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| Link | Quote | Stars | Tags | Author |
| 5f9cf8c | Driving Dixie Down In May 1863, two years into the American Civil War, Major-General Ulysses S. Grant captured Jackson, the Mississippi state capital, and forced the Confederate army under Lieutenant-General John C. Pemberton to retreat westward to Vicksburg on the banks of the Mississippi River. Surrounded, with Union gunboats bombarding their positions from behind, Pemberton's army repulsed two Union assaults but they were finally starved.. | Niall Ferguson | ||
| 6b13a74 | peculation. | Niall Ferguson | ||
| 1899461 | those who live by the tort, die by the tort. | Niall Ferguson | ||
| e9decc9 | And from 1966, under Regulation Q, there was a ceiling of 5.5 per cent on their deposit rates, a quarter of a per cent more than banks were allowed to pay. | Niall Ferguson | ||
| 4885d05 | Some S&Ls bet their depositors' money on highly dubious projects. Many simply stole it, as if deregulation meant that the law no longer applied to them. | Niall Ferguson | ||
| 8a60344 | tranches | Niall Ferguson | ||
| 4fecfd7 | The closure of the stock market and the intervention of the authorities to supply liquidity almost certainly averted a catastrophic fire-sale of assets. | Niall Ferguson | ||
| dbd3a8c | The risk was spread across the globe from American state pension funds to public health networks in Australia and even to town councils beyond the Arctic Circle. In Norway, for example, the municipalities of Rana, Hemnes, Hattjelldal and Narvik invested some $120 million of their taxpayers' money in CDOs secured on American subprime mortgages. | Niall Ferguson | ||
| 3af05be | In the Philippines, formalizing home ownership was until recently a 168-step process involving fifty-three public and private agencies and taking between thirteen and twenty-five years. | Niall Ferguson | ||
| 4b504c6 | agencies began to downgrade scores of RMBS CDOs (short for 'residential mortgage-backed security collateralized debt obligations', the very term testifying to the over-complex nature of these products). | Niall Ferguson | ||
| a10d843 | Even today, you can still see the empty lots that the riots left in their wake. | Niall Ferguson | ||
| e758063 | houses are pretty illiquid assets - which means they are hard to sell quickly when you are in a financial jam. House prices are 'sticky' on the way down because sellers hate to cut the asking price in a downturn; the result is a glut of unsold properties and people who would otherwise move stuck looking at their For Sale signs. That in turn means that home ownership can tend to reduce labour mobility, thereby slowing down recovery. | Niall Ferguson | ||
| f02f3d4 | the war should be understood as a kind of backlash against globalization, heralded by rising tariffs and immigration restrictions in the decade before 1914, and welcomed most ardently by Europe's agrarian elites, whose position had been undermined for decades by the decline in agricultural prices and emigration of surplus rural labour to the New World.14 | Niall Ferguson | ||
| 249be62 | the sellers of these 'structured products' boasted that securitization was having the effect of allocating risk 'to those best able to bear it'. Only later did it turn out that risk was being allocated to those least able to understand it. | Niall Ferguson | ||
| 779342d | Roughly two fifths of the world's population is effectively outside the financial system, without access to bank accounts, much less credit. | Niall Ferguson | ||
| 6199e71 | extravagant generosity with other people's money. | Niall Ferguson | ||
| cc5c170 | it's not owning property that gives you security; it just gives your creditors security. Real security comes from having a steady income, | Niall Ferguson | ||
| c1d603c | The S&Ls were simultaneously losing money on long-term fixed-rate mortgages, because of inflation, and haemorrhaging deposits to higher-interest money market funds. | Niall Ferguson | ||
| cd4206e | then resold their loans in bulk to Wall Street banks. The banks, in turn, bundled the loans into high-yielding residential mortgage-backed securities (RMBS) and sold them on to investors around the world, all eager for a few hundredths of a percentage point more return on their capital. Repackaged as collateralized debt obligations (CDOs), these subprime securities could be transformed from risky loans to flaky borrowers into triple-A rated.. | Niall Ferguson | ||
| bd289bb | Sie war ein Genie der Traurigkeit: Sie badete in Traurigkeit, sie entwirrte die zahlreichen Strange der Traurigkeit, sie kostete alle zarten Nuancen der Traurigkeit aus. Sie war ein Prisma, durch dass die Traurigkeit in ihr undendlich breit gefachertes Spektrum zerlegt werden kontte. | Jonathan Safran Foer | ||
| 1969729 | non-Western countries had, until quite recently, highly unreliable legal systems and differing accounting rules. If a foreign trading partner decided to default on its debts, there was little that an investor situated on the other side of the world could do. In the first era of globalization, the solution to this problem was brutally simple but effective: to impose European rule. | Niall Ferguson | ||
| 5e3925e | For the majority of mortgages continued to enjoy an implicit guarantee from the government-sponsored trio of Fannie, Freddie or Ginnie, meaning that bonds which used those mortgages as collateral could be represented as virtually government bonds, and hence 'investment grade'. | Niall Ferguson | ||
| 1bc5393 | The idea was to reinvent mortgages by bundling thousands of them together as the backing for new and alluring securities that could be sold as alternatives to traditional government and corporate bonds - in short, to convert mortgages into bonds. | Niall Ferguson | ||
| 9a8bb4e | Why, to give another suggestive example, did it take an American journalist sixty-five days to get official permission (including, after a wait of up to five weeks, a Food | Niall Ferguson | ||
| 524e8bb | Protection Certificate) to open a lemonade stand in New York City? | Niall Ferguson | ||
| 303f0ab | the crisis prompted the issue of emergency paper money: in Britain, PS1 and 10s Treasury notes; in the United States, the emergency currency that banks were authorized to issue under the Aldrich-Vreeland Act of 1908.46 Then, as now, the authorities reacted to a liquidity crisis by printing money. | Niall Ferguson | ||
| 08f40be | Protection Certificate) to open a lemonade stand in New York City?12 This is the kind of debilitating red tape that development economists often blame for poverty in Africa or Latin America. The rationale for the FDA's rigid standards is to avoid the sale of a drug like thalidomide. But the unintended consequence is almost certainly to allow many more people to die prematurely than would have died from side-effects under a less restrictive .. | Niall Ferguson | ||
| d1efa22 | Any investor unwise or patriotic enough to hang on to gilt-edged securities (consols or the new UK War Loans) would have suffered inflation-adjusted losses of -46 per cent by 1920. Even the real returns on British equities were negative (-27 per cent).51 Inflation in France and hyperinflation in Germany inflicted even more severe punishment on anyone rash enough to maintain large franc or Reichsmark balances. By 1923 holders of all kinds of.. | Niall Ferguson | ||
| 19c758c | autarky), | Niall Ferguson | ||
| cb4e8e3 | why, when its causes today seem so numerous and so obvious, were contemporaries so oblivious of Armageddon until just days before its advent? One possible answer is that their vision was blurred by a mixture of abundant liquidity and the passage of time. | Niall Ferguson | ||
| 456a2f3 | the lights in financial markets were flashing green, not red, until the very eve of destruction. | Niall Ferguson | ||
| e013a84 | volte-face | Niall Ferguson | ||
| 936eaba | Exchange rates would be fixed, as under the gold standard, but now the anchor - the international reserve currency - would be the dollar rather than gold (though the dollar itself would notionally remain convertible into gold, vast quantities of which sat, immobile but totemic, in Fort Knox). | Niall Ferguson | ||
| 8e916ac | seigniorage | Niall Ferguson | ||
| 9a407cf | complaints from France that Washington was exploiting its reserve currency status in order to collect seigniorage from America's foreign creditors by printing dollars, much as medieval monarchs had exploited their monopoly on minting to debase the currency. | Niall Ferguson | ||
| b568e64 | Only by historical methods can we explain why, over the past thirty years, so many countries created forms of debt that, by design, cannot be inflated away; and why, as a result, the next generation will be saddled for life with liabilities incurred by their parents and grandparents. | Niall Ferguson | ||
| ae20e12 | hapless | Niall Ferguson | ||
| 2abfcd0 | Soros regards himself as more a philosopher than a hit man. His book The Alchemy of Finance (1987) begins with a bold critique of the fundamental assumptions of economics as a subject, | Niall Ferguson | ||
| ec88bdd | The imposition of British rule (as in Egypt in 1882) practically amounted to a 'no default' guarantee; the only uncertainty investors had to face concerned the expected duration of British rule. | Niall Ferguson | ||
| 76f759f | Europe's central banks had nearly all committed themselves to the gold standard by 1908; that meant that they nearly all had to target their gold reserves, raising rates (or otherwise intervening) if they experienced a specie outflow. At the very least, this simplified life for investors, by reducing the risk of large exchange rate fluctuations. | Niall Ferguson | ||
| fd308ce | Kaffir | Niall Ferguson | ||
| 0fb1bd7 | Balkan Wars | Niall Ferguson | ||
| 5642508 | well as illiterate, unhealthy and bloody. I admire contemporary social scientific work that distinguishes between 'open' and 'closed' sets of institutions,18 but as an historian I find that distinction too simplistic. For one of the puzzles of modern history is that successful societies - like eighteenth-century England - often had institutions that today most people would be inclined to condemn. Already by the time of the Victorians, Hanov.. | Niall Ferguson | ||
| fb9e798 | Significantly, Smith singled out its socially regressive character. First, wages for the majority of people were miserably low: Though the wealth of a country should be very great, yet if it has been long stationary, we must not expect to find the wages of labour very high in it . . . It is in the progressive state, while the society is advancing to the further acquisition, rather than when it has acquired its full complement of riches, tha.. | Niall Ferguson |