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Fault lines [electronic resource] : how hidden fractures still threaten the world economy /
Raghuram G. Rajan.
imprint
Princeton : Princeton University Press, c2010.
description
x, 260 p. ; 24 cm.
ISBN
9780691146836 (acid-free paper)
format(s)
Book
Holdings
More Details
imprint
Princeton : Princeton University Press, c2010.
isbn
9780691146836 (acid-free paper)
restrictions
Licensed for access by U. of T. users.
contents note
Let them eat credit -- Exporting to grow -- Flighty foreign financing -- A weak safety net -- From bubble to bubble -- When money is the measure of all worth -- Betting the bank -- Reforming finance -- Improving access in america -- The fable of the bees replayed.
catalogue key
11949442
 
Includes bibliographical references (p. 231-246) and index.
A Look Inside
Awards
This item was nominated for the following awards:
PSP Prose Awards, USA, 2010 : Won
Excerpts
Flap Copy
" Fault Lines provides an excellent analysis of the lessons to be learned from the financial crisis, and the difficult choices that lie ahead. Of the many books written in the wake of our recent economic meltdown, this is the one that gets it right."--George A. Akerlof, coauthor of Animal Spirits and Identity Economics "Amidst the welter of books about our financial crisis, Rajan's book stands out for several reasons: the author's intellectual distinction, his academic and real-world involvement in the problems of finance and the macroeconomy, his global perspective, his search for the roots of the financial crisis in America's growing economic inequality, and also his prescience. In 2005, Rajan foresaw the coming financial collapse--and was fiercely criticized for his insight."--Richard A. Posner, author of A Failure of Capitalism: The Crisis of '08 and the Descent into Depression "Beautifully clear, cogent, and highly readable. This is the best book out there on the global imbalances that gave us the last financial crisis and might well give us the next one."--Kenneth S. Rogoff, coauthor of This Time Is Different: Eight Centuries of Financial Folly
Flap Copy
"Fault Linesprovides an excellent analysis of the lessons to be learned from the financial crisis, and the difficult choices that lie ahead. Of the many books written in the wake of our recent economic meltdown, this is the one that gets it right."--George A. Akerlof, coauthor ofAnimal SpiritsandIdentity Economics"Amidst the welter of books about our financial crisis, Rajan's book stands out for several reasons: the author's intellectual distinction, his academic and real-world involvement in the problems of finance and the macroeconomy, his global perspective, his search for the roots of the financial crisis in America's growing economic inequality, and also his prescience. In 2005, Rajan foresaw the coming financial collapse--and was fiercely criticized for his insight."--Richard A. Posner, author ofA Failure of Capitalism: The Crisis of '08 and the Descent into Depression"Beautifully clear, cogent, and highly readable. This is the best book out there on the global imbalances that gave us the last financial crisis and might well give us the next one."--Kenneth S. Rogoff, coauthor ofThis Time Is Different: Eight Centuries of Financial Folly
Full Text Reviews
Appeared in Choice on 2010-10-01:
Rajan (Univ. of Chicago; former IMF chief economist) explains the financial market panic of 2008 and argues that the weaknesses or fault lines in the world economy that led to financial collapse and recession persist. Like other commentators on the crash, he emphasizes that expectations of government bailout, what some call privatizing gains and socializing losses, encouraged financial institutions and others in the private sector to take greater and more dangerous risks than they should have. Other themes are not so conventional, but overall, Rajan stresses incentives: stagnant income growth at the bottom half of the income distribution encourages politicians to redistribute through cheap credit, countries that pursue development through export strategies create international instability, and an inadequate US social safety net allows the rest of the world to depend on the Federal Reserve as a stimulator of last resort. Economists who can challenge their peers while remaining accessible to the general reader are rare, but Rajan belongs to this elite group. No short summary can do justice to this well-written, insightful, and nuanced study. Summing Up: Highly recommended. All audiences. R. E. Schenk emeritus, Saint Joseph's College (IN)
Appeared in Library Journal on 2011-03-15:
Rajan (Eric J. Gleacher Distinguished Service Professor of Finance, Univ. of Chicago Booth Sch. of Business) presents a readable consideration of flaws-"fault lines"-that still exist in American and global financial practices and systems, discussing growing income inequalities worldwide, easy credit, export imbalances, and the lack of "safety nets" in a jobless recovery. (c) Copyright 2011. Library Journals LLC, a wholly owned subsidiary of Media Source, Inc. No redistribution permitted.
Reviews
Review Quotes
A book that should be the default choice of discerning finance professionals when they enter the store the next time.
"A book that should be the default choice of discerning finance professionals when they enter the store the next time."-- D. Murali, Business Line
A book that should be the default choice of discerning finance professionals when they enter the store the next time. -- D. Murali, Business Line
A high-powered yet accessible analysis of the financial crisis and its aftermath, Fault Lines was awarded the FT/Goldman Sachs Business Book of the Year. Rajan . . . was one of the few who warned that the crisis was coming and his book fizzes with striking and thought-provoking ideas.
A high-powered yet accessible analysis of the financial crisis and its aftermath, Fault Lines was awarded the FT/Goldman Sachs Business Book of the Year. Rajan . . . was one of the few who warned that the crisis was coming and his book fizzes with striking and thought-provoking ideas. -- Financial Times
"A high-powered yet accessible analysis of the financial crisis and its aftermath, Fault Lines was awarded the FT/Goldman Sachs Business Book of the Year. Rajan . . . was one of the few who warned that the crisis was coming and his book fizzes with striking and thought-provoking ideas."-- Financial Times (FT Critics Pick 2010)
A thought-provoking new book. . . . [Rajan's] voice is worth listening to.
"A thought-provoking new book. . . . [Rajan's] voice is worth listening to."-- Martin Wolf, Financial Times
A thought-provoking new book. . . . [Rajan's] voice is worth listening to. -- Martin Wolf, Financial Times
Best Crisis Book by an Economist (2010).
"Best Crisis Book by an Economist (2010)."-- James Pressley, Bloomberg News
Best Crisis Book by an Economist (2010). -- James Pressley, Bloomberg News
'Convincing'
[C]onvincing.
"[C]onvincing."-- Christopher Caldwell, New York Times Magazine
[C]onvincing. -- Christopher Caldwell, New York Times Magazine
Dozens of experts have explored the reasons behind the ongoing global economic turmoil, and Raghuram Rajan provides his own elegant and thoughtful analysis in Fault Lines.
"Dozens of experts have explored the reasons behind the ongoing global economic turmoil, and Raghuram Rajan provides his own elegant and thoughtful analysis in Fault Lines."-- BizEd
Dozens of experts have explored the reasons behind the ongoing global economic turmoil, and Raghuram Rajan provides his own elegant and thoughtful analysis in Fault Lines. -- BizEd
Economists who can challenge their peers while remaining accessible to the general reader are rare, but Rajan belongs to this elite group. No short summary can do justice to this well-written, insightful, and nuanced study.
"Economists who can challenge their peers while remaining accessible to the general reader are rare, but Rajan belongs to this elite group. No short summary can do justice to this well-written, insightful, and nuanced study."-- Choice
Economists who can challenge their peers while remaining accessible to the general reader are rare, but Rajan belongs to this elite group. No short summary can do justice to this well-written, insightful, and nuanced study. -- Choice
[E]xcellent. . . . [ Fault Lines ] deserve[s] to be widely read in a time when the tendency to blame everything on catch-all terms like 'globalisation' is gaining ground.
[E]xcellent. . . . [Fault Lines] deserve[s] to be widely read in a time when the tendency to blame everything on catch-all terms like 'globalisation' is gaining ground.
"[E]xcellent. . . . [ Fault Lines ] deserve[s] to be widely read in a time when the tendency to blame everything on catch-all terms like 'globalisation' is gaining ground."-- Economist
[E]xcellent. . . . [ Fault Lines ] deserve[s] to be widely read in a time when the tendency to blame everything on catch-all terms like 'globalisation' is gaining ground. -- Economist
[E]xcellent. . . . [Fault Lines] deserve[s] to be widely read in a time when the tendency to blame everything on catch-all terms like 'globalisation' is gaining ground. -- Economist
Fault Lines has a strong claim to be the economics book that best caught the spirit of 2010. Raghuram Rajan's receipt of the Financial Times and Goldman Sachs annual business book award only confirmed his book's widespread popularity. It is not hard to see why so many people liked it. Fault Lines eschews hyperbole for a lucid and balanced account of the crisis.
" Fault Lines has a strong claim to be the economics book that best caught the spirit of 2010. Raghuram Rajan's receipt of the Financial Times and Goldman Sachs annual business book award only confirmed his book's widespread popularity. It is not hard to see why so many people liked it. Fault Lines eschews hyperbole for a lucid and balanced account of the crisis."-- Fund Strategy
Fault Lines has a strong claim to be the economics book that best caught the spirit of 2010. Raghuram Rajan's receipt of the Financial Times and Goldman Sachs annual business book award only confirmed his book's widespread popularity. It is not hard to see why so many people liked it. Fault Lines eschews hyperbole for a lucid and balanced account of the crisis. -- Fund Strategy
Fault Lines is a must-read.
" Fault Lines is a must-read."-- Nouriel Roubini, Forbes.com
Fault Lines is a must-read. -- Nouriel Roubini, Forbes.com
Fault Linesis a must-read. -- Nouriel Roubini, Forbes.com
[ Fault Lines ]'s great strength is that it is a clearly written work of political economy, accessible to readers who do not have a PhD in economics or finance. Its objective is not to point fingers at the guilty, and it comes to some surprising conclusions.
"[ Fault Lines ]'s great strength is that it is a clearly written work of political economy, accessible to readers who do not have a PhD in economics or finance. Its objective is not to point fingers at the guilty, and it comes to some surprising conclusions."-- Stewart Fleming, European Voice
[ Fault Lines ]'s great strength is that it is a clearly written work of political economy, accessible to readers who do not have a PhD in economics or finance. Its objective is not to point fingers at the guilty, and it comes to some surprising conclusions. -- Stewart Fleming, European Voice
Few people were able to foresee the recent economic downturn. Raghuram Rajan . . . was one of them. This makes his new book, Fault Lines , worthy of consideration amidst the rampant speculation about the causes of the financial crisis. . . . Fault Lines is valuable primarily for its clear explanation of unintended economic consequences from well-meaning government intervention.
Few people were able to foresee the recent economic downturn. Raghuram Rajan . . . was one of them. This makes his new book, Fault Lines, worthy of consideration amidst the rampant speculation about the causes of the financial crisis. . . . Fault Lines is valuable primarily for its clear explanation of unintended economic consequences from well-meaning government intervention.
"Few people were able to foresee the recent economic downturn. Raghuram Rajan . . . was one of them. This makes his new book, Fault Lines , worthy of consideration amidst the rampant speculation about the causes of the financial crisis. . . . Fault Lines is valuable primarily for its clear explanation of unintended economic consequences from well-meaning government intervention."-- Washington Times
Few people were able to foresee the recent economic downturn. Raghuram Rajan . . . was one of them. This makes his new book, Fault Lines , worthy of consideration amidst the rampant speculation about the causes of the financial crisis. . . . Fault Lines is valuable primarily for its clear explanation of unintended economic consequences from well-meaning government intervention. -- Washington Times
Few people were able to foresee the recent economic downturn. Raghuram Rajan . . . was one of them. This makes his new book,Fault Lines, worthy of consideration amidst the rampant speculation about the causes of the financial crisis. . . .Fault Linesis valuable primarily for its clear explanation of unintended economic consequences from well-meaning government intervention. -- Washington Times
Former IMF chief economist Raghuram G. Rajan . . . in his new book, Fault Lines , brings together and explains the diverse failings that contributed to the crisis--the fault lines, as he puts it, that were exposed by the events of the past several years. Rajan then puts forward broad policy recommendations to ward off a future problem. . . . Rajan's book takes a comprehensive look at what got us into the crisis and offers an intriguing approach to avoiding another one.
Former IMF chief economist Raghuram G. Rajan . . . in his new book,Fault Lines, brings together and explains the diverse failings that contributed to the crisis--the fault lines, as he puts it, that were exposed by the events of the past several years. Rajan then puts forward broad policy recommendations to ward off a future problem. . . . Rajan's book takes a comprehensive look at what got us into the crisis and offers an intriguing approach to avoiding another one.
"Former IMF chief economist Raghuram G. Rajan . . . in his new book, Fault Lines , brings together and explains the diverse failings that contributed to the crisis--the fault lines, as he puts it, that were exposed by the events of the past several years. Rajan then puts forward broad policy recommendations to ward off a future problem. . . . Rajan's book takes a comprehensive look at what got us into the crisis and offers an intriguing approach to avoiding another one."-- Phillip Swagel, Finance & Development
Former IMF chief economist Raghuram G. Rajan . . . in his new book, Fault Lines , brings together and explains the diverse failings that contributed to the crisis--the fault lines, as he puts it, that were exposed by the events of the past several years. Rajan then puts forward broad policy recommendations to ward off a future problem. . . . Rajan's book takes a comprehensive look at what got us into the crisis and offers an intriguing approach to avoiding another one. -- Phillip Swagel, Finance & Development
Former IMF chief economist Raghuram G. Rajan . . . in his new book,Fault Lines, brings together and explains the diverse failings that contributed to the crisis--the fault lines, as he puts it, that were exposed by the events of the past several years. Rajan then puts forward broad policy recommendations to ward off a future problem. . . . Rajan's book takes a comprehensive look at what got us into the crisis and offers an intriguing approach to avoiding another one. -- Phillip Swagel, Finance & Development
I devoured Raghuram Rajan's Fault Lines: How Hidden Fractures Still Threaten the World Economy in a very short span of time last night. It's brief, well-written, and extremely interesting. I would definitely recommend adding it to your financial crisis reading list.
I devoured Raghuram Rajan'sFault Lines: How Hidden Fractures Still Threaten the World Economyin a very short span of time last night. It's brief, well-written, and extremely interesting. I would definitely recommend adding it to your financial crisis reading list.
"I devoured Raghuram Rajan's Fault Lines: How Hidden Fractures Still Threaten the World Economy in a very short span of time last night. It's brief, well-written, and extremely interesting. I would definitely recommend adding it to your financial crisis reading list."-- Matthew Yglesias, Yglesias blog
I devoured Raghuram Rajan's Fault Lines: How Hidden Fractures Still Threaten the World Economy in a very short span of time last night. It's brief, well-written, and extremely interesting. I would definitely recommend adding it to your financial crisis reading list. -- Matthew Yglesias, Yglesias blog
I devoured Raghuram Rajan'sFault Lines: How Hidden Fractures Still Threaten the World Economyin a very short span of time last night. It's brief, well-written, and extremely interesting. I would definitely recommend adding it to your financial crisis reading list. -- Matthew Yglesias, Yglesias blog
In 2007, then-chief IMF economist Raghuram G. Rajan delivered a stark warning to the world's top bankers: financial markets were headed for doom. They laughed it off. In the wake of the collapse that followed, Rajan has written a new book,Fault Lines: How Hidden Fractures Still Threaten the World Economy, that warns the system is doomed to repeat its mistakes. Like many defenders of the market, Rajan urges us not to demonize the bankers. But it's this fiscal conservative's focus on inequality that makes him stand out from the pack. The growing wage gap, he argues, is a hidden driver of financial instability, putting constant pressure on politicians to enact short-term fixes.
In 2007, then-chief IMF economist Raghuram G. Rajan delivered a stark warning to the world's top bankers: financial markets were headed for doom. They laughed it off. In the wake of the collapse that followed, Rajan has written a new book, Fault Lines: How Hidden Fractures Still Threaten the World Economy , that warns the system is doomed to repeat its mistakes. Like many defenders of the market, Rajan urges us not to demonize the bankers. But it's this fiscal conservative's focus on inequality that makes him stand out from the pack. The growing wage gap, he argues, is a hidden driver of financial instability, putting constant pressure on politicians to enact short-term fixes. -- Toronto Star
In a new book . . . entitled Fault Lines , Rajan argues that the initial causes of the breakdown were stagnant wages and rising inequality. With the purchasing power of many middle-class households lagging behind the cost of living, there was an urgent demand for credit. The financial industry, with encouragement from the government, responded by supplying home-equity loans, subprime mortgages, and auto loans. . . . The side effects of unrestrained credit growth turned out to be devastating--a possibility most economists had failed to consider.
In a new book . . . entitledFault Lines, Rajan argues that the initial causes of the breakdown were stagnant wages and rising inequality. With the purchasing power of many middle-class households lagging behind the cost of living, there was an urgent demand for credit. The financial industry, with encouragement from the government, responded by supplying home-equity loans, subprime mortgages, and auto loans. . . . The side effects of unrestrained credit growth turned out to be devastating--a possibility most economists had failed to consider.
"In a new book . . . entitled Fault Lines , Rajan argues that the initial causes of the breakdown were stagnant wages and rising inequality. With the purchasing power of many middle-class households lagging behind the cost of living, there was an urgent demand for credit. The financial industry, with encouragement from the government, responded by supplying home-equity loans, subprime mortgages, and auto loans. . . . The side effects of unrestrained credit growth turned out to be devastating--a possibility most economists had failed to consider."-- John Cassidy, New Yorker
In a new book . . . entitled Fault Lines , Rajan argues that the initial causes of the breakdown were stagnant wages and rising inequality. With the purchasing power of many middle-class households lagging behind the cost of living, there was an urgent demand for credit. The financial industry, with encouragement from the government, responded by supplying home-equity loans, subprime mortgages, and auto loans. . . . The side effects of unrestrained credit growth turned out to be devastating--a possibility most economists had failed to consider. -- John Cassidy, New Yorker
In a new book . . . entitledFault Lines, Rajan argues that the initial causes of the breakdown were stagnant wages and rising inequality. With the purchasing power of many middle-class households lagging behind the cost of living, there was an urgent demand for credit. The financial industry, with encouragement from the government, responded by supplying home-equity loans, subprime mortgages, and auto loans. . . . The side effects of unrestrained credit growth turned out to be devastating--a possibility most economists had failed to consider. -- John Cassidy, New Yorker
Insightful, educative and incredibly gripping, if you want just one book to understand the ongoing global financial crisis and the way forward, Fault Lines it is.
"Insightful, educative and incredibly gripping, if you want just one book to understand the ongoing global financial crisis and the way forward, Fault Lines it is."-- Gautam Chikermane, Hindustan Times
Insightful, educative and incredibly gripping, if you want just one book to understand the ongoing global financial crisis and the way forward, Fault Lines it is. -- Gautam Chikermane, Hindustan Times
Insightful, educative and incredibly gripping, if you want just one book to understand the ongoing global financial crisis and the way forward,Fault Linesit is. -- Gautam Chikermane, Hindustan Times
Like geological fault lines, the fissures in the world economic system are more hidden and widespread than many realize, he says. And they are potentially more destructive than other, more obvious culprits, like greedy bankers, sleepy regulators and irresponsible borrowers. Mr. Rajan . . . argues that the actions of these players (and others) unfolded on a larger world stage, that was (and is) subject to the imperatives of political economies. . . . [A] serious and thoughtful book.
"Like geological fault lines, the fissures in the world economic system are more hidden and widespread than many realize, he says. And they are potentially more destructive than other, more obvious culprits, like greedy bankers, sleepy regulators and irresponsible borrowers. Mr. Rajan . . . argues that the actions of these players (and others) unfolded on a larger world stage, that was (and is) subject to the imperatives of political economies. . . . [A] serious and thoughtful book."-- New York Times
Like geological fault lines, the fissures in the world economic system are more hidden and widespread than many realize, he says. And they are potentially more destructive than other, more obvious culprits, like greedy bankers, sleepy regulators and irresponsible borrowers. Mr. Rajan . . . argues that the actions of these players (and others) unfolded on a larger world stage, that was (and is) subject to the imperatives of political economies. . . . [A] serious and thoughtful book. -- New York Times
Mr. Rajan, a Massachusetts Institute of Technology Ph.D., sees the crisis through an unusual lens. He spent his childhood in India, studied electrical engineering there and still advises its government. He later did a few years as chief economist of the International Monetary Fund. More than most economists, he sees ways in which rich countries behave similarly to poorer ones and sees the roots of the crisis as global.
Praise for Raghuram G. Rajan and Luigi Zingales'sSaving Capitalism from the Capitalists: "Raghuram G. Rajan and Luigi Zingales . . . argue persuasively that free markets 'cannot flourish without the very visible' hand of government.'
Rajan . . . comes up with original and important long-term remedies. . . . Rajan's book is a bold enterprise in three ways: firstly it aims to explain the US financial crisis by looking at deep, decade-long fractures in economies and societies; secondly it suggests well-known but radical solutions that few dare put forward; and finally it supplies innovative answers to practical questions. . . . [T]he book will please any reader looking for an inquiry into the deepest causes of the recession and a consistent account of government's errors of omission and commission.
"Rajan . . . comes up with original and important long-term remedies. . . . Rajan's book is a bold enterprise in three ways: firstly it aims to explain the US financial crisis by looking at deep, decade-long fractures in economies and societies; secondly it suggests well-known but radical solutions that few dare put forward; and finally it supplies innovative answers to practical questions. . . . [T]he book will please any reader looking for an inquiry into the deepest causes of the recession and a consistent account of government's errors of omission and commission."-- Natacha Postel-Vinay, British Politics and Policy
Rajan . . . comes up with original and important long-term remedies. . . . Rajan's book is a bold enterprise in three ways: firstly it aims to explain the US financial crisis by looking at deep, decade-long fractures in economies and societies; secondly it suggests well-known but radical solutions that few dare put forward; and finally it supplies innovative answers to practical questions. . . . [T]he book will please any reader looking for an inquiry into the deepest causes of the recession and a consistent account of government's errors of omission and commission. -- Natacha Postel-Vinay, British Politics and Policy
Rajan is worth reading not just because he was correct when few were but also because his writing is clear as a bell, even to nonspecialists.
"Rajan is worth reading not just because he was correct when few were but also because his writing is clear as a bell, even to nonspecialists."-- Christopher Caldwell, Weekly Standard
Rajan is worth reading not just because he was correct when few were but also because his writing is clear as a bell, even to nonspecialists. -- Christopher Caldwell, Weekly Standard
Rajan's Fault Lines is . . . expansive and policy-focused and clearly destined to become a must-read on any list of books on the recent global crisis.
"Rajan's Fault Lines is . . . expansive and policy-focused and clearly destined to become a must-read on any list of books on the recent global crisis."-- Jahangir Aziz, Business Standard
Rajan's Fault Lines is . . . expansive and policy-focused and clearly destined to become a must-read on any list of books on the recent global crisis. -- Jahangir Aziz, Business Standard
Rajan'sFault Linesis . . . expansive and policy-focused and clearly destined to become a must-read on any list of books on the recent global crisis. -- Jahangir Aziz, Business Standard
Rajan's writing is clear and direct.
"Rajan's writing is clear and direct."-- James Pressley, Bloomberg News
Rajan's writing is clear and direct. -- James Pressley, Bloomberg News
The book, published by Princeton University Press, saw off stiff competition from five others on the shortlist, to be chosen as 'the most compelling and enjoyable' business title of 2010. The final intense debate among the seven judges came down to a choice between Fault Lines and Too Big to Fail , Andrew Ross Sorkin's acclaimed minute-by-minute analysis of the collapse of Lehman Brothers. The book identifies the flaws that helped cripple the world financial system, prescribes potential remedies, but also warns that unless policymakers push through painful reforms, the world could be plunged into renewed turmoil. -- Financial Times
The book, published by Princeton University Press, saw off stiff competition from five others on the shortlist, to be chosen as 'the most compelling and enjoyable' business title of 2010. The final intense debate among the seven judges came down to a choice betweenFault LinesandToo Big to Fail, Andrew Ross Sorkin's acclaimed minute-by-minute analysis of the collapse of Lehman Brothers. The book identifies the flaws that helped cripple the world financial system, prescribes potential remedies, but also warns that unless policymakers push through painful reforms, the world could be plunged into renewed turmoil. -- Financial Times
The critics are wrong: Raghuram Rajan's analysis of the global financial crisis remains highly relevant and deserves to be widely read. . . . The breadth of Rajan's explanatory framework--which is presented cogently and concisely within 230 pages of text--marks this book apart from many others that tackle the same themes.
"The critics are wrong: Raghuram Rajan's analysis of the global financial crisis remains highly relevant and deserves to be widely read. . . . The breadth of Rajan's explanatory framework--which is presented cogently and concisely within 230 pages of text--marks this book apart from many others that tackle the same themes."-- Mark Hannam, Prospect
The critics are wrong: Raghuram Rajan's analysis of the global financial crisis remains highly relevant and deserves to be widely read. . . . The breadth of Rajan's explanatory framework--which is presented cogently and concisely within 230 pages of text--marks this book apart from many others that tackle the same themes. -- Mark Hannam, Prospect
The left has figured out who to blame for the financial crisis: Greedy Wall Street bankers, especially at Goldman Sachs. The right has figured it out, too: It was government's fault, especially Fannie Mae and Freddie Mac. Raghuram Rajan of the University of Chicago's Booth School of Business says it's more complicated: Fault lines along the tectonic plates of the global economy pushed big government and big finance to a financial earthquake. To him, this was a Greek tragedy in which traders and bankers, congressmen and subprime borrowers all played their parts until the drama reached the inevitably painful end. (Mr. Rajan plays Cassandra, of course.) But just when you're about to cast him as a University of Chicago free-market stereotype, he surprises by identifying the widening gap between rich and poor as a big cause of the calamity.
The left has figured out who to blame for the financial crisis: Greedy Wall Street bankers, especially at Goldman Sachs. The right has figured it out, too: It was government's fault, especially Fannie Mae and Freddie Mac. Raghuram Rajan of the University of Chicago's Booth School of Business says it's more complicated: Fault lines along the tectonic plates of the global economy pushed big government and big finance to a financial earthquake. To him, this was a Greek tragedy in which traders and bankers, congressmen and subprime borrowers all played their parts until the drama reached the inevitably painful end. (Mr. Rajan plays Cassandra, of course.) But just when you're about to cast him as a University of Chicago free-market stereotype, he surprises by identifying the widening gap between rich and poor as a big cause of the calamity. -- David Wessel, Wall Street Journal
The proposed global reforms that [Rajan] lists in Fault Lines run the gamut from the prosaic to grandiose. Along with revamping Wall Street's pay system, he offers innovative ideas on building capital buffers into the global credit system, obviating much of the need for bailouts of companies deemed too big or too enmeshed in the financial system to fail.
The proposed global reforms that [Rajan] lists inFault Linesrun the gamut from the prosaic to grandiose. Along with revamping Wall Street's pay system, he offers innovative ideas on building capital buffers into the global credit system, obviating much of the need for bailouts of companies deemed too big or too enmeshed in the financial system to fail.
"The proposed global reforms that [Rajan] lists in Fault Lines run the gamut from the prosaic to grandiose. Along with revamping Wall Street's pay system, he offers innovative ideas on building capital buffers into the global credit system, obviating much of the need for bailouts of companies deemed too big or too enmeshed in the financial system to fail."-- Barron's
The proposed global reforms that [Rajan] lists in Fault Lines run the gamut from the prosaic to grandiose. Along with revamping Wall Street's pay system, he offers innovative ideas on building capital buffers into the global credit system, obviating much of the need for bailouts of companies deemed too big or too enmeshed in the financial system to fail. -- Barron's
The proposed global reforms that [Rajan] lists inFault Linesrun the gamut from the prosaic to grandiose. Along with revamping Wall Street's pay system, he offers innovative ideas on building capital buffers into the global credit system, obviating much of the need for bailouts of companies deemed too big or too enmeshed in the financial system to fail. -- Barron's
What caused the crisis? . . . There is an embarrassment of causes--especially embarrassing when you recall how few people saw where they might lead. Raghuram Rajan . . . was one of the few to sound an alarm before 2007. That gives his novel and sometimes surprising thesis added authority. He argues in his excellent new book that the roots of the calamity go wider and deeper still.
"What caused the crisis? . . . There is an embarrassment of causes--especially embarrassing when you recall how few people saw where they might lead. Raghuram Rajan . . . was one of the few to sound an alarm before 2007. That gives his novel and sometimes surprising thesis added authority. He argues in his excellent new book that the roots of the calamity go wider and deeper still."-- Clive Crook, Financial Times
What caused the crisis? . . . There is an embarrassment of causes--especially embarrassing when you recall how few people saw where they might lead. Raghuram Rajan . . . was one of the few to sound an alarm before 2007. That gives his novel and sometimes surprising thesis added authority. He argues in his excellent new book that the roots of the calamity go wider and deeper still. -- Clive Crook, Financial Times
What if the financial crash of 2008 was really caused by income inequality? Not greedy bankers, not reckless homeowners, but the ever widening-gulf between the rich and the poor? And what if the lack of social services--like health care--made things much, much worse? This is the startling new theory from Raghuram Rajan. . . . [ Fault Lines is] especially fascinating because it mixes free-market Chicago School economics with good-government ideas straight out of Obamaland.
What if the financial crash of 2008 was really caused by income inequality? Not greedy bankers, not reckless homeowners, but the ever widening-gulf between the rich and the poor? And what if the lack of social services--like health care--made things much, much worse? This is the startling new theory from Raghuram Rajan. . . . [Fault Linesis] especially fascinating because it mixes free-market Chicago School economics with good-government ideas straight out of Obamaland.
"What if the financial crash of 2008 was really caused by income inequality? Not greedy bankers, not reckless homeowners, but the ever widening-gulf between the rich and the poor? And what if the lack of social services--like health care--made things much, much worse? This is the startling new theory from Raghuram Rajan. . . . [ Fault Lines is] especially fascinating because it mixes free-market Chicago School economics with good-government ideas straight out of Obamaland."-- John Richardson, Esquire.com
What if the financial crash of 2008 was really caused by income inequality? Not greedy bankers, not reckless homeowners, but the ever widening-gulf between the rich and the poor? And what if the lack of social services--like health care--made things much, much worse? This is the startling new theory from Raghuram Rajan. . . . [ Fault Lines is] especially fascinating because it mixes free-market Chicago School economics with good-government ideas straight out of Obamaland. -- John Richardson, Esquire.com
What if the financial crash of 2008 was really caused by income inequality? Not greedy bankers, not reckless homeowners, but the ever widening-gulf between the rich and the poor? And what if the lack of social services--like health care--made things much, much worse? This is the startling new theory from Raghuram Rajan. . . . [Fault Linesis] especially fascinating because it mixes free-market Chicago School economics with good-government ideas straight out of Obamaland. -- John Richardson, Esquire.com
Winner of the 2013 Deutsche Bank Prize in Financial Economics, The Center for Financial Studies Winner of the 2010 Business Book of the Year Award, Financial Times and Goldman Sachs Winner of the 2011 Gold Medal in Finance/Investment/Economics, Independent Publisher Book Awards Winner of the 2010 PROSE Award in Economics, American Publishers Awards Winner of the 2010 Gold Medal Book of the Year Award in Business & Economics, ForeWord Reviews Finalist for the 2010 Paul A. Samuelson Award, TIAA-CREF One of strategy+business magazine 's Best Business Books of the Year for 2010 Best Crisis Book by an Economist and Named one of Bloomberg News 's Thirty Business Books of the Year for 2010 One of Financial Times 's Books of the Year in Business & Economics, Nonfiction Round-Up for 2010 Finalist for the 2010 Book of the Year Awards in Business and Economics, ForeWord Reviews Finalist for the 2011 Estoril Global Issues Distinguished Book Prize
With Fault Lines , Rajan has made an original diagnosis of the credit crisis, one that goes much further than those of greedy bankers or wasteful mortgage giants such as Fannie Mae and Freddie Mac.
With Fault Lines , Rajan has made an original diagnosis of the credit crisis, one that goes much further than those of greedy bankers or wasteful mortgage giants such as Fannie Mae and Freddie Mac. -- Christophe De Rijcke, De Tijd
WithFault Lines, Rajan has made an original diagnosis of the credit crisis, one that goes much further than those of greedy bankers or wasteful mortgage giants such as Fannie Mae and Freddie Mac. -- Christophe De Rijcke, De Tijd
"With Fault Lines , Rajan has made an original diagnosis of the credit crisis, one that goes much further than those of greedy bankers or wasteful mortgage giants such as Fannie Mae and Freddie Mac."-- Christophe De Rijcke, De Tijd (translated from the Dutch by K.C.L.)
Amidst the welter of books about our financial crisis, Rajan's book stands out for several reasons: the author's intellectual distinction, his academic and real-world involvement in the problems of finance and the macroeconomy, his global perspective, his search for the roots of the financial crisis in America's growing economic inequality, and also his prescience. In 2005, Rajan foresaw the coming financial collapse--and was fiercely criticized for his insight.
Beautifully clear, cogent, and highly readable. This is the best book out there on the global imbalances that gave us the last financial crisis and might well give us the next one.
Fault Linesprovides an excellent analysis of the lessons to be learned from the financial crisis, and the difficult choices that lie ahead. Of the many books written in the wake of our recent economic meltdown, this is the one that gets it right.
This item was reviewed in:
Choice, October 2010
Library Journal, March 2011
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Summaries
Bowker Data Service Summary
Raghuram Rajan warned about the global financial crisis long before it hit. Now, as the world struggles to recover, it's easy to blame the crisis on a few greedy bankers who took irrational risks. In 'Fault Lines', Rajan argues that serious flaws in the economy are also to blame, & warns that a further crisis awaits us if they aren't fixed.
Main Description
Economist Raghuram Rajan warned about the global financial crisis long before it hit, but few listened. Now, as the world struggles to recover, it's tempting to blame the crisis on just a few greedy bankers who took irrational risks and left the rest of us to foot the bill. In Fault Lines, Rajan argues that serious flaws in the economy are also to blame, and warns that a potentially more devastating crisis awaits us if they aren't fixed. Can we risk not listening to him a second time? Rajan shows how the individual choices that collectively brought about the economic meltdown--made by bankers, government officials, and ordinary homeowners--were rational responses to a flawed global financial order in which the incentives to take on risk are incredibly out of step with the dangers those risks pose. He traces the deepening fault lines in a system overly dependent on American consumption to power the world economy and stave off a global downturn; a system where America's thin social safety net has created tremendous political pressure to keep job creation robust, because jobs are the primary provider of health and other benefits; and where the U.S. financial sector, with its skewed incentives, is the critical but unstable link between an overstimulated America and an underconsuming world. Rajan demonstrates how inequalities in U.S. incomes, education, and health care are putting all of us into deeper financial peril, and he outlines sensible reforms to ensure a more stable world economy and to restore lasting prosperity.
Main Description
Raghuram Rajan was one of the few economists who warned of the global financial crisis before it hit. Now, as the world struggles to recover, it's tempting to blame what happened on just a few greedy bankers who took irrational risks and left the rest of us to foot the bill. In Fault Lines , Rajan argues that serious flaws in the economy are also to blame, and warns that a potentially more devastating crisis awaits us if they aren't fixed. Rajan shows how the individual choices that collectively brought about the economic meltdown--made by bankers, government officials, and ordinary homeowners--were rational responses to a flawed global financial order in which the incentives to take on risk are incredibly out of step with the dangers those risks pose. He traces the deepening fault lines in a world overly dependent on the indebted American consumer to power global economic growth and stave off global downturns. He exposes a system where America's growing inequality and thin social safety net create tremendous political pressure to encourage easy credit and keep job creation robust, no matter what the consequences to the economy's long-term health; and where the U.S. financial sector, with its skewed incentives, is the critical but unstable link between an overstimulated America and an underconsuming world. In Fault Lines , Rajan demonstrates how unequal access to education and health care in the United States puts us all in deeper financial peril, even as the economic choices of countries like Germany, Japan, and China place an undue burden on America to get its policies right. He outlines the hard choices we need to make to ensure a more stable world economy and restore lasting prosperity.
Main Description
Raghuram Rajan was one of the few economists who warned of the global financial crisis before it hit. Now, as the world struggles to recover, it's tempting to blame what happened on just a few greedy bankers who took irrational risks and left the rest of us to foot the bill. In Fault Lines, Rajan argues that serious flaws in the economy are also to blame, and warns that a potentially more devastating crisis awaits us if they aren't fixed.Rajan shows how the individual choices that collectively brought about the economic meltdown--made by bankers, government officials, and ordinary homeowners--were rational responses to a flawed global financial order in which the incentives to take on risk are incredibly out of step with the dangers those risks pose. He traces the deepening fault lines in a world overly dependent on the indebted American consumer to power global economic growth and stave off global downturns. He exposes a system where America's growing inequality and thin social safety net create tremendous political pressure to encourage easy credit and keep job creation robust, no matter what the consequences to the economy's long-term health; and where the U.S. financial sector, with its skewed incentives, is the critical but unstable link between an overstimulated America and an underconsuming world.In Fault Lines, Rajan demonstrates how unequal access to education and health care in the United States puts us all in deeper financial peril, even as the economic choices of countries like Germany, Japan, and China place an undue burden on America to get its policies right. He outlines the hard choices we need to make to ensure a more stable world economy and restore lasting prosperity.
Table of Contents
Acknowledgmentsp. ix
Introductionp. 1
Let Them Eat Creditp. 21
Exporting to Growp. 46
Flighty Foreign Financingp. 68
A Weak Safety Netp. 83
From Bubble to Bubblep. 101
When Money Is the Measure of All Worthp. 120
Betting the Bankp. 134
Reforming Financep. 154
Improving Access to Opportunity in Americap. 183
The Fable of the Bees Replayedp. 202
Epiloguep. 225
Notesp. 231
Indexp. 247
Table of Contents provided by Ingram. All Rights Reserved.

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