Yves Smith Knihy

"In ECONned, Yves Smith draws a direct connection between fundamentally flawed financial theories and a series of crises that culminated in the global meltdown of 2007 and 2008. This devastating critique shows that the pursuit of unenlightened self interest has produced a financial services industry that is a doomsday machine, systematically predatory, and now hugely powerful thanks to its control of vital financial infrastructure." "This is the first book to put the financial crisis in its proper context, as not merely a subprime mortgage meltdown, but the inevitable culmination of a process building over decades yet endorsed by mainstream economists and enabled by their flawed precepts."--Jacket

Why are we in such a financial mess today? There are lots of proximate causes: over-leverage, global imbalances, bad financial technology that lead to widespread underestimation of risk. But these are all symptoms. Until we isolate and tackle fundamental causes, we will fail to extirpate the disease. ECONned is the first book to examine the unquestioned role of economists as policy-makers, and how they helped create an unmitigated economic disaster. Here, Yves Smith looks at how economists in key policy positions put doctrine before hard evidence, ignoring the deteriorating conditions and rising dangers that eventually led them, and us, off the cliff and into financial meltdown. Intelligently written for the layman, Smith takes us on a terrifying investigation of the financial realm over the last twenty-five years of misrepresentations, naive interpretations of economic conditions, rationalizations of bad outcomes, and rejection of clear signs of growing instability. In eConned, author Yves Smith reveals: --why the measures taken by the Obama Administration are mere palliatives and are unlikely to pave the way for a solid recovery --how economists have come to play a profoundly anti-democratic role in policy --how financial models and concepts that were discredited more than thirty years ago are still widely used by banks, regulators, and investors --how management and employees of major financial firms looted them, enriching themselves and leaving the mess to taxpayers --how financial regulation enabled predatory behavior by Wall Street towards investors --how economics has no theory of financial systems, yet economists fearlessly prescribe how to manage them