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This book seeks to explain the global financial crisis and its wider economic, political, and social repercussions, arguing that the 2007-9 meltdown was in fact a systemic crisis of the capitalist system. The volume makes these points through the exploration of several key questions: What kind of institutional political economy is appropriate to explain crisis periods and failures of crisis-management? Are different varieties of capitalism more or less crisis-prone, and can the global financial crisis can be attributed to one variety more than others? What is the interaction between the labour market and the financialization process? The book argues that each variety of capitalism has its own specific crisis tendencies, and that the uneven global character of the crisis is related to the current forms of integration of the world market. More specifically, the 2007-09 economic crisis is rooted in the uneven income distribution and inequality caused by the current financial-led model of growth. The book explains how the introduction of more flexibility in the labour markets and financial deregulation affected everything from wages to job security to trade union influence. Uneven income distribution and inequality weakened aggregate demand and brought about structural deficiencies in aggregate demand and supply. It is argued that the process of financialization has profoundly changed how capitalist economies operate. The volume posits that financial globalization has given rise to growing international imbalances, which have allowed two growth models to emerge: a debt-led consumption growth model and an export-led growth model. Both should be understood as reactions to the lack of effective demand due to the polarization of income distribution.

American Power after the Financial Crisis -- Contents -- Preface -- 1. The Global Financial Crisis as World Politics -- 2. Learning from the Great Depression -- 3. From the First to the Second US Postwar Order -- 4. Seeds of Discord: The Asian Financial Crisis -- 5. The New American Model and the Financial Crisis -- 6. The Crisis and World Politics -- 7. The Crisis and the International Balance of Power -- 8. Conclusions, Expectations, and Speculations -- Notes -- Index

Featuring essays by Nobel laureate economists and an afterword by Richard Posner, this volume provides a comprehensive overview of the collapse of the global financial sector in 2008. It will be essential reading for anyone interested in the nature of modern capitalism and regulation.

Political support for Argentina's currency board rested on distributing the early gains from ending hyper-inflation and the spending made possible with access to external credit. When these gains were exhausted and external shocks left the peso overvalued, neither Argentina's political system nor its economy could adjust. The needed adjustment went well beyond simple fiscal tightening: it required deciding who would incur the financial losses associated with the deep contraction needed to correct a real over-valuation in a heavily indebted economy. By 2000, Argentina faced the prospect of further economic contraction, a banking crisis and an external sovereign debt crisis. Even if none of the three crises was avoidable, preemptive action might have made one or more of them less severe. Yet preemption was a political orphan - no political constituency in Argentina argued to bring some pain forward for a chance of less pain down the road, and the IMF and G-7 preferred continued financing to the political risk of supporting a new macroeconomic strategy.

The Financial Crisis and Federal Reserve Policy is fully revised and updated with the most accurate and thorough coverage available of the causes and consequences of the 2008 Financial Crisis and the role the Federal Reserve played in the recovery efforts.

Government efforts to manage the financial crisis and to promote economic recovery have been extensive over the past three years. Hundreds of billions of dollars have been distributed—and much of it now repaid—from the Troubled Asset Relief Program. The Federal Reserve holds more than $2 trillion in mortgage‐backed securities, collateralized loans to financial institutions, and other assets and liabilities to maintain liquidity in the financial markets. The American Recovery and Reinvestment Act injected more than $600 billion into the economy through tax breaks, loans, contracts, grants, and entitlements. Congress also passed the Dodd‐Frank Wall Street Reform and Consumer Protection Act in 2010. Yet economic recovery remains flat. The author examines the reform effort to date, key points of its primary focus, and the politics of implementing the reform as a factor in eventual economic recovery. One component of the reform, the creation of a Consumer Financial Protection Bureau, holds the greatest potential for changing the way consumers participate in the financial markets, but also has drawn the greatest debate and opposition. While regulatory reform alone will not revive the economy, a newly conceived and broadly participatory Consumer Financial Protection Bureau could simplify and streamline the complex linkages that contribute to the supply of credit.

The recent banking crisis has brought into question the business model used by most large banks. This collection of essays explores the success of 'alternative banks' - savings banks, cooperative banks and development banks, using case studies from around the world and discussion of both the historical and theoretical context of banking practices