Judge Posner's A Failure of Capitalism: The Crisis of '08 and the Descent into Depression: A Review Brian Gilmore. Thus, A Failure of Capitalism is intriguing for many reasons but initially because of the choice of title. A.: A failure of capitalism 289 by itself. He is (now) surprisingly critical of individual greed as a cause for the crisis. HisbrushingasidethenotionoftenvoicedinconservativecirclesthattheCommunity. A Failure of Capitalism — Richard A. Posner. The financial and economic crisis that began in 2. How could it have happened, especially after all that we’ve learned from the Great Depression? Why wasn’t it anticipated so that remedial steps could be taken to avoid or mitigate it? What can be done to reverse a slide into a full- blown depression? Why have the responses to date of the government and the economics profession been so lackluster? Richard Posner presents a concise and non- technical examination of this mother of all financial disasters and of the, as yet, stumbling efforts to cope with it. No previous acquaintance on the part of the reader with macroeconomics or the theory of finance is presupposed. This is a book for intelligent generalists that will interest specialists as well. Among the facts and causes Posner identifies are: excess savings flowing in from Asia and the reckless lowering of interest rates by the Federal Reserve Board; the relation between executive compensation, short- term profit goals, and risky lending; the housing bubble fuelled by low interest rates, aggressive mortgage marketing, and loose regulations; the low savings rate of American people; and the highly leveraged balance sheets of large financial institutions. Posner analyzes the two basic remedial approaches to the crisis, which correspond to the two theories of the cause of the Great Depression: the monetarist—that the Federal Reserve Board allowed the money supply to shrink, thus failing to prevent a disastrous deflation—and the Keynesian—that the depression was the product of a credit binge in the 1. Posner concludes that the pendulum swung too far and that our financial markets need to be more heavily regulated. Buy A Failure of Capitalism: The Crisis of '08 and the Descent into Depression by Richard A. Why the title 'A Failure of Capitalism?' Posner recognizes that competition carries the seeds of capitalism's. Among the facts and causes Posner identifies are: excess savings flowing in from Asia and the reckless lowering of interest rates by the Federal Reserve Board; the relation between executive compensation.
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