5 comments about The Secret History of the American Empire: The Truth About Economic Hit Men, Jackals, and How to Change the World.

1. John Perkins, a former "economic hit man", revealed his emotional turmoil in Confessions of an Economic Hitman. He illustrated from an insider's perspective the evils of the modern-day empire building of corporations or "corporatocracy" in action. He lifted the veil on the military-industrial complex, which partners with Government in bewitching consumers with guile, corruption and big marketing budgets, whilst carrying out gross environmental and human rights abuses.
   
   In this sequel, Perkins has a more mature view of the world. Gone is the continuous guilt and egotistical self-reflection, and in its place, is more depth, plenty of anecdotes, solutions for a better world, and many exciting world travels thrown in. Not only does it read like a spy novel at times, but also a travel book. Perkins is no journalist, and there is an opportunity here for a follow-up research piece on his vignettes. There are also times when unsubstantiated conspiracy theories run a bit far. His sources are not always vetted for quality. However, I believe Perkins' heart is in the right place and he should be forgiven for less than perfect journalism.
   
   One major faux pas is in his discussion on the 2006 Israel-Lebanon war. He mentions that Israel launched an attack on Beirut, as if they were making afternoon tea, and faced international criticism. Perkins conceals the major facts of this war - that Hizbollah instigated it by kidnapping an Israeli soldier from sovereign Israel, and launched a missile attack on Haifa. This error of omission calls to question many of his other theories. I wonder what the book could have been if he had employed a fact-checker.
   
   There is no doubt that corporate hegemony is casting a chilling shadow on our world, and the more aware people become, the more we can do. Whilst this is by no means, a 5-star book, it is redeemed by the solutions provided, and Perkins' open-minded approach. Everyone with an interest in why the world is in the situation it's in, why we're so dependent on oil, politics, economics, and the environment, will find this book worthwhile. I would recommend it to everyone interested in the future of humanity and the world we inhabit. This is a must-read for anyone wondering why so much of Asia, Africa and the Middle East hate America.



2. The US State Dept website's description of Perkins' previous book (Confessions of an Economic Hit Man) works here, as well: "an exciting, first-person, cloak-and-dagger tale that plays to popular images about alleged U.S. economic exploitation of Third World countries."
   
   In an easy to read style, Perkins weaves his personal stories around generally established events from around the world that one can usually trace to sources other than Perkins. Although it certainly doesn't hurt to have such incidents brought to mind again, his inclusion of them end up leading the reader in a way that make his behind-the-scenes stories feel more plausible, seeming to simply fill in ground level details of US/corporate exploitation. Together it goes down more smoothly as narrative, a great format for popular consumption.
   
   Yet, as other reviewers have already pointed out, the lack of verifiability really limits the book. The "secrets" Perkins is trying to reveal are, of course, based on personal or anonymous testimony. On the one hand, the circumstances he describes warrant such anonymity, and we should not dismiss singular personal testimony out of hand (especially when regarding such alleged clandestine incidents, where scattered personal testimony may be all there is). On the other hand, since readers' cannot cross-examine his evidence, many of his claims simply must remain unproven, which is unfortunate. Perkins' work would be a stronger contribution to informing the public if it could do so objectively.
   
   At best, perhaps his stories (along with the more established incidents he mentions) should be kept in mind as what powerful corporations and countries are capable of, causing us to be all the more on our guard against corruption.



3. As a former "Economic Hit Man", Perkins reveals the damage done to nations who do not yield to US demands for their resources. He shows how the usual pattern is to send in the "Jackals" (the CIA) to do the initial dirty work including assassinations, starting internal wars, and many other things. The EHMs then move in to privatise local institutions which are acquired by US interests, and set up massive loans which poor countries can never afford to repay. Among the examples given are Indonesia, Bolivia, Ecuador and, of course, Chile. The role of the World Bank and the IMF as USA-centred institutions is also discussed.
   Most of the book reads like a thriller, and only moves to a slower pace when Perkins proposes solutions to reforming the practices of the American Empire. He is positive that the growing group of South American countries who are resisting the US 'invasions' may at least slow these insidious activities.



4. After a life of `robbing from the poor and giving to the rich' as an economic hit man, thereby pocketing his commissions, John Perkins became an environment activist and a militant for change in the policies of the corporatocracy.
   
   Corporatocracy
   The author delivers in this book many well directed punches into the face of his former employers, transnational companies which act as imperial dictatorships in the global economy.
   Together with their long arms (controlled or corrupt governments, the IMF, the World Bank, the WTO, intelligence services, infiltrated or outright controlled NGOs and the military) the corporations are building an empire for the wealthy few. Behind the rhetoric of `free trade', `free markets` and `free choice' the author discovers disinformation, corruption, oligopolies and market and export protection.
   This empire claims to defend democracy, but ousts or assassinates democratically elected presidents like P. Lumumba, S. Allende, O. Torrijos, D. Roldós).
   The corporations profit heavily from the empire's War Machine (a trillion dollar business) which invents its own enemies. After the fall of the Berlin Wall Islamic revolutionaries took the place of the Communists in order to justify bulging military budgets.
   
   A few examples
   In Nigeria, the great writer, Ken Saro-Wiwa was hanged for opposing environmental havoc in the territories of the Ogoni people.
   In Diego Garcia the entire population was forced out of their country without compensation in order to build a military base.
   In East-Timor, the slaughtering of the population by Indonesian troops was approved by the US government.
   In Columbia, the drug war is a subterfuge for protecting oil interests.
   
   Change
   If the many want to change the world, they must force change on the corporations. The latter are vulnerable because they need us as clients and consumers. We should impose on them policies of ecological sustainability and social responsibility. Governments should be elected by `real' democracy.
   The ultimate goal of all policies should be `a stable, sustainable and peaceful world for everybody.'
   
   Although this book is sometimes too anecdotic, it is a must read for all those who want to understand the world we live in.



5. Just thought I'd inform fellow customers that I ordered a hardback book and received it without the cover jacket.

5 comments about The New Economic Disorder: Strategies for Weathering Any Crisis While Keeping Your Finances Intact.

1. THIS BOOK EXSPOSES FED.RESERVE,OUR GOVN'T,BANKS AND ETC. IF YOU ARE A CHRISTIAN THIS BOOK IS REVEALED IN THE BIBLE. SOME FOLKS MIGHT THINK THIS BOOK IS A JOKE BUT THEY ALSO THOUGHT NOAH WAS A JOKE ABOUT THE FLOOD. DO THE INVESTIGATION YOURSELF?



2. Dr. Bates really exposes the truth behind our currency and banking system and how it affects all of us in our daily lives. This is a must read for all trying to make heads or tails of the turmoil in our economy today. While it was written five years ago, the information and basic principles it uncovers are timeless and will be as true one hundred years from now as they are today. If you are concerened for your financial future or that of future generations, you will find solutions to the economic problems that we are facing today. For those who need to know what to do to protect their hard-earned assets, this is again, a must read.
   I am impressed with this book and recommend that every household read a copy. It should be required reading for all business and economic majors.



3. You will hardly find a book where the author will contradict himself as many times as in this one. You will also hardly find a book where the author will repeat himself as many times as in this one. The key point of the book is: monetary system is deeply flawed, it is going to collapse very soon, we are in danger, S.O.S. O.k., let's say, the system is going to collapse. And now what? Apart from excessive alarmism what really bothers me is that the author is trying to explain not how an average person can protect himself from this coming "disaster" but how an average person can make profit out of it. When you read this book you are put in the position to learn how to become accessory to what is supposedly going to happen. I found so many inconsistencies in the book that at certain point it becomes just confusing, there is no coherent picture that could possibly emerge out of it. Overall, this is a good material to be used to develop critical thinking skills.



4. Larry Bates sounds like an alarmist or something, but what he says makes sense and I have heard similar things from reliable sources. I would recommend this for anyone who wants to have an understanding of how the world economy and political system works. I also have bought The Bilderberg Group by Daniel Estulin. I have only started reading it, but it seems excellent so far.



5. I thought it was a good quick read book. He had a few things in it that were very very insightful. While it's not a deep in depth book, I thought he did pretty good. (I have to say he did good because he thinks just like me. lol )Besides he predicted was is now happening on Wall Street to the letter. He seems to know his stuff and doesn't tout himself as being a super intelligent PHDD EEconomic ID alien know-it-all. He simply presents his ideological opinion of the current economic banking system along with the Bible. Yes the bible. He was a banker, congressman and a pretty smart guy to foresee what is now happening on Wall Street. If you have any interest in the markets, this is a must read.

5 comments about Irrational Exuberance.

1. This book has good info in it but man, does it get long. I read lots of analytical info with interest, but this book was very very slow for me, especially in the middle and later chapters.
   
   The good news is that the first couple of chapters make it worthwhile. It does present some very important and valid concepts. The easily-bored reader could read the first few chapters and the last chapter, learn a lot of good info, and not miss much in the long middle chapters.
   
   JD



2. If you have Invested more than ten dollars in the share market or real estate than you should read this book.



3. Last year in my country you can see some commercials in the TV inviting to invest in Mutual Funds, and I believe lots of people turned to that. The problem is that the very next year, beginning in January, the housing bubble burst and we know the rest of the story. Although this book was written before that, the book remain valid at explaining the particular behavior of the markets in these moments of furor, the "irrational exuberance", and the panic that follows it. In my opinion the book is a good investigation of the markets, you can see the author analyzing all the factors involved, including sociological and psicological (this make the book a little slow). Is good to invest in the financial system, but in awareness of its possible behavior.



4. not much food in the book overall..a very shallow and general talk, but i found it interesting to see his comments (p220) on the interest rate and other potential risks in the mortgage market back in 2005. some of the points he mentioned are indeed drivers of the recent subprime meltdown



5. Great book based on the phrase spoken by Greenspan to try and slow down the economy.

5 comments about Long Tail, The, Revised and Updated Edition: Why the Future of Business is Selling Less of More.

1. This book was recommended to me by a business friend. I am interested in starting an internet business and operate within what Chris Anderson describe as "The Long Tail" of my business sector. Armed with the knowledge and insight from this book, I feel that I am better prepared to launch my business. The best thing about this book is that it is linked to a blog that is constantly updated as well. So, and remaining questions that I had regarding the book were either answered on Chris Anderson's blog (www.thelongtail.com) or I could ask it then and there.
   
   This book will quickly become one of the mandatory pieces of literature for anyone wanting to operate a business or grow an idea on the internet.



2. I purchased this book and was expecting a much better read. This is just another bunch of self proclaimed babble from someone trying to promote himself as an expert.
   
   You can keep my money, I just want the time back I spent reading this book.
   
   There are too many technology "experts" out there anymore.



3. The book was pretty informative however a lot of the information that was in it I found a duplication from what was posted on the author's blog. There is a lot of fuel for thought in deciding what kind of business or product to sell considering that there is a niche market for probably anything that anybody can think of. Recommended.



4. Although I try to keep up with hot business books, I missed this one when it was climbing the NY Times Bestseller ranks in 2006. I heard about it in a Q&A session on LinkedIn and decided to read it. Chris Anderson has soundly articulated how the democratization of production and distribution has changed the rules of the game. If you're a creative type trying to produce and sell your own stuff, this book will encourage you to forge ahead. There's a niche out there somewhere that is looking for you.



5. I guess I picked up this book too late as most of what is written seemd fait accompli and some parts seemed to try to make the facts fit the model.

5 comments about Chain of Blame: How Wall Street Caused the Mortgage and Credit Crisis.

1. This book in great detail tells the tale of the subprime bottom feeders and their links to equally greedy and bottom feeders on Wall Street. It's easy to read, and you start to understand how these loans were made-- quickly and without much regard to whether people could actually repay them. I would have liked to see the "chain" completed, however. We don't hear much about the home buyers and what they did or what happened to them--were they all deadbeats, as some say, or hapless naifs? And, at the other end, what were regulators doing? Surely, they must have had some thoughts about what was going on. I know at the time that consumer groups were screaming their heads off, and a few state legislatures tried to pass better regulations--but they were pre-empted from implementing them by the Office of Thrift Supervision an the Office of the Comptroller of the Currency. Of course, if the authors had covered all that, their book would have been bigger than the phone book, and they would still be writing. All in all, though, I thought it was riveting.



2. Until reading this book, it was difficult to see how bad home loans could bring down Wall Street. In an entertaining read, Muolo and Padilla tell the story.



3. This book was an easy read. I like the way the authors tried to keep it simple, which must've been a challenge. This whole crisis and why it happened, is not that simple to explain, so the average person, who's not in the world of high finance can understand. Muolo and Padilla did a good job breaking it down for us; exposing the culrpits involved and tried to give us an idea of what these guys were thinking. Obviously, they all swallowed that line from the movie Wall Street, "Greed is good", and paid a hefty price with other people's money.



4. This book clearly spells out what went wrong to precipitate the mortgage crisis that catapulted the financial markets into a global meltdown. The book uses simple language to describe complex concepts, which is very helpful to the financial novice like myself. In this sense, this book is wonderful.
   
   However, the book is way too long. Some whole paragraphs are repeated almost verbatim in different chapters. Each paragraph chronicles the life and times of another major mortgage company. While this concept is ok for telling stories about the individuals involved in the business, it makes for highly repetitive reading, as the mistakes made by one company are often made by others. The first 150 pages is a tough slog of similar people and similar stories, but the book picks up steam in the final 150.
   
   Finally, while this book does a great job of explaining the mortgage industry and their role in the financial crisis, the authors make a cursory explanation of what truly happened on the Wall Street side of things. (This isn't too unexpected because the authors are mortgage experts.) For example, there is basically no mention of the subsequent credit crunch that was precipitated by the sub-prime mortgage disaster.
   
   For a good explanation of what went wrong on the Wall Street side of things, I recommend 'The Trillion Dollar Meltdown: Easy Money, High Rollers, and the Great Credit Crash'. That book is not an easy read, because the author expects the reader to have a solid understanding in Wall Street lingo. But 'Chain of Blame' is a useful primer.



5. This book tells it like it is. It's clear, well ordered, and very readable. But it's a little scary to realize how greed can control a country like ours.

5 comments about The End of Poverty: Economic Possibilities for Our Time.

1. Jeffrey Sachs uses his broad knowledge to frame the context of a call for action to end extreme poverty in our generation. He demonstrates through detailed statistical comparisons the evolution of the widening gap of economic opportunity between the world's regions, and provides interesting narrative examples to support his conclusions.
   
   Although the statistics sometimes are mind-numbing, Sachs does a good job of creating graphical representations in the form of world maps, which serve to educate the reader and demonstrate the often overlooked connections between health, education and economic development. He has "done his homework" in providing a wealth of historic perspectives on the problems we observe in today's economy.
   
   Sachs uses his groundwork effectively as a springboard to inspire our thinking about how we can help create a better world by doing relatively simple things. Again, he uses the narrative to demonstrate how small amounts of money, medicine or appropriate technologies, delivered to the point of need, can make a huge difference in the outcomes for people living in or near extreme poverty.



2. the man who has brought destruction to the Russian economy through the "shock therapy" and preparing the ground for his zionist jewish friends in Russia to own all the key national assets, now goes on to tell us what to do with the rest of the world...his books should be prohibited



3. I read. A lot. That said, only half this book is worth the time and energy it took me to read it. The middle half, to be specific. The first few chapters are dedicated to Sachs detailing to us that, no, he's not an idiot writing about something he's had no experience with and that, yes, he can help to solve macroeconomic problems. The end chapters are all Sachs recapping what he said in the rest of the book with charts and graphs that start to become meaningless if you're not a economist or a student with a couple econ classes under your belt. The middle, in my opinion, is the only redeeming part of this book that mentions far too often big-names Sachs has met and important jobs he's held. The middle actually talks about his plan for ending extreme poverty by 2015 and how we can do it. The rest of the book is just padding. So read chapters 8 - 15 if you want to "read" the book. Donate money to an NGO if you want to do something towards ending poverty with your time.



4. What do Bono, and countless other celebrities have in common with the author? A: They've always wanted to be celebrities. What is different? A: The celebs actually think that the world can be rid of poverty and misery and vice.
   
   Are you honestly going to tell me that one of the world's most influential economists ACTUALLY believes that poverty can be banished or even meaningfully reduced? Not a chance. Not with Africa's population growth rate. Sachs is selling panic again to promote himself and it's really beginning to grate my nerves.
   
   The entire book is a formula to get people "involved" i.e.: spending money a happy percentage of which Sachs and others like him will collect. The truth is that despite all the self-important boo-hooing about how a child dies every 3 seconds in Africa, no one ever mentions that 12 were just born and 8 survived which is why the continent has a growth rate of 3% and will harbor 1.2 billion starving souls in next 23 years. People who, when China and India become as rich as Japan, will be happy to stitch together our soccer balls.



5. If you are like me, you may often worry about the poor and the underprivileged across the world. You may wonder what it would take to help them achieve sustainable livelihoods which is the first step to ending poverty for them. You may even be wondering what role you could play in ending poverty in this world. Well, look no further because here is the book that is a must-read for anyone concerned about global poverty and how to overcome it - "The End of Poverty" by Dr. Jeffery Sachs. Dr. Sachs, one of the leading economists of our times makes this book comprehensible for everyone even if you are not an economist. And what is even more wonderful is that he backs up most of his claims with well-grounded research and reasoning.
   The book mainly talks about overcoming extreme poverty. Dr. Sachs defines a person as extremely poor if he/she cannot meet basic needs required for survival. He says that the extremely poor "are chronically hungry, unable to access health care, lack the amenities of safe drinking water, and sanitation, cannot afford education for some or all of the children and perhaps lack rudimentary shelter [..] and basic articles of clothing such as shoes. Unlike moderate and relative poverty, extreme poverty occurs only in developing countries." And 93% of the world's extremely poor live in East Asia, South Asia and sub-Saharan Africa.
   Of course, when a country grows economically, it has a direct effect on reducing the extremely poor in that country. But the reason, that many of the countries have not been able to achieve the expected economic growth, as many statistical studies have shown, is due to a multiplicity of factors including fertility rates, education levels, diseases, trade policies and even climate and proximity to markets, some of which are not under the control of the governments of these countries .
   As part of the U.N initiated Millennium Development Goals (MDGs), the developed countries committed to contributing 0.7 percent of GNP every year to help the developing countries eradicate extreme poverty by the year 2025 through investments that contribute to sustained economic growth. By presenting a thorough analysis, Dr. Sachs shows that this is adequate money to reach the goal of ending extreme poverty by 2025. So, you may now be wondering where is the problem.
   As Dr. Sachs skillfully presents in the book, the problem lies in the fact that the developed world has not kept it's promise although they make it sound that they are doing their best. So, the book is dedicated to making the case to convince the developed world, as to why they should keep their promise, why helping the developing countries eradicate extreme poverty is not just the right thing to do morally but also why it would benefit the developed world in the long term much more than many of the current foreign policies that are on the table. In the process, Dr. Sachs takes institutions like IMF, WorldBank and even the US federal government head-on. He even answers many questions and criticisms about his ideas and theories. On the whole, he makes the book a very engrossing, intriguing and inspiring read. At the end of it, you may even walk away with ideas on how you could help combat global poverty.

5 comments about Greenspan's Bubbles: The Age of Ignorance at the Federal Reserve.

1. The author attacks Alan Greenspan for setting interest rates too low and thus causing all out economic problems. Why did Greenspan do this? He did not see the bubbles (that he himself created) because he was blinded by the "concept of technological driven productivity miracles." The author repeats this idea many many times. But from reading the first five pages you might wonder if Mr. Fleckenstein is the best person to launch a bubble attack like this. On page 3 the author leads you to note 2 (page 189) where he writes: "Determining that a bubble exists is somewhat subjective, though not terribly difficult." A couple of pages later on page 5, the author admits: "I saw the stock market bubble building and concluded it would end in disaster -- about four years too soon!" Should Fleckenstein not have disqualified himself from documenting forecasting failures at the Fed at this point? Taking strong action to stop a bubble based on the author's forecast could have driven us into a deep recession. In these first pages Fleckenstein proves with personal experience the validity of Greenspan's statement on page 99: "I don't think we can know there's a bubble until after the fact. To assume we know it presupposes that we have the capacity to forecast a imminent decline in prices." On page 162 in a confusing paragraph Fleckenstein seems to agree with this by writing: "What would be correct to say is that one can't exactly know what action might be required to stop a bubble." This not say that Mr. Greenspan is blameless.
   The author quotes his column from 1999 to judge Greenspan without the benefit of hindsight. In this column he writes that the increases in stock prices are "breathtaking" but never uses the word, bubble, before it burst. He uses the word, bubble, in column on September 17, 2001 after it is bust. Even I did better than that. In my book, "How to Invest in Condominiums" I use bubble twice and tell my readers how to to avoid them (I finished writing the book in 1999). Yet Fleckenstein is the one who has the nerve to attack the FOMC for not using the word often enough. This book is all about criticism with the benefit of hindsight. There are no lessons learned. We have to take it on faith that tighter money applied here and there would have been better. He does not attempt to demonstrate his forecasting ability and help Chairman Ben Bernanke by telling him how big the bursting real estate bubble is and when it will hit bottom, so that the Fed can set the "correct" rate. But no, on page 184 the author indicates that Ben Bernanke would make the same decisions as Greenspan. When we finally know how big and bad the real estate bubble was, say in 2013, Ben Bernanke (if he is still there) and the FOMC are sure to get flack from Fleckenstein for allowing the bubble to end so badly. The FOMC will be unaware of this incoming flack or wisely ignore it. This negative evaluvation (or well documented rant) deserves three stars for providing an insight into how difficult the task the FOMC has is and why in the long run the value of our paper money will always erode.
   
   
   



2. In this fascinating book, financial journalist William Fleckenstein studies the record of Alan Greenspan, chairman of the Federal Reserve from 1987 to 2006.
   
   Between 1937 and 1987 there were no bubbles, but Greenspan helped to create two bubbles in ten years - in stocks and then in real estate - by holding interest rates too low, punishing savers. He helped to make the American people worse off by redistributing wealth to the rich, the bubbles' boosters and sponsors.
   
   Greenspan viewed new technology expenses as assets. So he thought that productivity and profits were higher than they really were, that inflation was overstated and that stocks were understated. In 1998 firms spent $95 billion on computers. After Greenspan's `hedonic adjustment', this came out as $352 billion, adding 2% to US GDP.
   
   Governments want to understate inflation and overstate growth, productivity and incomes. So now, most price rises seem to be way above the rate of inflation.
   
   Greenspan's rate cut of 15 October 1998 triggered the stock market bubble. By 1999 the stock market was valued at 180% of US GDP. (In the last bubble, in 1929, it was 85% of GDP.) In 2000-01 this bubble burst - the new technology miracle proved to be a mirage. In 1992-99 there was zero productivity growth in 99% of the US economy, and growth only in 1%, computer hardware.
   
   In 2001-03, housing `saved' the US economy from the aftershock of the stock bubble. De-regulation led to lower lending standards with more `creative' financial instruments, like the $500 trillion worth of derivatives, which Warren Buffett described as `financial instruments of mass destruction'.
   
   So from 2003 to 2007 there was a real estate bubble, based on huge debts. Mortgage-equity withdrawals created half US GDP growth between 2001 and 2007. By 2006, household debt was 97% of GDP: mortgage debt was $13.3 trillion. Total US debt in 2007 was 325% of GDP.
   
   This ocean of debts rested on a falling real estate market, a sinking economy and a weak currency. Where could the next economic rebound come from? Capitalism has destroyed production and destroyed the housing market: it is running out of options.



3. Greenspan will be forever linked to the global financial meltdown of 2008. History will not be kind to the Bubble Boy.



4. This is a truly invaluable book. Fleckenstein shows,beyond any doubt, that Alan Greenspan has been a disaster for the country and the economy. Even before becoming Fed chairman, Greenspan had demonstrated his incompetence (Read the beginning where Greenspan's predictions as one of President Ford's advisers would drastically miss the mark). Unfortunately, Greenspan would be confirmed as Fed chairman and begin a nearly twenty year career of gross mismanagement.
   
   Fleckenstein quotes Greenspan repeatedly, demonstrating the Fed Chairman's inability to predict the stock market or housing bubble (or anything else for that matter). Greenspan comes off as completely incompetent in Greenspan's Bubbles. Perhaps some day the Federal Reserve will be abolished and the economy will not be subject to the whims of mediocre men like Greenspan and Bernanke. If that day comes, it will be because of thoughtful experts like this book's author. I also recommend Ron Paul's analysis of Greenspan in his recent book--Paul points out that Greenspan once supported sound money but changed his views as the lure of great power as a central planner seduced him.



5. This book is a disappointment. For the happy few it might be an interesting read, but for someone intereted in the general ramifications of the Greenspan era it is a huge dissappointment.
   The book seems to be a blow-by-blow vendetta of the author against Alan Greenspan. And while the author clearly has an authority on the whole subject, he fails to engage his reader by not clarifying the details on why he rants againts Greenspan. Sometimes too much knowledge can be a hindrance.

5 comments about Financial Armageddon: Protecting Your Future from Four Impending Catastrophes, Revised and Updated Edition.

1. 1. Hedge funds are structured around a performance-based compensation system. Hedge fund advisors are paid an incentive fee based on how well they do. Hedge fund advisors get a 20 percent cut above a preset benchmark, in addition to a 2 percent fee, of the total funds under management. Many hedge funds have become comfortable using large amounts of debt to boot returns. Many on Wall Street switch sides and became a hedge fund. The goal is too generate the highest possible returns in the shortest period of time, ignoring any long-term consequences.
   
   2. The pricing of options is dependant on time remaining until maturity, interest rates, and investor expectations on market volatility.
   
   3. According to Towergroup, US brokerage firms expected to generate $33.2 billion from derivatives-related revenue in 2006.
   
   4. Credit Default swaps make up the fastest growing segment of the $415 trillion derivatives market. "The credit derivative has one party making periodic payments to other and receives the promise of a payoff if a third party defaults. The former party receives credit protection." (Wikipedia)
   
   5. Credit Default Swaps can be used to manage risk without selling the corporate bond or government bond. Credit Default Swaps are a form of insurance for banks, pensions, and hedge funds (Party A) too protect themselves against the companies they invest in against debt default.
   
   6. Insurance is bought to protect against loss. Without insurance, if company X defaults on debt, the bond value is lost. For example, a pension fund (Party A) buys a CDS and pays a 2% premium per year broke up over four quarterly payments, payable too a derivative bank; on the books, the risk of default is eliminated by the insurance; and CDS coverage lasts 5 years.
   
   7. Since the CDS is not tie to a physical asset it can be bought and sold. Speculation on the credit-spread works drives buying and selling of CDS contracts. Without a CDS, a third party profits by identifying, a company with weak financial performance and offers to pay $900k for a $1 million bond from party B and profits $100k, if the company paid its debt. With CDS, party B profits: "Alternatively, one could enter into a credit default swap with the Party B, by selling credit protection and receiving a premium of $100,00. If the company does not default, one would make a profit of $100k without investing anything." Speculation profits are on the margin. Swap prices decline as credit quality increases and rise when quality worsens. "Some who believes that a company's credit quality will change could potentially profit more from investing in swaps than in the underlying bonds."
   
   8. Problem: Party A buys the CDS from Party B, Party B can assign the insurance contract to another party; the final party may or may not be in a position to pay the bond's full value in the case of Party A default. If companies default on their obligations, buyers of credit default swaps would lose money, banks would tighten credit, and interest rates would rise.
   
   9. In 2006, at least $200 billion of General Motor's CDS were estimated to exist, covering $30 billion of bonds. There is a risk that major financial operators are in over their heads leading to dangerous systematic pressures. The danger occurred in 2005 when 100,000 CDS had been verbally agreed to but not settled.
   
   10. According to the US comptroller, JPMorgan Chase, Bank of America, Citibank, Wachovia, and HSBC accounted for 96 percent of the $100 trillion of derivatives controls outstanding among the 836 US banks. JPMorgan being the largest derivate player. Fannie Mae and Freddie Mac had $1.5 trillion of derivates to hedge against risk in their portfolios.
   
   11. "Credit derivatives have never been tested in times of acute market stress, such as a collapse of the real estate market, a cratering economy, or a 1987 type stock crash."



2. If you care about your family's future financial well being, this book is a must read. This is the second edition of the work, but Panzer made some predictions in the first edition, written a few years ago, that have come to pass alrady. While, I hope we never see the "armageddon" that Paznzer lays out, I do believe that we are poised for a massive recession or depression due to the recent credit and houing bubbles. Panzer lays out a series of events led by a weakening dollar, national trade budget shortfalls, and credit derivative misuse that could ultimately change the face of America and our current way of life. I would also recommend "The Demise of the Dollar" as a follow on read to this work.



3. I seldom buy financial books because most of them are simply print "scams". I bought this one because of the reviews and a recommendation by someone, and Mr Panzner's credentials. He certainly has the background to write a meaningful book on the subject. However, I was stunned at how extraordinarily superficial the book was, and thus felt compelled to write a review. The book takes some similar events in history and paints a potentially very scary future. And that future may come to pass, but you've got almost 200 pages of extrapolating those historical events into the future and very little else. Seems little more than an attempt to sensationalize and commercialize what "can" and possibly will happen. There is little digging into what precipated some of the events, and the "advice" offered is really pathetic. The fact that this got such high ratings is either a testimony to how many friends he has in the industry or how ill informed and poorly read our society is. The one thing for sure is that there was indeed a wealth transfer that occured here: my wallet to his. But other than that, there is absolutely no reason to purchase this book. Given his credentials, I would have thought he would have been mildly embarrassed to pen this. He could undoubtedly do better.



4. We are in perilous times. Now (i.e., late September 2008), we all realize it. Several years ago, virtually alone, Panzner predicted (in great detail) exactly what has now actually come to pass over the last few years, and---perhaps much more importantly, he warned us exactly what is coming in the near future.
   
   Several years ago, he was regarded as being "an alarmist"; now, we recognize that he was (and is) a PROPHET!
   
   I believe we all should read this book very carefully, and use it to plan for our families' futures. Buy copies of this for your friends---they'll soon be very grateful that you did.



5. If you think that the perfect storm is total collapse of the economic system, this is your book. Probability of everything outlined in this book actually happening? Not very likely - but one should be cautious with how one structures one's affairs... So it was for me more of a checklist - not necessarily one of impending doom.

2 comments about Fixing Global Finance (Forum on Constructive Capitalism).

1. Must read given the state of today's economy. Incredibly thoughtful yet accesible piece of work that puts today's economic crisis in its historical and economic context from one of the World's leading economists.



2. This version (i.e., Forum on Constructive Capitalism) might be different than Mr. Wolf's yet-to-be-released book of the same name. I don't know. But, regardless this an eye-opening book. Previously, I have studied the US credit crunch from a retail/Wall Street perspective: that is, subprime loan originations and securitizations. Before Mr. Wolf, I understood the crisis as an utterly avoidable debacle triggered by greed and enabled by certain financial instruments.
   
   But the book opened my eyes to larger forces at work in global finance. Sort of like, if i before saw the crisis as an inept swimmer drowning, now I see the swimmer as more of a victim caught up inexorably in a powerful undertow beyond his control. To see it his way, there was a degree of inevitability due to unsustainable imbalances. Mr. Wolf is absolutely expert on the dynamics of international capital flows. A good portion of the book makes vivid something he covers in his columns: the U.S. has been the world's "spender and borrower of last resort;" okay, you knew that, but the breakdown between government, companies and households is where it gets scary. While the US government used deficits to spur demand (and absorb other countries, like China's, excess savings), US households went into an unprecedented deficit. Our problem is that our current account deficit is met with excess spending rather than investment. Mr. Wolf has great charts in the book to illustrate this perfectly; a few of his simple line charts elicited a visceral reaction for me (fear, specifically).
   
   Also, for those who haven't read Mr. Wolf before, he is the consumate professional giving counter-arguments their just due. You learn just as much while he's weighing the idea he doesn't agree with. But by the time I was done with it, he had convinced me formally around a nagging suspicion: that the U.S. has been reacting to global patterns as much as instigating them (i.e., that our Fed and policy makers aren't all powerful - he even dubs them "victims" in some respects).
   
   I gave it four stars only because the book was tough work for me. For a trained economist (not me, I am a financial analyst), probably it deserves five stars. I needed extra time and a macroeconomic reference to sort through some of it. (that's why i remove one star. If you are going to make me break out Mankiw's macroecon text to keep pace, i am going to have to ding you!). It looks harmless, without equations and such, but it's way dense. This is one of those that books that is easy to buy but hard to read all the way through. So, the four stars is only for the time it required on my part. I would not exactly call it accessible. But Mr. Wolf is a national treasure.

5 comments about The Collapse of the Dollar and How to Profit from It: Make a Fortune by Investing in Gold and Other Hard Assets.

1. I bought the book when it first came out. More importantly, I ACTED on the book's advice. I bought gold, silver, Goldcorp(GG) and a lot more. Goldcorp was selling for about $12 per share at the time. Gold hadn't gone beyond about $430 per ounce. The dollar was trading much higher than it is now. Goldcorp is now at about $40 per share. Gold is near $950 per ounce. Silver is at $18 per ounce. Suffice it to say that if I ever have the chance to meet Mssrs Turk and Rubino in person, I will pick up the tab for dinner!
   I had to smile when I read some of the reviews which have been posted on this site. I guess that some people still do not "get it" when it comes to the role of gold in protecting assets and purchasing power. Although the book's title speaks of making a fortune by investing in gold and hard assets, this book is not really a get rich quick book. It is a survival book. With everything that has been happening in the financial sector, the most important thing for all of us is to protect what we have!



2. For anyone interested in the dynamics of our falling dollar, this book: "The Collapse of the Dollar and How to Profit from It" is a must read. I was led to it after reading the author's: "How to Profit from the Coming Real Estate Bust." I was delighted to find: "The Collapse of the Dollar's" paperback version updated (containing 2007 numbers)! It's amazing how visionary the author has been. Morover, the book is easy to read/understand. I highly recommend...



3. Oh Wow.. Every one should get this Bible. Amazing; it gives you deep details how to profit from precious metals, and gold on top of them. A question to all; who created Gold? Answer is "God." Now who created Dollar? Answer is "Human." In the end Who will win God or human? Answer is left to all of you!!



4. TO: Mr. John Rubino/Mr. James Turk BRAVO on your tour de force book that lays out the Truth, unencumbered, and with sobering and simple recommendations on how to save ones self from financial ruin in the next couple of years, and now for that matter.
   
   The comparisons of other empires that have economically collapsed (due to fiat currencies, fractional reserve banking, etc), most mighty nations in history, is an invaluable inclusion to the beginning of the book to give unaware readers perspective at how close to the edge the United States is.
   
   Since 2000, this is what I have been telling people and you both are the first ones I have really seen to make the case in clear terms and dire warnings, with simple steps to protect ones self.. You guys are the best and your book has been a GOLD mine, literally... You guys strike at the heart of the Truth and expose it good, bad, ugly..
   This book is small enough, inexpensive enough, and valuable enough to buy a dozen copies and hand them out to relatives, good friends, and those you care about... Simple enough for the economic laymen (most of Americans) to wake up to! People with HUNDREDS of thousand's of USD$$$ in stocks, bonds, over leveraged homes/real estate, etc etc.. This book and information is vital to their future. They could save themselves but unfortunately many will choose not to and will bury their heads and follow the herd of "mainstream" money managers...
   
   I will keep on tyring to wake people up and inform them of the peril ahead, though sadly few have listened to me since I was recommending gold at $320 in 2001 or so... Silver at $5 back then too... Sometimes I am ashamed to be American because of my fellow Americans who have lost their critical thinking skills, independent thought, discernment, and a healthy ongoing distrust of government and Elites... to be and STAY free and economically sound, as an individual, family, or nation, we MUST be informed, vigilant, and critical of all orthodox information and mainstream opinion and most of all, government promises...
   
   You guys are the bright spots of Truth in American economics! BRAVO!



5. If you understand the fiscal situation this country is in, the place the elected & non-elected officials wanna take it, and what will happen after that has taken place, this book is dead on.
   
   Monetary policy in this country(USA) has been flawed since the inception of the federal reserve system in 1913. The Monetarist economists(Widely known as Anna J Schwartz & Milton Friedman) blame the fed's lack of action as the cause of the great depression. They believe if the fed had intervened and created a little more inflation at the time the deflation was occuring(aka Deflationary Depression), the Great depression would have lasted only 1-5 years. Ben Bernanke (current FED Chairperson) believes this theory, that's why he's currently inflating that debt away through bail-outs.
   
   On the other hand, Hard money Economists (aka Ludwig von Mises' Austrian school of economics) blames the fed completely for the Great Depression. Since their inception in 1913 the fed has fueled massive credit bubbles and the roaring 20's were no different. From 1913-1919 the fed increased the money supply by around 50% leading to the credit induced boom known as the roaring 1920's. When they finally called in all the inflationary credit they had put out, it killed the economy. Instead of letting the money stay out, they kept deflating the bubble which fueled the longest economic downturn in US history.
   
   Today our economists and financial leaders will make sure not to repeat that mistake again. The system will not be allowed to go broke, almost everyone will get a huge bailout, and when they do, the countries who hold our short term US debt will begin dumping it, due to its losing value thanks to the bailouts.
   
   If you believe the dollar is gonna take a hit over the next 5-10 years, then dedicating some of your portfolio (10-25%) to precious metals and watching what happens is going to be very exciting. If you paid attention to the 60s & 70s, you would notice some odd but scary similarities, huge needless wars followed by inflationary downturns in the economy. The 1970's bad economy was the price for the 1960's vietnam war. Remember, Nixon took us off the Gold Standard in 1971 when gold was only $35 an Ounce(today its ~$900). During the 70s the DOW Jones only gained 10 points but gold jumped almost 24 times, silver more. This time its gonna be a lot worse. I think physical silver is the best deal, as long as you can find some quality physical without a high retail purchase fee.
   
   James turk is a pro and this book ranks high on the list of profit from the coming gloom & doom books. If you want to implement a section of your portfolio into precious metals this book is a great way to learn some very helpful tactics. He writes about what types of Precious Metals investments you can buy: Physcical(keep@home&vault), Paper(futures/options), Mining stocks, Numismatic, but doesn't really mention his world-renowned service called GOLDMONEY.com located in British Jersey,UK. I personally have an account with GoldMoney.com and I feel its a one of a kind service. It keeps part of your wealth outside the US, which is very important. My say is Pick up the book and Partake in the Precious Metals bull market that will last for the next 5-10 years minimum, and create some wealth during the bad times we're gonna go through :)
   
   I also recommend the book CRASHPROOF by Peter Schiff (he recommends GoldMoney.com)