ABSTRACT
The U.S. role in producing the global financial crisis demands explanation, and yet cannot be fully discussed in one short chapter. Our focus here is on the trends and developments in the financial services sector, both because that sector was central to the dynamics that led to the crisis, and because developments in that sector clearly show the regulatory and economic theories that underpinned the U.S. version of economic liberalism. Examining regulatory developments in the financial sector also serves to bring into focus one of the dominant trends in the U.S. economy over the past three decades, that of ‘financialization’, in which an ever-greater proportion of financial market activity has come to occur within finance itself, rather than in service to the ‘real’ economy, and in which even industrial companies earn significant, and increasing, shares of their profits from financial transactions, not from the sale of goods or services (Krippner 2005; Mitchell 2011).
