The Financial Crisis

D&S blog logo

Recent posts from the D&S Blog.

Earlier posts on the crisis:

Note: We got sick of keeping this updated, so the earlier posts listed below are through early summer 2009.

Still earlier posts on the crisis:

Articles from Dollars & Sense:

Note: Not all articles are available online.
Order back issues here.
Subscribe to the print edition.
Donate to support our work.

  • Sciacchitano thumb

    W(h)ither the Dollar?

    By Katherine Sciacchitano | June 2nd

    The trade deficit, the global economic crisis, and the status of the dollar as the world’s reserve currency. Read more »

  • Dr. Dollar

    “Pressure from the Bond Markets”

    By Arthur MacEwan | May 6th

    With the crisis in Greece and other countries, commentators have said that governments are “under pressure from the bond market” or that bond markets will “punish” governments. What does this mean? Read more »

  • We Trust

    Myths of the Deficit

    By Marty Wolfson | April 23rd

    Why do people think that it is more important for the government to reduce the deficit now, rather than to spend money to create jobs? Read more »

  • Greece-Europe

    Greece as a Demonstration Project

    By Mike-Frank Epitropoulos | April 14th

    Will the Black Sheep Bite Back? Will the PIIGS? What about US? Read more »

  • tank

    Is Military Keynesianism the Solution?

    By Heidi Garrett-Peltier | March 3rd

    At a time when unemployment in the domestic economy remains near 10%, it may seem convenient to fall back on the principle of military Keynesianism: War is good for the economy. But it’s not. Read more »

  • UAWSJ logo

    Bad News, Good News,
    and Class Conflict

    By John Miller | February 10th

    So the Journal has noticed that bad news on Main Street is good news on Wall Street. What’s next—will the Journal report that “the history of all hitherto existing societies is the history of class struggle”? Read more »

  • jobs

    Creating Decent Jobs

    By Jeannette Wicks-Lim | January 21st

    What would help generate decent jobs in the coming decade? Unions, and collective bargaining for better wages, benefits, and working conditions. Read more »

  • FDR in 1941

    Economic Rights, Then and Now

    By Susan Feiner | January 11th

    What is the state of the economic rights that FDR unveiled in his “Second Bill of Rights” 66 years ago? Read more »

  • State Budget Blues

    By Marianne Hill | December 9th

    States are slashing budgets to close gaps that are averaging a jaw-dropping 24% this year. Read more »

    The Economic Crisis in the States

    By Gerald Friedman | December 9th

    Two intrinsic features of the U.S. system of government come together to threaten a social disaster. Read more »

  • UAWSJ logo

    How I Learned to Stop Worrying
    and Love the Deficit

    By John Miller | November 17th

    You would have thought the budget deficit had morphed into Dr. Strangelove’s doomsday machine from the howling that followed the publication of Congressional Budget Office projections. Read more »

  • That ’70s Crisis

    That ’70s Crisis

    By Alejandro Reuss | November 6th

    Stagflation, gas lines, high unemployment: What can the crisis of U.S. capitalism in the 1970s teach us about the current crisis and its possible outcomes? Read more »

  • Pizzigati thumb

    Have the Rich Won?

    By Sam Pizzigati | October 28th

    Today’s super rich are doing fantastically better, than when D&S was founded 35 years ago. In 2006, the top 400 averaged an astounding $263 million each in income, and paid just just 17.2% of their incomes in federal tax. Read more »

  • unemployment line

    Unemployment Compensation:
    A Broken System

    By Marianne Hill | September 22nd

    Millions of workers have lost their jobs in the current recession, and many more are sure to join them. But unemployment insurance provides income to help tide these workers over this rough patch, right? Not so fast. The share of unemployed workers receiving benefits has gradually shrunk since the 1970s. Read more »

  • LehmanAIG

    The Bailouts Revisted

    By Marty Wolfson | Sept/Oct 2009

    Bank of America got bailed out, but Lehman Brothers was allowed to fail. AIG was rescued, but in July federal authorities refused to bail out a significant lender to small and medium-sized businesses, the CIT Group. What is the logic behind these decisions? Who is being bailed out—and who should be? Read more »

  • Keynes in 1918

    Keynes, Wage and Price “Stickiness,” and Deflation

    By Alejandro Reuss | Web-Only |September 7th

    Did Keynes think that ‘sticky’ wages and prices were the cause of depressions? No. Did he think falling wages and prices could be the solution? No again. Keynes argued that in fact deflation is likely to deepen economic depressions. Read more »

  • UAWSJ logo

    (Economic) Freedom’s Just Another Word for... Crisis-Prone

    By John Miller | August 31st

    While the global economy is in recession, many of the star performers in the Heritage Foundation’s Index of Economic Freedom are tanking. Read more »

  • IMF logo

    Beyond the World Creditors’ Cartel

    By Dariush Sokolov | August 12th

    One group of financiers seems to be doing nicely in the global recession: the International Monetary Fund and other “IFIs” are enjoying a return to relevance and lining up for increased funding. Read more »

  • Dr. Dollar

    Ponzi Schemes, Bubbles, and Banks

    By Arthur MacEwan | July 30th

    What is the difference between a Ponzi scheme and the way the banks and other investors operated during the housing bubble? Read more »

  • young Bernanke

    Bernanke’s Bad Teachers

    By Gerald Friedman | July 15th

    Fed chair Ben Bernanke got “hooked” on Milton Friedman and Anna Schwartz while he was in grad school. Following their teachings on the Great Depression, he’s been starving the real economy to avoid interfering in free markets. Read more »

  • Bichler-Nitzan thumb

    Contours of Crisis III: Systemic Fear and Forward-Looking Finance

    Third in a series of articles on the current crisis.

    By S. Bichler & J. Nitzan | Web-Only | June 11th

    The rituals of finance condition investors to look forward and price assets based on expected future earnings. But what happens during a systemic crisis, when the future of capitalism itself is in doubt? Read more »

  • unemployment graph

    The Real Unemployment Rate
    Hits a 68-Year High

    By John Miller | June 9th

    Although you have to dig into the statistics to know it, unemployment in the United States is now worse than at any time since the end of the Great Depression. Read more »

  • Keynes in 1918

    The “Revolutionary”
    Who Wasn’t

    By Alejandro Reuss | Web-Only | June 3rd

    First in a series of articles on the economics of John Maynard Keynes and the current crisis. Read more »

  • Goldman Sachs logo

    All That Glitters
    Is Goldman Sachs

    By Robert Zevin | Web-Only | May 20th

    “When I told a friend who runs a program in community economic development the subtitle of my talk, ‘A Primer on Skullduggery in High Finance,’ he replied, ‘Isn’t that redundant?’” Read more »

  • Cayman Islands beach

    Tax Havens and
    the Financial Crisis

    By Rachel Keeler | May/June 2009

    The G20 leaders declared that “The era of banking secrecy is over.” But will leaders from countries made rich from offshore banking follow through to shut it down? Read more »

  • Bichler-Nitzan thumb

    Contours of Crisis II: Fiction and Reality

    By S. Bichler & J. Nitzan | Web-Only |April 28th

    Economists tell us that the current crisis is our punishment for letting the fiction of finance distort the real economy. But what exactly is this “real” economy and how does finance distort it? Do the economists have a clue? Read more »

  • pushing on a string

    Pushing on Strings

    By Gerald Friedman | May/June 2009

    The explosion of U.S. banks’ excess reserves since last fall illustrates the dramatic failure of monetary policy. Read more »

  • PERI logo thumb

    Should We Be Talking About Living Wages Now?

    By Jeannette Wicks-Lim | March/April 2009

    Should living-wage campaigns take a back seat to pulling the economy out of recession? Read more »

  • Dr. Dollar thumb

    Why are things getting worse?

    By Arthur MacEwan | March/April 2009

    Dear Dr. Dollar: I learned in my economics classes that in a market economy, problems tend to be self-correcting. So why don’t we see this kind of self-correction now? Read more »

  • Foreclosed house image

    Renters in the Crosshairs

    By Daniel Fireside | March/April 2009

    The foreclosure crisis threatens to wreak havoc not just on homeowners, but also on tenants. Read more »

  • Bank thumb

    Time for Permanent Nationalization!

    By Fred Moseley | March/April 2009

    If a bank is “too big to fail,” it should be public. Read more »

  • Canadian flag thumb

    Shovel-Ready in Canada

    By Maurice Dufour | Web-Only | Feb 19th

    Pundits are praising the financial health of the United States’s northern neighbor—but should they? Read more »

  • humpty dumpty thumb

    Picking Up the Crumbling Pieces

    Sixth and Final Installment in a Series on the Subprime/Securitization Crisis

    By Larry Peterson | Web-Only | Feb 4th

    A look at the medium- and longer-term significance of the crisis. Read more »

  • capital flight thumb

    The Specter of Capital Flight

    By Marie Duggan | Jan/Feb 2009

    In the 1990s and early 2000s, many emerging markets—including Mexico, Thailand, and Argentina—endured severe financial crises that began with capital flight. The special status of the dollar has protected the United States from such capital flight—so far. Read more »

  • tulip thumb

    From Tulips to Mortgage-Backed Securities

    By Gerald Friedman | Jan/Feb 2009

    Because capitalist financial markets trade in unknown and unknowable future returns, they are inevitably driven by the madness of crowds. Read more »

  • sit-in thumbnail

    Bail Out the Safety Net

    By Randy Albelda | Jan/Feb 2009

    Our physical infrastructure needs work, but so does our social infrastructure. The safety net is not only tattered; it is nearly obsolete. Read more »

  • Bichler-Nitzan thumb

    Contours of Crisis

    By Shimshon Bichler and Jonathan Nitzan | Web-Only | Dec 31st

    First in a series of articles on the current crisis. The series aims to outline some of the important contours of the crisis, to situate these patterns in historical context, and to reflect on their possible causes and implications. Read more »

  • Hossein-zadeh thumb

    Whose Interests Will Shape Obama’s “Change”?

    By Ismael Hossein-zadeh | Web-Only | Dec 23rd

    The market meltdown has made change an urgent universal demand, but the question is: what kind of change? Whose mandates or interests will guide the course of the urgently needed change? The answer depends on the outcome of the balance of power, or the outcome of the ongoing (though largely submerged) class struggle. Read more »

  • sit-in thumbnail

    The Real Audacity of Hope

    By Kari Lydersen and James Tracy | Dec 12th

    The story behind the sit-in at Republic Windows and Doors in Chicago and the recent settlement with Bank of America. Read more »

  • dollar thumb

    The Impasse Ahead

    By Korkut A. Erturk | Web-Only |Dec 12th

    Government efforts to stimulate demand won’t be enough to stop the downward recessionary spiral. While the stock market searches for its own bottom, the fate of the economy depends on the health of the dollar. Read more »

  • financial vs. real economy thumb

    Crisis and Neoliberal Capitalism

    By David Kotz | Nov/Dec 2008

    It is impossible to predict the course of the financial crisis. But even if the financial crisis is contained, the bursting of the housing bubble—which began in 2007 and is bound to continue for some time—will have a powerful downward impact on the economy. Read more »

  • Notes logo

    Ten Weeks That Shattered a World

    Fifth in a Series on the Subprime/Securitization Panic

    By Larry Peterson | Web-Only | Nov 7th

    Make no mistake about it. The world has experienced in the last few weeks events comparable in historical significance to the fall of the Berlin Wall. As in the fall of the Wall, there was an exceptionally sudden collapse of an hegemonic system that had seemed, to the vast majority of observers, and only weeks before the event, to be at least somewhat secure in its continued existence, if irreversibly committed to an inevitable, fundamental process of reform. Read more »

  • bond thumb

    Financialization: A Primer

    By Ramaa Vasudevan | Nov/Dec 2008

    You don’t have to be an investor dabbling in the stock market to feel the power of finance. Finance pervades the lives of ordinary people in many ways, and its size and impact are only getting bigger. Read more »

  • fan thumb

    Capitalism Hits the Fan

    By Rick Wolff | Nov/Dec 2008

    The current crisis has profound social roots in America’s households and families, and political roots in government policies. It did not start with finance, and it won’t end with finance. Read more »

  • Paulson and Bernanke thumb

    Derivatives and Deregulation

    By Marty Wolfson | Nov/Dec 2008

    It has become commonplace to describe the current financial crisis as the most serious since the Great Depression. Although we have more tools now to avoid a depression, the current crisis represents in some ways more significant challenges than did the banking crises of the 1930s. | Order this issue or subscribe.

  • Notes logo

    Notes on the Foreclosure Crisis

    By Tom Weisskopf | Web-Only | Nov 7th

    The number of home foreclosures across the United States is now approaching 2 million, and economists expect that several million more borrowers may default within another year as job losses rise and housing prices continue to fall. This constitutes a crisis that must be addressed as soon as possible, for multiple reasons. Read more »

  • Dr. Dollar thumb

    Dealing with a “Rotten Tooth”

    By Arthur MacEwan | Nov/Dec 2008

    Dear Dr. Dollar: Isn’t the bailout like having a rotten tooth extracted? The extraction is unpleasant, but it beats the alternative. Shouldn’t people quit complaining and suck it up? Read more »

  • Commercial Paper graph thumb

    Commercial Paper

    Financialization’s (Latest) Weak Link

    By Max Fraad Wolff | Web-Only | Oct 29th

    There may be no better illustration of the staggering pain emanating from financial market turbulence than the carnage experienced recently in commercial paper markets worldwide. Read more »

  • bailing worker thumb

    Confidence Trick

    By John Miller | Sept/Oct 2008

    Whatever the bailout will do to patch up the credit system, it will not counteract the downward spiral in housing prices that brought on the crisis. Read more »

  • Notes logo

    Notes on the Financial Crisis, #3

    Third in a Series

    By Tom Weisskopf | Web-Only | Oct 15th

    The last 10 days have brought further news of economic disaster, highly volatile stock market movements (most of them sharply downward), and indisputable evidence that the crisis is world-wide in scope. It’s no longer just Hank Paulson and his associates trying to figure out what the U.S. Government should do to stem a collapse of the U.S. financial system. Read more »

  • Notes logo

    Notes on the Financial Crisis, #2

    Second in a Series

    By Tom Weisskopf | Web-Only | Oct 5th

    Barack Obama has shown stronger signs of readiness to pursue the measures needed to make the bailout effort succeed, and in a way that is fair to all concerned. In order to follow through, he needs to be prodded and supported by substantial Democratic majorities in both houses of Congress. Read more »

  • Notes logo

    Notes on the Financial Crisis, #1

    First in a Series

    By Tom Weisskopf | Web-Only | Oct 1st

    The current financial crisis is broadly attributable to the system of (relatively) deregulated and globalized capitalism into which the U.S. economy is now thoroughly integrated. Read more »

  • Freddie Mac logo

    The Fannie/Freddie Bailout

    By Fred Moseley | Sept/Oct 2008

    A look at the Fannie/Freddie bailout exposes the critical fault line—between private profits and public aims—that ran right through the hybrid structure of the mortgage giants. Read more »

  • wall street thumb

    The Greed Fallacy

    By Arthur MacEwan | Sept/Oct 2008

    Various people explain the current financial crisis as a result of "greed." But there is no indication of a change in the degree or extent of greed on Wall Street in the last several years. Read more »

  • moseley thumb

    How to Stop the Foreclosures?

    By Fred Moseley | July/August 2008

    If current policies do not change, it is estimated that, taken as a whole, up to five million homeowners could lose their homes due to foreclosure over the next few years. Which policies would truly help homeowners at risk? Read more »

  • private equity thumb

    Private Equity Exposed

    Orlando Segura, Jr. | July/August 2008

    How do private equity firms make money? How do private equity firms affect the distribution of financial risk in society as a whole? And how do regulations give private equity firms an advantage in the market? | Order this issue or subscribe.

  • Freddie Mac logo

    Banking on Bankruptcy

    Fourth in a Series on the Subprime/Securitization Panic

    By Larry Peterson | Web-Only | Aug 11th

    In order to understand how an unstable situation at Fannie Mae and Freddie Mac tipped over into a rout that threatened the whole global financial system, we have to focus on a charming investment strategy that is becoming more and more popular every time a major financial firm finds itself under mortal attack. Read more »

  • dr. dollar logo

    The Bear Stearns Bailout

    By Arthur MacEwan | May/June 2008

    Dear Dr. Dollar: Who cares if Bear Stearns fails? Or the Carlyle Group? Or Merrill Lynch? Or one of the other big financial companies? They've made their profits. So what's the problem? Read more »

  • federal reserve seal

    Can the Fed Handle a Systemic Crisis? Maybe.

    By Jane D'Arista | May/June 2008

    The growth of nontransparent over-the-counter markets in derivatives and the explosion in leverage both point to what went wrong in the U.S. financial system over the last two decades. | Order this issue or subscribe.

  • billtwo thumb

    Bear Stearns: Not Your Average Bailout

    Third in a Series on the Subprime/Securitization Panic

    By Larry Peterson | Web-Only | May 13th

    The Fed-led rescue of Bear gave investors an unmistakable signal that the central bank would not allow what had long ceased to be perceived as a “mere” liquidity (involving availability of funds to carry out current business) crunch to finally, however belatedly, tip over into a full-blown solvency (involving conditions pertaining to whether or not business could be carried on or not at all) crisis. The unique thing about this shift was that any prior distinction between systemic solvency and the solvency of one particular institution was reduced to precious little. Read more »

  • Dodd thumb

    A New WPA?

    By Ryan A. Dodd | March/April 2008

    National governments, by serving as "employers of last resort," could guarantee full employment by providing a job for anyone ready, willing, and able to work. Read more »

  • Pollin thumb

    It's Still the Economy, Stupid

    By Robert Pollin | March/April 2008

    What do the candidates have to say about our current reality of financial crisis and recession, and the generation-long stagnation in average living standards that has preceded the crisis of the moment? Read more »

  • Miller thumb

    War Spending, Deficits,
    and Economic Stimulus

    By Arthur MacEwan | March/April 2008

    Dear Dr. Dollar: Doesn't all the war spending stimulate the economy? And shouldn't the Bush tax cuts do the same? So why are we falling into recession? Read more »

  • billtwo thumb

    Finding Spare Change for the Invisible Hand

    Second in a Series on the Subprime/Securitization Panic

    By Larry Peterson | Web-Only | Mar 3rd

    Since our first piece on the subprime/securitization crisis came out, we’ve seen official proposals to confine the damage come and go, with price tags going up each time, while the contagion itself continues to infect regions of the financial world most people never even knew existed. Read more »

  • kawachi thumb

    Stormier Weather

    By John Miller | Jan/Feb 2008

    Hard times have been the hallmark of the U.S. economy during this decade, even as the economy expanded. | Order this issue or subscribe.

  • mortgage thumb

    The Subprime/ Securitization Panic

    A Guide for the Perplexed

    By Larry Peterson | Web-Only | Dec 14th, 2007

    What does the swindling of financially benighted, sometimes greedy, and even gullible American homeowners have to do with collateral used by mysterious funds which promise outsized returns to the incredibly wealthy? And how on earth can developments in these markets cause a bank run (Northern Rock) in England, which hadn’t seen anything similar since the 1860s? Moreover, who are those even more shadowy characters lurking on the horizon—Sovereign Wealth Funds and private equity investors to name two—who stand to capitalize on the mess? Read more »

  • Black thumb

    (Mis)Understanding a Banking Industry in Transition

    By William K. Black | Nov/Dec 2007

    To even begin to understand the recent crisis in the U.S. and global banking industries, you have to look back at the seismic shifts in the industry over the past 30 to 40 years. The story that continues to unfold is one of progressively worse policies that make financial crises more common and more severe. Read more »

  • Palley thumb

    The Fed and America's Distorted Expansion

    By Thomas I. Palley | Nov/Dec 2007

    The U.S. economy has been in expansion mode since November 2001. Though of reasonable duration, the expansion has been fragile and unbalanced. Now, with the subprime mortgage and credit crises, there are signs that the expansion may be ending. If the Fed deserves criticism, it is for endorsing the policy paradigm underlying a distorted expansion. Read more »

  • homeownership thumb

    The Homeownership Myth

    By Howard Karger | Spring 2007

    How pushing homeownership puts low-income people at risk.

  • chase thumb

    Chase: A Bank for the New Century?

    By Joseph Pluta | Spring 2007

    Chase Bank's suspect practices suggest the consequences of banking deregulation.

  • fringe economy thumb

    America’s Fringe Economy

    By Howard Karger | Nov/Dec 2006

    Financial services for the poor and credit-challenged are big business.

  • house of cards thumb

    Bubble Trouble

    By Dean Baker | Jan/Feb 2005

    Throughout the recovery, overheated housing prices have kept the economy simmering.