The Young Fed – The Banking Crises of the 1920s and the Making of a Lender of Last Resort
By: Mark Carlson – US Federal Reserve System
The long-standing description of the Federal Reserve as a “lender of last resort” refers to the central bank’s emergency liquidity provision for financial entities in periods of crisis. As Mark Carlson shows, this function was foundational to how the Fed was designed but has, at times, proven challenging to implement. The Young Fed examines the origins of the Federal Reserve’s emergency liquidity provision which, along with the setting of monetary policy, has become a critical responsibility.
Focusing on the Fed’s response to the financial crises of the 1920s, Carlson documents the formative deliberations of central bank policymakers regarding how to assist banks experiencing distress; the lessons that were learned; and how those lessons shaped subsequent policies. Carlson depicts an early Fed that experimented with a variety of approaches to crises, ranging from bold spectacles featuring cash-filled armored cars to behind-the-scenes interventions to prevent inducing panics or bank runs. The Young Fed weaves previously unpublished material from the Fed archives into a watershed work in American economic history: a deeply sourced account of how the world’s most important central bank became a lender of last resort.
Macroeconomic Modeling – The Cowles Commission Approach
By: Ray C. Fair – Yale University
Macroeconomic Modeling presents an empirically based approach to the construction of macroeconomic models—the Cowles Commission approach—as a response to the backlash that has taken place since the late 1970s to this methodology. The emphasis in the literature has been on tightly specified theoretical models, which lack realism. In this book, Ray C. Fair develops models to analyze a variety of issues and events in macroeconomics and the US economy, and he explains the econometric techniques needed to estimate those models. Many of the results are either contrary to results from the theoretical models or cannot be examined by the theoretical models because they omit many important features of the economy.
Fair covers a broad range of topics, including inflation and unemployment, the size of wealth effects, the behavior of the Federal Reserve and its effects on the economy, the effects of fiscal policy, Okun’s law, and contractions and expansions. Macroeconomic Modeling will appeal equally to graduate students and researchers as well as macroeconomic policy makers.
Capital in Banking
By: Simon Amrein – Lucerne School of Business
Capital in Banking traces the role of capital in US, British, and Swiss banking from the 19th to the 21st century. The book discusses the impact of perceptions and conventions on capital ratios in the 19th century, the effects of the First and Second World Wars, and the interaction of crises and banking regulation during the 1930s and the 1970s. Moreover, it emphasises the origins of the risk-weighted assets approach for measuring capital adequacy and explains how the 2007/2008 crisis led to a renaissance of unweighted capital ratios. The book shows that undisclosed reserves, shareholders’ liability, and hybrid forms of capital must be considered when assessing capital adequacy. As the first long-run historical assessment of the topic, this book represents a reference point for publications in economics, finance, financial regulation, and financial history.
The Global Financial Crisis of 2008 reminded us, if needed be, of the crucial importance of capital in banking. Simon Amrein unveils the thinking, context and events leading to its dramatic fall from the mid-nineteenth to the late twentieth century in three major financial powers, the United States, the United Kingdom and Switzerland. A fascinating story and a must read for practitioners and regulators alike.
Youssef Cassis, European University Institute
Every American an Innovator – How Innovation Became a Way of Life
By: Matthew Wisnioski – Virginia Tech
For half a century, innovation served as a universal good in an age of fracture. That consensus is cracking. While the imperative to innovate for a better future continues to fuel systemic change around the world, critics now assail innovation culture as an engine of inequality or accuse its do-gooders of woke groupthink. What happened? Drawing on a decade of research, Every American an Innovator by Matthew Wisnioski investigates how innovation—a once obscure academic term—became ingrained in our institutions, our education, and our beliefs about ourselves.
Wisnioski argues that innovation culture did not spring from the digital revolution, nor can it be boiled down to heroic entrepreneurs or villainous capitalists. Instead, he reveals the central role of a new class of experts in spreading toolkits and mindsets from the cornfields of 1940s Iowa to Silicon Valley tech giants today. This group of engineers, philosophers, bureaucrats, and business leaders posited that “innovators” were society’s most important change agents and remade the nation in their image. The innovation culture they built transcended partisan divisions and made strange bedfellows. Wisnioski shows how Kennedy-era policymakers inspired President Nixon’s dream of a Nobel Prize for innovators, how anti-military professors built the first university incubators for entrepreneurs, how radical feminists became millionaire consultants, how demands for a rust belt manufacturing renaissance inspired theories of a global creative class, how programs that encouraged girls and minority children to pursue innovative lives changed the nature of childhood play, and why the innovation consensus is now in dispute.
