| | Location: Home » Books » Meltdown: A Free-Market Look at Why the Stock Market Collapsed, the Economy Tanked, and Government Bailouts Will Make Things Worse | |
|
| Meltdown: A Free-Market Look at Why the Stock Market Collapsed, the Economy Tanked, and Government Bailouts Will Make Things Worse |  | Author: Thomas E. Woods Jr.
Creator: Ron Paul
Brand: Spring Arbor/Ingram
Category: Book
List Price: $27.95
Buy New: $8.98
as of 9/5/2010 04:30 CDT details
You Save: $18.97 (68%)
New (50) Used (41) from $8.45
Seller: backpack_books
Rating:  226 reviews
Sales Rank: 20,134
Media: Hardcover
Edition: 1
Pages: 194
Number Of Items: 1
Shipping Weight (lbs): 0.9
Dimensions (in): 9.1 x 6.2 x 0.9
MPN: 9781596985872
ISBN: 1596985879
Dewey Decimal Number: 338.542
EAN: 9781596985872
ASIN: 1596985879
Publication Date: February 9, 2009
Availability: Usually ships in 1-2 business days
| |
| Features:
| • | ISBN13: 9781596985872 | | • | Condition: New | | • | Notes: BUY WITH CONFIDENCE, Over one million books sold! 98% Positive feedback. Compare our books, prices and service to the competition. 100% Satisfaction Guaranteed |
|
| Also Available In:
|
| Similar Items:
| |
| Editorial Reviews:
Product Description
Is Capitalism the Culprit? The media tells us that deregulation andunfettered free markets have wrecked our economy and will continue tomake things worse without a heavy dose of federal regulation. But thereal blame lies elsewhere. In Meltdown, bestselling authorThomas E. Woods Jr. unearths the real causes behind the collapse ofhousing values and the stock market--and it turns out the culpritsreside more in Washington than on Wall Street.And the trillions ofdollars in federal bailouts? Our politicians ham-handed attempts tofix the problems they themselves created will only make things muchworse.Most important, Woods, author of the New York Times bestseller The Politically Incorrect Guide to American History,traces this most recent boom-and-bust--and all such booms and busts ofthe past century--back to one of the most revered governmentinstitutions of all: the Federal Reserve System, which allows busy-bodybureaucrats and ambitious politicians to pull the strings of ourfinancial sector and manipulate the value of the very money we use.Meltdown also provides a timely history lesson to counter the current clamor for a newNew Deal. The Great Depression, Woods demonstrates, was only as deepand as long as it was because of the government interventions byHerbert Hoover (no free-market capitalist, despite what your highschool history teacher may have taught you) and Franklin D. Roosevelt(no savior of the American economy, in spite of what the mainstreammedia says). If you want to understand what caused the financialmeltdown--and why none of the big-government solutions being triedtoday will work--Meltdown explains it all. Publisher: Regnery Publishing Author: Thomas E Woods Jr Format: 194 pages, hardcover ISBN: 9781596985872
|
| Customer Reviews:
Showing reviews 1-5 of 226
 The Most Important Debate in our Lifetime February 9, 2009
Dan Moit (Saint Joseph, MI USA)
250 out of 264 found this review helpful
Tom Woods has written a timely and timeless book - timely because it addresses the most pressing issue of our day, and timeless because he explains economic cycles and the nature of money in plain language.
It is curious that Congress is on the verge of passing an economic stimulus bill that is opposed by nearly two thirds of Americans. Mr. Woods provides the logic behind the intuition of this increasingly disenfranchised majority. Americans opposed to further government meddling should read this book to fully arm themselves with the knowledge necessary to win the debate. Well-intentioned Americans who support government intervention in the economy should read this book to understand the unintended consequences of their support.
Partisan readers beware: regardless of your political affiliation, you will discover that your party shares in the blame for the mess we're in. It is best to check your party affiliation at the door before you read this book. But read it!
The first chapter quickly identifies fractional reserve central banking as the main driver of the current and previous economic downturns. It's a long-overdue call to debate the necessity of our Federal Reserve system.
The second chapter addresses the housing bubble, and how the loudest voices on all sides of the debate are proposing solutions to the symptoms instead of recognizing the real problem.
The third chapter addresses the government's futile reactions to the financial and economic crisis in the last months of 2008. It's amazing to see such recent history covered so well in a book.
The fourth chapter alone is well worth the price of the book. Mr. Woods explains in plain language that economic cycles are not natural phenomenon, but are caused by artificial manipulation of the money supply. The business cycle theory of Ludwig von Mises and F. A. Hayek is explained in a manner easily understood by the layman reader.
Chapter five covers myths of the Great Depression. Understanding this time in our history has never been so important as it appears we are on the verge of repeating the same mistakes. Mr. Woods gleans lessons by comparing previous market busts and subsequent government reactions to them.
Again, the sixth chapter alone is worth the price of the book. Mr. Woods explains the nature of money. It's hard to believe how something we use every day can be such a mystery to us. It's impossible to effectively engage in the debate about fractional reserve central banking without understanding the nature of money. We learn in this chapter how money is a creation of the free market and not a government invention.
The book ends with a chapter that instructs us on what courses of action (or inaction) that we should take in order to restore a lasting prosperity. It is vastly different than the choices being proposed by our government and the media.
Whether you are a liberal, conservative, or something else, I implore you to read this concise, well-reasoned book. In the most important debate in our lifetimes, this book represents a side that is ignored by the media. Ignore it at your peril.
Buy a second copy to throw at the TV February 9, 2009
Andrew S. Rogers (Stamford, Connecticut)
318 out of 340 found this review helpful
In discussions of today's economic meltdown and what to do about it, the Federal Reserve is a stealth helicopter: it never shows up on the radar. With the exception of a few esoteric specialists and those Ron Paul Revolutionaries who burst into chants of "Abolish the Fed!" during campus rallies last year, it's like something has been put in our water to cause our eyes to glaze over and our minds to wander off at the very mention of centralized banking.
Which is, of course, a Problem, since as historian Thomas Woods notes in this important book, the Federal Reserve bears a large part of the blame for the mess we're in. In the first part of "Meltdown," Woods shows how both in theory (the Austrian School, to be precise) and in practice, Fed policy fueled an artificial boom and instead of allowing the necessary, if unpleasant, short-term bust that will lead to recovery, is pursuing policies guaranteed to drive us deeper into the abyss. Little of this finds its way into the popular or business press, suggesting that the people who know the truth aren't talking, and the people who are talking either don't know or are deliberately trying to keep the helicopter hidden. As Woods writes, "critics of the market who ignore the arguments raised in this chapter are, to say the least, not being honest" (p. 86).
But to paraphrase Will Rogers (no relation), it's not so much the things we don't know that are a problem, it's the things we DO know that aren't really true. That's why every bit as important as Woods' explanation of the role of the Federal Reserve in the unnecessary cycle of boom and bust is his taking down of decades' worth of myths about the government's role in the economy. As the author points out, historians have more or less abandoned the idea that New Deal intervention "got us out of the Depression," but the myth remains stronger than ever among journalists and the public. The result of this is not only a profound misunderstanding of American history, but more to the point, a widespread delusion that "history proves" massive government spending promoting consumer demand is the way out of a recession. Here again we see the apocalyptic power of bad ideas.
All this suggests the economic crisis, and particularly the stimulus-driven response to it on the part of the Bush and Obama administrations, are a domestic equivalent of the Iraq War (I want to note that this is my metaphor, not Woods'): an over-reaction to a situation by and large of our own creation, and sold to the American people through a series of lies, the plan largely benefits those who argue for it most strongly while the rest of us end up poorer. The "opposition" is arguing over details while conceding the fundamental principle -- an intervention that gives the government a foothold of occupation it will probably never relinquish.
That's why "Meltdown" is so important -- and why the Austrian School, which alone not only foresaw the coming crash but understood why it was going to happen, deserves so much wider attention. If I could improve anything about "Meltdown," I would have made even more prominent the citations of thinkers and books interested readers should pursue. Woods does do this in an appendix, and I strongly recommend you read the footnotes closely. But something like the "additional reading" or "books they don't want you to read" call-outs of the author's The Politically Incorrect Guide to American History would, I think, have been even more useful.
If "respectable opinion" does pay attention to this book and the ideas it promotes, it will do so with the same combination of pity and contempt that earlier book received. As Woods writes, "You do not win friends in the political and media establishments by proposing a monetary system that cannot be exploited by governments to enrich their friends, enable their addiction to spending and looting, and fund their bailouts" (p. 134). But out here among the non-establishment, you DO make friends by telling the truth. And Tom Woods has a lot of friends.
The Fed's Fingerprints Are All Over It March 16, 2009
Karen A. Decoster (Detroit, MI)
66 out of 73 found this review helpful
Deregulation. Market failure. Greed. Not enough government oversight. All kinds of fallacious explanations are being trotted out as primary causes of the economic meltdown that dropped like a bombshell on baffled Americans. After all, weren't they basking in the most prosperous years of their lives? They were indulging in a soaring stock market, buying extraordinary houses, and going on fantasy vacations. Wasn't that the American Dream? What happened?
The "American dream" is a phrase attributed to American author James Truslow Adams in his 1931 book, _The Epic of America_. He wrote: "It is not a dream of motor cars and high wages merely, but a dream of social order in which each man and each woman shall be able to attain to the fullest stature of which they are innately capable, and be recognized by others for what they are, regardless of the fortuitous circumstances of birth or position."
In view of that, the modern interpretation has strayed far from the original meaning. In fact, the "American Dream" represents something more than the cars and big money that Adams warned about. Central planners and social engineers misappropriated the term, a long time ago, and put it into use as a slogan to convey a sense of entitlement and equality as they began to shape and subsidize the home ownership nation that started with the creation of Fannie Mae in 1938.
A new book by Regnery author Thomas E. Woods, Jr., _Meltdown_, suggests that the American dream became an American bubble brought on by the reckless, self-serving actions of government institutions that commenced a series of interventions that culminated in a collapse of the stock market and financial institutions, along with the rapid disintegration of the US economy. Ergo, the American nightmare.
Woods at once puts his finger on the unmistakable "elephant in the living room," the Federal Reserve System. As he points out, other than a few assorted rumblings, there has been almost no discussion in the mainstream media of the Federal Reserve's role in launching this crisis. The Federal Reserve, which centrally plans monetary policy and interest rates, sparked the crisis by drastically reducing interest rates beyond levels that would otherwise have been set by a free market. "Making cheap credit available for the asking does encourage excessive leverage, speculation, and indebtedness," Mr. Woods writes. He adds, "Manipulating interest rates and thereby misleading investors about real economic conditions does in fact misdirect capital into unsustainable lines of production and discombobulate the market." This begins the authors' explanation of the boom-bust phenomenon and how an artificial boom, and the financial holocaust it leaves behind, can be perfectly clarified and understood in terms of the Austrian theory of the business cycle.
--Turn on the Bubble Machine--
Thanks to the Fed's easy-credit policies, the housing bubble became ground zero for the catastrophe. Mr. Woods points out several factors that contributed to this mess, all of which were significant government interventions that emerged in order to fulfill a specific agenda. First there were Fannie Mae and Freddie Mac, two government-sponsored enterprises (GSEs) that had the benefit of an implied government backing, thus giving investors the appearance that their investments in these entities were essentially risk-free. Both entities were created for the sole purpose of intervening in the housing market and subsidizing home ownership, especially for the politically favored classes. Besides easing credit requirements so that banks could loan to dubious buyers, both Fannie and Freddie helped to spread the bubble's aftermath by buying mortgages on the secondary market and pooling and selling the mortgages in the form of mortgage-backed securities. Soon everyone was getting their mitts on these securities and holding them as investments, creating conditions that were ripe for disaster.
Another factor in the housing bubble that Woods points to is the Community Reinvestment Act, a law born in 1977 that was given a new lease on life from Bill Clinton. The CRA was a crusade to jettison traditional lending standards in favor of an equality-based agenda aimed at putting minorities and the poor into homes they couldn't afford. Woods points to a study by the Federal Reserve Bank of Boston that concluded, "even allowing for differences in creditworthiness, minority applicants were still getting mortgage loans at lower rates than whites." Consequently, it was determined that the mortgage banking industry was engaging in discriminatory lending policies and a massive government intervention was needed to stamp out the disparity. The result was the birth of the CRA, and the beginnings of a massive lending spree to unqualified, or subprime, borrowers.
In spite of the obvious problem of granting long-term loans to high-risk individuals, perhaps one of the more illuminating points made by Mr. Woods is that the subprime loan mishap may have been overemphasized while the flurry of impractical lending innovations, such as 100 percent loans, ARMs, and interest-only loans, were given less attention.
The push for relaxed lending standards for low and middle-income borrowers was so pervasive and systemic, persisting for a full decade, that it is no surprise that it should have spilled over into the standards for higher-income borrowers as well.
"...Not only were these easier mortgage terms available to speculators, but the surge in demand for housing caused by the much easier access to financing also led to increases in home prices that had the unintended effect of enticing speculators into the market in the first place."
Alan Greenspan, as chairman of the Federal Reserve, publicly put his stamp of approval on ARMs , thereby leading people to believe that they were reasonably safe options. Woods points out that the foreclosure crisis has not been confined to the subprime sphere, and in fact prime loan foreclosures increased in unison with subprime foreclosures.
--Weekend at Ben and Hank's--
In the spring of 2008, Treasury Secretary Hank Paulsen claimed "we are closer to the end of the market turmoil than the beginning." Rather, it was just the beginning, as Bear Stearns had collapsed and the Fed set up a bailout arrangement with JP Morgan so it could acquire the investment bank. What followed was a meltdown of the entire financial system that had been incorrectly assessed time and time again, by both Paulsen and fed Chairman Ben Bernanke.
The government seized control of Fannie Mae and Freddie Mac just a couple of months after it placed IndyMac Bank into receivership. Lehman Brothers filed for bankruptcy, Merrill Lynch was rescued by the Bank of America, Washington Mutual was seized by the FDIC, the government poured billions into the failing giant AIG, and Wachovia was scooped up by Wells Fargo. The White House responded by announcing its Emergency Economic Stabilization Act of 2008 that would give unprecedented powers to the US Treasury. This bailout bill was sold to the American people via repetitive, tactical scaremongering. Woods notes that the public was told:
"...all kinds of horror stories of what would happen to them if they failed to do as their betters told them: the decimation of their retirement plans, the collapse of housing prices, the inability of small businesses to make payroll (as if a healthy small business borrows to make payroll), and on and on. The bailout had to be passed right away."
This epic bill that was too big to read and passed too quickly for debate to take place, was put forth as necessary to breathe life back into an expiring economy that only the Fed-Gods could save with their collective financial genius and business acumen. Of course, once the Feds decide something is a "crisis," that opens the door to inescapable solutions, and only government can ever provide those solutions. Crisis, then, becomes the doorman for a massive series of government interventions. The "do something" mentality of the bureaucrats acted on impulse, and they made things up as they went along, changing their minds whenever it was convenient. This produced, in Mr. Woods's words, "a Weekend at Bernie's economy, with sunglasses and Hawaiian shirts on zombie companies supposed to give the impression of life and health."
The housing mania wasn't the only hiccup, however. The Federal Reserve had successfully ushered in a "No Adult Left behind" policy for the credit-intoxicated, consumption-crazed masses with its years of low interest rates. Government had created a credit dependent society in which people did not want to give up their newfound "prosperity" quite so easily. With the average American saving little or no earnings and living dangerously on the edge of insolvency, it became apparent that life in a bubble did not reflect real prosperity. Thus we witnessed the birth of a nation of Two-Thousandaires - those with a Hummer and a decked-out Chrysler 300, a huge house, all the latest toys, vacations that Bernie Madoff would envy, and $2,000 in the bank.
Soon thereafter came the nationalization of the banking system so that the credit markets could be propped up so the extravagant lifestyle people had come to depend on could be sustained indefinitely. Loan! Spend! Don't Save! Or so said the Keynesians who saw spending as being the key ingredient of a prosperous economy. Paulsen even lamented the illiquidity that was said to be "raising the cost and reducing the availability of car loans, student loans and credit cards." The lesson is this: give rise to more of what caused the financial mess in the first place.
--Government is to Blame--
After Mr. Woods lays out the house of cards that became the meltdown, he launches into an ample explanation of the government's boom-bust business cycle, along with an entire chapter of challenges to the conventional wisdom concerning the Great Depression and the countless fallacies that surround both its causes and cure. By invoking F.A. Hayek's theory of the business cycle, he aptly explains to the reader the basics of how things work in a free market and what happens when the visible hand of the Federal Reserve manipulates interest rates, distorts the supply of credit, and misrepresents investment opportunities for entrepreneurs, thereby leading them to commit clusters of errors that lead to the misallocation of resources. The Austrian theory of the business cycle, Woods says,
"Exonerates the free market of blame for the boom-bust cycle, since the factors that bring the cycle about - the artificially low interest rates that provoke the boom, and the foolish government interventions that prolong the bust, - are all examples of interference with the free market."
The other piece of evidence that the Fed's fingerprints are on this calamity is the money problem. Woods calls into question a monetary system that devalues the dollar, expropriates through the hidden tax of inflation, and manipulates the money supply in order to achieve specific political agendas. He refers to the Federal Reserve Act of 1913 as "special-interest legislation masquerading as a public-spirited measure." As a follow-up, Woods puts forth the notion that a monetary system based on precious metals, or a commodity standard, is the only system available that will return America to a sound monetary policy free from entrenched political privileges and central planning machinations.
--Throw the Bums Out--
Readers oftentimes don't like reading a whole lot of abysmal revelations unless there are some promising solutions that follow. Tom Woods doesn't disappoint those who want to hear how the current system can be rescued from the grip of despots and placed onto a free-market foundation for building genuine prosperity. He speaks clearly to the free-market reforms that are necessary to convert America from a bankrupt nation to a free and flourishing republic. The solutions, however, are radical, and in fact, so radical that Ron Paul, who also sought the same reforms, was disavowed by his Republican Party members for the crime of endorsing the intellectual roots of this country's Founding Fathers.
Toss the too-big-to-fail baloney, says Woods, and let insolvent, inefficient, bloated giants fail, because the free market will take the best of what's left and make good use of it without having to poach the taxpayers' pockets for Friday night beer money. As to Fannie and Freddie, say goodbye, and as to all government bailouts of private institutions, good riddance. "Problems caused by excessive spending and indebtedness," says Woods, "cannot be cured by more spending and more indebtedness, any more than the cure for excessive lending is more excessive lending."
Finally, since "money is the most socialized sector in the American economy," it must be liberated from the hands of tyrants. Thus the subject of the Federal Reserve, then, must be put up for debate. The Fed generates economic instability through its monopoly on money, advances moral hazard, and conducts much of its affairs in secret, notes Woods, so it is time to put some new ideas on the table and allow the market to function as the bedrock for a free society.
Connoisseurs of Austrian economists, along with newbies to the freedom movement and everyone else in between, will find _Meltdown_ to be a compelling account that sheds light on the darkest economic times our generation has ever encountered.
A Dose of Reality, and not a Moment Too Soon February 9, 2009
A. M. Schmidt (Philly, PA)
93 out of 106 found this review helpful
I looked forward to this book from the moment I received advanced notices about it. Thomas Woods does not disappoint. The chapters in this book are short and sweet. He lays out the Austrian Theory in terms even a bricklayer could understand. The solution is obvious, but politically incorrect, that the Fed via its money policy and paper currency, creates instability in the market. It is aided by Congress and their own libertine attitudes towards lending. The end result is the so-called business cycle, which results from the false promises of the government being bashed to bits by reality.
This book is a godsend by clarifying what people have observed for years but couldn't piece together. It also helps to have someone of Mr. Woods' credentials as an historian and stalwart Catholic traditionalist hammer these point home. If it had been Murray Rothbard, Ron Paul, or Ludwig von Mises, or any of the Randians, the Paul Krugman's of the world would yell "Crank!" "Extremist!" or some other irrelevant charge, in order to distract us from the issue. Now after reading this book, which won't take you too long, you will know that this is not some curse from the gods but the deliberate result of government's incompetent operations.
He does provide solutions that are immediate and effective. Restoration of commodity money, repeal of the legal tender laws, and above all else ABOLITION OF THE FEDERAL RESERVE. It does not take government sanctions to make money or to keep it's value. In fact the government has no business at all with money, outside of taxes. Thomas Woods demonstrates this on page after page, leaving no room for error or denial.
This book should be read in conjunction with Hazlitt's "Economics in One Lesson" Economics in One Lesson: The Shortest and Surest Way to Understand Basic Economics for a one-two punch against the welfare-warfare state. We have now reached the point where we LITERALLY cannot afford the lunacy of liberals and conservatives alike.
(I want you to go out and commit two treasonous acts: educate yourself, friends and family on economics, and enforce the Constitution on money, that Article 1, Sec. 8--no state shall accept anything other than gold or silver in payment of debt. )
Common Sense From an Uncommon Economist February 9, 2009
Christopher Byrnes (Northport, NY)
49 out of 55 found this review helpful
As the mainstream media pundits struggle through their shallow and predictable attempts to blame the free market for the economic collapse, Tom Woods rides in on a metaphorical white horse to put these myths in their final resting place. Their are innumerable reasons why everyone needs to read this book, but I'll mention just a few, in no particular order:
1. It gives a broad and deep overview of America's current economic situation, and who got us here. For example, Chapter 2 is organized as a series of short yet powerful jabs at whom Prof. Woods has identified as the "culprits" who caused the housing bubble, ranging from #1 - Fannie Mae and Freddie Mac, to #2 The Community Reinvestment Act, to #5, The Federal Reserve, and so on.
2. It is one of the most readable books on economics ever written. Cover to cover, this book takes maybe 4 hours to read and digest.
3. Prof. Woods fully utilizes his mastery of both economics and history to dispel myths about the Great Depression, the creation of the Federal Reserve, and the causes of economic panics prior to the existence of a central bank in America.
4. It explains what inflation is, and why it is bad.
5. It explains the absolute lunacy behind these massive bailouts being passed out to Fortune 500 companies like candy on Halloween. Throughout the book, Prof. Woods points out the serious flaws in the reasoning of various officials who supported these bailouts. For example, he writes: "According to [Henry] Paulson, "millions of Americans" were facing rising credit card rates or reduced access to credit, thus "making it more expensive for families to finance everyday purchases." That made even less sense than the usual Paulson rationalization. Think about it: is it sustainable in the long run for families to make everyday purchases on Credit? How can that go on?"
6. Perhaps most importantly, anyone who reads this book will have a whole arsenal of ideas to bring to the table when popular politics and current events are being discussed around the water cooler. After all, everyone wants to sound informed, right?
Showing reviews 1-5 of 226
|
|
|
Copyright © 2009 Free Enterprise
| |
|
