The nature of economic manias and crashes (6/16/2009)

Readers who have followed the trials and tribulations of the world economy and financial markets will find in Donald Rapp's new book, Bubbles, Booms and Busts: The Rise and Fall of Financial Assets, a detailed explanation of the history of economic ups and downs in financial markets.

The book deals with the financial booms and bubbles-how they develop and collapse. Rapp writes of the distribution of wealth, inflation, rationality of bankers, monetary and fiscal policy, the role of central banks, tax policies, social security, US federal, state, municipal and personal debt, and valuation of common stocks. He goes on to describe the historical boom/bust cycles of the 1720s, the Florida land boom of the 1920s and the 1929 stock market crash, the Great Depression, the S&L fiasco of the 1980s, the great bull market of 1982-1995, the crash of 1987, the dot.com mania of 1995-2000, corporate swindles of the 1990s and 2000s, the sub-prime disaster of the 2000s, and Japan in the late 20th century.

Rapp explains that most of the recent wealth generation was derived from increased debt and appreciation of paper assets. The architects of the new economics were Ronald Reagan and Arthur Greenspan. Inevitably, the US Government's cure for excessive spending and inadequate revenues is to increase spending and cut revenues.

Professor Donald Rapp has had a long and varied scientific and engineering career, with 48 years of experience in different fields. He has published many scientific papers and five books, including Assessing Climate Change, published by Springer-Praxis in December 2007.

Note: This story has been adapted from a news release issued by the Springer

Post Comments: