Discover how the global financial plague is poised to return, and what can be done to stop it. This is not your father's financial system. Jimmy Stewart, the trustworthy, honest banker in the movie, It's a Wonderful Life, is dead. And so is his small-town bank, Bailey Savings & Loan. Instead, we're watching It's a Horrible Mess with Wall Street (aka the Vegas Strip) playing ever larger craps with our economy and our tax dollars.
This audiobook, written by one of the world's most respected economist, describes in lively, humorous, simple, but also deadly serious terms the big con underlying the big game-the web of interconnected financial, political, and regulatory malfeasance that culminated in financial meltdown and brought us to our economic knees. But is also proposes a solution—Limited Purpose Banking, a straightforward and easily implemented plan to make Wall Street safe for Main Street.
Outlines the first and only proposal to fundamentally fix our financial disaster for good
Written by a leading economist whose insights on this topic are unparalleled
Explains the tenets of the plan, such as the regained government control of the money supply and the new role of insurance companies
Jimmy Stewart Is Dead will fundamentally change the way you think about the economy, financial markets, and the government-sand even if you don't agree with Kotlikoff's conclusion, you'll find his analysis of the crisis and his simple solution a true economic eye-opener.
Amazon.com Review
Discover how the global financial plague is poised to return, and what can be done to stop it
This is not your father's financial system. Jimmy Stewart, the trustworthy, honest banker in the movie, It's a Wonderful Life, is dead . And so is his small-town bank, Bailey Savings & Loan. Instead, we're watching It's a Horrible Mess with Wall Street (aka the Vegas Strip) playing ever larger craps with our economy and our tax dollars.
This book, written by one of the world's most respected economist, describes in lively, humorous, simple, but also deadly serious terms the big con underlying the big game-the web of interconnected financial, political, and regulatory malfeasance that culminated in financial meltdown and brought us to our economic knees. But is also proposes a solution-Limited Purpose Banking, a straightforward and easily implemented plan to make Wall Street safe for Main Street.
Outlines the first and only proposal to fundamentally fix our financial disaster for good
Written by a leading economist whose insights on this topic are unparalleled
Explains the tenets of the plan, such as the regained government control of the money supply and the new role of insurance companies
Jimmy Stewart Is Dead will fundamentally change the way you think about the economy, financial markets, and the government-sand even if you don't agree with Kotlikoff's conclusion, you'll find his analysis of the crisis and his simple solution a true economic eye-opener.
Amazon Exclusive: Q &A with Author Lawrence Kotlikoff
1. What is limited-purpose banking ? First I want to point out that Jimmy Stewart Is Dead is only partly about this proposal. It’s in large part a layman’s tour of the financial collapse conducted by an economist who can talk in plain English and is holds no bars. If you really want to understand what happened in fundamental economic terms, please read the book. And if you really want to know how to fix the problem, please read the book and then send it to your Senator or Congressman.
Limited Purpose Banking puts takes the multifaceted fraud out of our financial system by turning all banks, insurance companies, hedge funds, etc. into fully transparent mutual fund companies. Limited Purpose Banking also abolishes over 115 federal and state regulatory authorities and replaces them with the Federal Financial Authority, which verifies, fully and immediately discloses, and independently rates and appraises all securities held by the mutual funds.
In a nut shell, Limited Purpose Banking makes Wall Street safe for Main Street. Under Limited Purpose Banking we will never again experience financial collapse and contagion. The proposal is receiving significant attention by Mervyn King, Governor of the Bank of England, and other top policymakers throughout the world.
2. Another term that is mentioned a lot these days is narrow banking . What is the difference between narrow banking and LPB and why is LPB a better option? Narrow Banking says that the monies invested in checking accounts and similar short-term deposits must be invested in very safe securities, like federal government Treasury bills. It lets the rest of the financial system do its own thing and tells that part of the system – “Boys and girls, you’re on your own.” If you borrow money to invest in fraudulent or simply risky securities and lose your shirts, we’re not going to bail you out. Well, this was tried in the case of Lehman’s failure and it blew up in the government’s face.
Limited Purpose Banking includes cash mutual funds, which are held strictly in cash. So one element of LPB is narrow banking. But LPB is much broader. It precludes any financial intermediary of any kind, which is protected by limited liability, from doing anything but marketing mutual funds and the mutual funds are themselves never leveraged. So the entire financial piping system is made safe, not just a few pipes that weren’t at much risk to begin with.
3. What are the advantages of implementing a system like limited-purpose banking and how will it differ from our current banking system? We’ll never have another financial collapse. We’ll never see a run on banks ever again. We’ll never see insurance companies insuring the uninsurable. We’ll get rid of all the con jobs underlying the current financial system. There will be no more insider rating deals, liar loans, director sweetheart deals, bonuses which amount to corporate theft, bribing of Congress, and the list goes on. The financial plague will be cured, once can for all.
The biggest difference between what we now have and Limited Purpose Banking is we’ll have a financial system that’s honest and that we can trust. This will make all the difference in the world in getting the American economy back on its feet.
4. You’ve recently been referred to as Mervyn King’s (Bank of England) “Guru”. Do you anticipate that the UK might be more amenable to a proposal like LPB than the US? Why? First, Mervyn King needs no guru, and I’m not his guru. He’s a brilliant economist and an outstanding public servant. I’ve learned a lot more from him over the years than he’s learned from me.
Many of the ideas contained in Limited Purpose Banking were being independently conceived and considered by other economists at the time the book appeared. This includes Mervyn King and other superb economists at the Bank of England.
Governor King, Alisdair Turner, and other top members of the British government are taking this plan very seriously. It’s very simple and if the UK adopts it, the U.S. is likely to follow.
But the U.S. may move first. If you look at who endorsed the book – former Treasury Secretary and Secretary of State George Shultz, former Senator Bill Bradley, former Secretary of Labor, Robert Reich, two former CEA chairmen (Michael Boskin and Murrar Weidenbaum), two former chief economists of the IMF (Simon Johnson and Ken Rogoff), a former chief economist of the SEC, a former deputy Comptroller General of the Currency, and … not to mention FIVE Nobel Laureates in Economics, you see that there is extremely widespread support for this plan in U.S. policy circles and academia. The endorsements are coming from all sides and ends of the political aisle.
5. What do you anticipate as the reaction by the banking industry to LPB? If the banking industry is smart, they will realize this is the best way to go. The American public is extremely angry and is not up for business as usual. 15,000,000 people are unemployed and many other millions are underemployed or have dropped out of the labor force. Wall Street has destroyed the economy and millions of innocent economic lives. Wall Street did this by engaging in fraud – left, right, and center and then turning to the tax payer to pay for the havoc it created. These problems continue to this day. They need to be fixed fundamentally. The status quo seems safe, but as the book shows, it’s extremely risky. And because it is so risky, Wall Street will either need to be baby sat in a manner it won’t like or it can operate honestly under LPB. These are its only two options.
Review
"Kotlikoff has presented a thought-provoking proposal that meritsattention in the debate over financial regulation." —Kenneth Silber, FrumForum.com, March 2010
" Jimmy Stewart Is Dead makes for provocativereading. We certainly have squandered much of America's businessand economic strength in the pursuit of personal gain and huge ifnot obscene bonuses. … It might just be easier to findanother Jimmy Stewart. I'd call him Mr. Smith. And I'd ask him togo to Washington." —Philip Moeller, U.S. News & World Report
"Kotlikoff grabs us by the collar, brilliantly unveiling thetruth about our financial system. With scintillating arguments,vivid examples, and terrific wit, he offers a powerful reform thatstops banks from gambling and restricts them to their legitimatepurpose, 'connecting borrowers to lenders and savers to investors.'This is economics at its very best: deeply insightful andpowerfully useful. It will change the global debate." —JEFFREY SACHS, Director of The Earth Institute, QueteletProfessor of Development and Health Policy, Columbia University
"Financial reform needs something simple, clear, and, most ofall, effective. Read this book to get and understand theanswer." —GEORGE SHULTZ, Distinguished Fellow, the Hoover Institution,former U.S. Secretary of the Treasury, and former U.S. Secretary ofState
"At last! A real financial page-turner. Kotlikoff calls out thebad actors behind the financial crisis and nails them cold. But healso tells us how to prevent it from happening again. It's calledLimited Purpose Banking. Anyone can read this book—andeveryone should." —SCOTT BURNS, Financial Columnist, Universal PressSyndicate
"Jimmy Stewart Is Dead is a page-turner, as fast-paced as TheSimpsons, with new insights on every page. As fun as it is, JimmyStewart is also deadly serious. It describes our deep financialproblems and offers an amazingly simple financial fix to prevent aneven worse crash. Everyone should read this book." —GEORGE AKERLOF, Koshland Professor of Economics, Universityof California at Berkeley, Nobel laureate in Economics
"Kotlikoff's book makes an impassioned, coherent, and convincingcase for Limited Purpose Banking." —ROBERT E. LUCAS, Jr., John Dewey Distinguished Professor ofEconomics, University of Chicago, Nobel laureate in Economics
"This book is 'must' reading for everyone who cares about thefuture of the American economy."? —ROBERT W. FOGEL, Walgreen Distinguished Service Professor,University of Chicago, Nobel laureate in Economics
"Kotlikoff is right. Unless we institute fundamental reforms,there will be an even greater crisis. This well-written book is amust-read for those concerned with reforming the financialsystem." —EDWARD C. PRESCOTT, W. P. Carey Chair in Economics, ArizonaState University, Nobel laureate in Economics
"Certainly we need to abandon today's hazardous financialsystem. Kotlikoff's Limited Purpose Banking plan is one of the bestvisions to surface so far." —EDMUND PHELPS, McVickar Professor of Political Economy,Columbia University, Nobel laureate in Economics
From the Inside Flap
Make no mistake, Jimmy Stewart, the honest, trustworthy banker(a.k.a. George Bailey) in It's a Wonderful Life , is dead.And so is his small-town, virtuous bank—Bailey Savings andLoan. Today, a very different financial movie, It's a HorribleMess , is playing on Main Street. This economic horrorshow—produced by Wall Street and directed byCongress—is no Christmas story, but a tale of pervasive andmassive financial malfeasance that has devastated the lives ofmillions of people around the globe.
Though our financial system lies in tatters and economic miserystalks the land, the horrible mess is far from over. Uncle Sam, whoaided and abetted the financial fraud, is working overtime torestore a financial system that's virtually designed for hucksters,that no one can trust, and that towers on a bed of sand.
Uncle Sam's strategy is Wall Street's—borrow short, placerisky bets, make financial commitments you can't possibly keep, andlet no one see precisely what you're doing. The sums involved areenormous and have leveraged us and our children far beyond ourcapacity to pay. Sam's bluff has put our economy at grave economicrisk. Without the right financial fix, the global financial plaguewill strike again with even more devastating force.
Written by Laurence Kotlikoff—one of the world's mostrespected economists— Jimmy Stewart Is Dead describesin lively, but deadly serious terms the big con underlying the biggame: namely the web of interconnected financial, political, andregulatory misconduct that culminated in financial meltdown andbrought us to our economic knees. It's a tragic story that startswith our economic disaster and where it's headed, describes itscauses, identifies its architects, and then shows how to fix thesystem for good.
Throughout the book, Kotlikoff not only surveys thedisheartening events surrounding our economic collapse, but alsoconveys their deeper economic meaning, particularly theextraordinary danger of maintaining the financial status quo. Alongthe way, he proposes Limited Purpose Banking (LPB)—astraightforward and easily implemented plan to make Wall Streetsafe for Main Street. Featured in the Financial Times,Forbes, the New Republic, Bloomberg , and other topmedia, LPB transforms all financial corporations into pass-throughmutual companies that can never fail, never leverage the taxpayer,and never sell fraudulent securities. LPB is the first and onlyproposal that could fundamentally end our enduring financial plagueand restore economic prosperity.
Whether or not you agree with Kotlikoff's conclusion, you'llfind his analysis of the crisis and his simple solution a trueeconomic eye-opener. Indeed, Jimmy Stewart Is Dead willfundamentally change the way you think about the economy, financialmarkets, the government, and the safest way to shape our economicfuture.
From the Back Cover
Praise for Jimmy Stewart Is Dead
"Kotlikoff grabs us by the collar, brilliantly unveiling thetruth about our financial system. With scintillating arguments,vivid examples, and terrific wit, he offers a powerful reform thatstops banks from gambling and restricts them to their legitimatepurpose, 'connecting borrowers to lenders and savers to investors.'This is economics at its very best: deeply insightful andpowerfully useful. It will change the global debate." —JEFFREY SACHS, Director of The Earth Institute, QueteletProfessor of Development and Health Policy, ColumbiaUniversity
"Financial reform needs something simple, clear, and, most ofall, effective. Read this book to get and understand theanswer." —GEORGE SHULTZ, Distinguished Fellow, the HooverInstitution, former U.S. Secretary of the Treasury, and former U.S.Secretary of State
"At last! A real financial page-turner. Kotlikoff calls out thebad actors behind the financial crisis and nails them cold. But healso tells us how to prevent it from happening again. It's calledLimited Purpose Banking. Anyone can read this book—andeveryone should." —SCOTT BURNS, Financial Columnist, Universal PressSyndicate
" Jimmy Stewart Is Dead is a page-turner, as fast-paced as The Simpsons , with new insights on every page. As fun as itis, Jimmy Stewart is also deadly serious. It describes our deepfinancial problems and offers an amazingly simple financial fix toprevent an even worse crash. Everyone should read this book." —GEORGE AKERLOF, Koshland Professor of Economics,University of California at Berkeley, Nobel laureate inEconomics
"Kotlikoff's book makes an impassioned, coherent, and convincingcase for Limited Purpose Banking." —ROBERT E. LUCAS, Jr., John Dewey Distinguished Professorof Economics, University of Chicago, Nobel laureate inEconomics
"This book is 'must' reading for everyone who cares about thefuture of the American economy." —ROBERT W. FOGEL, Walgreen Distinguished ServiceProfessor, University of Chicago, Nobel laureate inEconomics
"Kotlikoff is right. Unless we institute fundamental reforms,there will be an even greater crisis. This well-written book is amust-read for those concerned with reforming the financialsystem." —EDWARD C. PRESCOTT, W. P. Carey Chair in Economics,Arizona State University, Nobel laureate in Economics
"Certainly we need to abandon today's hazardous financialsystem. Kotlikoff's Limited Purpose Banking plan is one of the bestvisions to surface so far." —EDMUND PHELPS, McVickar Professor of Political Economy,Columbia University, Nobel laureate in Economics
SEE INSIDE ENDORSEMENTS BY Jagdish Bhagwati, MichaelBoskin, Bill Bradley, Niall Ferguson, Kevin Hassett, Simon Johnson,William Niskanen, William Owens, Rudy Penner, Robert Reich, KennethRogoff, Paul Romer, Steve Ross, Eytan Sheshinski, MurrayWeidenbaum, Susan Woodward, and other prominent economists andpolicymakers.
About the Author
LAURENCE J. KOTLIKOFF is a William Fairfield Warren Professor of Economics at Boston University, Fellow of the American Academy of Arts and Sciences, Research Associate of the National Bureau of Economic Research, Fellow of the Econometric Society, and former Senior Economist, President's Council of Economic Advisers. Coauthor of The Coming Generational Storm and Spend 'Til the End and author of The Healthcare Fix, Kotlikoff has been published extensively in the nation's leading newspapers, magazines, and financial web sites on financial reform, taxes, saving, growth, deficits, Social Security, healthcare, pensions, and personal finance.
Discover how the global financial plague is poised to return, and what can be done to stop it. This is not your father's financial system. Jimmy Stewart, the trustworthy, honest banker in the movie, It's a Wonderful Life, is dead. And so is his small-town bank, Bailey Savings & Loan. Instead, we're watching It's a Horrible Mess with Wall Street (aka the Vegas Strip) playing ever larger craps with our economy and our tax dollars.
This audiobook, written by one of the world's most respected economist, describes in lively, humorous, simple, but also deadly serious terms the big con underlying the big game-the web of interconnected financial, political, and regulatory malfeasance that culminated in financial meltdown and brought us to our economic knees. But is also proposes a solution—Limited Purpose Banking, a straightforward and easily implemented plan to make Wall Street safe for Main Street.
Jimmy Stewart Is Dead will fundamentally change the way you think about the economy, financial markets, and the government-sand even if you don't agree with Kotlikoff's conclusion, you'll find his analysis of the crisis and his simple solution a true economic eye-opener.
Amazon.com Review
Discover how the global financial plague is poised to return, and what can be done to stop it
This is not your father's financial system. Jimmy Stewart, the trustworthy, honest banker in the movie, It's a Wonderful Life, is dead . And so is his small-town bank, Bailey Savings & Loan. Instead, we're watching It's a Horrible Mess with Wall Street (aka the Vegas Strip) playing ever larger craps with our economy and our tax dollars.
This book, written by one of the world's most respected economist, describes in lively, humorous, simple, but also deadly serious terms the big con underlying the big game-the web of interconnected financial, political, and regulatory malfeasance that culminated in financial meltdown and brought us to our economic knees. But is also proposes a solution-Limited Purpose Banking, a straightforward and easily implemented plan to make Wall Street safe for Main Street.
Jimmy Stewart Is Dead will fundamentally change the way you think about the economy, financial markets, and the government-sand even if you don't agree with Kotlikoff's conclusion, you'll find his analysis of the crisis and his simple solution a true economic eye-opener.
Amazon Exclusive: Q &A with Author Lawrence Kotlikoff
1. What is limited-purpose banking ?
First I want to point out that Jimmy Stewart Is Dead is only partly about this proposal. It’s in large part a layman’s tour of the financial collapse conducted by an economist who can talk in plain English and is holds no bars. If you really want to understand what happened in fundamental economic terms, please read the book. And if you really want to know how to fix the problem, please read the book and then send it to your Senator or Congressman.
Limited Purpose Banking puts takes the multifaceted fraud out of our financial system by turning all banks, insurance companies, hedge funds, etc. into fully transparent mutual fund companies. Limited Purpose Banking also abolishes over 115 federal and state regulatory authorities and replaces them with the Federal Financial Authority, which verifies, fully and immediately discloses, and independently rates and appraises all securities held by the mutual funds.
In a nut shell, Limited Purpose Banking makes Wall Street safe for Main Street. Under Limited Purpose Banking we will never again experience financial collapse and contagion. The proposal is receiving significant attention by Mervyn King, Governor of the Bank of England, and other top policymakers throughout the world.
2. Another term that is mentioned a lot these days is narrow banking . What is the difference between narrow banking and LPB and why is LPB a better option?
Narrow Banking says that the monies invested in checking accounts and similar short-term deposits must be invested in very safe securities, like federal government Treasury bills. It lets the rest of the financial system do its own thing and tells that part of the system – “Boys and girls, you’re on your own.” If you borrow money to invest in fraudulent or simply risky securities and lose your shirts, we’re not going to bail you out. Well, this was tried in the case of Lehman’s failure and it blew up in the government’s face.
Limited Purpose Banking includes cash mutual funds, which are held strictly in cash. So one element of LPB is narrow banking. But LPB is much broader. It precludes any financial intermediary of any kind, which is protected by limited liability, from doing anything but marketing mutual funds and the mutual funds are themselves never leveraged. So the entire financial piping system is made safe, not just a few pipes that weren’t at much risk to begin with.
3. What are the advantages of implementing a system like limited-purpose banking and how will it differ from our current banking system?
We’ll never have another financial collapse. We’ll never see a run on banks ever again. We’ll never see insurance companies insuring the uninsurable. We’ll get rid of all the con jobs underlying the current financial system. There will be no more insider rating deals, liar loans, director sweetheart deals, bonuses which amount to corporate theft, bribing of Congress, and the list goes on. The financial plague will be cured, once can for all.
The biggest difference between what we now have and Limited Purpose Banking is we’ll have a financial system that’s honest and that we can trust. This will make all the difference in the world in getting the American economy back on its feet.
4. You’ve recently been referred to as Mervyn King’s (Bank of England) “Guru”. Do you anticipate that the UK might be more amenable to a proposal like LPB than the US? Why?
First, Mervyn King needs no guru, and I’m not his guru. He’s a brilliant economist and an outstanding public servant. I’ve learned a lot more from him over the years than he’s learned from me.
Many of the ideas contained in Limited Purpose Banking were being independently conceived and considered by other economists at the time the book appeared. This includes Mervyn King and other superb economists at the Bank of England.
Governor King, Alisdair Turner, and other top members of the British government are taking this plan very seriously. It’s very simple and if the UK adopts it, the U.S. is likely to follow.
But the U.S. may move first. If you look at who endorsed the book – former Treasury Secretary and Secretary of State George Shultz, former Senator Bill Bradley, former Secretary of Labor, Robert Reich, two former CEA chairmen (Michael Boskin and Murrar Weidenbaum), two former chief economists of the IMF (Simon Johnson and Ken Rogoff), a former chief economist of the SEC, a former deputy Comptroller General of the Currency, and … not to mention FIVE Nobel Laureates in Economics, you see that there is extremely widespread support for this plan in U.S. policy circles and academia. The endorsements are coming from all sides and ends of the political aisle.
5. What do you anticipate as the reaction by the banking industry to LPB?
If the banking industry is smart, they will realize this is the best way to go. The American public is extremely angry and is not up for business as usual. 15,000,000 people are unemployed and many other millions are underemployed or have dropped out of the labor force. Wall Street has destroyed the economy and millions of innocent economic lives. Wall Street did this by engaging in fraud – left, right, and center and then turning to the tax payer to pay for the havoc it created. These problems continue to this day. They need to be fixed fundamentally. The status quo seems safe, but as the book shows, it’s extremely risky. And because it is so risky, Wall Street will either need to be baby sat in a manner it won’t like or it can operate honestly under LPB. These are its only two options.
Review
"Kotlikoff has presented a thought-provoking proposal that meritsattention in the debate over financial regulation."
—Kenneth Silber, FrumForum.com, March 2010
" Jimmy Stewart Is Dead makes for provocativereading. We certainly have squandered much of America's businessand economic strength in the pursuit of personal gain and huge ifnot obscene bonuses. … It might just be easier to findanother Jimmy Stewart. I'd call him Mr. Smith. And I'd ask him togo to Washington."
—Philip Moeller, U.S. News & World Report
"Kotlikoff grabs us by the collar, brilliantly unveiling thetruth about our financial system. With scintillating arguments,vivid examples, and terrific wit, he offers a powerful reform thatstops banks from gambling and restricts them to their legitimatepurpose, 'connecting borrowers to lenders and savers to investors.'This is economics at its very best: deeply insightful andpowerfully useful. It will change the global debate."
—JEFFREY SACHS, Director of The Earth Institute, QueteletProfessor of Development and Health Policy, Columbia University
"Financial reform needs something simple, clear, and, most ofall, effective. Read this book to get and understand theanswer."
—GEORGE SHULTZ, Distinguished Fellow, the Hoover Institution,former U.S. Secretary of the Treasury, and former U.S. Secretary ofState
"At last! A real financial page-turner. Kotlikoff calls out thebad actors behind the financial crisis and nails them cold. But healso tells us how to prevent it from happening again. It's calledLimited Purpose Banking. Anyone can read this book—andeveryone should."
—SCOTT BURNS, Financial Columnist, Universal PressSyndicate
"Jimmy Stewart Is Dead is a page-turner, as fast-paced as TheSimpsons, with new insights on every page. As fun as it is, JimmyStewart is also deadly serious. It describes our deep financialproblems and offers an amazingly simple financial fix to prevent aneven worse crash. Everyone should read this book."
—GEORGE AKERLOF, Koshland Professor of Economics, Universityof California at Berkeley, Nobel laureate in Economics
"Kotlikoff's book makes an impassioned, coherent, and convincingcase for Limited Purpose Banking."
—ROBERT E. LUCAS, Jr., John Dewey Distinguished Professor ofEconomics, University of Chicago, Nobel laureate in Economics
"This book is 'must' reading for everyone who cares about thefuture of the American economy."?
—ROBERT W. FOGEL, Walgreen Distinguished Service Professor,University of Chicago, Nobel laureate in Economics
"Kotlikoff is right. Unless we institute fundamental reforms,there will be an even greater crisis. This well-written book is amust-read for those concerned with reforming the financialsystem."
—EDWARD C. PRESCOTT, W. P. Carey Chair in Economics, ArizonaState University, Nobel laureate in Economics
"Certainly we need to abandon today's hazardous financialsystem. Kotlikoff's Limited Purpose Banking plan is one of the bestvisions to surface so far."
—EDMUND PHELPS, McVickar Professor of Political Economy,Columbia University, Nobel laureate in Economics
From the Inside Flap
Make no mistake, Jimmy Stewart, the honest, trustworthy banker(a.k.a. George Bailey) in It's a Wonderful Life , is dead.And so is his small-town, virtuous bank—Bailey Savings andLoan. Today, a very different financial movie, It's a HorribleMess , is playing on Main Street. This economic horrorshow—produced by Wall Street and directed byCongress—is no Christmas story, but a tale of pervasive andmassive financial malfeasance that has devastated the lives ofmillions of people around the globe.
Though our financial system lies in tatters and economic miserystalks the land, the horrible mess is far from over. Uncle Sam, whoaided and abetted the financial fraud, is working overtime torestore a financial system that's virtually designed for hucksters,that no one can trust, and that towers on a bed of sand.
Uncle Sam's strategy is Wall Street's—borrow short, placerisky bets, make financial commitments you can't possibly keep, andlet no one see precisely what you're doing. The sums involved areenormous and have leveraged us and our children far beyond ourcapacity to pay. Sam's bluff has put our economy at grave economicrisk. Without the right financial fix, the global financial plaguewill strike again with even more devastating force.
Written by Laurence Kotlikoff—one of the world's mostrespected economists— Jimmy Stewart Is Dead describesin lively, but deadly serious terms the big con underlying the biggame: namely the web of interconnected financial, political, andregulatory misconduct that culminated in financial meltdown andbrought us to our economic knees. It's a tragic story that startswith our economic disaster and where it's headed, describes itscauses, identifies its architects, and then shows how to fix thesystem for good.
Throughout the book, Kotlikoff not only surveys thedisheartening events surrounding our economic collapse, but alsoconveys their deeper economic meaning, particularly theextraordinary danger of maintaining the financial status quo. Alongthe way, he proposes Limited Purpose Banking (LPB)—astraightforward and easily implemented plan to make Wall Streetsafe for Main Street. Featured in the Financial Times,Forbes, the New Republic, Bloomberg , and other topmedia, LPB transforms all financial corporations into pass-throughmutual companies that can never fail, never leverage the taxpayer,and never sell fraudulent securities. LPB is the first and onlyproposal that could fundamentally end our enduring financial plagueand restore economic prosperity.
Whether or not you agree with Kotlikoff's conclusion, you'llfind his analysis of the crisis and his simple solution a trueeconomic eye-opener. Indeed, Jimmy Stewart Is Dead willfundamentally change the way you think about the economy, financialmarkets, the government, and the safest way to shape our economicfuture.
From the Back Cover
Praise for Jimmy Stewart Is Dead
"Kotlikoff grabs us by the collar, brilliantly unveiling thetruth about our financial system. With scintillating arguments,vivid examples, and terrific wit, he offers a powerful reform thatstops banks from gambling and restricts them to their legitimatepurpose, 'connecting borrowers to lenders and savers to investors.'This is economics at its very best: deeply insightful andpowerfully useful. It will change the global debate."
—JEFFREY SACHS, Director of The Earth Institute, QueteletProfessor of Development and Health Policy, ColumbiaUniversity
"Financial reform needs something simple, clear, and, most ofall, effective. Read this book to get and understand theanswer."
—GEORGE SHULTZ, Distinguished Fellow, the HooverInstitution, former U.S. Secretary of the Treasury, and former U.S.Secretary of State
"At last! A real financial page-turner. Kotlikoff calls out thebad actors behind the financial crisis and nails them cold. But healso tells us how to prevent it from happening again. It's calledLimited Purpose Banking. Anyone can read this book—andeveryone should."
—SCOTT BURNS, Financial Columnist, Universal PressSyndicate
" Jimmy Stewart Is Dead is a page-turner, as fast-paced as The Simpsons , with new insights on every page. As fun as itis, Jimmy Stewart is also deadly serious. It describes our deepfinancial problems and offers an amazingly simple financial fix toprevent an even worse crash. Everyone should read this book."
—GEORGE AKERLOF, Koshland Professor of Economics,University of California at Berkeley, Nobel laureate inEconomics
"Kotlikoff's book makes an impassioned, coherent, and convincingcase for Limited Purpose Banking."
—ROBERT E. LUCAS, Jr., John Dewey Distinguished Professorof Economics, University of Chicago, Nobel laureate inEconomics
"This book is 'must' reading for everyone who cares about thefuture of the American economy."
—ROBERT W. FOGEL, Walgreen Distinguished ServiceProfessor, University of Chicago, Nobel laureate inEconomics
"Kotlikoff is right. Unless we institute fundamental reforms,there will be an even greater crisis. This well-written book is amust-read for those concerned with reforming the financialsystem."
—EDWARD C. PRESCOTT, W. P. Carey Chair in Economics,Arizona State University, Nobel laureate in Economics
"Certainly we need to abandon today's hazardous financialsystem. Kotlikoff's Limited Purpose Banking plan is one of the bestvisions to surface so far."
—EDMUND PHELPS, McVickar Professor of Political Economy,Columbia University, Nobel laureate in Economics
SEE INSIDE ENDORSEMENTS BY Jagdish Bhagwati, MichaelBoskin, Bill Bradley, Niall Ferguson, Kevin Hassett, Simon Johnson,William Niskanen, William Owens, Rudy Penner, Robert Reich, KennethRogoff, Paul Romer, Steve Ross, Eytan Sheshinski, MurrayWeidenbaum, Susan Woodward, and other prominent economists andpolicymakers.
About the Author
LAURENCE J. KOTLIKOFF is a William Fairfield Warren Professor of Economics at Boston University, Fellow of the American Academy of Arts and Sciences, Research Associate of the National Bureau of Economic Research, Fellow of the Econometric Society, and former Senior Economist, President's Council of Economic Advisers. Coauthor of The Coming Generational Storm and Spend 'Til the End and author of The Healthcare Fix, Kotlikoff has been published extensively in the nation's leading newspapers, magazines, and financial web sites on financial reform, taxes, saving, growth, deficits, Social Security, healthcare, pensions, and personal finance.