BOOK FACT FRIDAY – The Federal Reserve & Ben S. Bernanke

k9928“The Federal Reserve was founded 1914, and concerns about both macroeconomic stability and financial stability motivated the decision of Congress and President Woodrow Wilson to create it. After the Civil War and into the early 1900s, there was no central bank, so any kind of financial stability functions that could not be performed by the Treasury had to be done privately.” -Ben S. Bernanke, from chapter one of The Federal Reserve and the Financial Crisis

In 2012, Ben Bernanke, chairman of the U.S. Federal Reserve, gave a series of lectures about the Federal Reserve and the 2008 financial crisis, as part of a course at George Washington University on the role of the Federal Reserve in the economy. In this unusual event, Bernanke revealed important background and insights into the central bank’s crucial actions during the worst financial crisis since the Great Depression. Taken directly from these historic talks, The Federal Reserve and the Financial Crisis offers insight into the guiding principles behind the Fed’s activities and the lessons to be learned from its handling of recent economic challenges.

Ben S. Bernanke is chairman of the U.S. Federal Reserve. He has served as chairman of the President’s Council of Economic Advisors and as a member of the Board of Governors of the Federal Reserve. Before his time in public service he was a professor of economics at Princeton University. His many books include Essays on the Great Depression and Inflation Targeting (both Princeton).

The Federal Reserve and the Financial Crisis
by Ben S. Bernanke

We invite you to read chapter one online at:

Why Our Banking System is Broken–and the Reforms Needed to Fix It

j9929[1]What is wrong with today’s banking system? The past few years have shown that risks in banking can impose significant costs on the economy. Many claim, however, that a safer banking system would require sacrificing lending and economic growth. The Bankers’ New Clothes examines this claim and the narratives used by bankers, politicians, and regulators to rationalize the lack of reform, exposing them as invalid. Anat Admati and Martin Hellwig argue we can have a safer and healthier banking system without sacrificing any of the benefits of the system, and at essentially no cost to society.

Learn more about it from Anat Admati’s interview from NPR’s Morning Edition:
Anat Admati argues that banks carry too much debt and have too little equity.

We invite you to read a book excerpt at at:

The Bankers’ New Clothes:
What’s Wrong with Banking and What to Do about It
by Anat Admati & Martin Hellwig

“Crucial . . .”–Jim Surowiecki,

“Ms. Admati and Mr. Hellwig, top-notch academic financial economists, do understand the complexities of banking, and they helpfully slice through the bankers’ self-serving nonsense. Demolishing these fallacies is the central point of The Bankers’ New Clothes.”–John Cochrane, Wall Street Journal

We also invite you to try your luck and enter for a chance to win a copy of The Bankers’ New Clothes: What’s Wrong with Banking & What to Do about It at Goodreads:

The Great Rebalancing Review in The Wall Street Journal

The Wall Street Journal published a book review of The Great Rebalancing: Trade, Conflict, and the Perilous Road Ahead for the World Economy by Michael Pettis. The reviewer calls Pettis a “brilliant economic thinker” and gives a good background of the financial situation in China and why it needs to be rebalanced. If you are not quite sure what the book is about or what exactly is going on with the Chinese economy and why it is important at all, this book review is a great place to start.

A Banking Paper Tiger

China Development Bank underwrote a massive stadium in Loudi, Hunan Province—a city that lacks a professional sports team.

China’s econoPettis_GreatRebalancing_S13my sometimes seems the work of miracles: three decades of economic growth, with GDP compounding at an annual rate of around 10%; the world’s highest levels of savings and investment; vast trade surpluses, which feed the largest foreign-exchange reserves in history. The financial system has played a key role in delivering these economic feats, and no single institution within it has been more important than China Development Bank. “Understand CDB,” Henry Sanderson and Michael Forsythe write in “China’s Superbank,” “and you understand the core of China’s state capitalism.”

This so-called policy bank, founded less than two decades ago, boasts a larger loan book than J.P. Morgan ChaseJPM +3.41% . Over the past 15 years, CDB has lent trillions of dollars to finance China’s urbanization policy. More recently, it has dished out vast sums across the globe to secure China’s long-term energy supplies. Hugo Chávez, whose country has been the largest single foreign recipient of CDB’s loans, proclaims his financial benefactor as the bank “with the most money in the world.”

Read the FULL review at The Wall Street Journal online.

Admati on’s Moneywatch

Anat Admati appeared on’s Moneywatch to discuss the problems with the banking system and possible solutions to remedy the problems. Admati is co-author of The Bankers’ New Clothes, a forthcoming book that not only critiques big banks but also gives them advice to fix their mistakes before it is too late.

Also, read the accompanying article on

Admati on Fox Business Network

Anat Admati appeared on Fox Business Network’s Money with Melissa Francis on Tuesday to discuss the government’s regulations for the financial sector. Admati is co-author of The Bankers’ New Clothes: What’s Wrong with Banking and What to Do About It which examines the current banking system problems and how to fix them in clearly defined terms.

Watch the full interview here.

Additionally The New Yorker, Bloomberg Business Week, and Business Insider all discuss the financial situation and possible solutions as laid out by Admati and Hellwig in The Banker’s New Clothes. Admati and Hellwig say that “higher equity requirements would therefore alleviate the problem of banks being too big, too interconnected, or too political to fail. Not only would banks be less likely to fail, they would bear more of their own losses should they incur losses.” James Pethokoukis for Business Insider agrees and sums up that “capping bank size, limiting bank activities, higher equity capital requirements — all tools in the toolbox for eliminating the crony capitalist subsidy of the US financial system by government.”

Read the articles about The Banker’s New Clothes:

Anat Admati interview on Nightly Business Report

Anat Admati was interviewed on PBS’s Nightly Business Report on Tuesday, February 11th to talk about the size and safety of banks, and her new book The Bankers’ New Clothes. Watch the interview below.

If this video is not working, please visit the Nightly Business Report site.

Also, tune into Fox Business’s Money with Melissa Francis TONIGHT at 5:00 pm for another interview with Admati.

Stanford finance prof Anat Admati discusses her new book, with Martin Hellwig, THE BANKERS’ NEW CLOTHES

Stanford finance and economics professor Anat Admati discusses her new book, with Martin Hellwig, THE BANKERS’ NEW CLOTHES: What’s Wrong with Banking and What to Do about It, out in March, with the Stanford Graduate School of Business.

Follow Professor Admati on her popular Twitter feed @anatadmati

New Economics and Finance Catalog!

We invite you to browse and download our new economics and finance catalog!

Of particular interest are some of our forthcoming titles including Benn Steil’s remarkable The Battle of Bretton Woods: John Maynard Keynes, Harry Dexter White, and the Making of a New World Order, Ben S. Bernanke’s insightful The Federal Reserve and the Financial Crisis, and Anat Admati and Martin Hellwig’s engaging and accessible The Bankers’ New Clothes: What’s Wrong with Banking and What to Do about It. Also note Justin Yifu Lin’s The Quest for Prosperity: How Developing Economies Can Take Off. Interwoven with insights, observations, and stories from Lin’s travels as chief economist of the World Bank and his reflections on China’s rise, this book provides a road map and hope for those countries engaged in their own quest for prosperity.

Our catalog also exhibits critical textbooks including David M. Kreps’ rigorous Microeconomic Foundations I: Choice and Competitive Markets, Steven Tadelis’ comprehensive Game Theory: An Introduction, Ariel Rubinstein’s essential second edition Lecture Notes in Microeconomic Theory: The Economic Agent, and Michael Wickens’ superior second edition Macroeconomic Theory: A Dynamic General Equilibrium Approach.

If you’re interested in hearing more about our economics and finance titles, sign up with ease here: Your email address will remain confidential!

We’ll see everyone at the meeting of the Allied Social Science Associations January 4-6 in San Diego, CA. Come visit us at booth 308! Be sure to stop by Saturday, January 5 at 1:00 p.m. for a book signing with Justin Yifu Lin, author of The Quest for Prosperity: How Developing Economies Can Take Off.

Another Google+ Giveaway!

Are you following PUP on Google+ yet? If not, today’s the day to add us to your circle—we’re hosting another giveaway this week! Follow us by Friday to win!

Finance and the Good Society
by Robert J. Shiller

The reputation of the financial industry could hardly be worse than it is today in the painful aftermath of the 2008 financial crisis. New York Times best-selling economist Robert Shiller is no apologist for the sins of finance—he is probably the only person to have predicted both the stock market bubble of 2000 and the real estate bubble that led up to the subprime mortgage meltdown. But in this important and timely book, Shiller argues that, rather than condemning finance, we need to reclaim it for the common good. He makes a powerful case for recognizing that finance, far from being a parasite on society, is one of the most powerful tools we have for solving our common problems and increasing the general well-being. We need more financial innovation—not less—and finance should play a larger role in helping society achieve its goals.

Challenging the public and its leaders to rethink finance and its role in society, Shiller argues that finance should be defined not merely as the manipulation of money or the management of risk but as the stewardship of society’s assets. He explains how people in financial careers—from CEO, investment manager, and banker to insurer, lawyer, and regulator—can and do manage, protect, and increase these assets. He describes how finance has historically contributed to the good of society through inventions such as insurance, mortgages, savings accounts, and pensions, and argues that we need to envision new ways to rechannel financial creativity to benefit society as a whole.

Ultimately, Shiller shows how society can once again harness the power of finance for the greater good.

“Finance is in need of a little redemption. In his priestly new book, Finance and the Good Society, Mr. Shiller . . . sets out to provide it. He argues convincingly that finance can, should and usually does make the world a better place. . . . As an advocate for the financial system . . . he is wonderfully persuasive because he never plays down the problems. . . . Mr. Shiller reminds us of the profound importance of finance to making our society work.”—Robin Harding, Financial Times

We invite you to read the Introduction here:

The random draw for this book with be Friday 6/22 at 11 am EST. Be sure to check out our Google+ page and add us to your circle to be entered to win!

Upcoming lecture by Diane Coyle at the LSE

Economics of Enough


Diane Coyle, whose book ‘The Economics of Enough’ was published last year, will be lecturing at the London School of Economics on Thursday .

Please follow the links above for further details if you would like to attend.

Robert Shiller discussing FINANCE AND THE GOOD SOCIETY in Darien, CT, with the American Association of Individual Investors

If you happen to be in the Darien, Connecticut, area on June 21, please come out to see Robert Shiller discuss his new book FINANCE AND THE GOOD SOCIETY, hosted by the Connecticut chapter of the American Association of Individual Investors.  The event is open to the public and will be held at The Waters Edge at Giovanni’s II, 2748 Boston Post Rd. (US-1), Darien, CT.  Check in begins at 6:00 PM and dinner served at 7:00 PM.  Please click here to find out more about the event from the AAII website.

This Week’s Book Giveaway (on Google+!)

Are you following PUP on Google+ yet? If not, today’s the day to add us to your circle—we’re giving away a copy of The Founder’s Dilemmas by Noam Wasserman. Follow us by Friday to win!

The Founder’s Dilemmas: Anticipating and Avoiding the Pitfalls That Can Sink a Startup
by Noam Wasserman

Often downplayed in the excitement of starting up a new business venture is one of the most important decisions entrepreneurs will face: should they go it alone, or bring in cofounders, hires, and investors to help build the business? More than just financial rewards are at stake. Friendships and relationships can suffer. Bad decisions at the inception of a promising venture lay the foundations for its eventual ruin. The Founder’s Dilemmas is the first book to examine the early decisions by entrepreneurs that can make or break a startup and its team.

Drawing on a decade of research, Noam Wasserman reveals the common pitfalls founders face and how to avoid them. He looks at whether it is a good idea to cofound with friends or relatives, how and when to split the equity within the founding team, and how to recognize when a successful founder-CEO should exit or be fired. Wasserman explains how to anticipate, avoid, or recover from disastrous mistakes that can splinter a founding team, strip founders of control, and leave founders without a financial payoff for their hard work and innovative ideas. He highlights the need at each step to strike a careful balance between controlling the startup and attracting the best resources to grow it, and demonstrates why the easy short-term choice is often the most perilous in the long term.

The Founder’s Dilemmas draws on the inside stories of founders like Evan Williams of Twitter and Tim Westergren of Pandora, while mining quantitative data on almost ten thousand founders.

People problems are the leading cause of failure in startups. This book offers solutions.

“Harvard Business School professor Noam Wasserman is one of the writers and teachers who best captures the high stakes decisions that entrepreneurs face every day.”—Scott Kirsner, Boston Globe

“[T]he definitive book on the topic. . . . If you are a founder or thinking about becoming one, you should read this book.”—Dharmesh Shah,

We invite you to read Chapter 1 here:

The random draw for this book with be Friday 6/8 at 3 pm EST. Be sure to check out our Google+ page and add us to your circle to be entered to win!