Preface                                            ix
    Chapter 1 How Credit Slipped Its Leash         1  (16)
      Opening Pandora's Box                        1  (2)
      Constraints on the Fed and on Paper Money    3  (2)
      Creation
      Fractional Reserve Banking Run Amok          5  (1)
      Fractional Reserve Banking                   5  (2)
      Commercial Banks                             7  (3)
      The Broader Credit Market: Too Many          10 (2)
      Lenders, Not Enough Reserves
      Credit without Reserves                      12 (1)
      The Flow of Funds                            13 (2)
      The Rest of the World                        15 (1)
      Notes                                        15 (2)
    Chapter 2 The Global Money Glut                17 (16)
      The Financial Account                        18 (2)
      How It Works                                 20 (3)
      What Percentage of Total Foreign Exchange    23 (1)
      Reserves Are Dollars?
      What to Do with So Many Dollars?             24 (2)
      What about the Remaining $2.8 Trillion?      26 (2)
      Debunking the Global Savings Glut Theory     28 (3)
      Will China Dump Its Dollars?                 31 (1)
      Notes                                        32 (1)
    Chapter 3 Creditopia                           33 (18)
      Who Borrowed the Money?                      33 (5)
      Impact on the Economy                        38 (1)
      Net Worth                                    39 (2)
      Profits                                      41 (1)
      Tax Revenue                                  41 (1)
      Different, Not Just More                     41 (4)
      Impact on Capital                            45 (4)
      Conclusion                                   49 (1)
      Note                                         49 (2)
    Chapter 4 The Quantity Theory of Credit        51 (12)
      The Quantity Theory of Money                 52 (3)
      The Rise and Fall of Monetarism              55 (2)
      The Quantity Theory of Credit                57 (2)
      Credit and Inflation                         59 (1)
      Conclusion                                   60 (1)
      Notes                                        61 (2)
    Chapter 5 The Policy Response: Perpetuating    63 (22)
    the Boom
      The Credit Cycle                             64 (1)
      How Have They Done so Far?                   65 (1)
      Monetary Omnipotence and the Limits          66 (1)
      Thereof
      The Balance Sheet of the Federal Reserve     67 (2)
      Quantitative Easing: Round One               69 (2)
      What Did QE1 Accomplish?                     71 (1)
      Quantitative Easing: Round Two               72 (1)
      Monetizing the Debt                          73 (2)
      The Role of the Trade Deficit                75 (1)
      Diminishing Returns                          76 (2)
      The Other Money Makers                       78 (5)
      Notes                                        83 (2)
    Chapter 6 Where Are We Now?                    85 (22)
      How Bad so Far?                              85 (1)
      Credit Growth Drove Economic Growth          86 (2)
      So, Where Does that Leave Us?                88 (1)
      Why Can't TCMD Grow?                         89 (7)
      The Banking Industry: Why Still Too Big      96 (5)
      to Fail?
      Global Imbalances: Still Unresolved          101(3)
      Vision and Leadership Are Still Lacking      104(1)
      Notes                                        105(2)
    Chapter 7 How It Plays Out                     107(14)
      The Business Cycle                           107(2)
      Debt: Public and Private                     109(2)
      2011: The Starting Point                     111(1)
      2012: Expect QE3                             112(2)
      Impact on Asset Prices                       114(1)
      2013-2014: Three Scenarios                   114(4)
      Impact on Asset Prices                       118(1)
      Conclusion                                   119(1)
      Notes                                        120(1)
    Chapter 8 Disaster Scenarios                   121(12)
      The Last Great Depression                    121(5)
      And This Time?                               126(1)
      Banking Crisis                               126(1)
      Protectionism                                127(1)
      Geopolitical Consequences                    128(4)
      Conclusion                                   132(1)
      Note                                         132(1)
    Chapter 9 The Policy Options                   133(16)
      Capitalism and the Laissez-Faire Method      134(6)
      The State of Government Finances             140(2)
      The Government's Options                     142(1)
      American Solar                               143(3)
      Conclusion                                   146(1)
      Notes                                        147(2)
    Chapter 10 Fire and Ice, Inflation and         149(20)
    Deflation
      Fire                                         150(1)
      Ice                                          151(1)
      Fisher's Theory of Debt-Deflation            152(3)
      Winners and Losers                           155(2)
      Ice Storm                                    157(1)
      Fire Storm                                   157(1)
      Wealth Preservation through                  158(2)
      Diversification
      Other Observations Concerning Asset          160(5)
      Prices in the Age of Paper Money
      Protectionism and Inflation                  165(1)
      Consequences of Regulating Derivatives       166(1)
      Conclusion                                   166(1)
      Notes                                        167(2)
Conclusion                                         169(2)
About the Author                                   171(2)
Index                                              173