Why the Bubble Popped

This clutch of books offers an excellent retrospective on the recent stock-market crash, which wiped out $8.5 trillion in market value. The value of individual retirement accounts dropped by one-third, and in just twelve months, 2 million Americans lost their jobs.

But the lessons from the crash will probably soon be shrugged off. Memory will be softened by a market that is beginning to recover at an impressive pace. The NASDAQ index, a swamp where tech alligators lurk, is double its value of eighteen months ago. That's a pity. Politicians never work up the nerve to really reform Wall Street until, as after the 1929 collapse, half the population in some cities is unemployed and ex-millionaires start jumping out of windows.

Many of the exploiters and attitudes and wobbly rules that launched the crash are still with us. A sign of the unchanging times could be found in the February 25 Wall Street Journal, which reported that Goldman Sachs is once again suspected of violating securities rules, this time by charging excessive bond-trading price markups. The accompanying report also sounds normal: Goldman's chief executive took home $21 million last year, a 75 percent increase over 2002.

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