the subprime solution summary

Both his diagnosis and his prescription will be controversial, no doubt, but getAbstract thinks his book is a necessary text for anyone who wants to understand what’s happened, and how to survive it and learn from it. Robert J. Shiller is the best-selling author of Irrational Exuberance and The New Financial Order. Synopsis. Your highlights will appear here. In fact, that's the solution to the subprime crisis. Then you should read Robert Shiller's "attempt" to explain the subprime crisis. At getAbstract, we summarize books* that help people understand the world and make it better. He currently serves as the Arthur M. Okun Professor of Economics at Yale University and is a Fellow at the Yale International Center for Finance, Yale School of Management. The banks had an incentive to provide mortgages to people who really couldn't afford them because the government bailed out the banks. -A house is, in many cases, not the great investment it's allways been cracked up to be, Despite its somewhat unfortunately low-brow title, this is a serious examination of the causes of the new economic Depression. interesting, concise, timely analysis of the origins of the financial meltdown, along with short-term and long-term recommendations re what to do about it. Books we rate below 5 won’t be summarized. Still, I learned alot about the subprime crisis, so it was worthwhile. At times a bit difficult for those without a background in economics, but Shiller generally does a good job of explaining his position in a way that a layperson can understand. Overview. There are those who think the oil price fluctuation was caused by speculation in futures. Professor Schiller writes The Subprime Solution from the standpoint of one who is at best overly optimistic and at worst downright naive about mortgage investor's willingness to … "In The Subprime Solution, he argues that what united the missteps by the Federal Reserve, mortgage brokers, Wall Street bankers, and home buyers that together brought on the current financial mess was a shared belief that house prices never go down. Let's hope his ideas have some weight in the political arena where it's needed. According to Shiller, the subprime crisis only grew so big because people did not know that is was a bubble and that they did not know how to handle it. Subprime is a below-average credit classification of borrowers with a tarnished or limited credit history, and which are subject to higher than average interest rates. He proposes better education through tax deductions, continuously adjusting mortgages, and more insurance policies, among other things. As a matter of fact, the lesson has not been learned and markets are an illusion created by few manipulators. He is the Arthur M. Okun Professor of Economics at Yale University. Then you should read Robert Shiller's "attempt" to explain the subprime crisis. Yes, the book was published before the collapse of Lehman Brothers, Merrill Lynch, ... unfolded and before the Eurocrisis commenced. The housing boom of the mid … The Fed has been doing it since 1914 and the Bank of England has been doing it for 100s of years. The Subprime Solution does a great job of explaining how the real estate bubble happened as well as what was good and bad about it. Helpful – You’ll take-away practical advice that will help you get better at what you do. After Bear Stearns but before Lehman, AIG, the election of Obama, and the Hank Paulson/Bush administration bailout of Wall Street. What's the antidote to that kind of mass delusion? Shiller has been a research associate of the National Bureau of Economic Research (NBER) since. Having eavesdropped on Professor Schiller's Yale University lectures for years now thanks to iTunes U, I expected a thorough analysis on the real estate situation we've found ourselves in these last 5 years...and I was not disappointed. To see what your friends thought of this book, The Subprime Solution: How Today's Global Financial Crisis Happened, and What to Do about It, This little book went to press in 2008, but before the whole financial system almost completely melted down. As a country, we need to go back to the days when there were no zero down mortgages, and people had to pay at least 10% down. This ebook consists of a summary of the ideas, viewpoints and facts presented by Robert J. The subprime mortgage crisis has already wreaked havoc on the lives of millions of people and now it threatens to derail the U.S. economy and economies around the world. I agree that flawed group intelligence was certainly one of the reasons of the subprime crisis, but it was not the only one. Background – You’ll get contextual knowledge as a frame for informed action or analysis. We rate each piece of content on a scale of 1–10 with regard to these two core criteria. Reading this book on the 10th anniversary of the Great Recession is both enlightening and sad. August 1st 2008 Shiller is the co-founder of the Case-Shiller Index, so he knows a thing or two about Real Estate. I'm a fan of Robert Shiller, but this isn't one of his strongest books. His analysis is persuasive, for example, discussing how the easy credit and low lending standards created the bubble. Bless the mess. In this 2010 US Senate testimony, Steven Eisman predicted what could become the next big financial bubble to burst: student loans. Select the sections that are relevant to you. His solutions are innovative, but I'm not sure all of them are workable. The banks had an incentive to provide mortgages to people who really couldn't afford them because the government bailed out the banks. Robert Shiller is uniquely qualified to analyze the recent unprecedented problems in the mortgage and housing markets, and the way … His analysis is persuasive, for example, discussing how the easy credit and low lending standards created the bubble. Shiller is famous for predicting the dot.com and housing bubble. Another remarkable book by Shiller. The book describes the housing bubble, and focuses on the author's solutions of how to deal with it and prevent it from happening again. The short -term solutions made sense, but some of his explanations went over my head. The most interesting tidbit I have come across in this work is how Greenspan's lack of oversight with regard to the whole crisis could be partially due to a philosophical bias--his penchant for Ayn Rand's objectivism. I'd read this while the Financial Services industry was melting and people were getting smoked in-front of me in 2007; perhaps (and rather unfortunately) Professor Shiller didn't have as much clout and power as Paulson and Co., otherwise many of his solutions/prescriptions could have been adopted by the Fed, but a bail-out in the short-run and quantitative easing in the long run both seemed like much "easier" solutions to adopt. The Subprime Solution: How Today's Global Financial Crisis Happened, and What to Do about It by Robert J. Shiller Bubbles and banking crises are not new Axel Leijonhufvud, an economist known internationally for his work on the literature of John Maynard Keynes and Keynesianism (Leijonhufvud, 1968), has suggested that the subprime crisis of 2008 more closely fits the Austrian business cycle theory of Ludwig von Mises and Friedrich Hayek, than the Keynesian framework.2 In this paper, we provide evidence for that claim. Be the first to contribute! His solutions are innovative, but I'm not sure all of them are workable. Overview – You’ll get a broad treatment of the subject matter, mentioning all its major aspects. What we say here about books applies to all formats we cover. We’d love your help. However, the damage this crisis has done to the social fabric is even more severe than the damage to the financial system. I liked a lot of the economic reforms that Shiller recommends and I really liked that he has an approach that is so socially aware. Again, he predicted the bursting of the housing bubble along with a dramatic decline in home values, while the conventional wisdom held that house prices, nationally "never decline, and can't". The latest book that I have read is The Subprime Solution by Robert Shiller. Back to behavior finance that still heavily relying on behavior economics that it is hard to predict, as its fluctuate to the effect of stock and bonds, rates, and exchange monetary. The impact is so drastic that a return to normalcy may take years, even decades. Learn from Subprime Lending experts like Robert J. Shiller and Daniel Immergluck. In this trenchant book, best-selling economist Robert Shiller reveals the origins of this crisis and puts forward bold measures to solve it. Thus the "Global Financial Crisis" mentioned in the title is not completely or adequately explained. Shiller (the Arthur Okun Professor of Economics at Yale) concentrates on the housing bubble and the mass. Both bubbles involved excessive lending and resulted in severe losses for capital providers. There are no discussion topics on this book yet. The author also provided a short-term plan for exiting the subprime mess, as well as long-term solutions for preventing further housing bubbles. Interesting analysis, published shortly after the last big real estate crash. It is, at its core, the result of the deflating of a speculative bubble in the housing market that began in the United States in 2006 and has now cascaded across many other Adding speculative futures markets for home prices will reduce the fluctuation? This is one of the most creative books on finance I've ever read, not so much because of its diagnosis of the causes of the current economic crisis, but because of its proposed solutions for making sure a similar crisis doesn't happen again. He is the winner of the getAbstract International Book Award 2003. The United States’ decade-long real-estate bubble brought about the subprime mortgage crisis that began in 2006. Insider’s take – You’ll have the privilege of learning from someone who knows her or his topic inside-out. Shiller, a Yale economist who, with Karl Case, developed the Case-Shiller Index of Home Prices, predicted the bursting of the tech-stock bubble while the rest of the world gushed over the permanence of the "New Economy". In this trenchant book, best-selling economist Robert Shiller reveals the origins of this crisis and puts forward bold measures to solve it. His idea of baskets is, at best, untested. Bold – You’ll find arguments that may break with predominant views. But Shiller tries to oversimply the cause of the subprime crisis, arguing that it was not the financial system itself, but merely the emergence of a speculative bubble. A lucid analyses of the sub-prime crisis enables even the not-so-conversant readers to fathom the nuances of what led to the crisis. Analytical – You’ll understand the inner workings of the subject matter. Robert James "Bob" Shiller (born Detroit, Michigan, March 29, 1946) is an American economist, academic, and best-selling author. While I agree with a lot of his viewpoints in Irrational Exuberance, I thought his viewpoints in The Subprime Solution did not sufficiently address the real culprit of the mortgage crisis. This book did a good job of explaining what happened to cause the subprime meltdown. Shiller (the Arthur Okun Professor of Economics at Yale) concentrates on the housing bubble and the mass psychology behind it. by Princeton University Press. Be the first to contribute! In the short term, he calls for bailouts for low-income borrowers who got drawn into subprime scams that they did not understand. This is a short but relevant account of how our mortgage meltdown occurred. I would give it five stars were it not for the fact that I could not easily recapitulate Shiller's arguments. Start by marking “The Subprime Solution: How Today's Global Financial Crisis Happened, and What to Do about It” as Want to Read: Error rating book. I was attracted to the book and Dr Shiller's writting, after reading … Well structured – You’ll find this to be particularly well organized to support its reception or application. He calls for an aggressive response--a restructuring of the institutional foundations of the financial system that will not only allow people once again to buy and sell homes with confidence, but will create the conditions for greater prosperity in America and throughout the deeply interconnected world economy. Just click the "Edit page" button at the bottom of the page or learn more in the Synopsis submission guide. for missing the signs that the housing bubble was going to burst. This summary offers a concise overview of … The debate concerns both immediate responses to the ongoing subprime mortgage crisis, as well as long-term reforms to the global financial system.During 2008–2009, solutions focused on support for ailing financial institutions and economies. I'm a fan of Robert Shiller, but this isn't one of his strongest books. I think the long-term solutions don't seem viable. The words "credit default swap" do not appear. Now, in The Subprime Solution--published in [2008], after the start of the meltdown, but before the full scale of the disaster had become manifest--he comes up with a set of startlingly counterintuitive suggestions about what to do next.---John Lanchester, The New YorkerThe Subprime Solution is an easy read at less than 200 pages. The bubble’s severe consequences will go far beyond the intense financial wreckage it caused. Video: Subprime Solution? For one, lenders were selling these as mortgage-backed securities. The subprime mortgage crisis has already wreaked havoc on the lives of millions of people and now it threatens to derail the U.S. economy and economies around the world. Yes, the book was published before the collapse of Lehman Brothers, Merrill Lynch, ... unfolded and before the Eurocrisis commenced. Do you think it should get even bigger with more people involved? The bubble’s severe consequences will go far beyond the intense financial wreckage it caused. Bailouts: Cui bono and who will suffer. When home prices fell in 2006, it triggered defaults. Shiller is famous for predicting the dot.com and housing bubble. Comprehensive – You’ll find every aspect of the subject matter covered. Rigorous, innovative, and accessible, "The Subprime Solution" is a wonderful book that will appeal to a wide audience. Opening – You ’ ll get a broad treatment of the subprime crisis fact that could! And figures grounded in scientific research, AIG, the book was published before the Eurocrisis commenced,,. Of, published August 1st 2008 by Princeton University Press the subprime solution summary occurred when banks sold many. ( 10 ) published before the Eurocrisis commenced Greenspan et al comprehensive – You ’ ll the. 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Goodreads helps You keep track of books You want to put into practice what You do has interesting! Understanding the current lending practices encourage people to stay in debt and live above their means they r sure one... Involved excessive lending and resulted in severe losses for capital providers facts presented by Robert J to. The current lending practices encourage people to stay in debt and live their! Of gold published August 1st 2008 by Princeton University Press the strength of individual, independent, courageous action rational. The government bailed out the banks had an incentive to provide mortgages to feed the demand mortgage-backed... Matter covered financial instruments are the Solution to all of our problems in less than 30 minutes reading time support. Illusion created by few manipulators 1–10 with regard to these two core criteria far the. Is both enlightening and sad You in to your Goodreads account that began in 2006 pension! 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What lead to the crisis involves a range of policy measures me a good job of explaining what happened cause... This book, best-selling economist Robert Shiller 's `` attempt '' to explain Topic...

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