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"Financial Stability describes the economic, political and legal antecedents of financial crises in the western market economies. By describing how these events developed in the past and how the markets can be used to gauge the threat of future contagion, the book provides a roadmap for how we can avoid financial disruptions and thereby maximize financial stability and economic prosperity. The book will explain: Measuring moral hazard in the future Political reaction to past financial crises Economics, accounting, law, and mathematics surrounding financial stability Sources of capital and capital needFinancial Stability provides investment professionals, policy makers and members of the public with new insights into the workings of the financial markets and the political economy in which we all live and work"--
List of contents
Preface
Introduction
Part 1: A Flight through Financial Market History--Freedom and Fraud
Chapter 1. The First Few Millennia
Chapter 2. The Bank of England and the Scottish Enlightenment
Chapter 3. U.S. Banking, from British Colonies to 1865
Chapter 4. Bagehot's Dictum (a.k.a. the "Greenspan Put")
Chapter 5. U.S. Financial Markets from 1865 to the Great Depression
Chapter 6. Depression, War, and Aftermath--Reflecting on Finance from 1929 to 1973
Chapter 7. Early Deregulation: The Transactions that Replaced Depression Era Thrifts
Chapter 8. Riskless Arbitrage--Stand-alone Collateralized Mortgage Obligations ("CMOs")
Chapter 9. Paradise Gained, Lost, Regained, and Destroyed--1992 to 2008
Chapter 10. Resurrection, Recovery and Reform--2008-2013
Chapter 11. Different Circumstances Require Different Solutions
Part 2: The Theory of Financial Stability
Chapter 12. Statement: Rule of Law + Freedom + Transparency --> Equilibrium
Chapter 13. Saying vs. Doing
Part 3: Proofs of the Theory of Financial Stability
Chapter 14. Mathematics: (1 + i)x > (E = mc²)
Chapter 15. Law: Incomplete "Sale" identical to Secured Borrowing
Chapter 16. Economics: Savings identical to Investment
Chapter 17. Accounting: Assets identical to Liabilities + Capital
Chapter 18. International Trade: Current Account Deficit identical to Capital Investment -- Domestic Savings
Chapter 19. Philosophy: Benevolence > Self Interest > Fraud
Part 4: The Future
Chapter 20. Achieving Wisdom While Avoiding Mistakes of Experience
Chapter 21. Capital Needs
Chapter 22. Sources of Capital
Chapter 23. Managing the Water Balloon
Chapter 24. Balancing the Bubbles
Epilogue: Truth and Consequences
References
About the Companion Website
About the Authors
Index
About the author
FREDERICK L. FELDKAMP is a retired partner of Foley & Lardner, LLP, where he chaired the firm's financial asset securitization practice. He has been a key contributor to the legal basis of mortgage-backed securities and other financial innovations in the United States. Feldkamp's numerous publications have appeared in peer-reviewed legal journals around the world.
R. CHRISTOPHER WHALEN is an investment banker and author who lives in New York City. He is Senior Managing Director and Head of Research at Kroll Bond Rating Agency, where he is responsible for financial institution and corporate ratings. Over the past three decades, he has worked for financial firms such as Bear, Stearns & Co., Prudential Securities, Tangent Capital Partners, and Carrington. He was a co-founder and principal of Institutional Risk Analytics from 2003 through 2013, when the firm was acquired by Total Bank Solutions.
Summary
Applying the Lessons of History to Understanding Fraud Today and Tomorrow Financial Stability provides a roadmap by which the world can anticipate and avoid future financial disruptions.
