy, New Urbanism, passive income, pull request, rent control, ride hailing / ride sharing, Sand Hill Road, self-driving car, sharing economy, side project, Silicon Valley, Silicon Valley startup, social web, South of Market, San Francisco, special economic zone, technoutopianism, telepresence, telepresence robot, union organizing, universal basic income, unpaid internship, urban planning, urban renewal, women in the workforce, Y2K, young professional

The agents were excited to unveil a gorgeous oasis with soaking tub and matte cabinetry; they were delighted to share an adorable bungalow with original details and breakfast nook. The agents pitched proximity to the freeways, and inserted maps of the tech shuttle routes, color-coded by company. Coveted location, the brochures read. Fabulous investment property with no rent control. I stood on the steps of my apartment building, looking at the agents’ headshots and thinking about bleaching my teeth. San Francisco had tipped into a full-blown housing crisis. Whenever the media reported that a new tech company had filed an S-1 with the SEC, people started comparing notes on tenants’ rights. Buy a house before the next IPO, my coworkers joked. It wasn’t a joke because it was funny; it was a joke because the overnight-wealthy were bidding 60 percent over asking on million-dollar starter homes, and paying in cash. Four of the six apartments in my rent-controlled building were occupied by middle-aged couples, some of whom had been there since at least the last boom; they were familiar with the rhetoric of community and revolution, had heard it all before.


pages: 829 words: 186,976

The Signal and the Noise: Why So Many Predictions Fail-But Some Don't by Nate Silver

"Robert Solow", airport security, availability heuristic, Bayesian statistics, Benoit Mandelbrot, Berlin Wall, Bernie Madoff, big-box store, Black Swan, Broken windows theory, business cycle, buy and hold, Carmen Reinhart, Claude Shannon: information theory, Climategate, Climatic Research Unit, cognitive dissonance, collapse of Lehman Brothers, collateralized debt obligation, complexity theory, computer age, correlation does not imply causation, Credit Default Swap, credit default swaps / collateralized debt obligations, cuban missile crisis, Daniel Kahneman / Amos Tversky, diversification, Donald Trump, Edmond Halley, Edward Lorenz: Chaos theory, en.wikipedia.org, equity premium, Eugene Fama: efficient market hypothesis, everywhere but in the productivity statistics, fear of failure, Fellow of the Royal Society, Freestyle chess, fudge factor, George Akerlof, global pandemic, haute cuisine, Henri Poincaré, high batting average, housing crisis, income per capita, index fund, information asymmetry, Intergovernmental Panel on Climate Change (IPCC), Internet Archive, invention of the printing press, invisible hand, Isaac Newton, James Watt: steam engine, John Nash: game theory, John von Neumann, Kenneth Rogoff, knowledge economy, Laplace demon, locking in a profit, Loma Prieta earthquake, market bubble, Mikhail Gorbachev, Moneyball by Michael Lewis explains big data, Monroe Doctrine, mortgage debt, Nate Silver, negative equity, new economy, Norbert Wiener, PageRank, pattern recognition, pets.com, Pierre-Simon Laplace, prediction markets, Productivity paradox, random walk, Richard Thaler, Robert Shiller, Robert Shiller, Rodney Brooks, Ronald Reagan, Saturday Night Live, savings glut, security theater, short selling, Skype, statistical model, Steven Pinker, The Great Moderation, The Market for Lemons, the scientific method, The Signal and the Noise by Nate Silver, The Wisdom of Crowds, Thomas Bayes, Thomas Kuhn: the structure of scientific revolutions, too big to fail, transaction costs, transfer pricing, University of East Anglia, Watson beat the top human players on Jeopardy!, wikimedia commons

There was a failure on the part of the ratings agencies, as well as by banks like Lehman Brothers, to understand how risky mortgage-backed securities were. Contrary to the assertions they made before Congress, the problem was not that the ratings agencies failed to see the housing bubble. Instead, their forecasting models were full of faulty assumptions and false confidence about the risk that a collapse in housing prices might present. There was a widespread failure to anticipate how a housing crisis could trigger a global financial crisis. It had resulted from the high degree of leverage in the market, with $50 in side bets staked on every $1 that an American was willing to invest in a new home. Finally, in the immediate aftermath of the financial crisis, there was a failure to predict the scope of the economic problems that it might create. Economists and policy makers did not heed Reinhart and Rogoff’s finding that financial crises typically produce very deep and long-lasting recessions.

The confidence that the banks had in Moody’s and S&P’s ability to rate mortgage-backed securities may have been based on the fact that the agencies had generally performed competently in rating other types of financial assets. However, the ratings agencies had never before rated securities as novel and complex as credit default options. The confidence that economists had in the ability of the financial system to withstand a housing crisis may have arisen because housing price fluctuations had generally not had large effects on the financial system in the past. However, the financial system had probably never been so highly leveraged, and it had certainly never made so many side bets on housing before. The confidence that policy makers had in the ability of the economy to recuperate quickly from the financial crisis may have come from their experience of recent recessions, most of which had been associated with rapid, “V-shaped” recoveries.


pages: 262 words: 83,548

The End of Growth by Jeff Rubin

Ayatollah Khomeini, Bakken shale, banking crisis, Berlin Wall, British Empire, business cycle, call centre, carbon footprint, collateralized debt obligation, collective bargaining, Credit Default Swap, credit default swaps / collateralized debt obligations, decarbonisation, deglobalization, energy security, eurozone crisis, Exxon Valdez, Fall of the Berlin Wall, fiat currency, flex fuel, full employment, ghettoisation, global supply chain, Hans Island, happiness index / gross national happiness, housing crisis, hydraulic fracturing, illegal immigration, income per capita, Intergovernmental Panel on Climate Change (IPCC), Jane Jacobs, Kickstarter, McMansion, Monroe Doctrine, moral hazard, new economy, Occupy movement, oil shale / tar sands, oil shock, peak oil, Ponzi scheme, quantitative easing, race to the bottom, reserve currency, Ronald Reagan, South China Sea, sovereign wealth fund, The Chicago School, The Death and Life of Great American Cities, Thomas Malthus, Thorstein Veblen, too big to fail, uranium enrichment, urban planning, urban sprawl, women in the workforce, working poor, Yom Kippur War, zero-sum game

Economic growth is only one measure of well-being. And since it often comes at the cost of endangering our own survival, there are other standards we should take into account. The surprising thing is that if we look at it through a different lens, the end of growth will leave us all richer than we ever may have thought. [ SOURCE NOTES ] INTRODUCTION this page: A copious amount of ink has been spilled dissecting the US housing crisis and subsequent stock market crash in 2008. For a particularly lively account of the bubble that developed for collateralized debt obligations and the emergence of the credit default swap market, see The Big Short (2010) by Michael Lewis. CHAPTER 1: CHANGING THE ECONOMIC SPEED LIMIT this page: For a broader take on how Reaganomics fostered the culture of deregulation that still persists in the United States, see The Price of Civilization: Economics and Ethics After the Fall (2011) by Jeffrey Sachs, director of the Earth Institute at Colombia University.


pages: 281 words: 86,657

The Great Inversion and the Future of the American City by Alan Ehrenhalt

anti-communist, big-box store, British Empire, crack epidemic, David Brooks, deindustrialization, Edward Glaeser, Frank Gehry, haute cuisine, Honoré de Balzac, housing crisis, illegal immigration, Jane Jacobs, manufacturing employment, mass immigration, McMansion, New Urbanism, Norman Mailer, Peter Calthorpe, postindustrial economy, Richard Florida, The Chicago School, The Death and Life of Great American Cities, too big to fail, transit-oriented development, upwardly mobile, urban decay, urban planning, urban renewal, walkable city, white flight, working poor, young professional

One study by a real estate consulting firm in 2009 reported that only 17 percent of Generation Y (the “millennials,” born roughly between 1980 and 1995) expressed a preference for urban living, most likely a rental apartment, over a suburban mode of life. But there are equally compelling, and strikingly different, results on the other side. A competing study by the consulting firm RCLCO, in 2008, revealed an almost precisely opposite result: 77 percent of Generation Y wanted to live some variant of the urban life. “Generation Y’s attitudes toward home ownership have been changed by the housing crisis and the recession,” the Urban Land Institute found in commenting on the RCLCO study. “The number of people trapped by underwater homes that cannot be sold and the millions of foreclosures are tempering their interest in buying their own homes and they will be renters by necessity rather than by choice for years ahead.” In many if not most cases, that means urbanized rather than traditional suburban rentals.


pages: 252 words: 78,780

Lab Rats: How Silicon Valley Made Work Miserable for the Rest of Us by Dan Lyons

Airbnb, Amazon Web Services, Apple II, augmented reality, autonomous vehicles, basic income, bitcoin, blockchain, business process, call centre, Clayton Christensen, clean water, collective bargaining, corporate governance, corporate social responsibility, creative destruction, cryptocurrency, David Heinemeier Hansson, Donald Trump, Elon Musk, Ethereum, ethereum blockchain, full employment, future of work, gig economy, Gordon Gekko, greed is good, hiring and firing, housing crisis, income inequality, informal economy, Jeff Bezos, job automation, job satisfaction, job-hopping, John Gruber, Joseph Schumpeter, Kevin Kelly, knowledge worker, Lean Startup, loose coupling, Lyft, Marc Andreessen, Mark Zuckerberg, McMansion, Menlo Park, Milgram experiment, minimum viable product, Mitch Kapor, move fast and break things, move fast and break things, new economy, Panopticon Jeremy Bentham, Paul Graham, paypal mafia, Peter Thiel, plutocrats, Plutocrats, precariat, RAND corporation, remote working, RFID, ride hailing / ride sharing, Ronald Reagan, Rubik’s Cube, Ruby on Rails, Sam Altman, Sand Hill Road, self-driving car, shareholder value, Silicon Valley, Silicon Valley startup, six sigma, Skype, Social Responsibility of Business Is to Increase Its Profits, software is eating the world, Stanford prison experiment, stem cell, Steve Jobs, Steve Wozniak, Stewart Brand, TaskRabbit, telemarketer, Tesla Model S, Thomas Davenport, Tony Hsieh, Toyota Production System, traveling salesman, Travis Kalanick, tulip mania, Uber and Lyft, Uber for X, uber lyft, universal basic income, web application, Whole Earth Catalog, Y Combinator, young professional

A region that once supported a thriving, prosperous middle class has been transformed into something that resembles a Third World banana republic, with an obscenely wealthy ruling class, a vast and growing underclass, and not much in between. San Francisco, once a city full of artists and hippies, with a vibrant gay community, has become overrun with dipshit tech bros zipping around on electric scooters, complaining about the growing ranks of homeless people, seemingly oblivious to the fact that they—the tech bros—are the ones who created the housing crisis that has pushed so many people onto the streets. “San Francisco has become unrecognizable,” a sixty-something techie told me, explaining why she had sold her home and fled the city. What didn’t she like? “The greed,” she said. Now those same mercenary, clueless tech bros who have ruined San Francisco are gaining ever more power and wielding influence that reaches beyond the tech industry into the culture at large.


pages: 307 words: 82,680

A Pelican Introduction: Basic Income by Guy Standing

bank run, basic income, Bernie Sanders, Bertrand Russell: In Praise of Idleness, Black Swan, Boris Johnson, British Empire, centre right, collective bargaining, cryptocurrency, David Graeber, declining real wages, deindustrialization, Donald Trump, Elon Musk, Fellow of the Royal Society, financial intermediation, full employment, future of work, gig economy, Gunnar Myrdal, housing crisis, hydraulic fracturing, income inequality, intangible asset, job automation, job satisfaction, Joi Ito, labour market flexibility, land value tax, libertarian paternalism, low skilled workers, lump of labour, Mark Zuckerberg, Martin Wolf, mass immigration, mass incarceration, moral hazard, Nelson Mandela, offshore financial centre, open economy, Panopticon Jeremy Bentham, Paul Samuelson, plutocrats, Plutocrats, precariat, quantitative easing, randomized controlled trial, rent control, rent-seeking, Sam Altman, self-driving car, shareholder value, sharing economy, Silicon Valley, sovereign wealth fund, Stephen Hawking, The Future of Employment, universal basic income, Wolfgang Streeck, women in the workforce, working poor, Y Combinator, Zipcar

In the early years of the welfare state, 60 per cent of the population lived in privately rented accommodation subject to strict rent controls, and an ambitious council house building programme was underway. Now, area differences in rents and house prices are much greater, rents in the private sector have soared, and the sale at a discount of council and social housing has resulted in a massive shortage of affordable homes. The cost of means-tested housing benefit has ballooned to some £25 billion a year. While Britain’s housing crisis needs to be tackled through urgent measures to boost affordable supply, it poses a difficulty here and now for the design of social protection systems. The basic income costings summarized above all assume continuation of the current means-tested housing benefit in broadly its present form, at least for the time being. The one saving grace is that, if the basic income is taken into account in the means test, fewer people will be dependent on this complex, administratively expensive and steeply tapered scheme.


pages: 252 words: 85,441

A Book for Her by Bridget Christie

Affordable Care Act / Obamacare, Boris Johnson, British Empire, carbon footprint, clean water, Costa Concordia, David Attenborough, feminist movement, financial independence, glass ceiling, housing crisis, Isaac Newton, obamacare, Rubik’s Cube, sexual politics

It’s like him tweeting a photo of himself next to Denzel Washington with the words, ‘And finally, through the talent of a good ethnic actor, teenage, racist me is slain.’ I’m being hard on Russell. He’s not one of the seriously bad guys. He does some good stuff, such as raising awareness and media interest for the Focus E15 mothers, whose passionate campaign for social housing came to symbolise the London housing crisis.fn3 And I agree with him on many issues – capitalism, tax evasion, skinny jeans – but Russell’s type of sexism, which he once described as being ‘a bit like his granny’s racism; a bit 1970s and harmless’ is still sexism. Even if he tried to distract us by coating his sexism in flowery language and calling it ‘a cascading dichotomy of highly nuanced empiricism and the indefatigable needs of me old working-class winky’, it would still be sexism.


pages: 244 words: 81,334

Picnic Comma Lightning: In Search of a New Reality by Laurence Scott

4chan, Airbnb, airport security, augmented reality, Berlin Wall, Bernie Sanders, Boris Johnson, clean water, colonial rule, cryptocurrency, dematerialisation, Donald Trump, Elon Musk, housing crisis, Internet of things, Joan Didion, job automation, late capitalism, Mark Zuckerberg, Narrative Science, Productivity paradox, QR code, ride hailing / ride sharing, Saturday Night Live, sentiment analysis, Silicon Valley, Skype, Slavoj Žižek, Snapchat, Y2K

We looked wistfully over a stranger’s shoulder and into the road, imagining the soot-stained chimney sweep who would soon come whistling up the path. We convinced ourselves that crumbling sash windows wouldn’t be cold and that plastic ones would be worth the energy savings and eco-righteousness. In the London of my time, I could be someone’s child or a mortgage-holder, but not both. In the midst of a disgraceful housing crisis, even this dilemma was a privilege. Once in the new flat, I began the work of assembling a post-parental world. After an adult life lived in temporary accommodation, I had fun buying bedside tables from markets, stocking up on towels and pillows, climbing a rung on the duck-down ladder. I walked to the flat carrying shopping bags with a blasphemous spring in my step. Old things, a few inherited pieces, also came through the front door: a veteran card table, whose top swivels and folds, became my writing desk.


pages: 823 words: 220,581

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

"Robert Solow", 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, business cycle, butterfly effect, capital asset pricing model, cellular automata, central bank independence, citizen journalism, clockwork universe, collective bargaining, complexity theory, correlation coefficient, creative destruction, 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, fixed income, Fractional reserve banking, full employment, Henri Poincaré, housing crisis, Hyman Minsky, income inequality, information asymmetry, invisible hand, iterative process, John von Neumann, Kickstarter, 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, money market fund, open economy, Pareto efficiency, Paul Samuelson, 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, zero-sum game

A catalogue record for this book is available from the British Library Library of Congress Cataloging in Publication Data available eISBN 9781780322209 CONTENTS Tables, figures and boxes Preface to the second edition Preface to the first edition 1 Predicting the ‘unpredictable’ 2 No more Mr Nice Guy Part 1 Foundations: the logical flaws in the key concepts of conventional economics 3 The calculus of hedonism 4 Size does matter 5 The price of everything and the value of nothing 6 To each according to his contribution Part 2 Complexities: issues omitted from standard courses that should be part of an education in economics 7 The holy war over capital 8 There is madness in their method 9 Let’s do the Time Warp again 10 Why they didn’t see it coming 11 The price is not right 12 Misunderstanding the Great Depression and the Great Recession Part 3 Alternatives: different ways to think about economics 13 Why I did see ‘It’ coming 14 A monetary model of capitalism 15 Why stock markets crash 16 Don’t shoot me, I’m only the piano 17 Nothing to lose but their minds 18 There are alternatives Bibliography Index TABLES, FIGURES AND BOXES Tables 2.1 Anticipations of the housing crisis and recession 3.1 ‘Utils’ and change in utils from consuming bananas 3.2 Utils arising from the consumption of two commodities 3.3 The commodities in Sippel’s ‘Revealed Preference’ experiment 4.1 Demand schedule for a hypothetical monopoly 4.2 Costs for a hypothetical monopoly 4.3 Sales and costs determine the level of output that maximizes profit 4.4 Cost and revenue for a ‘perfectly competitive’ industry identical in scale to hypothetical monopoly 5.1 Input and output data for a hypothetical firm 5.2 Cost drawings for the survey by Eiteman and Guthrie 5.3 Empirical research on the nature of cost curves 7.1 Sraffa’s hypothetical subsistence economy 7.2 Production with a surplus 7.3 Relationship between maximum and actual rate of profit and the wage share of surplus 7.4 The impact of the rate of profit on the measurement of capital 10.1 Anderson’s ranking of sciences 12.1 The alleged Money Multiplier process 13.1 A hypothetical example of the impact of decelerating debt on aggregate demand 13.2 The actual impact of decelerating debt on aggregate demand 14.1 A pure credit economy with paper money 14.2 The dynamics of a pure credit economy with no growth 14.3 Net incomes 14.4 A growing pure credit economy with electronic money 15.1 Von Neumann’s procedure for working out a numerical value for utility 15.2 The Allais ‘Paradox’ 15.3 The Allais ‘Paradox’ Part 2 16.1 The solvability of mathematical models 17.1 Marx’s unadjusted value creation table, with the rate of profit dependent upon the variable-to-constant ratio in each sector 17.2 Marx’s profit distribution table, with the rate of profit now uniform across sectors 17.3 Steedman’s hypothetical economy 17.4 Steedman’s physical table in Marx’s value terms 17.5 Steedman’s prices table in Marx’s terms 17.6 Profit rate and prices calculated directly from output/wage data 17.7 Marx’s example where the use-value of machinery exceeds its depreciation Figures 2.1 US inflation and unemployment from 1955 2.2 Bernanke doubles base money in five months 2.3 Private debt peaked at 1.7 times the 1930 level in 2009 3.1 Rising total utils and falling marginal utils from consuming one commodity 3.2 Total utils from the consumption of two commodities; 3.3 Total ‘utils’ represented as a ‘utility hill’ 3.4 The contours of the ‘utility hill’ 3.5 Indifference curves: the contours of the ‘utility hill’ shown in two dimensions 3.6 A rational consumer’s indifference map 3.7 Indifference curves, the budget constraint, and consumption 3.8 Deriving the demand curve 3.9 Upward-sloping demand curve 3.10 Separating out the substitution effect from the income effect 3.11 Engel curves show how spending patterns change with increases in income 3.12 A valid market demand curve 3.13 Straight-line Engel ‘curves’ 3.14 Economic theory cannot rule out the possibility that a market demand curve may have a shape like this, rather than a smooth, downward-sloping curve 4.1 Leijonhufvud’s ‘Totems’ of the Econ tribe 4.2 Stigler’s proof that the horizontal firm demand curve is a fallacy 4.3 Profit maximization for a monopolist: marginal cost equals marginal revenue, while price exceeds marginal cost 4.4 Profit maximization for a perfectly competitive firm: marginal cost equals marginal revenue, which also equals price 4.5 A supply curve can be derived for a competitive firm, but not for a monopoly 4.6 A competitive industry produces a higher output at a lower cost than a monopoly 4.7 The standard ‘supply and demand’ explanation for price determination is valid only in perfect competition 4.8 Double the size, double the costs, but four times the output 4.9 Predictions of the models and results at the market level 4.10 Output behavior of three randomly selected firms 4.11 Profit outcomes for three randomly selected firms 4.12 Output levels for between 1- and 100-firm industries 5.1 Product per additional worker falls as the number of workers hired rises 5.2 Swap the axes to graph labor input against quantity 5.3 Multiply labor input by the wage to convert Y-axis into monetary terms, and add the sales revenue 5.4 Maximum profit occurs where the gap between total cost and total revenue is at a maximum 5.5 Deriving marginal cost from total cost 5.6 The whole caboodle: average and marginal costs, and marginal revenue 5.7 The upward-sloping supply curve is derived by aggregating the marginal cost curves of numerous competitive firms 5.8 Economic theory doesn’t work if Sraffa is right 5.9 Multiple demand curves with a broad definition of an industry 5.10 A farmer who behaved as economists advise would forgo the output shown in the gap between the two curves 5.11 Capacity utilization over time in the USA 5.12 Capacity utilization and employment move together 5.13 Costs determine price and demand determines quantity 5.14 A graphical representation of Sraffa’s (1926) preferred model of the normal firm 5.15 The economic theory of income distribution argues that the wage equals the marginal product of labor 5.16 Economics has no explanation of wage determination or anything else with constant retu