Unfettered Capitalism Can Be Lethal

The Snake Bit Us By Frank Schiavone In the spring of 2000, a stock market bubble burst siphoning off roughly ten trillion dollars of wealth. That’s $33,000 for every person in the Nation. In response, the Federal Reserve slashed interest rates to historic new lows inundating the market with cheap credit. Our Calvinistic impulses long since forgotten, Americans went on a spending binge. (The...

Efforts to Expand HomeOwnership Overshot the Mark

Bipartisan Housing Initiatives Helped To Fuel Massive Asset Bubble By Frank Schiavone “Expanding Homeownership: The President believes that homeownership is the cornerstone of America’s vibrant communities and benefits individual families by building stability and long-term financial security. In June 2002, President Bush issued America’s Homeownership Challenge to the real estate and...

We Are All Keynesians Now

We Are All Keynesians Now By Frank Schiavone “Those of us who have looked to the self-interest of lending institutions to protect shareholders’ equity, myself included, are in a state of shocked disbelief …“This modern risk-management paradigm held sway for decades. The whole intellectual edifice, however, collapsed in the summer of last year. This crisis has turned out to be much...

Our Shaky Economic Foundation

Simpler Times   By Frank Schiavone Things used to be a lot simpler. We lived in smaller homes with just one TV. There was no shame in driving a used car. We were more earnest savers. A savings account got you about a 5% return on your “investment”. Banks would not dream of charging you a fee for the privilege of parking your money there. Banks and S&Ls would leverage the...