- Hardcover: 393 pages
- Publisher: Wiley; 1 edition (December 7, 2010)
- Language: English
- ISBN-10: 0470875143
- ISBN-13: 978-0470875148
- Product Dimensions: 6.1 x 1.3 x 9.3 inches
- Shipping Weight: 1.2 pounds (View shipping rates and policies)
- Average Customer Review: 22 customer reviews
- Amazon Best Sellers Rank: #907,715 in Books (See Top 100 in Books)
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Inflated: How Money and Debt Built the American Dream 1st Edition
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takes the reader on a journey through more than two centuries of monetary and fiscal policy and banking. (The Economist, December 2010).
From the Inside Flap
When it comes to matters of money, most Americans tend to view themselves as reasonably prudent people, reflecting the puritan roots of their European ancestors. Yet, at the same time, Americans also seem to feel entitled to a lifestyle, individually and nationally, that is well above the rest of the world's, and well beyond our current means. Inflated: How Money and Debt Built the American Dream explores more than two hundred years of American politics and monetary policy to examine this conflict. In doing so, it asks whether the current understanding of the American Dream, one of entitlement, is so ingrained that to expect Americans willingly to live in a "deflated" world is unrealistic. This book simply and directly tells the story of inflation and public debt as enduring, and perhaps even endearing, features of American life. It describes:
- The Gold Rush and how dreams of instant wealth replaced the notions of hard work and saving as the national ideal
- How Congress's deficit spending is a direct legacy of Abraham Lincoln's presiding over the first legal tender laws, which gave the federal government control overthe issuance of "money"
- How the financial crisis of 1893 led to the creation of the Federal Reserve System, ultimately confirming the cautionary views of Thomas Jefferson and Andrew Jackson that a central bank would prove antithetical to democracy and individual rights
- The rise of investment trusts during the 1890s, and how those trusts were the precursors of hedge funds and complex financial derivatives
- How the dollar's role as the world's currency after WWII encouraged America's tendency to demand immediate gratification of national wants and needs
- Why the Gold Standard Act of 1900 was the high watermark for sound money in the United States, and why Richard Nixon's decision to end the dollar's gold convertibility in 1971 opened the door to vast inflation and debt in the decades that followed
Top customer reviews
Very few of the recent published books on the US economic crisis have an adequate historical perspective. In Inflated, Chris gives us a very full history -- he starts at the founding of the Republic! The book is nonetheless extremely entertaining. I found myself captivated by it, and finished it fairly quickly.
Chris is an endearing narrator who is obviously more detail-oriented than many of his fellow commentators -- he clearly brings a high level of understanding to this work.
The book is very much of the Austrian School. I don't fully agree with some of Chris' views -- I think I'm generally more tolerant of inflation and inflation risk than he is.
Chris is quite pessimistic about the long future of the American economy, but I think I'm more pessimistic. He believes that austerity measures are required in the US and that the US will be able to weather these austerity measures fairly well socially and politically. I believe that the US cannot deal with austerity measures socially or politically -- therefore, they will not occur. The consequences of a lack of austerity are anyone's guess. Chris believes that high rates of inflation are inevitable without austerity -- I think high inflation and declining living standards are likely but not inevitable.
I find Chris overall views on debt and inflation quite similar to those of Peter Warburton, author of the truly incredible book, Debt and Delusion. The views of both of these authors are wholly different than the New Keynesian thinking of Ben Bernanke. I tend to slightly favor the Warburton/Whalen side of the debate.
I thought this was going to be another crisis book--I must have read 20 of them--but it turned out to be an exceedingly pleasing historical treatise on intersection of money, debt, politics, and monetary policy over the two centuries. (I decided to read it out of my deepest respect for Chris' analytical skills.) Although much of the material will not be new to connoisseurs of fine economic history, I thought it was tied together very nicely. I, for example, found the discussion of bimetallism and the underlying political currents fascinating. (I realized that I had failed to understand William Jenning Bryan's famous "cross of gold" speech.) Chris generally does an excellent job of describing the political cross currents underlying important political events. I also think this book dovetails nicely with Reinhart's and Rogoff's "This Time is Different" in that it delves into the slow, methodical undermining of our monetary system--a single case study of sorts.
As I was nearing the end of the book, I began to see what I would call the "praying mantis model." We got handed the reserve currency and a globally profound position. We got to run the world. As debts accrued, our creditors kept assuring us that, as masters of the universe, we were good for it. ("You guys just keep spending.") We didn't understand the end game: It's a suicide mission. (The male praying mantis gets eaten after copulating.) Whalen finishes with a few words of encouragement, but I am not convinced he believes them. To use Mauldin's term, we are going to muddle our butts off.
As usual, I went to Amazon to see what others had to say. Of course, there were strong reviews from Chris' friends (Rickards, Laggner, and probably a couple others). Looking at the weakest reviews, there were aspersions to his political ideology--don't read this if you love FDR--but I would say that Chris kept me on my heels with his ability to show layers of the onion. The typos were also omnipresent, which I personally care about but was not distracted by. Somebody demanded a fusillade of charts and data, but I enjoyed the reliance on prose often characteristic of the Austrians. Everybody who reviewed the book comments about Chris' intellectual firepower and analytical skills.
The strong side of this book is the historical perspective, that our predicament is not nearly as new as we may wish to believe. He properly makes the case that the fight for soft/hard money, the extreme political/economic power of the national banking oligarchy and short-sighted/corrupt/destructive politicians as the norm, not the exception are all part of the long and rich history of America. This seems to me to be extremely important to those attempting to make sense of what is happening in America and across the globe today.
The writing is not the best. Its not 'entertaining', it could be better organized, have a stronger 'unified' line throughout the book, be less dependent on footnotes or glorify the author as an oracle. All valid criticism of a writer.
But, Whalen's not really a writer, he's an analyst - maybe now a financial historian. It seems to me that he did what he set out to do, to present to a wide audience how we got here, and not simply a case of the last 5-10 years like every other pop-financial writer out there who worked in an Ibank, or hung out with those who did.
I believe this is a very important book, with appropriately geeky zits. It is true to its author's approach to analysis. I am taking the lack of writer polish as a positive.
Most recent customer reviews
A erudite treatise on US monetary and political history that is thoroughly readable and relevant to professionals and...Read more