• Financial Weapons of Mass Destruction: From Bucket Shops to Credit Default Swaps
    • “While CDSs may only be about a decade old, they are linked to a fundamentally similar, equally risky arcane financial instrument, which helped bring down the market in the Panic of 1907, known as the bucket shop.Bucket shops became very popular after the Civil War, even rivaling the stock market in size and the amount of money exchanged, until they were outlawed after the Panic. CDSs and bucket shops are linked not only through the fact that they are very similar financial instruments, but also, at one time, they both were regulated under the same laws.”
  • Debt into Growth: How Sovereign Debt Accelerated the First Industrial Revolution
    • “Why did the country that borrowed the most industrialize first? Earlier research has viewed the explosion of debt in 18th century Britain as either detrimental, or as neutral for economic growth. In this paper, we argue instead that Britain’s borrowing boom was beneficial. The massive issuance of liquidly traded bonds allowed the nobility to switch out of low-return investments such as agricultural improvements… Because external financing contributed little to the Industrial Revolution, this boost in profits in new industries accelerated structural change, making Britain more industrial more quickly.”
  • The Rate of Return on Real Estate: Long-Run Micro-Level Evidence
    • “Together these findings imply limited long-run capital gains and real annualized net total returns of less than 4% across all property types. Moreover, we find substantial volatility in net income streams and variation in relative price levels across transacted properties, revealing the considerable idiosyncratic risks associated with real estate investments.”
  • Business Booms and Depressions Since 1775
    • “An Accurate Charting of the Past and Present Trend of Price Inflation, Federal Debt, Business, National Income, Stocks and Bond Yields with a Special Study of Postwar Periods”

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