Introduction

The financial meltdown of 2007 to 2009was surely a great spectacle. Mightynames toppled like that statue of SaddamHussein. Lehman Brothers, with a historyspanning a century-and-a-half, just disappeared.Bear Stearns and even MerrillLynch–the same Merrill Lynch that hadtaught generations of small investors tobe “bullish on America”–were sold offat discounts suitable for used furniture.AIG was rescued in the nick of time, butonly with $182 billion of U.S. governmentassistance. Trillions of dollars of investors’wealth simply evaporated. Onecould think, “Oh, well, easy come, easygo.” But still, trillions of dollars? It was aspectacle all right, but why did it reallymatter to the rest of us, who count ourselvesmerely as citizens of the republic