there's of in and
books and
contributions to another media parbo publications thank you so much for
taking the time today jeff my pleasure catalog sanctions seventy to the
president
leads and we we will actually we would get to that because the
this is
is aid
i guess in
we annals of
love american history anyway relatively recent
phenomenon not so much greed but the triumph of
live of greed and and finance let's let's start with the question what is
finance supposed to do
what is the financial industry supposed to do for a country for society and and
what has it
has a become
and then ransacked good question
the primary thing it is supposed to do is to allocate the nation's savings
the nation's businesses to productive investment some of the low risk
investment lowest business wants to keep
companies going to be a long saying the commercial banks use to do
so i'm a bit
riskier benchers new ideas
new expansions new companies through equities stock
and other new kinds of securities of course secondarily
provides
i've been away for much of america to invest in business and american that's
no small matter we can
invest our money
but that has to be affair
investment and contro anna my view
regulate it happens soaks up at the day's we've this allocated
this capital
and i know you are going to get to that we did miss allocating this capital
since the nineteen seventies
so that means of finances a tizzy crucial of
industry for
or any type of growing or functioning a society
but we have dismiss allocation now in an end img
what is that a functional
well i think that's cases in america growing start
to write along ghosh
but demand and them capsulize it very quickly
but i trace it to what was basically an assault on government
and the nineteen seventies
that was victorious
it change the attitude of much of america towards the purpose of
government
it made much of america want to limit government
and allowed much of america couldn't to come down
i'd be
philosophical profound to deregulation of the financial business and that began
in the nineteen seventies not in the nineteen nineties or the two thousand
finance is not
like
uh... selling autos or selling chewing gum
it is a very special kind of products subject to all kinds of women
manipulation
and speculation
and it requires
close government
regulation and oversight
to take
the finance industry away from the private sector
but the controller and we've learned to do that in the nineteen thirty's because
of the devastation of the depression and because of this change of attitudes and
then the focus of the business and finance in particular and getting
political power
those
those regulations got
rolled back either we have been ladder
or m spirit
we didn't create new egg it regulations for example for changing times
promo anyways
bankers and financiers
they weren't at
they weren't too old
rich
i guess i mean you go in there
banker was a
it was uh... you know back in the day considers fairly boring
straight laced profession and there was that there was money but if the reader
wasn't the sort of
nor miss amount of wealth generated was it
whether they want to exactly but very good point one at one of the uh...
interesting much moment in economic histories with j_p_ morgan valid he was
the great financier as you know the late eighteen hundreds in early nineteen
hundreds
in fact there's never been anybody like him again
but when he died andrew carnegie i believe it was said
my gosh i didn't know he was still poorer wall street people did not make
me really what the industrial workers owners of industry made it back
that all changed and that's partly why
the pieces of this book is that individuals who were responsible for
what happened
it was not some great
inevitable a historical
that created the power problems at work they were individuals and i tell the
story
and terms of individuals and that's a complex for it but i think
that when you tell in terms of individuals very readable water
uh... people began to get very rich by taking advantage of the february
loosening regulations
and this lead to
bed decision right
loans to third world countries which were crazy
takeovers of companies
which were crazy i crazy prices
that resulted in a lot of pressure on cutting jobs in japan are empty
but many billionaires subway bridge buyout specialists and takeover
specialists
crazy investments by savings and loan institutions
that we've deregulated in one of the most forgive this word but none of the
most idiotic
pieces of legislation
and nineteen eighty two american ever produce
and in the take on the nineteen nineties we all remember the high-technology
fantasies we would sit around and see these are fantasy so that would go on
and on why
in large part madam small part of a large part because wall street people
were making so much money
issuing
securities tues launch these companies
at high prices
who wish they'd make five or seven percent bat
haiti
of that tape
and on and on to the housing craziness of the two thousand
this allocation of our precious capital
which could have gone into productive and investment that
pitta built the foundation of the company
all coupled with very low tax rates
very presume also freed up a lot of
almost extraneous
capital for which to dry
these type of transactions i think you know you know if you're going to have a
very low capital gains rate right now just keep speculating
why that keep investing this money for the short run
and and you make the use of the big games especially if you have a little
knowledge about what's going on her little
you know you're tied to a group that might not might know what's going on and
and quite in particular in nearly two thousand
you can borrow if you're becoming a very low grades
leverage up your equity just like we all do with the hot you know we put ten
percent not opt for a home
i'm at home price goes up you know we're making a big return on their investment
will be skies did this
and silver gold international currencies international
landed federal unit government bonds and so forth
and
what is a circus surface it's been but i think by and large it's an image america
say why that mr
i'm allegedly captured this alan greenspan who is one of the key
frankly and i also i don't like to make personal effects but he
he and i i applied that respect i try to be dispassionate this bucket solicitous
but greenspan does come across as one of the men builds of the time
alan greenspan which is what we have to we had to allow this wild over
speculation
and he's bad investments in order to get the good investment
but over this period productivity output per hour work weeks tribes living
standards
did not rise have historically rapid rates capital investment
with strong only in a few years of this forty year period
strong by historical standards
and wages as we know have stagnated and for member actually lower today the
typical man today makes less than a typical mandate after inflation
in nineteen sixty nine
so the benefits
did map flow
the argument is bogus stx
leave it was in
jerod diamonds collapse
the great society's of the past
have essentially collapsed
when finance but here
a certain percentage i believe it was in the upper twenty percentage points
uh... of the economy
that simply is that simply a function of the fact that you are there's so much
welfare is being this allocated that is in some way been taken out
the real economy and created almost a secondary economy which is creating a
tremendous imbalance within a society
i believe there are some truth to that i don't believe there's enough empirical
information traders specific cut-off point
and society is when you know we go over the top
i do believe america want over the top there are two ways of looking at it one
way is almost a marxist way of looking at it
economies one have a good investments
so they make peace with these crazy financial investments games people play
with each other
the way i look at it is somewhat different
date people play games with each other not because we ran out of possible
productive investment and the economy
but uh... it because it was so much easier to make a lot of money
in finance you didn't have to take the risk no bargain
and and undertake the long-term unknowns
of regular investment the way capitalism should really work
just easier especially if you could cheat
there is a heck of a lot of cheating
and lining and manipulation an inside information
over these forty years
xx
your your book does uh...
focus uh...
intensely on on individuals like uh... walter wrist in in uh... boesky and
greenspan and i think it
that this was not
this is not a natural phenomenon laminated takes individuals but on some
level there's also
there has to be a context and the enablers uh...
you have allocation of resources that
benefits
most amount of people
and and and and so
what what
what can we do where where was the context where were the enablers where
was that problematic in what can we do
to to fix this
but i think your neighbors uh... yeah
frankly we have to blame ourselves subject
this belief the government is
not necessarily not necessarily a must prove the necessary
this belief that all over
came the nation
now partly
that occurred because
some people everywhere so effectively controlling he could be economic debate
in washington
but partly of and i try to explain the speech to the complex a benson history
partly came out of the very difficult times of the nineteen seventies with
both soaring unemployment
and soaring inflation and people needed a scapegoat government became that
scapegoat
and everybody climbed aboard including the democrats
and pretty soon deregulation amend weaker government
became the order of the day i teach kid still believe that
why should government get in the way of private market even after this
devastation
it became deeply ingrained in us and people take advantage of leadership
nobody rose
tippit nobody effectively rose are a few people effectively rose to camp director
and i think president obama
has not been sufficiently
people always say why don't we get the reforms we got after the depression
during the depression the level of reform
and i said one reason is
we avoided that to pressure because of the lessons we learned republic of the
severity of it
so people are not so startin hurt although they are very stark
but secondly we don't have f_d_r_
individuals make a difference f_d_r_
took part in the battle took up the fight
and told it like it was and he made mistakes
that basically he was willing to do battle and be a leader
i think if i have one message for people with this book has one message and
that's a book of stories with him
history is a story
and i tried to make it a narrative dot but i think is an accurate ma
americans should not back just sit back and think we're just gonna muddle
through and be okay
nations that don't necessarily want up okay
we've got to start taking responsibility for this mess bursar's bu cl
because one thing that strikes me over this this thirty-year period in
protection particularly last
twenty is this notion of
money
and ingredient
almost as an ascendant value in our society
you think
this was a
a function of the tremendous wealth that was generated in the hands of
of of a few
you indeed created a sense that
more relevant in people's lives more important to accrue
or more of a status symbol ordered
by two percent
yeah i think of that by and large we became a culture of money
candidate
high activity
hope i can't imagine who could ever imagine
that people would get on television
and plan our problems but teachers make too much money
as they've been doing during the recent
the recent raucous in wisconsin elsewhere
it it's just unbelievable abusing teachers
p_j_ mainly their main beaverton requirement for reform there
but the idea sing p_m_s_ and i get people to say
all of the but those bankers created jobs
drawn those bankers lost eight million jobs couple years ago
eight million two eleven million and we're not we haven't gotten them back
yet
so we've really got a wake up here
the tactic a capitalist free-market system is great but it is only once per
year of an economy and the social system
there is another sphere the cooperation governments fear and they've got to work
together in the last thirty to forty years
this competition business free market share
has pushed out
and denigrated the idea of cooperation
and uh... societies that are going to succeed in this century
or the societies that understand the value of cooperation
and mix it with the value of business of the great creativity and energy the
business can release
just magic thanks so much for joining us the book is the age of greed
the triumph of finance with a client of american nineteen seventy two the
present
we'll have a link to that boat
um... amazon it majority dot f_m_ thank you so much for taking the time today
it's a great read and it's in incredibly i think it's a paramount issue of our
day
fact you're creating a campaign to conduct