Money of the Mind: Borrowing and Lending in America from the Civil War to Michael Milken - Hardcover

Grant, James

Hardcover

ISBN 10: 0374169799 ISBN 13: 9780374169794

Publisher: Farrar Straus & Giroux, 1992

Synopsis

A look at America's relationship with debt describes how American industrial and financial communities' speculative frenzy in the 1980s has brought about today's weak economy.

About this title

From the Back Cover:

The 1980s witnessed a lemming-like rush into the sea of debt on the part of the American industrial and financial communities, with consequences we are only beginning to appreciate. But the speculative frenzy of the eighties didn't just happen. It was the culmination of a long cycle of slow relaxation of credit practices--the subject of James Grant's brilliant, clear-eyed history of American finance. Two long-running trends converged in the 1980s to create one of our greatest speculative booms: the democratization of credit and the socialization of risk. At the turn of the century, it was almost impossible for the average working person to get a loan. In the 1980s, it was almost impossible to refuse one. As the pace of lending grew, the government undertook to bear more and more of the creditors' risk--a pattern, begun in the Progressive era, which reached full flower in the "conservative" administration of Ronald Reagan. Based on original scholarship as well as firsthand observation, Grant's book puts our recent love affair with debt in an entirely fresh, often chilling, perspective. The result is required--and wickedly entertaining--reading for everyone who wants or needs to understand how the world really works.

From Kirkus Reviews:

To Grant, ``money of the mind'' is credit, and here he offers an entertaining as well as instructive chronicle of its near- ruinous emergence in the US. As the author of Bernard M. Baruch (1983) and publisher of a highly regarded newsletter on interest rates, Grant has the scholarly savvy to sift through the complex developments that have shaped American capitalism. He argues, for example, that the speculative excesses of the 1980's represented the culmination of a protracted cycle of increasingly easier credit, not spontaneous phenomena. According to Grant (a sound-money man by conviction), a pair of long-running trends--the democratization of credit and the socialization of risk--converged to create an unprecedented boom during the Reagan years. At the turn of the century, he points out, it was almost impossible for wage earners to borrow; during the past decade, they were invited, even implored, to do so. While US debt spiraled upward in the form of installment loans, junk bonds, mortgages, retail charge accounts, and allied obligations, the federal government accepted greater amounts of the risk (e.g., via deposit insurance) that used to be borne by creditors, an accommodation that Grant dates back to the Progressive Era. With both wit and perception, he lards his narrative with anecdotal accounts of yesteryear's seers and sinners, plus cautionary tales of their latter-day counterparts. In addition to such contemporary celebrities as Michael Milken, David Rockefeller, and Walter Wriston, he profiles less familiar figures from the past--Sewell Avery, George F. Baker, George Champion, James Stillman, et al. A substantive and accessible perspective on how the financial world really works, offering as its moral the unhappy reminder that all pipers eventually must be paid. -- Copyright ©1992, Kirkus Associates, LP. All rights reserved.

About this edition

• Publisher: Farrar Straus & Giroux
• Publication date: 1992
• ISBN 10: 0374169799
• ISBN 13: 9780374169794
• Binding: Hardcover
• Edition number: 1
• Number of pages: 513