Other People’s Houses provides the clearest explanation yet of how the Financial Crisis of 2008 developed and why it could happen again.

"A must-read for anyone seeking to understand the causes of the last financial crisis and why we may very well be heading towards another."

Neil Barofsky
Former Special Inspector General for the Troubled Asset Relief Program and author of Bailout: An Inside Account of How Washington Abandoned Main Street While Rescuing Wall Street

"By unearthing the personal stories of homeowners, bankers, and regulators, Jennifer Taub shows that our recent financial crisis was no accident"

James Kwak
University of Connecticut School of Law, co-founder of the Baseline Scenario blog, and coauthor of 13 Bankers: The Wall Street Takeover and the Next Financial Meltdown and White House Burning: Our National Debt and Why it Matters to You.

"This is first-rate financial history."

Marty Fridson
CEO, FridsonVision LLC

"Taub exposes three decades of predatory lenders, greedy investors, and lax regulators, with a much-needed focus on the dire consequences of preventing bankruptcy judges from restructuring mortgage debt."

Julia Gordon
Dir. of Housing Policy, Center for American Progress

"A page-turner that reads like a Michael Lewis financial thriller, this bracing account of the roots of financial crises debunks stubborn myths with insight that would make Louis Brandeis proud."

Lawrence A. Cunningham
George Washington University, editor of The Essays of Warren Buffett: Lessons for Corporate America

"Taub argues persuasively how the seeds for the 2008 financial crisis were sown back in the 1980s as deregulation paved the way for the S&L debacle. But that was only an appetiser for even greater calamity later."

Mark Tran
The Guardian

"Meticulously argued and guaranteed to raise the blood pressure of the average American taxpayer."

Kirkus Reviews

"Over the years I’ve read a tall stack of books about the financial crisis. Other People’s Houses, by Vermont Law School professor Jennifer Taub, provides the clearest, beginning-to-end explanation I’ve seen of what went wrong."

Pat Regnier
Money Magazine

"Provides a concise, clear, and compelling account."

Glenn C. Altschuler
Huffington Post

"Taub's cogently written, accusatory work will interest a wide readership."

Library Journal

"Highly recommended. . .Taub does an excellent job retelling and reframing a reasonably well-known story to make it fresh and interesting, and makes a strong case tying the 2008 crisis to the 1980s deregulation."

Adam Levitin
Professor of Law, Georgetown University Law Center

"Brilliant account of the housing crisis and its lingering impact."

Frank A. Pasquale III
Professor of Law, University of Maryland, Francis King Carey School of Law

"A compelling narrative that keeps the reader's attention from cover to cover . . .It is a must read for anyone interested in understanding and reforming our broken financial system."

Timothy Canova
Professor of Law and Public Finance, Nova Southeastern University, Shepard Broad Law Center

Jennifer Taub is the author of financial crisis book Other People’s Houses. Formerly an associate general counsel at Fidelity Investments, Taub’s research and writing focuses on corporate governance and financial market regulation. Taub is a graduate of Harvard Law School and Yale College and a professor of law at Vermont Law School, where she teaches Contracts, Corporations, Securities Regulation, and White Collar Crime. She resides in Northampton, Massachusetts.

safe banking

a blog on banking, corporate governance, and financial market reform.

February 13, 2017

New Hopes and Hazards for Social Investment Crowfunding

Happy to be included in Law and Policy for a New Economy: Sustainable, Just, and Democratic, edited by Melissa K. Scanlan, forthcoming in 2017.

What follows is an excerpt from my chapter on “New Hopes and Hazards for Social Investment Crowdfunding.”

In his chapter on the “Joyful Economy,” (Chapter 2), Gus Speth contends that building a new economy requires a redefinition of the corporation and its goals. He advocates for shifting it from an enterprise designed primarily to provide profits for shareholders to one concerned about a broader set of values and stakeholders. To develop what he deems a joyful economy, he suggests that people, place and planet must be prioritized. Perhaps those who bring leadership to businesses that focus on social and environmental concerns–––social entrepreneurs–––can answer the call by reorienting the corporations that they create. Such localized efforts to transform individual firms could inspire widespread change.

The timing is good for such a transition, as social entrepreneurs have promising new options available for widely soliciting like-minded investors and organizing their business enterprises to include social goals. Yet, due to distrust of the existing system, some may not explore these opportunities. Not attuned to mainstream matters, they may be unaware of the recent legal changes that make it easier for them to engage within the existing financial and corporate governance systems to fund their enterprises and to organize them with a social or environmental mission in mind.


These recent legal developments are significant. Now in the US, those seeking to fund an enterprise using securities offerings can forgo a complex, time-consuming full federal registration process with the Securities and Exchange Commission (SEC) while still reaching out to solicit a wide group of potential investors. This general solicitation can take place in a variety of media include advertising online through crowdfunding portals and other platforms. The ability to bypass the full SEC registration process is the result of recent legal reforms that streamline how businesses can raise money through the offering and sale of securities. These legal reforms impact social entrepreneurs because the law covers the methods they might use to attract funding. Unlike a donation made through a site like Kickstarter or Go Fund Me, which is not subject to the securities laws, investments made with an expectation of profit typically are subject to securities regulation at the federal or state levels (or both). This is because as a matter of law, securities include investments of money in a common enterprise with the expectation of profit as well as more common financial instruments like stocks and bonds.


Taken together, these federal and state legal and regulatory updates make it easier for startups, including socially or environmentally-focused enterprises to raise capital and for members of the general public to channel their savings into such investments. These changes can provide space for those social entrepreneurs who believe they do not fit within the current system.


]With these hopeful legal developments, however, come hazards. The usual concerns around fraud and mismanagement endure. Moreover, less sophisticated members of the public may not have the skills to assess the investment opportunities. And, they may not fully understand that the majority of startups fail and may invest more in individual startups or even in a diversified portfolio than they can stand to lose. Streamlining the offering process and eliminating traditional federal registration and disclosure requirements may result in investors not obtaining information essential to their investment decisions. These streamlined offering processes may also attract the unscrupulous and reckless issuers seeking a quick buck without sufficient skill or realistic business plans. Indeed, in some cases, given the combination of the perceived virtue of or affinity with a local and mission-driven enterprises and unsophisticated investors, fraud could be even more prevalent.


Professor Jennifer Taub moderating an all-star panel following Senator Elizabeth Warren’s keynote address at the “Five Years On, Learning Lehman’s Lessons from the Panic of 2008,” event sponsored by Better Markets and George Washington School of Law. Panelists include (from l to r) Professor James Galbraith; former Special Inspector General of the TARP, Neil Barofsky; Professor John Coffee, Jr.; and former Senator Ted Kaufman.