You might enjoy Bryan, Dick and Michael Rafferty. 2006. Capitalism with Derivatives: A Political Economy of Financial Derivatives, Capital and Class (NY: Palgrave Macmillan).
You can find historical precedents in ancient times: People ridiculed Thales of Miletus for his poverty. To show that he was voluntarily poor, he forecast a bumper crop of olives. He offered to pay all the owners of olive presses for the right to rent their presses in advance. When the harvest came in, he was able to charge what he pleased for the presses. The ridicule ended. [The story comes from Aristotle. Politics. Book 1] What is new, besides the scale of derivatives, is the proliferation of different forms. Partnoy, Frank. 2003. Infectious Greed: How Deceit and Risk Corrupted the Financial Markets (NY: Times Books) says that one structured note was even linked to the number of victories by the Utah Jazz. see Eatwell, John and Lance Taylor. 2000. Global Finance at Risk: The Case for International Regulation (NY: New Press): p. 101. On Mon, Dec 25, 2006 at 11:59:51AM -0500, Jayson Funke wrote: > I have read several accounts about how there was tremendous innovation > in financial instruments (derivatives like swaps, futures, options etc) > coinciding with the collapse of Bretton Woods and the move to flexible > exchange rates in the 1970s and the process of securitization beginning > in the 1980s. Yet it seems to me that almost none of these financial > instruments (at least those listed above) are actually new innovations. > In some cases they have existed and have been used for centuries. What > does seem different after the collapse of Bretton Woods was how they > were being used and the increase in their use. While there certainly > were many new forms or manifestations of these existing derivatives and > other financial instruments as a result of securitization, they do not > appear qualitatively different. > > What, if any, financial instruments developed since the 1970s are > actually new? > > Thanks > > Jayson Funke > > Graduate School of Geography > Clark University > 950 Main Street > Worcester, MA 01610 > -- Michael Perelman Economics Department California State University Chico, CA 95929 Tel. 530-898-5321 E-Mail michael at ecst.csuchico.edu michaelperelman.wordpress.com
