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financial crisis
Don't Mourn Alan Greenspan
He never mourned for you.
Jun 24, 2026
Alan Greenspan, who served as chair of the Federal Reserve from to 1987 to 2006 and who died on Monday, was a monster. He was the Henry Kissinger of economic policy. Like Kissinger, he was mistakenly considered a genius. Reporters, businesses, and many members of Congress hung on his words—more accurately, his jargon-filled word salad, which obscured more than it explained—to understand what was going on in the economy. Despite the fact that his policies, like Kissinger's, were a blatant failure, he was, also like Kissinger (who also died at 100), still taken seriously by the media after he left government service, and made a ton of money as a consultant. Both men caused enormous harm and suffering for which they were never held accountable.
The New York Times obituary has a few paragraphs about writer and pseudo-philosopher Ayn Rand's influence on Greenspan, but doesn't do justice to the fact that Rand's inner circle wasn't just a discussion group. It was a cult. Greenspan absorbed her belief that selfishness was the highest principle. It was that view that guided his economic thinking, including when he was Fed chair, and before that, chief economic advisor to President Gerald Ford.
The core of Rand's influence was Greenspan's belief that government should play no role in regulating business. He believed that corporations could police themselves without any government rules. He reflected Rand's belief that corporations' self-interest and greed, and those of major shareholders, would lead them to behave responsibly.
Greenspan was appointed Fed chair by Ronald Reagan in 1987 and reappointed by George H.W. Bush, Bill Clinton, and George W. Bush. He was also part of the corporate ruling class, serving on the boards of several Fortune 500 corporations, including Mobil Oil, J.P. Morgan, the Aluminum Corp. of America (Alcoa), Morgan Guarantee Trust Co., Automatic Data Processing Inc., Capital Cities/ABC, Pittston Company, and General Foods.
Greenspan's influence, along with the intense lobbying by the banking industry, provided the justification for the dismantling of dismantling of decades of government bank regulations, providing lenders with the leeway to engage in an orgy of mergers, speculation, and risky and racist lending practices that ultimately led to the collapse of major Wall Street firms.
The banking industry's greed—its insatiable appetite for profits and wealth—led to the 2007 mortgage meltdown, the implosion of the housing market, the near-collapse of the financial industry, and the breakdown of the whole economy, including widespread layoffs and foreclosures, from which we have still not fully recovered. But it was made possible by the see-no-evil views of Greenspan and his ilk.
In the late 1990s, during Greenspan's watch at the Federal Reserve, banks and private mortgage lenders began pushing subprime mortgages, many with “adjustable” rates that jumped sharply after a few years. These risky loans comprised 8.6 percent of all mortgages in 2001, soaring to 20.1 percent by 2006. That year alone, 10 lenders accounted for 56 percent of all subprime loans, totaling $362 billion. These loans were a ticking time bomb, waiting to explode.
Starting in 2007, housing prices fell by third. Americans lost $7 trillion in wealth. Over 5 million Americans lost their homes. The drop in housing values affected not only families facing foreclosure but also families in the surrounding communities because having a few foreclosed homes in a neighborhood brings down the value of other houses in the area. The neighborhood blight created by the housing collapse was much worse in African-American and Hispanic areas because they were the primary victims of subprime loans and almost twice as likely as whites to lose their homes to foreclosures.
Brooksley Born, chairwoman of the Commodity Futures Trading Commission from 1996 to 1999, wanted her agency to regulate derivatives and other exotic financial investments (including credit default swaps) that she accurately predicted were too risky and would lead to disaster. But Greenspan, along with President Clinton’s Treasury Secretary Robert Rubin and economic advisor Larry Summers, stopped her from exercising the kind of regulatory authority that would have prevented the calamity. In 2000, Edward Gramlich, a Federal Reserve Board member, repeatedly warned Greenspan about subprime mortgages and predatory lending, which he said jeopardized the twin American dreams of owning a home and building wealth. He tried to get Greenspan to crack down on irrational subprime lending by increasing oversight, but his warnings fell on deaf ears.
Greenspan was the leading culprit of the policies that led to the economic collapse. He allowed the banks' short-sighted gluttony to cause enormous human suffering.
It wasn’t until the system imploded that Greenspan gained any insight about the fundamental flaw of his belief that greed is the best operating principle for the economy. In 2008, testifying before the House Committee on Oversight and Government Reform, Greenspan admitted: “Those of us who have looked to the self-interest of lending institutions to protect shareholders’ equity, myself included, are in a state of shocked disbelief…. This modern [free market] paradigm held sway for decades. The whole intellectual edifice, however, collapsed in the summer of last year.”
Of course, there was plenty of evidence throughout history that big corporations do NOT behave responsibly unless they are required to do so by government regulations and enforcement. This has been especially true of banks. But because Greenspan was such a libertarian ideologue, in thrall to Rand and others, he could not, or refused to, see what was right in front of him. For the millions of Americans who lost their homes, their jobs, and their small businesses through no fault of their own. Greenspan's self-awareness came much too late.
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Canada Is Quietly Putting War Into Your Portfolio
By hosting the proposed Defence, Security, and Resilience Bank, Canada risks transforming war from a political decision subject to public scrutiny into a financial product.
May 07, 2026
Canada is set to host the headquarters of the proposed Defence, Security, and Resilience Bank, or DSRB, a new multinational institution designed to mobilize tens of billions in financing for military and security projects among allied nations. In short, what we are seeing is the quiet normalization of something far more consequential: the permanent financialization of war.
The structure being envisioned for DSRB closely resembles other multilateral financial institutions. It would raise capital on global markets, issue bonds, and extend loans to governments and defense companies. That means funding for military supply chains, weapons systems, and defense infrastructure would increasingly flow through financial markets rather than direct public expenditure. In doing so, war itself risks being transformed from a political decision subject to public scrutiny into a financial product embedded in portfolios.
And so, with remarkable efficiency, we may be arriving at a point where, whether you like it or not, you are investing in war. Not because you consciously chose to, but because modern finance rarely asks for permission. It integrates. It diffuses. It embeds. Just as complex mortgage-backed securities seeped into pension funds and retirement portfolios before the 2008 Financial Crisis, instruments tied to defense financing could quietly become part of the same financial plumbing that underpins everyday savings. Deposits in major banks, such as Royal Bank of Canada or Toronto-Dominion Bank, feed into broader lending and investment pools. If those banks help underwrite DSRB bonds or finance defense projects, then ordinary savings are, at least indirectly, part of the system. You won’t need to opt in. The system will do it for you.
Once you are in that system, try opting out. Go ahead—divest. In theory, it sounds simple. In practice, it is anything but. Large pension funds, such as the Canada Pension Plan Investment Board or the Ontario Teachers’ Pension Plan, operate within a web of financial relationships that makes complete divestment extraordinarily complex. If DSRB bonds are rated as safe investment-grade assets, they could easily find their way into fixed-income portfolios. Even if funds choose to avoid them directly, indirect exposure remains: through banks that underwrite the bonds, through ETFs that bundle defense assets, and through lending syndicates that finance defense contractors. “All the king’s horses and all the king’s men” of global finance, institutions like JPMorgan Chase and Deutsche Bank, are already lining up behind this model. When the entire financial stack aligns like this, divestment becomes less a matter of choice and more a question of how far you are willing, or even able, to disentangle yourself from the system.
The DSRB starts to look like a "World Bank for Warfare."
What emerges is not just a new bank, but a new layer of abstraction between citizens and the consequences of war. Traditionally, military spending is debated, however imperfectly, through parliaments and public scrutiny. A financialized model shifts that process into capital markets, where decisions are driven less by voters and more by risk assessments, yield expectations, and institutional incentives. Over time, this risks normalizing war as an investable asset class, something to be priced, traded, and held in portfolios rather than questioned in public forums.
That transformation carries consequences. One of the most immediate concerns is that such a bank could normalize or even facilitate controversial military interventions. If borrowing costs for defense spending are lowered, the financial barriers to launching military operations also fall. History offers a sobering precedent. The Iraq War was widely condemned after the central justification, claims of weapons of mass destruction, collapsed under scrutiny. Yet the war had already been financed, executed, and justified through institutional momentum. A system like DSRB could make such momentum easier to sustain, not harder. When capital is readily available, restraint becomes less likely.
Over time, this could make war financing a permanent feature of the global system. What used to be occasional becomes routine, and what was once debated becomes taken for granted. In that sense, the DSRB starts to look like a "World Bank for Warfare."
Equally concerning is the question of democratic oversight. Traditional military spending must pass through national parliaments, where budgets are debated by elected representatives. A multilateral financial institution operates differently. By raising funds on global capital markets and deploying them through loans and financial instruments, DSRB could create a layer of decision-making that sits at arm’s length from voters. The result is a subtle but significant shift from public accountability to financial abstraction. Decisions about long-term military financing could become less visible, less contested, and ultimately less democratic.
What makes this shift particularly jarring is where it is happening. Canada has long cultivated an image of a country that prioritizes diplomacy, multilateralism, and peacekeeping. Yet by stepping forward to host the DSRB, it is positioning itself not just as a participant in global security, but as a financial hub for its expansion. The very country that has emphasized de-escalation is now spearheading an ecosystem designed to sustain long-term militarization.
In a world where defense financing is deeply embedded in financial markets, peace does not simply reduce risk; it disrupts revenue.
The implications extend beyond symbolism. By helping institutionalize a system capable of mobilizing upwards of $100-135 billion in defense financing, Canada is effectively tying part of its economic future to the expansion of military spending. That alignment carries risks. When financial systems are built around a particular sector, they begin to depend on its growth. We have seen this dynamic before, most notably in the housing market prior to the 2008 Financial Crisis, when an entire economic ecosystem became reliant on ever-expanding real estate values.
Apply that same logic to the realm of defense, and the parallels become difficult to ignore. A system that depends on continuous military spending creates subtle but powerful incentives: to maintain high levels of defense budgets, to expand procurement programs, and to sustain the geopolitical tensions that justify both. Over time, what begins as risk management can evolve into dependence. A system built to finance war risks becoming a system that depends on it.
Then comes the uncomfortable question: What happens if the wars actually stop?
In a world where defense financing is deeply embedded in financial markets, peace does not simply reduce risk; it disrupts revenue. If the assumptions underpinning defense-linked investments are built on sustained spending and ongoing tension, then de-escalation could trigger a recalibration across portfolios, institutions, and markets. The consequences would not remain confined to defense companies or financiers. They would ripple outward to pension funds, public investment vehicles, and the everyday savings of millions who never consciously chose to participate in this system.
This is where the analogy to the 2008 Financial Crisis becomes more than rhetorical. Before that collapse, housing was treated as a permanently expanding asset class. Financial innovation spread exposure across the system, embedding risk in places few fully understood. When the underlying assumptions failed, the fallout was systemic. Homes were lost. Savings evaporated. Institutions faltered.
Now imagine a similar architecture built around militarization. A world in which conflict is not just a geopolitical reality, but a financial dependency. Where instability is quietly priced into the system as a driver of returns. And where, if that instability recedes, the economic consequences are felt far beyond the battlefield.
At that point, the challenge will not just be moral or political, it will be structural. Governments may find themselves trying to stabilize a system that has grown dependent on the very thing it claims to minimize: war. And there may come a moment when the system simply breaks, and it becomes impossible to put Humpty Dumpty back together again.
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Trump Agency ‘Setting Stage for Another Financial Crisis’ With Attack on Prediction Market Regulations
"By moving to crush state safeguards for prediction markets in court, the CFTC is giving gambling companies a green light to prey on all Americans," said one critic.
Feb 17, 2026
A key federal regulatory commission has announced that it will be fighting against individual states' powers to regulate prediction markets.
Mike Selig, chairman of the US Commodity Futures Trading Commission (CFTC), wrote in an editorial published by the Wall Street Journal on Tuesday that his agency has exclusive powers to regulate prediction markets, and that it would be backing an appeal by Crypto.com aimed at overturning state regulations.
Selig, who was appointed to his post by President Donald Trump last year, said this action was necessary because the prediction markets "face an onslaught of state-driven litigation," with many states claiming that these markets are subject to their laws regulating gambling.
"The CFTC will no longer sit idly by," Selig declared, "while overzealous state governments undermine the agency’s exclusive jurisdiction over these markets by seeking to establish statewide prohibitions on these exciting products."
The CTFC commissioner also disputed that prediction markets constituted gambling, saying instead that they are derivative instruments of the kind that the CFTC was given sole jurisdiction to regulate under the 1936 Commodity Exchange Act.
"These exchanges aren’t the Wild West, as some critics claim, but self-regulatory organizations that are examined and supervised by experienced CFTC staff," Selig concluded. "America is home to the most liquid and vibrant financial markets in the world because our regulators take seriously their obligation to police fraud and institute appropriate investor safeguards."
Selig's announcement was greeted with skepticism by Emily Peterson-Cassin, policy director for the Demand Progress Education Fund, who warned the CFTC was making the same mistakes made by regulators that led to the 2008 global financial crisis.
"The 2008 financial crisis happened because we let bankers gamble on housing," said Peterson-Cassin. "Now the CFTC is trying to let gamblers gamble on every aspect of life. By moving to crush state safeguards for prediction markets in court, the CFTC is giving gambling companies a green light to prey on all Americans and is setting the stage for another financial crisis."
The CFTC announcement was also criticized by Republican Utah Gov. Spencer Cox, who said that state regulations for online betting markets are fundamentally different from the kinds of futures markets traditionally regulated by the commission.
"I don’t remember the CFTC having authority over the 'derivative market' of LeBron James rebounds," he wrote in a social media post. "These prediction markets you are breathlessly defending are gambling—pure and simple. They are destroying the lives of families and countless Americans, especially young men. They have no place in Utah."
Cox further vowed to "use every resource within my disposal as governor of the sovereign state of Utah, and under the Constitution of the United States to beat you in court."
Former Republican New Jersey Gov. Chris Christie also criticized Selig for trying to interfere in the rights of states to regulate betting markets, arguing that "sports betting is not a derivative, it’s gambling."
Ron Filipkowski, editor-in-chief of MeidasNews, raised suspicions about the effort to undo state regulations on betting apps and pointed to Donald Trump Jr.'s connections to popular prediction markets Polymarket and Kalshi.
As reported by the New York Times last month, Trump Jr. "is both an investor in and an unpaid adviser to Polymarket, and a paid adviser to Kalshi," as well as "a director of the Trump family’s social media company, which recently announced it would start its own platform called Truth Predict."
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