Capitalism Without Capital explores the events which took place in the
financial markets from September 2008 to March 2009, including the dramatic 'historical
week' at Wall Street of September 11, 2008.
This book follows on the heels of another book by Dimitris N. Chorafas, Financial Boom
and Gloom, which addresses the abysmal descent of the banking industry from July 2007 to
August 2008.
Had this book been written at the tail-end of 2008, its central theme would have
been that credit is what the crisis is all about. In the year 2009 the keyword is trust.
While confidence is at a very low point, capitalism is left without capital and this is
impacting upon the real economy like a sledgehammer. It transpires that many complex
financial instruments are actually backed by assets that are nearly or fully worthless.
These include:
• housing loans that may never be paid back
• corporate loans, with rising default rates
• a great amount of poorly understood and incorrectly valued structured products
Capitalism Without Capital explains why the economic crisis and credit crunch, which
continues unabated in 2009, has seen the destruction of the American dream as well as of
the dreams of the citizens of Britain and other Western nations.
The book begins by introducing the reader to the background concepts of macroeconomic
crises: the notions of money supply, interest rates and inflation; damage created by high
leverage; need for well-balanced and careful credit allocation; potential after-effects of
ever-rising household debt; and the abuses of the market economy's freedoms. It also
explains what can be expected from dozens of 'summits' as well as the central banks'
recent policy of throwing public money at the problem.
DIMITRIS N. CHORAFAS has advised financial institutions and industrial
corporations in strategic planning, risk management, computers and communications systems,
and internal controls since 1961. More than 8,000 banking, industrial and government
executives have participated in his seminars in the United States, the United Kingdom,
Germany, Italy, Asia and Latin America. Dr Chorafas is the author of around 150 books,
some of which have been translated into up to 16 languages.
Table of Contents
List of Tables and Figures
Preface
PART I: MONEY
The Destruction of the American Dream
Macroeconomic Crises
Money Supply and Inflation
The Cost of Money
PART II: DEBT
Leverage Can Be Highly Counterproductive
Asset Allocation, Credit Regulation and Banking Supervision
PART III: CASE STUDIES
Household Debt and the Housing Markets Debacle
Mea Culpa and the Abuse of Virtual Economy's Freedoms
The G-20 Conference, Central Banks and Garbage Collection
Trillion of Dollars, Euros and Pounds Thrown at the Problem
Notes
Bibliography
Index
288 pages, Hardcover
