|  | Author: Gerald F. Davis
Publisher: Oxford University Press, USA
List Price: $29.95
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as of 11/25/2009 00:17 CST details
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Seller: Florida Panhandlers
Rating:  38 reviews
Sales Rank: 125199
Languages: English (Original Language), English (Unknown), English (Published)
Media: Hardcover
Pages: 320
Number Of Items: 1
Shipping Weight (lbs): 1.6
Dimensions (in): 9.2 x 6.5 x 1.1
ISBN: 0199216614
Dewey Decimal Number: 332.0410973
EAN: 9780199216611
ASIN: 0199216614
Publication Date: June 15, 2009
Availability: Usually ships in 1-2 business days
Condition: brand new hard cover with dust sleeve as arrived from publisher - ships with tracking #
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Showing reviews 16-20 of 38
A Theory of (D)evolution June 22, 2009
Edward J. Barton (Mill Creek, WA)
The book covers the history of the evolution of our financial society from a post-industrialized economy to a financial one. Professor Davis reviews the history of several key drivers of the change - including the roles of government, banking, householders, deregulation, globalization and market efficiency.
I found the book to be reasonably interesting, if somewhat repetitive. Davis works hard to cover a lot of ground in 250 pages, ad unfortunately covers a few of the items and quotes over and over, while other ares, like housing, get a pretty quick gloss. I agree with some of the other reviewers in that he tries to create a unified theory of the markets in modern times, and probably has made a stretch in doing so.
Having said that, the book is approachable by almost anyone, and he does a nice job of explaining complex financial and market theories and products in a way that a lay person can comprehend (though a finance person will find over simplified).
The conclusion is somewhat Mathusian, and his view of the future is pretty bleak - though candidly hard to argue with given recent events. I'd take he time and read the book, if only to gain a comprehensive perspective and researched view of the current fnancial crisis.
How the New Finance is Reshaping the World June 22, 2009
Aaron Gutsell (Clementon, NJ)
It is immediately apparent in the preface to 'Managed by the Markets' that Gerald Davis has some startling things to say about the modern economy: "In a period of just over a month, a conservative presidential administration devoted to free markets and financial deregulation had engineered a level of direct government control over the nation's financial institutions undreamed of by V.I. Lenin a century before."
Davis moves forward in somewhat dry scholarly prose, but opens up as the book unfolds, and really gets into the red meat of his subject with some great chapters like "From Institution to Nexus: How the Corporation Got, Then Lost, its Soul" and "From Sovereign to Vendor-State: How Delaware and Liberia became the McDonald's and Nike of Corporate Law."
Mr. Davis lays out a basic history of corporate phases in America, the vertical integration of companies like Ford that once owned mines and rubber plantations, the welfare model of the early twentieth century where companies provided retirement and health benefits and the breakups of these models in the '80s and '90s when companies began to focus exclusively on shareholder value, offshoring, and the esteem Wall St. currently holds for companies that can produce the most profit with the least assets. Davis ties these changes in the nature of corporations to the central theme of his book, the financialization of America and its pervasive societal effects. The last two decades have essentially been a revolution in economics, and the tech and housing bubbles are disasters comparable to the emergence of any new technology such as boiler explosions in the early age of steam or plane crashes with the advent of aviation. To a non-financial reader 'Managed by the Markets' is an eye-opener, basically anything that has a projected future revenue stream has been commoditized, so that toll roads in Michigan are owned by pension funds in Norway, policies are taken out against the terminally ill and packaged off in bonds, and the projected future earnings of say David Bowie or a Hollywood studio may too be an investment opportunity for traders.
Mr. Davis has written an extremely far-reaching work that spans the globe and contrasts the peculiar experiment of corporate America against other successful nations like Germany that has only 650 publicly listed companies. Since the 1980s the number of stock exchanges around the world has doubled, and the inventiveness and arcania of finance have effectively decentralized Wall Steet so that it is now an intimate part of every household, and hence brought us all down with it. Gerald Davis is clearly skeptical and extremely knowledgable as he outlines the current crisis and its historical underpinnings and makes it obvious that the real changes are yet to come.
Is this the way for us to live? June 21, 2009
Naor Wallach (Pittsburgh, PA USA)
In Managed by the Markets, Gerald Davis makes the argument that society is in the midst of a migration from the industrial to a post-industrial society, and that in the United States; the direction we've gone is to allow Finance to take the central role in this evolving society. Unfortunately, finance is a little-regulated area and because of the rise of inherent conflicts of interest and people being incentivized to enrich themselves without regards to the impacts of their actions on others, the U.S. has found that a financial crisis has led to a real reduction in the standard of living and employability - a severe recession!
The book covers 255 pages and in its 7 chapters the author develops the argument in a historic time line fashion. The first few chapters cover the rise of finance in the context of the industrial revolution and the time of the big corporations. Describing the decades in which the large organization ran the U.S. economy and the "organization man" was an upwardly mobile but conformist person. Even though the impression of these times was of stifled creativity and conformity, the author claims that these organizations took on various aspects of the social welfare state that in other countries around the world has remained the work of the sovereign governments.
This began unraveling in the 1980's as the role of the corporation changed from a paternalistic entity to an entity that is solely focused on creating shareholder value. The book chronicles the changes that took place and points out in particular the wave of corporate restructuring that tore apart the many conglomerates that existed in the 1970's as the seminal events along the road. With the IRS allowing companies to ditch traditional pension plans in favor of the 401K plan, another step was taken in the road where there is no more loyalty between company and employee and everyone is nothing more than a free agent who is out to maximize his or her return without regard to anyone else.
This trend has gone on to other areas, according to the author, with even governments being bludgeoned into the shareholder value trend and subcontracting out every single function that they can. The author even makes the claim that there is current discussion and debate over what functions remain at the core of government at all? The question that he raises is whether states will remain in place with any kind of sovereign power, or will the trend continue and whether disintermediation takes down governments and their roles.
Another trend that is discussed is the ability of finance to create more and more complex instruments that revolve around the ability of someone to generate a set of cash flows. The author cites examples as benign as securitizing a mortgage by bundling thousands of mortgages into a Mortgage Backed Security (MBS) and selling it as a series of bonds, to such bizarre situations as David Bowie selling bonds backed by his future earning potential from concerts; to the morbid practice of the terminally ill selling bonds based on the proceeds that someone will be able to collect when they die.
The current financial crisis erupted because all of these trends converged and the financial centers were not sufficiently disciplined to take on a longer view of what is happening, but focused on an ongoing race to enrich themselves, and the U.S. government stood aside and let it all happen - both from an ideological bent which proved to be too optimistic - and from the consequences of the brain drain that took place as the best and brightest of U.S. society moved into finance to chase their high compensation.
There is no conclusion to this trend, nor does the author offer any prescriptions for resolving the problems in this book. That is one of the two reasons why I deducted one point from its rating. The other reason is that the author is fond of several examples which he repeats ad nauseum - surely there is no need to read four or five times about the fishing village in Norway that was hurt by the mortgage crisis in the U.S.? One time would have been sufficient. Even given these negatives, that was an interesting overview of a possible process that lead us to the situation we are in today.
" 'It's easy to build a car. It's harder to build a brand.' " June 19, 2009
K. M. (California)
1 out of 1 found this review helpful
The above quote came from Ford Motor's chairman and declares that the work of physically building an automobile can be left to anyone, and Ford management ought to concentrate on advertising and sales concepts. Add to that Sara Lee's CEO's statement that Wall Street has " ' decided to give premiums to companies that harbor the most profits for the least assets.' " These comments point to misguided corporate trends that, in part, have precipitated the recent and ongoing financial meltdowns. Business elites have shifted focus from building solid organizations with production of products in mind to captaining nexus corporations that deal in information, contracts, and affiliations. Likewise, financial institutions such as banks, brokerages, realtors, and insurance companies have, mainly through deregulation, lost their separate identities and functions to become shell clearing houses for complicated financial instruments, such as Collateralized Debt Obligations (CDOs). Instead of firms sticking to their own original areas of expertise, they have uprooted themselves in the "post-industrial" economy. And, of course, large segments of the public have been swept along as less-than-fully-informed investors in the real estate and stock market booms that have now gone bust.
In Managed by the Markets: How Finance Re-Shaped America, Gerald F. Davis systematically chronicles how we Americans arrived at our current predicament. In his words, "My aim in writing this book was to sketch a map of how finance and post-industrialization have reshaped contemporary American society." In comprehensive chapters on financial markets, corporate evolution, the effects of disintermediation on banking, how governments are becoming "vendor-states," and how citizens have morphed into investors, he traces these various threads with scholarly method. Chapter Three, "From Institution to Nexus: how the Corporation Got, Then Lost, Its Soul" stands out as particularly informative and absorbing, but the discussions on "From Banks to Markets" and "From Sovereign to Vendor-State" rank nearly as highly on the "valuable" scale.
If there is a downside to MANAGED BY THE MARKETS, it is that Davis's scope limits his ability to address the full complement of causes of our present situation. The Federal Reserve's decisions, ballooning government spending, and ever-widening social contracts with concomitant future liabilities all contribute. Davis, however, mainly (though not exclusively) analyzes the "private" side of things, and this constrains him in the search for how to disengage from and correct the faults. He says simply, "In short, government is needed to help create a new set of institutions to address the void created by the end of corporate feudalism and the rise of financialization. but after the past decade of government outsourcing, it is perhaps less equipped than ever to accomplish this." But Davis is not unreasonable to limit his range of subject matter.
Overall, MANAGED BY THE MARKETS provides a detailed historical survey that does indeed prove the accuracy of the title: the markets have become the preponderant force in America and much of the world. Instead of being seen as civic or simply human entities, we're "consumers" and "investors." We're also just cogs in the wheels of multinationals, financial institutions, and governments, all of which seek more control, globalization, and standardization and which are not, organizationally, interested in redressing these basic problems: lack localism, of accountability and comprehensibility, and of human worth values.
 Most important book written today on our financial situation June 19, 2009
Russ Emrick (Monument, CO)
2 out of 3 found this review helpful
"Managed by the Markets: How Finance Re-Shaped America" is such a good book, such an important read, that I'm challenged to even review it. Economics bores me to tears and was glad to leave it behind in College. However Mr. Davis makes the subject very interesting and lively - changing a very dry and academic subject into, well almost, a page burner.
I have been completely stumped how the world wide financial system collapsed so quickly and so thoroughly. Using detailed academic research and published papers Mr. Davis unravels our current disaster in a methodical and understandable way. This book is a must read for every business person, every voter, every person who uses money - okay everyone. I cannot praise this book enough.
Moreover, Mr. Davis illuminates the societal changes in our thinking and acting which not only got us to this point but foretells the future. What does it mean to go from a post-industrial society to a service economy? What are the implications for our future and our children living in a information age characterized and framed within the terms of finance?
Einstein said that you cannot solve a problem with the same level of thinking that created it. Unfortunately that is exactly what we are doing. Mr. Davis elevates our thinking so that we understand the problem and the fundamentals that created it, as well as the "the Copernican revolution" that has radically shifted society, human values, and human infrastructures.
"Managed by the Markets: How Finance Re-Shaped America" isn't another droll academic polemic, it isn't a political diatribe favoring the right or the left, nor is it some PhD theorizing on some economic nirvana. Mr. Davis has meticulous researched and documented the subject, with numerous references and abundant empirical data. Mr. Davis' gift is to take economic information and published reports which are virtually impenetrable reads and make sense of them while communicating them in a interesting and educational way.
5 stars - I'd give this book 10 and say that if you only read a few books a year, please, please add this to your list. It will clarify current events, educate you on economics, make you a better citizen and voter, even fortify your investments and future security. Thank you Mr. Davis for this gift - an oasis of truth in a desert of disinformation and dishonesty.
Showing reviews 16-20 of 38
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