The Great Deformation
Page 99
INDEX
A123 company, 602, 604
Abe, Shinzo, 703
Acheson, Dean, 161, 215
Ackley, Gardner, 254–255
ACORN (Association of Communities for Reform Now), 408, 411
Agricultural Adjustment Act (AAA/1933)
description/problems, 181–182
New Deal and, 178–179, 181–182
Agriculture
debt changes (1919–1933), 180
mechanization revolution, 179–180
New Deal and, 180–182
statistics on, 182
World War I/early 1900s, 151, 179–180
AIG
bailout, 5, 6–7, 8, 11, 19, 21
before 2008, 356
“contagion” warning and, 6, 8–9, 10
credit default insurance (CDS), 6, 7, 10, 11–12
structure/“assets,” 6, 8–10
without bailout, 5–6, 7, 8, 11, 12
Al Qaeda, 678, 693
Alltel Corporation LBO, 518–519, 523–524
American General, 9
American Petroleum Institute, 673
Ameriquest Mortgage (Ameriquest Capital Corporation), 421–423, 442
Amtrak, 610
Anderson, Benjamin, 210, 344
Anderson, Marty, 71
Angell, Wayne
background, 307
Federal Reserve, 308, 318
financial futures, 307, 308, 314, 318
Apollo, 529
Arizona education funding, 595
Arnall, Roland, 421, 422, 423, 442
Arrow, Kenneth, 595n
Ash, Roy, 130
Asian economic growth
effects on US, 60–61, 63–64, 65–66
See also specific countries
Association of Communities for Reform Now (ACORN), 408, 411
Astor, Vincent, 144, 154
“ATMs going dark,” 32, 45
Auto industry
car sales slump, 625–626
debt in bubble era, 572–573, 576
excess capacity, 620
financial crisis (2008) and, 572
See also specific companies
Auto industry bailout
AutoNation/Jackson and, 626–629
George W. Bush and, 613, 615, 661
Mitt Romney and, 551–552, 664
Obama’s reelection and, 614, 623
one percent getting richer with, 660–668
problems overview, 613–614, 623–630
vulture capitalism, 663–665
See also specific companies
AutoNation and Mike Jackson, 624–625, 626–630
Bagehot, Walter, 699–700
Bagley, William, 305, 306, 309
Bailout. See Financial crisis (2008) bailout
Bain Capital
accounting tricks, 568–569
Ampad (American Pad and Paper), 564–567
bankruptcies and, 561–563, 564, 567, 570
Clear Channel, 531
debt and, 560, 562, 565–566, 567
Experian, 567–568, 570
Goldman Sachs and, 562
Greenspan bubble and, 560–562, 566, 570, 571
inside job (Experian), 567–568, 570
Italian yellow pages/phone book publisher, 569–570
job destruction vs. job creation, 558, 563–564, 570
KKR and, 515, 525, 526, 527, 529
Republican actions/beliefs and, 570–571
Romney’s tenure (summary), 560–561, 570
speculation/windfalls and, 558–570
Stage Stores Inc., 562–563, 564
Staples, 563–564
Wesley Jessen, 568–569, 570
Williamhouse, 565, 566
Bair, Sheila, 44
Baker, Howard
budget (1983), 81, 82
Kemp-Roth and, 95
spending cuts plans, 90–91, 100, 101
Volcker and, 264
Baker, Jim
background, 263, 348
job switch/at Treasury, 293, 314, 348, 349
Baltimore Sun, 156
Bank of America
after financial crisis (2008), 693
AIG and, 10
bailout, 7, 49
before financial crisis (2008), 393, 395, 399, 542
Banks
abolishing deposit insurance and, 707
central banking problems (overview), 699–703
chartered banks, 707
comparison of runs (1930s/2008), 27
restoring banker’s bank, 706–707
See also Investment banks; Main street banks; specific banks
Barclays bailout, 7
Bear Stearns
before financial crisis (2008), 22, 28–29, 384–385, 539, 540
financial crisis/bailout (2008), 543
financial futures/options exchange, 302
toxic assets, 392–393, 534, 535
Bernanke, Ben
background, 42, 183
beliefs/doctrines, 50
“deflation” warnings, 444–446
false depression comparison, 583–588
financial crisis/bailout (2008), 5, 6, 8, 25, 27, 208, 272, 365–366, 399, 443–445, 577–579
Friedman and, 184, 270, 272, 578
Great Depression and, 42, 43, 183, 184, 189, 444, 577–578
housing boom and, 18, 374–375, 428, 431
interest rates, 266, 445, 446, 503, 522
money printing, 184, 185–186, 365–366, 447–448, 544, 657–658
“Put” beginnings, 19, 475
Biden, Joe, 603
Bin Laden, Osama, 79, 692
Blackstone
IPO, 538–539, 540
John Paulson hedge fund partnership, 545, 547
leveraged buyouts (LBOs), 11, 512, 516, 517, 529, 533, 534, 538, 540, 541, 542, 543
Stockman and, 11, 512, 516, 560
Blankfein, Lloyd, 48, 668
Bloom, Ron, 621
Bolton, John, 554
Bovender, Jack, 525
Brady, Nick, 318
Bretton Woods monetary system
conference, 241–242
description/effects, 117, 118
flaws, 110, 243–244
gold standard end effects, 56, 60, 109–111, 124–126, 133–135, 176–177, 231
gold standard selection, 237–239
LBJ and, 112
Nixon/gold standard end and, 45, 52, 56, 60, 89, 107, 109, 110, 115, 120, 121, 133–134, 141, 145, 195, 248, 258–259, 559
US financial discipline and, 116, 124
See also Gold standard
Bryan, William Jennings, 141, 162, 185
Budgets
balanced budget rule/discarding, 128–129
balancing requirements needed, 708
ten-year budget baselines/forecasts, 683, 684–687, 690, 691–692
Buffet, Warren, 25, 316, 444
Burns, Arthur
Eisenhower and, 223–224, 225
gold standard and, 281, 283
inflation and, 125, 131, 132, 177, 264
Melamed’s T-bill futures and, 301, 302, 303
money printing, 293, 351
Nixon’s monetary policies and, 111, 112–113, 116–117, 119–120, 123, 125
Bush, George H. W.
deficits and, 106
federal spending/taxes, 58, 59, 276, 350, 557
housing/GSEs, 406, 408, 419
Merc PAC, 309
Persian Gulf wars/1980s defense buildup, 79
Bush, George W.
auto industry bailout, 613, 615, 661
electric vehicle development and, 606–607
federal spending, 58, 219, 675
financial crisis (2008), 6, 45–46, 446, 556
home-buyers’ tax credit plan, 580
housing issues, 414, 580
Middle East wars, 50, 55, 79–80, 205, 214, 217–218, 693
pre-crisis deficit, 590–591
tax cuts, 50, 55, 58, 552, 555, 631, 66
9, 680, 681, 684
unfunded wars, 50, 55, 205, 214, 217–218
Business Week, 347, 484
Buybacks (stocks). See Stock buybacks
Byrnes, Jimmy, 194
“C&I (commercial and industrial) loans,” 31
Caldwell banking chain collapse, 152
Cantwell, Helen, 573–574
Capital One, 38
Carlyle Group, 510, 511, 517
Carter, Jimmy
budget/criticism, 73, 90, 92, 94, 96, 99, 104, 105, 217
inflation and, 131–133
national security policies, 72
tax rebate, 51
taxes/spending, 57, 103, 131–133, 174
Cayne, Jimmy, 392
CDOs (collateralized debt obligations), 11–12, 316
CDS (credit default insurance), 6, 7, 10, 11–12, 22
Central banking
mobilized discount rate, 699–702, 706
problems (overview), 699–703
CEW (corporate equity withdrawal)
Dex Media/R.H. Donnelley & Sons example, 510–513
hedge funds and, 501–502
role/description, 455–456
wealthy/top percent and, 484–485, 505
See also M&A deals; Stock buybacks
CFTC (Commodity Futures Trading Commission)
Melamed and, 305–306, 308, 309, 311, 312–313
ratifying futures industry/effects, 311–313
Stone and, 310
Chambers, John, 457
Cheney, Dick
defense spending, 689, 690, 693
pre-crisis deficit, 590–591
on Reagan, 108
Chesapeake Energy, 522–523
Chicago Board of Trade, 310
Chicago “Merc” (CME)
growth, 287–288, 289, 291, 293, 297, 298–299, 300
politicians and, 308–310
See also Financial futures; Melamed, Leo
Chicago “Merc” PAC, 309
China
economic growth, 60–61, 63–64, 65–66
monetary bubble and, 704–705
savers myth, 327–328
US treasury bonds/bills, 61
“China price,” 63–64, 66, 266, 353, 380, 412, 423–424
Chrysler, 15, 623
Chu, Steven, 600, 601, 607
Cisco Systems
executives’ tax payments, 457
stock buybacks, 456–457
stock market and, 355–356, 456–457, 485
Cisneros, Henry, 408
Citibank
“gain on sale” profits, 38
Lichtenstein/Lightstone and, 539, 540
Prince and, 316
Citicorp, 398, 666
Citigroup
after financial crisis (2008), 693
bailout, 49
before financial crisis (2008), 22, 28–29, 306, 388, 393, 398–399
without bailout, 6
Citizens United decision, 708
Clear Channel Communications LBO, 518–519, 531–532
Clinton, Bill
defense budget and, 689
economics and, 557
housing issues, 408, 409, 412, 413–414, 419
spending reductions/raising taxes, 276
Clooney, George, 605
CLOs (collateralized loan obligations), 507
CME. See Chicago “Merc” (CME)
Collateralized debt obligations (CDOs), 11–12, 316
Collins & Aikman
debt and, 572–573, 574, 575, 576
description, 572
Stockman and, 572–576
Commercial paper market
ABCP (asset-backed commercial paper segment), 37–38
bailout, 39–40
financial crisis (2008), 35, 36–39
Commodity Futures Trading Commission. See CFTC (Commodity Futures Trading Commission)
Conable-Hance II plan, 96
Connally, John
description, 255
monetary policies, 109, 116, 117, 118, 119, 120, 241, 255, 281, 282, 293
Consumer price index (CPI)
1990s, 62–63
1960s, 234
Nixon presidency, 113, 115–116, 121, 123, 126
Consumption tax, 711, 712
Continental Illinois Bank, 15, 20
Coombs, Charles A., 236–237, 253
Cooper, Gary, 4, 395–396
Corrigan, Gerald, 315, 316
Countrywide Financial/disaster, 171, 379, 419, 420–421, 558
Couzens, James, 155
Cox, Chris, 48–49
Cox, James, 141
Cramer, Jim
rant effects, 476–477
rant on CNBC (2007), 475, 476, 477, 479
Credit default insurance (CDS), 6, 7, 10, 11–12, 22
Credit default swaps, 316
Crocs, 487–488, 489
Crony capitalism
description/roots, 3, 52
nonbank finance companies examples, 39–42
See also specific companies; specific events; specific individuals
Cuomo, Andrew, 411
Currency futures
beginnings, 290–293
D-mark example, 292–293
examples/description, 292–293, 297–299
traditional futures vs., 294–295, 297–298
Wall Street changes with, 301–302
Daley, Richard M., 305
Davis, John, 141
De Gaulle, President, 119
Debt ceiling, 645, 669–670
Debt monetization
effects, 57, 60, 322
ending gold standard and, 56–57, 60, 109
Johnson/Nixon and, 233
World War II and, 196–197, 202–203
Debt service to DPI, 644
Debt (US)
after 1980, 4–5, 61–62, 277, 327, 642–644
business sector (1996–2008), 501–502
century before 1980, 4
consumer credit, 277, 326
debt ceiling, 645, 669–670
foreign banks and, 61, 111, 274–275, 351, 414, 447–448
GDP comparisons, 4–5, 372–373
growth (2002–2007), 18, 275–276
household consumption/debt, 371–373
Peak Debt/effects, 644–648, 668–669
reduction recommendations, 710–711
World War II and, 199–200
See also Fiscal cliff
Debt zombies, 516, 529–536, 562
Defense spending
Afghanistan/Iraq wars and, 678, 690, 692–693
Bolton/Romney proposals, 554
conventional forces/imperial invasions, 71, 76, 77, 78–80, 86, 216, 688–689, 692–693
fiscal cliff and, 680, 681, 692–693
NSC-68, 215, 216
recommendations, 710
societal costs with, 85–86
“twofer” belief, 85
See also specific individuals; specific wars
Defense spending (US/1980s)
conventional forces, 71, 74–78
Eisenhower Minimum vs., 84–86, 216
lack of analysis/expertise, 71–73
myth on Soviet collapse and, 75, 86
Soviet “nuclear capabilities” and, 70–71, 72, 74, 75–76, 83
wars of invasion and, 71, 76, 77, 78–80, 86
“Deficits don’t matter,” 51, 55, 56, 91, 108, 275, 379, 590, 647, 669
Dell Inc., 354–355
Dell, Michael, 453
Delphi, 662–664, 665
Deng Xiaoping, 60, 64, 66
Deposit insurance
abolishing, 707
New Deal origins, 175–176
See also Glass-Steagall
Derivative contracts beginnings, 312
Deutsche Bank, 7, 10, 28–29
Dex Media, 510–513
DiCaprio, Leonardo, 603, 604
Dillon, Douglas
background, 20, 245, 318
gold standard and, 245–246, 247
, 248, 249
Dimon, Jamie, 668
Ditech online mortgage operation, 40
“Dividend stoppers,” 11
Doerr, John, 598, 603, 606
Dole, Bob, 308, 309
Dot-com bubble
collapse/aftermath, 66, 340, 342, 345, 355, 361, 362, 363
M&A deals, 479–481
stock market/Greenspan and, 17, 346, 358–360
Douglas, Lewis, 141, 143
Douglas, Paul, 239
Draghi, Mario, 570
DRGs (diagnostic review groups) system/reform, 527–529
Dudley, Bill, 246
Dudley, William, 556
ECB, 703, 704
Eccles, Marriner, 189, 190, 206, 207, 497
Economic Stabilization Fund, 21
Economy (global)
monetary bubble, 702–705
nationalism (early 1900s), 142, 145
post–World War I stabilization process, 146
Economy in Government Act (1933), 160–161
Economy (US)
agriculture (World War I/early 1900s), 151, 179–180
autos/autos supply chain (1929–1932), 147
Fed favoring one percent, 653–656
fiscal gap statistics/future, 683–686
household leverage ratio changes, 642–644
manufacturing sector (2000–2012), 677–679
nationalism (early 1900s), 112, 137, 142, 144, 145, 148, 160, 191–192
1914–1929, 137, 138, 145–147, 179–180
ten-year budget baselines/forecasts and, 683, 684–687, 690, 691–692
2002–2012, 66–67, 682
See also specific components; specific events; specific individuals
Economy (US Main Street after financial crisis)
Bernanke reflation, 656–658
debt vs. productivity/earned income, 633
Fed/Wall Street vs. Main Street, 584–585, 635, 639, 640, 656–660
junk bond boom and, 658–660
lack of recovery, 631–632, 640–641, 668
99 percent vs. 1 percent, 649–653
overview (2009–2012), 631–632
PCE, 631, 640, 641
retail sales, 649–652
“wealth effects” and, 631, 633, 634, 637, 649, 652–653
See also Jobs market
Ehrlichman, John, 114–115, 116
Eisenhower, Dwight D.
administration, 20
background, 213
comparisons with successors, 213–219, 233–234
conventional force vs. nuclear deterrence, 215–216
defense spending and, 76, 84–86, 215, 216
farewell address/warning, 85
federal budget and, 218–219, 221, 229–232
fiscal stimulus refusal and, 128, 195, 223, 224
fiscal success factors, 219–220
Heller’s “new economics”/mistakes, 226–229
interest rates, 299
Korean War armistice and, 214