First published 2008
The subprime mortgage crisis has destroyed millions of lives and threatens to collapse the U.S. economy along with global markets. Nobel Prize winning economist Robert Shiller examines how this disaster originated and presents concrete solutions to fix it. Shiller argues for aggressive action to restructure financial institutions so Americans can buy and sell homes with confidence again while creating conditions for broader prosperity worldwide. He traces the crisis to irrational exuberance that created bubbles in stocks during the 1990s and housing from 2000 to 2007. These bubbles caused dangerous credit overextension that led to foreclosures, bankruptcies, and a global credit shortage. Shiller advocates targeted bailouts for low income subprime victims in the short term. Long term solutions require leaders to overhaul the financial system through better information, simpler contracts and regulations, expanded risk management markets, home equity insurance, income linked mortgages, and consumer protection against hidden inflation.
Genres: business, economics, non-fiction, 21st-century, finance, academic
Vibes: thought-provoking
Tropes: investigative-journalism
208 pages · Hardcover · Princeton University Press