No Way Out: Persistent Government Interventions in the Great Contraction culminates more than a year of conversations with academics, policymakers, and financial market leaders to illuminate previously unexamined elements of the 2007–08 financial crisis. In the book, players in financial markets explore the mismatched market incentives and government policies that precipitated the crisis.

Among these analyses: former Federal Reserve governor and Columbia Business School Professor Frederic Mishkin provides a vision for an improved postcrisis Fed, and Ethan Ilzetzki of the London School of Economics and his coauthors assess the often-underwhelming impact of fiscal stimuli. As a whole, the volume provides a narrative of the financial crisis, its causes, and likely recurrences.

Editor Vincent R. Reinhart brings together an array of professional and academic authors to generate this narrative. The story demonstrates that government can do better, but only if it follows historical evidence, not popular opinion, to respond to financial crises.

CONTENTS

1.    Introduction by Vincent R. Reinhart

Part I: Markets React
2. An Alliance of Convenience by Christopher Whalen
3. Paradigm Lost: A Discussion of “No Way Out” by Angel Ubide
4. Contagion, Culture, and Shadow Banks: Why Some Countries Had Crises and Others Did Not by Greg Ip

Part II: Financial Experts Respond
5. The Federal Reserve after the Crisis by Frederic S. Mishkin
6. Determinants of the Size of Fiscal Multipliers in Open Economies by Ethan Ilzetzki, Enrique G. Mendoza, and Carlos A. Végh
7. Exit Strategies and the Federal Reserve by Ricardo Reis
8. Exits from Recessions: The US Experience, 1920−2007 by Michael D. Bordo and John Landon-Lane
9. Global Imbalances: The Crisis That Did Not Occur . . . Yet by Francis E. Warnock

Vincent R. Reinhart is a managing director and chief US economist at Morgan Stanley, responsible for the firm’s analysis of the US economy. He is also a former resident scholar at AEI.