The Lords of Easy Money: How the Federal Reserve Broke the American Economy by C

Description: The Lords of Easy Money by Christopher Leonard "The New York Times bestselling business journalist Christopher Leonard infiltrates one of Americas most mysterious institutions--the Federal Reserve--to show how its policies over the past ten years have accelerated income inequality and put our countrys economic stability at risk"-- FORMAT Hardcover LANGUAGE English CONDITION Brand New Publisher Description The Wall Street Journal Best Book of the Year NEW YORK TIMES BESTSELLER The New York Times bestselling business journalist Christopher Leonard infiltrates one of Americas most mysterious institutions—the Federal Reserve—to show how its policies spearheaded by Chairman Jerome Powell over the past ten years have accelerated income inequality and put our countrys economic stability at risk.If you asked most people what forces led to todays unprecedented income inequality and financial crashes, no one would say the Federal Reserve. For most of its history, the Fed has enjoyed the fawning adoration of the press. When the economy grew, it was credited to the Fed. When the economy imploded in 2008, the Fed got credit for rescuing us. But the Fed also has a unique power to reshape the American economy for the worse, which it did, fatefully, on November 4, 2010 through a radical intervention called quantitative easing. In just a few short years, the Fed more than quadrupled the money supply with one goal: to encourage banks and other investors to extend more risky debt. Leaders at the Fed knew that they were undertaking a bold experiment that would produce few real jobs, with long-term risks that were hard to measure. But the Fed proceeded anyway...and then found itself trapped. Once it printed all that money, there was no way to withdraw it from circulation. The Fed tried several times, only to see market start to crash, at which point the Fed turned the money spigot back on. Thats what it did when COVID hit, printing 300 years worth of money in two short months. Which brings us to now: Ten years on, the gap between the rich and poor has grown dramatically, stock prices are trading far above whats justified by actual corporate profits, corporate debt in America is at an all-time high, and this debt is being traded by big banks on Wall Street, leaving them vulnerable—just as they were during the mortgage boom. Middle-class wages have barely budged in a decade, and consumers are buried under credit card debt, car loan debt, and student debt. The Lords of Easy Money tells the shocking, riveting tale of how quantitative easing is imperiling the American economy through the story of the one man who tried to warn us. This will be the first inside story of how we really got here—and why we face a frightening future. Author Biography Christopher Leonard is a business reporter whose work has appeared in The New York Times, The Wall Street Journal, Fortune, and Bloomberg Businessweek. He is the New York Times bestselling author of The Meat Racket and Kochland, which won the J. Anthony Lukas Work-in-Progress Award. Review "A fascinating page-turner....Theres something undeniably gratifying about an elegantly crafted morality tale — and the business reporter Christopher Leonard has written a good one....A fascinating and propulsive story about the Federal Reserve — yes, you read that right. Leonard, in the tradition of Michael Lewis, has taken an arcane subject, rife with the risk of incomprehensibility (or boredom), and built a riveting narrative in which the stakes couldnt be any clearer."– The New York Times "Skillfully tells the story of how, over several decades, a phalanx of economic sophisticates at the Fed have badly misunderstood the U.S. economy and often come up with policies that fail to produce the intended results." – The Wall Street Journal "A timely addition—appearing just as inflation is making headlines....Leonard writes vividly about a technical subject....By focusing on a regional banker, Leonard offers a refreshingly non-Washington view....The author is surely correct that many Americans view the Fed as an unelected power aligned with elites, perhaps contributing to the disaffection that exploded on Jan. 6, 2021."– The Washington Post "Its tough to turn the nuances of monetary policy into personality-driven narrative. But Christopher Leonard has succeeded in doing just that with The Lords of Easy Money....He turns [an] unassuming economist into the protagonist of a compelling tale about how the Federal Reserve changed the entire nature of the American economy... Weaving together narrative non-fiction with big ideas can be difficult. One of the best things about this book is that through Hoenig, Leonard, a business journalist, is able to tell the whole, complicated half-century story of how we got to where we are now in a way that isnt at all wonky. There are real people here, making real decisions about the real world." – The Financial Times "[A] bracing and closely reported chronicle....Leonards book is an indispensable account in many respects—his coverage of the invisible bailout of the repo market alone stands as a bracing case study in how the false pieties of quantitative easing directly stoked ruinous asset bubbles. But Leonard is also that rarest of financial reporters who conscientiously tracks the real-life consequences of the Olympian deliberations undertaken by the paper economys gatekeepers....richly reported, accessible, biting, and long-overdue." – The New Republic "The book is a timely read to understand what could happen next through a thorough analysis of what this policy intervention looks like on the ground."– Enterprise: The State of the Nation "We get his point and it is a good one. This has been an era of loose money and the benefits have been very unevenly distributed... The office politics of the Fed are well captured by Leonard, as is the intimidating physical setting." – The New York Times "Leonard is skilled at explaining complicated financial maneuvering in a way normal people can understand... A good reminder of how uncertain a lot of monetary policy is." – The Washington Free Beacon "Brillian[t]... [Leonard] is onto a deeper and much more astute critique....His analysis of the dynamics and consequences of Wall Street–friendly easy Fed money is original and important." – The American Prospect"Leonards wonderfully readable new book is about one of the most important, yet least covered and least understood, changes in American life. Thats the effect of the dramatically increased role in financial markets played by the Federal Reserve. As Leonard convincingly argues, it might be nothing short of catastrophic." — Bethany McLean, New York Times bestselling co-author of The Smartest Guys in the Room "An essential, engrossing and, above all, human tale featuring the central banker who dared to dissent from the party line and a factory worker whose sufferings are traceable to that dissidents failure to carry his case. A monetary page-turner? Christopher Leonard has actually produced one." — James Grant, founder and editor of Interest Rate Observer "Thanks to Leonards gripping narrative, I now have a new monetary hero: former Fed governor Tom Hoenig. If, like me, you are desperate to understand how we got into this predicament, The Lords of Easy Money is required reading." — William D. Cohan, New York Times bestselling author of House of Cards "Leonards richly reported and provocative exploration will have you reassessing whether the Fed built on a solid foundation or on air."— Jesse Eisinger, Pulitzer Prize winning author of The Chickenshit Club "An eye-opener. Well-researched and engaging, it brings to life consequential issues that influence the current and future wellbeing of most Americans... How this journey ends has important implications not just for the United States but also globally." — Mohamed A. El-Erian, New York Times bestselling author of The Only Game in Town and president of Queens College, Cambridge University."A timely and persuasive challenge to the Feds new economic orthodoxy…. Leonard shrewdly dissects the policy wrangles roiling the Fed behind its facade of technocratic consensus—he presents a sharp riposte to glowing accounts of former Fed chairman Ben Bernankes leadership—while offering a trenchant analysis of how the Fed controls and misshapes the economy….[a] probing history."— Publishers Weekly (starred review) "The federal banking system has built a house of cards, Leonard cogently warns. Expect it to fall any minute now." — Kirkus Reviews "Leonard strives to present the issues clearly but without oversimplification….the patient reader comes away with a greater understanding of economic issues that are affecting everyones lives." — Booklist Review Quote "A timely and persuasive challenge to the Feds new economic orthodoxy.... Leonard shrewdly dissects the policy wrangles roiling the Fed behind its facade of technocratic consensus--he presents a sharp riposte to glowing accounts of former Fed chairman Ben Bernankes leadership--while offering a trenchant analysis of how the Fed controls and misshapes the economy....[a] probing history." -- Publishers Weekly (starred review) "The federal banking system has built a house of cards, Leonard cogently warns. Expect it to fall any minute now." -- Kirkus Reviews "Leonard strives to present the issues clearly but without oversimplification....the patient reader comes away with a greater understanding of economic issues that are affecting everyones lives." -- Booklist Excerpt from Book Chapter 1: Going Below Zero CHAPTER 1 GOING BELOW ZERO (2010) Thomas Hoenig woke up early on November 3, 2010, knowing what he had to do that day, and also knowing that he was almost certainly going to fail. He was going to cast a vote, and he was going to vote no. He was going to dissent, and he knew that this dissent would probably define his legacy. Hoenig was trying to stop something: A public policy that he believed could very well turn into a catastrophe. He believed it was his duty to do so. But the wheels were already turning to make this policy a reality, and the wheels were far more powerful than he was. The wheels were powered by the big banks on Wall Street, the stock market, and the leadership of Americas Federal Reserve Bank. Everyone knew that Hoenig was going to lose that day, but he was going to vote no anyway. HoenigI was sixty-four years old, and he was the president of the Federal Reserve Bank of Kansas City, a position that gave him extraordinary power over Americas economic affairs. He was in Washington that morning because he sat on the Federal Reserves powerful policy-making committee, which met every six weeks to effectively determine the value and quantity of American money. Most people in America dont think very much about money--meaning the actual currency, or that thing we call a dollar. The word dollar is, in fact, just a slang term for American currency, which is actually called a Federal Reserve note. People spend Federal Reserve notes every day (if theyre lucky enough to have them), but they rarely think about the complex, largely invisible system that makes money appear out of thin air. This system is the U.S. Federal Reserve System. The Fed, Americas central bank, is the only institution on Earth that can create U.S. dollars at will. Because he was a senior official at the Federal Reserve, Thomas Hoenig had to think about money all the time. He thought about it in the same way that a very stressed-out building superintendent might think about plumbing and heating. Hoenig had to think about money as a system to be managed, and to be managed just right. When you ran the system that created money, you had to do your job carefully, with prudence and integrity, or else terrible things might happen. The building might flood or catch on fire. This is why Hoenig felt so much pressure when he woke up that November morning in Washington, D.C. He was staying at a very nice hotel, called the Fairmont, where he always stayed when he traveled from his home in Kansas City to the nations capital. Hoenig was in town for the regular meeting of the Federal Open Market Committee, or FOMC for short. When the committee met in Washington, its members voted and set the course of the Feds actions. There were twelve members on the committee, which was run by the powerful chairman of the Federal Reserve. For a year now, Hoenig had been voting no. If you tallied his votes during 2010, the tally would read: no, no, no, no, no, and no. His dissents had become expected, but they were also startling if you considered Tom Hoenigs character. He wasnt, by nature, anything close to a dissident. He was a rule-follower. He was born and raised in a small town, where he started working at the family plumbing shop before he was ten years old. He served as an artilleryman in Vietnam, and when he came home he didnt protest against the war. Instead, he studied economics and banking at Iowa State, earning a PhD. His first job out of school was as an economist with the Federal Reserve regional bank in Kansas City, in the supervision department. At the Fed, he went from being a rule-follower to being a rule-enforcer. Hoenig rose through the ranks to became president of the Kansas City Fed in 1991. This was the job he still held in 2010. His responsibilities as one of twelve regional Fed bank presidents illuminate the structure of Americas money system. The Federal Reserve system is unlike any other in the world; it is a crazy genetic mashup of different animals, part private bank and part government agency. People talk about the Fed as if it were a bank, but it is really a network of regional banks, all controlled by a central office in Washington, D.C. Hoenig had all the fiery disposition that one might expect from a regional Fed president, which is to say none at all. He was soft-spoken, civil, wore cuff links and pin-striped suits, and spent his days talking about things like capital requirements and interest rates. Hoenig was an institutionalist, and a conservative in the little "c" sense of the word. And yet here he was, in late 2010, a dissident. After he woke up in his hotel room, Hoenig had some time alone before the big day started. He gathered his thoughts. He shaved, put on a suit, knotted his tie, and gathered his papers. If he had any doubts about what he was going to do that day, he didnt advertise them. He had spent months, years, even decades preparing for this action. His vote would reflect everything hed learned during his career at the Fed. He was trying to apply what he knew to help the Federal Reserve navigate through extraordinary times. The American financial system had broken in late 2008, after the investment bank Lehman Brothers collapsed. That moment marked a threshold for people like Tom Hoenig. Economists and central bankers describe the ensuing panic as the Global Financial Crisis, eventually bestowing the moment with its own biblical label, the GFC. The world of central banking was neatly divided into two eras. There was the world pre-GFC and the world post-GFC. The GFC itself was apocalyptic. The entire financial system experienced a total collapse that risked creating another Great Depression. This would mean years of record-high unemployment, economic misery, political volatility, and the bankruptcy of countless companies. The crisis prompted the Federal Reserve to do things it had never done before. The Feds one superpower is its ability to create new dollars and pump them into the banking system. It used this power in unprecedented ways after Lehmans collapse. So many of the financial charts that capture the Feds actions during this period look like the same chart--a flat line that bounces along in a stable range for many years, which then spikes upward like a reverse lightning bolt. The upward spikes capture the unprecedented amount of money the Fed created to combat the crisis. Between 1913 and 2008, the Fed gradually increased the money supply from about $5 billion to $847 billion. This increase in the monetary base happened slowly, in a gently uprising slope. Then, between late 2008 and early 2010, the Fed printed $1.2 trillion. It printed a hundred years worth of money, in other words, in little over a year, more than doubling what economists call the monetary base. There was one very important characteristic of all this new money. The Fed can create currency in just one way: It makes new dollars and deposits them in the vaults of big banks. Only about twenty-four special banks and financial institutions have the privilege of getting these pristine dollars, making those banks the seedbed of the money supply. The amount of excess money in the banking system swelled from $200 billion in 2008 to $1.2 trillion in 2010, an increase of 52,000 percent. In doing all of this, the Fed had created a new foundation for the American financial system, built on extraordinary amounts of new money. Hoenig had a chance to watch firsthand as this system was created because he sat on the very committee that created it, the FOMC. In the beginning, during the crisis years of 2008 and 2009, he had voted to go along with the extraordinary efforts. The dispute that Hoenig was preparing for, on that morning of November 3, 2010, was about what the Fed would do now that the days of crisis were over. A difficult and slow recovery was just beginning, and it was one of the most important moments in American economic history. It was the moment when one phase of economic conditions was ending and giving way to the next. The Fed had to decide what the new world was going to look like, and Hoenig was increasingly distressed by the path the Fed was choosing. It is commonly reported that the FOMC meets every six weeks to "set interest rates." What this means is that the Fed determines the price of very short-term loans, a number that eventually bleeds out into the entire economic system and has an effect on every company, worker, and household. The basic system works like this: When the Fed raises interest rates, it slows the economy. When the Fed lowers interest rates, it speeds up the economy. The FOMC, then, is like a group of engineers in the control room of a nuclear power plant. They heat up the reactor, by cutting rates, when more power is needed. And they cool down the reactor, by raising rates, when conditions are getting too hot. One of the most important things the Fed did during the Global Financial Crisis was to slash the interest rate to zero, essentially for the first time in history (rates had briefly flirted with zero in the early 1960s). Economists called the 0 percent interest rate the "zero bound," and it was once seen as some kind of inviolable boundary. You couldnt go below zero, it was believed. The rate of interest is really just the price of money. When interest rates are high, money is expensive because you have to pay more to borrow it. When rates are low, money is cheap. When rates are zero, money is effectively free for the bank Details ISBN1982166630 Author Christopher Leonard Publisher Simon & Schuster Language English Year 2022 ISBN-10 1982166630 ISBN-13 9781982166632 Format Hardcover Short Title The Lords of Easy Money Subtitle How the Federal Reserve Broke the American Economy Imprint Simon & Schuster Pages 384 Place of Publication New York Country of Publication United States Publication Date 2022-03-17 NZ Release Date 2022-03-17 US Release Date 2022-03-17 UK Release Date 2022-03-17 DEWEY 332.110973 Audience General AU Release Date 2022-05-31 Alternative 9781668059647 We've got this At The Nile, if you're looking for it, we've got it. With fast shipping, low prices, friendly service and well over a million items - you're bound to find what you want, at a price you'll love! TheNile_Item_ID:137204246;

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