Book Review: The Trillion Dollar Meltdown

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Morris, Charles R. The trillion dollar meltdown : easy money, high rollers, and the great credit crash. Public Affairs, 2008.

Almost daily the Wall Street Journal reports on the deepening credit crisis. Today, the front page includes a depressing story about bad loans, excessive risk taking and the need for large capital infusions. A year ago, consumer spending was strong, the market for investment grade credit was growing and the S&P 500 jumped 9% in three months. What happened?

According to financial writer, investment banker and lawyer Charles P. Morris, we are experiencing the result of a reckless financial environment — twenty five years of free and unregulated financial markets. In the Trillion Dollar Meltdown, Morris provides a brief history of financial markets beginning with the Reagan era. He also discusses financial instruments, why they were developed and how they now contribute to the problem of leverage in our economy — instruments such as CMOs, CSOs and SIVs.

After discussing the problem of growing inequality in America in this economic environment, Morris calls for oversight over the financial industry to restore transparency and integrity to American financial markets.

Two other new books on the credit crisis in the Ford Library are:

Bad Money : reckless finance, failed politics, and the global crisis of American capitalism by Kevin P. Phillips.

The New Paradigm for Financial Markets : the credit crisis of 2008 and what it means by George Soros.

© Reviewer: Meg Trauner & Ford Library – Fuqua School of Business. All rights reserved.

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