JCI383015

JCI

Speculating on
Everyday Life:The
Cultural Economy
of the Quotidian

Journal of Communication Inquiry

34(4) 366381
The Author(s) 2010
Reprints and permission: http://www.
sagepub.com/journalsPermissions.nav
DOI: 10.1177/0196859910383015
http://jci.sagepub.com

Fiona Allon1

Abstract
The economic crisis has generally been understood in terms of financial excess, speculation and fraud. This article suggests that there is a need to decenter this focus on financialization and instead reflect on the crisis as a cultural as much as an economic event. It
addresses the normalisation of practices of calculation and investment within everyday
life, especially in the figure of the citizen-speculator who is now required to view housing as a site of accumulation and object of speculation, not only for debt-fuelled consumption in the present but also as a source of asset-based welfare in the future.
Keywords
financial crisis, speculation, home ownership, cultural studies, cultural economy
It is now possible to use just about anything as a platform for more speculative financial
activityup to and including the kitchen sink.
(Leyshon & Thrift, 2007)

By far the most frequently given explanations for the global financial crisis involve
stories of individual moral failure: Excessive greed, feckless naivet, reckless speculation,
predatory lending. As the crisis played out spectacularly and unpredictably, these weaknesses were ascribed in varying degrees to a versatile cast of characters: greedy investment
banks and Wall Street financiers; irresponsible traders and their financial weapons of mass
destruction; unscrupulous lenders and mortgage brokers; imprudent and delinquent borrowers; lax regulators; overpaid captains of industry, and even the deluded captain of the
American financial system and Federal Reserve himself, Alan Greenspan.
This story of moral decline has proved a convenient, commonsense diagnosis,
explaining the bubble mania, the irrational exuberance, and the loss of moderation as
1

The University of Sydney, New South Wales, Australia

Corresponding Author:
Fiona Allon, Senior Lecturer, ARC Future Fellow, Department of Gender and Cultural Studies, School of
Philosophical and Historical Inquiry, The University of Sydney, NSW, 2006, AUSTRALIA
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E-mail: fiona.allon@usyd.edu.au

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Allon

a narrative of inevitability, a failure of standards and restraint that was bound to lead
to a crash, to some major moment of reckoning. It has also been used to explain the
operations of financial networks: the elaborate house of cards built on new financial
instruments and debt products, entrenching a short-term opportunism at every level
and in every player; the casino-style capitalism that separated finance from the real
economy, eventually corrupting the banking and other related sectors. In effect, personal weakness, speculative excess, and moral corruption have been used to explain
nearly every dimension of the crisis, including the experience of the victims as much
as the perpetrators. In 2007 this narrative shaped U.S. Treasury Secretary Henry
Paulsons publicly stated suspicion that the homeowners losing their homes in the
foreclosure crisis may actually be property speculators and, therefore, not deserving
of financial assistance (see Andrews, 2007). It was a message he repeated a year later
in 2008, when relief measures had finally been announced for (some) homeowners:
none of these efforts are a silver bullet that will undo the excesses of the past years,
nor are they designed to bail out real estate speculators or those who committed fraud
during the mortgage process (Paulson, 2008).
Paulsons statement highlights the general terms in which the financial crisis has
been understood: excess, speculation, fraud. Concrete socioeconomic conditions are
translated into questions of individual pathology and private morality. The deviation at
the level of the personal is also assumed to mirror a much wider, systemic deviation in
which extreme capitalism has led to a distortion of a true and proper model of
capitalist relationships. The blame therefore falls on the untrammeled speculation, by
household borrowers as much as institutional lenders, which somehow severed a connection to sound economic fundamentals. Hence, the crisis as a concentration of moral
failings that apparently came from nowhere and which, conveniently, can only be condemned in retrospect.
Obviously this fails to account for the way in which risk and speculation, not to
mention excess, are baked into the system of capitalism itself and are actually the very
fundamentals upon which all capitalist activity is predicated. But this narrative also
fails to consider how everyday life is increasingly framed as a space of investment
yielding both financial and personal returns. This not only makes material consumption more and more aspirational, but also positions the individual as an investor in a
life project that requires the constant pursuit of opportunities and the negotiation of
risks in order to yield rewards. With the growing calls for individuals to secure their
own independence and autonomy not via the state but through financial markets, practices of investment, calculation, and speculation become associated less with financial
distortion than with normalization and domestication and their embrace by ordinary
individuals taken as a sign of personal initiative, self-management, and enterprise
rather than moral or budgetary imprudence.
There is a pressing need to decenter an explicit and singular focus on the financialization that is assumed to be at the heart of the Global Financial Crisis and to
instead reflect on the crisis as much more than just an economic event. To view the
crisis as the predictable outcome of an excess of exogenous financial forces and

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associated irrational behaviour, fails to acknowledge the cultural and political rationality that saw the constitution of the individual as a citizen-speculator required to
depend on the home as a site of accumulation and an object of leveraged investment,
not only for debt-fuelled consumption in the present but also as an asset base for
welfare in the future. (Allon, 2008; Langley, 2008). In all of the Anglo-American
countries affected by the crisis, for example, there was an intense governmental
promotion of homeownership and the aggressive marketing of housing investment
opportunities, including schemes for equity withdrawal and refinancing. With the
links between responsible citizenship, personal freedom, and individual economic
security repeatedly tied to the ownership of housing, and with housing wealth presented as the only guarantee of personal and economic security in the long-term,
homeowners have responded by responsibly embracing risk and acting entrepreneurially, leveraging the only resource availabletheir home. Homeowners were
encouraged to bet the whole house on precisely that, their houses. In other words, the
financial crisis had cultural conditions of possibility that were imbricated with economic factors in complex and often contradictory ways (Allon & Redden, in press).
Its the culture, stupid!
If a cultural and political rationality is seen as a set of epistemic commitments, a
set of claims to truth, then it is also possible to understand how the interpellation of
an investment subjectivity is rarely made explicit, and is presented across a range of
cultural and financial literacies as just living. This makes it all the more important
to develop analyses of the crisis that develop along other lines, so that rather than just
confirming financialization as a single, univocal logic, there is a multiplication of
perspectives on the ways in which economic, political, and cultural rationalities are
variable, heterogeneous, and yet, intertwined.

Containing the Crisis

To question the moralization that has been such a defining feature of the dominant
narrative of the crisis is not to deny that fraudulent and reprehensible practices took
place. Widespread predatory lending in housing markets has been clearly established
even if the details of its scope and extent are still coming to light. In the United States,
for example, the boom in subprime lending is now being recognized as reverse
redlining whereby groups who were denied access to credit under an older regime of
exclusion and marginalization were actively targeted with new and high-risk credit
products (Crump et al., 2008; Wyly et al., 2006; Wyly et al., 2008). Intriguingly, much
of the emphasis has shifted from these institutional practices of mortgage and credit
markets on to exceptional figures such as the predatory lender and irresponsible or
delinquent borrowers and to morally bankrupt activities such as fraud.
Its worth looking a little more closely at who exactly is being targeted as irrational
and fraudulent, or as deviating from the norm of regular household financial behavior.
Indebted homeowners all over the world are now more likely to be experiencing the
painful and precarious correction of the housing bust (plummeting property values,

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default, and foreclosure) than the pleasures (soaring house prices, rising asset values,
big capital gains) of the recent housing boomthe high that some thought would never
end. In the context of the U.S. foreclosure crisis, for instance, entire neighborhoods,
suburbs, even cities have been overwhelmed. In Australia, declining housing affordability and mortgage-related financial stress have become central social and political
issues. In the United Kingdom, the collapse of Northern Rock (the mortgage lender
that in 2005 won the International Financing Review Securitization Award) demonstrated not just the interdependence of housing, mortgage, and financial markets but
the increasing exposures to insecurity and risk that are now interconnected and spread
far and wide. Globalized connectivity is experienced as very material and tangible when
a family in the American Deep South defaults on their home loan and a family on the
other side of the world feels the pain too.
The role of home ownership as an investment vehicle in these countries illustrates
the deep embeddedness of financial risks in everyday life. This is not just in terms of
the fallout of the crisis but also in the way in which global financial and mortgage
markets are increasingly connected to the lives of ordinary households. A 2006 study
by the Consumer Federation of America showed that women were the most likely
recipients of subprime loans (even if they had similar or higher credit scores to men),
African American women in particular. The profile of the typical subprime borrower
seeking assistance from foreclosure counseling organizations has been described as
single, female, with two children, in her first house (Consumer Federation of America,
2006). These borrowers held the subprime mortgages that were converted into
mortgage-backed securities (MBS) and sold to global investors.
Among the ranks of the countless so-called irresponsible borrowers, what is especially striking about the subprime borrower is not the deviation of this figure but the
profound ordinariness of the experience she represents: highly indebted, underpaid,
with flexible (insecure) employment, and carrying an increased individualized responsibility for all kinds of riskan existence that is significant these days for being more
common than unique and increasingly the rule rather than the exception in two-earner
as much as female-headed households (Baldauf, 2010; Cooper & Mitropolous, 2009).
As Nancy Fraser (2009) has argued, it is a mistake to see the entrepreneurial spirit of
contemporary capitalism as solely represented by the masculinist romance of the free,
unencumbered, self-fashioning individual (p. 7). As she states, neoliberal capitalism
has as much to do with Walmart, maquiladoras and microcredit as Silicon Valley and
Google. And its indispensable workers are disproportionately women (p. 7).
To explain the crisis as the end result of a slide into irrationality or as a decline of
moral and ethical standards, in other words a failure of morality, not only avoids an
examination of the present on its own terms but implies that essentially the problem
can be isolated at the level of personal and individual pathologya few bad apples. As
Slavoj Zizek (2009) has commented, The compulsion (to expand) inscribed into the
system itself is translated into a matter of personal sin, a private psychological propensity (p. 37). The claim of irrationality and failure is also predicated not only on the
possibility of rationality and business as usual but also by preempting their return

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and reassertion. Likewise, ideas of speculative excess and financial distortion hinge
inescapably on images of a system running smoothly and seamlessly, characterized by
stability, regulation, and restraintan assumption that manifested in the very phrase
officially used to describe the imagined taming of the volatile business cycle at the end
of the 20th century: the Great Moderation.3 The repeated representations of the crisis
as a departure from a norm, and as an aberration or anomaly, simply serve to reinstate
what eventually was confirmed as a fiction of equilibrium. In this sense, the very term
crisis is in many respects a misnomer; volatility is actually the normal mode of operation for capitalism generally (see Sassen, 2009).
Being able to clearly identify and isolate the flaw or failure in the system, irrespective of whether that fault is human or technical, also leads to a belief that it can simply
be fixed or, most commonly, regulated away. The necessary corollary of the language
of failure and distortion is the normalizing language of repair and reform. In these
terms, the financial turbulence is seen as an event that can essentially be resolved
through all kinds of regulatory reforms: through policy initiatives that serve to secure
greater, more effective, regulation; through returning financial instability to banking
stability; disequilibrium to equilibrium; delinquent borrowers to responsible savers;
excess to restraint. This process works by simply reinscribing or reinstating a norm
(thrift, saving, scarcity, living within ones means, deferred gratification, the prime
borrower) rather than by examining how such norms came to be established, the inclusions and exclusions they uphold, and indeed how what is considered normal and
rational may have changed and be developing new meanings. It is simultaneously a
call for a return to normative socioeconomic relations across a number of interrelated
levels: the individual (budgeting skills and financial literacy), the household (twoparent nuclear families, ideally with responsible male breadwinners), and the economy (the primacy of banks and balance sheets). In his closing address at the G20 in
Pittsburgh in September 2009, for example, President Obama focused on the reckless
few whose short-term greed and irresponsibility had unbalanced the global
financial system and the strong set of reforms that would reclaim transparency and
accountability. 4As in all morality tales, there is a sequence of sin, sacrifice, and
redemption.
In all of these critical framings, the crisis is contained (Gamble, 2010) Rather
than multiplying the possible domains of interpretation and therefore potential sites
of intervention, containing the meanings has come to be a feature of how the crisis
has been understood more widely, evident not just in the models of explanation but
also the kinds of solutions that have been proposed. For example, if the dominant
explanation of the financial crisis has been framed as one of failure and weakness,
both moral and regulatory, the models that have generally been accepted for responding to the crisis have been derived from past experiences of speculation and economic turmoil. Inevitably the stories that are told about all kinds of disasters, both
natural and social, are crucial to the organisation of peoples responses, of making
sense of events and constructing meaning, both in the immediate aftermath and in
the long term.

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Writing about Hurricane Katrina, Stephen Muecke (2007) has observed that while
the stories of individual events are told in the detail, they are nonetheless already
broadly scripted by narrative forms of mythical strength (p. 260). It is precisely the
logic of explanation and containment within such narrative forms that provides their
mythical strength and power as ways of making sense. As Roland Barthes (1973)
demonstrated, myth depoliticizes events by resolving social contradictions and by
turning history into nature. The types of speech that have addressed the global financial crisis have reduced its particular characteristics to an eternal structure of what has
already occurred and what is already known: an innate human tendency to moral corruption that can only be kept in check with regulation. So far the crisis has been broadly
scripted by narrative forms that focus on the repeat of the changing same: irrational
exuberance, speculative excess and herd-like mania that arise periodically and
then crash just as inevitably, one following the other as certainly as night follows day.
Historical analogies have been drawn extensively in attempts to both understand and
solve the financial crisis, with the most common describing it as the worst economic
slump since the Great Depression (Roubini, 2008). These analogies tend to rely on an
analytical maneuver of extrapolation that projects a direct line of connection between
past experiences of economic instability and the present. In one sense, they are not so
different to the mathematical models of extrapolation that assumed that the economic
growth of the future would look just like the recent past. Now, instead of models of
growth based on an endlessly booming present we are presented with models of severe
depression (and related solutions) inherited from the past (see, Krugman, 2008).
In his popular account of the history of economics, for example, Niall Ferguson
(2008) constructs an expanded analogical system to suggest that all speculative bubbles are essentially the same. His seamless history of Blowing Bubbles draws neat
equivalences between the South Sea Company, Tulip mania, and the subprime crisis,
arguing that the latter was essentially a repeat of the former, yet another instance of
irrational speculative fever, a bubble doomed to burst. This presents capitalism as an
unchanging and eternal presence, with the eruptions of bubbles and crises as inevitable as the cycles of nature, and displaying the same essential properties. The history
of economic thought is full of such analogies seeking to establish an isomorphism or
explicit parallels between two or more properties, metaphors usually derived from the
natural sciences that seek to establish social entities, such as the market, as natural
phenomena. It is a logic of extrapolation that constructs a linear movement in which
there is a succession of discrete periods that are either interchangeable in essence or
able to be subsumed within a single, overall system.
Given that the dominant rubric for understanding and responding to the crisis has
been the Great Depression, its no surprise that the refrain that We are all Keynesians
now became a repeated catchphrase. But this historical analogy was more than mere
semantics or a nostalgic simulacrum: It had real material effects and consequences as
governments rushed to implement emergency fiscal measures and stimulus packages
and reintroduce macroeconomic policies based on the rediscovery of the fact that
economic markets couldnt be left unregulated. Although this moment of Keynesian

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euphoria may have been short-lived, this expectation of a quick economic fix has actually been quite counterproductive. The assumption that a good dose of fiscal policy was
all that was needed to set things back on track has short-circuited a consideration of the
much wider cultural and political conditions of possibility in which the financial crisis
took shape. The economic fix of Keynesianism avoids any serious confrontation with
what has actually displaced the welfare state and its ideal of the family wage, and the
impossibility, indeed undesirability, of any real or mythical return.
It also neglects to consider the shared meanings and attitudes that have developed
around specific financial practices and the way in which investment in particular has
emerged as a dominant structure of feeling in everyday life, playing a prominent role
not just in formal financial institutions and centers but also in everyday spaces such as
the home, the workplace, and the lifeworld more generally. The language and practices
of investment are central to a neoliberal agenda in which the individual is required to
negotiate financial market risk/reward in order to achieve self-improvement, social
advancement, and material independence.5 As Pat OMalley (2004) has suggested, If
thrift gives way to investment, it is in part because risk is itself being more positively evaluated in contemporary liberal political rationality (p. 131). But implicit in
the idea of investment is not just the promise of future beneficial rewards but also the
prospect of pleasure through returns (Langley, 2008, p. 74), a logic that not only
underpins financial markets and contemporary practices of home ownership but also
pervasive lifestyle media and consumer cultures. Investment is tied to the simultaneous achievement of personal and economic growth, both of which are inseparable in
the actions of subjects who actively create opportunities for their own self-care, security and personal responsibility. Rather than moral bankruptcy or irrational herd-like
behaviour, then, investment appears as the most rational form of saving (Langley,
2008, p. 47).
Progressively over the past few decades, all responsible and enterprising AngloAmerican consumer-citizens have been called upon to see themselves as investors
and to view their lives in terms of the ownership and accumulation of assets. We may
briefly have been all Keynesians now, but the refrain Were all investors now is
a more realistic descriptor for what happened in the lead up to the financial crisis and
what is again occurring as things return to normal. Yet there is a tension at the heart
of the investor subjectivity being assembled here that blurs the line between speculative household consumption and investment. Consumption too can be seen as a form
of investmentthe creation and production of valuebut it also requires expenditure that makes other forms of investment impossible. This uncertainty over competing regimes of value is reproduced within the very dynamic of capitalism, where
every act of investment is a calculative claim or wager on the profitability of the
future (and, therefore, considered legitimate) and as such is impossible to distinguish
from the morally illegitimate practice of speculation. Contemporary home ownership
is underscored by exactly this ambiguity: It is a consumption good as well as an
investment asset.

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The conventional diagnosis of the crisis as a major rupture, a moment of exception

or aberration, suspends these kinds of tensions and uncertaintiesat the level of personal identities and everyday practices and also at the level of connectivity on which
new financial products and technologies operateand therefore deflects critical
scrutiny from the wider arrangements in which they develop. The repeated calls for a
return from financialization to a real capitalism re-embedded in the real economy
duplicates this kind of erasure. Recognizing such contradictions as inscribed in the
system itself presents a way of seeing the crisis not as the inevitable result of wayward distortion, but as business as usual, as they say, a development within the longue
dure of practices of capitalist accumulation rather than an absence of its fundamentals (Bryan, Martin, & Rafferty, 2009). In his book The Financialization of Daily Life,
for example, Randy Martin (2002) argues that financialization
integrates markets that were separate, like banking for business and consumers, or
markets for insurance and real estate. It asks people from all walks of life to accept
risks into their homes that were hitherto the province of professionals. Without
significant capital, people are being asked to think like capitalists. (p. 12)
Financialization is a process that operates within nonfinancial sectors of the real
economy as much as financial markets, interlocking financial networks with the lives,
homes, and households of ordinary citizens. This redefines the home and home ownership as spaces of calculation and objects of investment and includes the self-fashioning
of financial subject positions and identitieswhat Martin (2002) calls the movements of
body and soul (p. 3). A wide range of everyday cultural practices are now connected
to global financial networks: pensions, retirement schemes, and superannuation; the
purchase of houses, cars, holidays, consumer goods; the payment of phone bills, credit
card, and student loans; and of course home ownership and mortgages. This has primarily occurred through processes of securitization that bundle together a stream of
future repayments connected to an underlying asset, which are then traded as securities
within financial markets. Through mortgage securitization, the house itself is also
transformed into a liquid financial asset, with mortgage repayments converted into the
income stream attached to an investment product. As Leyshon and Thrift (2007) argue,
processes of securitization were propelled by an impulse to identify almost anything
that might provide a stable source of income, on which more speculation might be
built (p. 98).
Within households there is also what Randy Martin calls the invitation to live by
finance. With the ascent of finance as a way of life a new set of signals are introduced
as to how life is to be lived and what it is for (Martin, 2002, p. 17). Financialization is
not just related to a set of activities that are tied to global capital markets; it is also fundamentally an ontological question of what it means to be human, and can be seen as
mode of subjectivation and a technology of the self (Foucault, 1988). As Martin states,
Finance is not only the question of what to do with the money one has worked for,
but a way of working that money over, and ultimately, a way of working over oneself

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(pp. 16-17). Accordingly, risk too becomes a way of life, requiring the individual to
develop, in the words of the financial planners, a healthy appetite for risk, something that
must be grasped and managed in order to maximize returns and rewards in social practices that are now framed as investment decisions. Risk, however, becomes more than
simply a form of calculation or a way of knowing; it also invites a kind of being
(Martin et al. 2008, p. 123). One key outcome is that the priority given to including
workers fully in the labour market yields to the primacy of the investor as the way to
orient domestic policy and ideas of citizenship (Martin, 2002, p. 21).
Within the context of the financial crisis, the rise of derivative markets, residential
mortgage-backed securities, and household-based CDOs is generally understood as a
clear sign of the financialization of housing. The growth of these markets, and the
increasing interdependence of housing and global finance, has certainly played a role
in the way the crisis has developed and played out. However, the motivations and
aspirations of households, which are equally as complex as these technical innovations, are often not only overlooked, but are seen as simply an expression or residual
effect of structural changes in financial markets. In his article The Financialization of
Home and the Mortgage Market Crisis, for example, Manuel Aalbers (2008) links the
financialization of homeownership and homeowners to the development of securitization techniques within expanded mortgage markets. For Aalbers the financialization of home was never designed to enable homeownership; it was first and foremost
designed to fuel the economy (p. 160). For Andrew Leyshon and Nigel Thrift (2007),
too, the prevalence of processes of securitization means that the purpose of making
loans, mortgages and offering credit cards is, increasingly, the generation of tradeable
financial assets on the cycle of monthly repayments (p. 106).

More Than Financialization?

Financialization highlights the performative nature of finance in creating new financial products and the consumer credit markets in which theyll be bought and sold.
It also shows how the homes conversion from a place to live into a leveraged capital
asset represents a new dimension of the redefinition of the home as an object of invest
ment and new frontier of accumulation (Cooper & Mitropoulos, 2009). Within the
context of securitization, homes and mortgages are valued above all else as financial
products and investment vehicles, an identity that is far removed from the home as
a consumption good that provides a housing service. At the same time, there is a
clear tendency position financialization as a powerfully colonizing force subsuming
all social relations to finance. The consequence is that
Everyday life and social relations are reduced to residual effects of initiatives
emanating from dispersed, but nevertheless coherent concentrations of authority. The social is defined as a fundamentally re-active field, rather than one
from where dynamics of socio-cultural change might actually emerge. (Barnett,
Clarke, Cloke, & Malpass, 2008, p. 628)

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I would like to suggest that financialization is actually only one aspect of a much
larger assemblage of political and cultural rationalities that combine with economic
factors in complex and highly unpredictable ways. The crisis can then be pegged to the
contradictions that are implicit in this assemblage rather than to an excess of financial
processes that would disappear if they were removed from circulation or simply regulated away. This approach is also of interest here for the ways in which it disrupts a
range of binariesconsumption/production, everyday life/financial markets, and culture/
economywhich continue to stubbornly inform much research and analysis.
Such an understanding means positioning the consumption practices of households
a little differently, seeing them not as essentially manipulated by, or as the consequence
or reflection of, financial structures but as practices that have an implicit rationale and
agency of their own. Sure, the deregulation of financial systems and the liberalization
of lending policies re-formed the mortgage market. But new methods of selling mortgages intersected with new norms, desires, and expectations of housing and home
ownership on the part of household. One of the primary expectations to emerge was
that by embracing financial market risk, and successfully calculating and managing
that risk, owning a home would provide a store of housing wealth that could be
depended on not only to finance consumption in the present but to provide social and
economic security over the life course. Investing in real estate in general was seen as
a canny financial decision that would be rewarded with substantial investment returns
(culturally, financially, and symbolically), including the prospect of leveraging that
store of wealth a number of ways, including for further accumulation. As the Economist
put it, consumers have become obsessed with the idea of a house as their main store
of wealth, regarding it as a combination of cash cow and pension plan (2009, p. 71).
In effect, housing wealth came to be seen as the key to, and guarantee for, all other
kinds of wealth, prosperity, and financial security more widely. And with the home,
consumption, and life more generally, defined as spaces of constant improvement
dependent on leveraged investment, debt in effect becomes a structural necessity.
Unsurprisingly, a culture of borrowing became the norm in all Anglophone countries. In the United States, the United Kingdom, and Australia household debt reached
record levels. In other words, the typical household at this time spent far more than it
actually earned. Central banks confirmed that there was no precedent for this state of
affairs; they also showed that this debt explosion was mostly related to housing and
mortgages. In the U.S. home ownership became a cornerstone of the ownership
society agenda; George W. Bush repeatedly extolled its virtues, introducing a series
of measuresincluding his Homeownership Challengeto make home ownership
accessible to increasing numbers of Americans, especially minority groups. He also
used a familiar language of patriotism, national identity, and belonging, connecting home
ownership to the space of the nation: Owning a home lies at the heart of the American
dream. In Australia, governmental promotion of owner occupation has mobilized a
similar language, defining home ownership as part of the transition from a welfare
state to an opportunity society (Howard, 2007).

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In the United States, the United Kingdom, and Australia there was also a marked
increase in residential property investment during the house price boom. Also known
as buy-to-let investors, such investment usually involves owner-occupiers purchasing additional houses for the rental income streams they will generate. During the
property boom the demand for investment properties spiked dramatically, especially
as house price appreciation continued to generate the wealth effects associated with
increasing prosperity. Yet one of the major consequences of this large upswing in the
residential real estate market was the general expectation that ordinary households
should be able to derive significant income from profitable investment (or speculation) (Quiggin, 2008, p. 3). The meanings of home ownership also fundamentally
changed during the period of the boom. A house was no longer primarily a means of
shelter or simply a roof over ones head; rather it became a vehicle for investment,
capital gains, and equity accumulation. One of the results of this redefinition was that
home prices speculation became more entrenched on both national and international
scales than ever before (Shiller, 2005, p. 12).
Large numbers of homeowners also began to use housing and mortgage equity
withdrawal to top up disposable income, finance day-to-day spending and meet consumption needsa practice that has become so widespread in housing markets around
the world it is now known colloquially as eating the house. With the growing concentration of personal wealth in owner-occupied homes coinciding with the increasing
fungibility (fluidity and exchangeability) of that wealth, homeowners could, in effect,
cash out the equity in their homes. In the United States, homeowners used home
equity, and debt more widely, to compensate for stagnating wages, a practice that was
reinforced by the expectation of continually rising home prices. As Richard Wolff
(2008) argues, The end of rising real wages in the US drove workers to keep consuming by using up the only wealth accumulated by the home-owners among them.
Equity withdrawal is not specific to the United States, nor is it used solely as a
compensation for stagnating wages. In the United Kingdom one study found that among
many groups, young people especially, Housing equity is seen as the solution to all
future financial needs (Standard Life Bank, 2007, p. 1). In Australia, where wages
have generally increased for most groups over the past few decades, the Governor of
the Reserve, Bank Glenn Stevens, took the unusual step of appearing on commercial
breakfast TV warning about household borrowing and property speculation: I think it
would be a mistake to assume that a, you know, riskless, easy, guaranteed way to prosperity is just to be leveraged up into property (Rollins, 2010, p. 1).
Unlike previous imaginings of home ownership that drew a direct line of connection between owner occupation and citizenship, newer meanings of home as an object
of speculation and investment hinge precisely on the highly individualized, calculative
performances of the entrepreneurial self who is active in making choices to attain selfrealization and is personally responsible for managing and asserting control over the
risks that may be encountered. For Foucault (2008), homo oeconomicus was a figure
that reappeared powerfully within neoliberalism, but rather than being a partner of
exchange, [he] is an entrepreneur, an entrepreneur of himself (p. 226). As Wendy

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Brown (2005) has argued, this works by constructing and interpellating citizens as
individual entrepreneurial actors in every sphere of life. But more than this, by
making the individual fully responsible for her- or himself, neoliberalism equates
moral responsibility with rational action; it erases the discrepancy between economic
and moral behaviour by configuring morality entirely as a matter of rational deliberation about costs, benefits, and consequences (p. 42).
It would be a mistake, however, to reduce neoliberalism to an epiphenomenon of
economics or a bundle of economic policies with inadvertent political and social
consequences (Brown, 2005, p. 38). By simply concentrating the analysis at the scale
of financialization, and the obviously economic, many commentaries on the global
financial crisis have sidelined a consideration of the mundane but highly particular
ways of being and forms of subjectivity that have emerged in everyday contexts of
consumption, and especially in relation to the family, the home, and household
arenas that are in effect central to forms of liberal rule today. In this way, as Brown
states, they fail to address the political rationality that both organizes these policies and
reaches beyond the market (p. 38). In this sense, the ordinary practices of everyday
life, including the shared values and meanings attached to such practices, should also
not be considered as epiphenomena that will always be secondary to the hard, material
realities of economic and financial processes.
Consumption, after all, is as much a cultural as an economic phenomenon. It must
also be recognized as productive, producing value, meanings, and the formation of
subjects and identities. For Foucault, this means that we should think of consumption
as an enterprise activity by which the individual, precisely on the basis of the capital
he has at his disposal, will produce something that will be his own satisfaction (p. 226).
It also means not positing the consumer and producer as fundamentally divided and
irreconcilable but conducting an analysis of consumption in the neo-liberal terms of
the activity of production (Foucault, 2008, p. 226).
In the everyday spaces of society and labor markets, individuals must now take
control of their own economic lives and equip themselves with the entrepreneurial capacities necessary to negotiate the intensified individual competition and market pressures
of a flexible and deregulated economy. Homeowners are, as to be expected, quite rationally seeing their homes as assets, investments, and sources of income for consumption.
Without the guarantee of state-funded pensions, and with the move toward privately
managed superannuation, education, health care, and social security more widely,
households have in effect been forced into viewing increasingly liquid housing wealth as
a form of asset-based welfare. To repeat the point, the household, including most importantly, the saving, borrowing, and investment decisions related to home ownership, is
now central to this image of privatized economic security and risk taking.
The themes of reinvention, renovation and transformation that have become so
prevalent in consumer culture, support and reinforce the promotion of housing ownership
and investment politically and culturally. As OMalley (2009) suggests, Enterprising
subjects are imagined as innovators, who reinvent themselves and their environment (p. 465). Lifestyle media in particular play a quite crucial role in this process.

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Property television, for example, advises viewers on makeovers, trading up and

property flipping, and how to maximize capital gains in a rising market. The home
improvement genre also reinforces the idea of the home as an object of speculative
investment, emphasizing the financial returns to be made from renovating properties
and then selling them on. In this way, lifestyle consumer culture is a quintessential
technology of advanced or neoliberal citizenship (Ouellette & Hay, 2008), presenting
the citizen as an individual whose obligation to society is to be empowered privately,
while simultaneously demonstrating the conduct necessary to achieve this. A spectrum
of ordinary lifestyle practices are now viewed in these terms: activities that will yield
future returns to the individual, with everyday consumption explicitly tied to the accumulation of capital (cultural as much as financial) that can be leveraged to provide
further dividends.
For Martin (2002), the redefinition of the family home as an object of speculation
and credit, together with the infusion of its interior design with financial tastes, displaces domestic life in a number of ways (p. 195). But perhaps rather than seeing
domestic, consumer, and lifestyle cultures as somehow displaced, we could see them
as cultural practices that cannot be disentangled from financial practices because
they are the actual arenas in which consumer-citizens accrue and demonstrate the cultural and social value that is always derived from economic action. This includes the
activities of the subprime borrower who, through necessity, lives day to day by any
means possible as much as it does those of the middle-class property speculator intent
on securing material advancement.
Despite the increasing prominence of markets and the economic principles of calculation, investment, and actuarialism that have become associated with neoliberal
agendas, cultural and political rationalities cant be reduced to, or seen as the unwanted
and accidental effects of, processes of financial innovation or the sphere of economy.
Rather, what becomes significant is not just the multiplicity and heterogeneity of rationalities that seek to govern conduct in the name of freedom, but the fact that
it is, most often, at [the] vulgar, pragmatic, quotidian and minor level that one can
see the languages and techniques being invented that will reshape understandings
of the subjects and objects of government, and hence reshape the very suppositions upon which government rests. (Rose, 1999, p. 31)

Conclusion
For behavioral economist Robert Shiller (2008), it is the change in thinking about
ourselves that is the deepest cause of the bubble, and may be the slowest to unravel
after the bubble comes to an end (p.57). Yet while Shiller may be on to something
herethe critical role of the truths governing conducthe misses another factor
altogether. Viewing the Global Financial Crisis as an episode of collective speculative
fever or mass mania, as in his diagnosis of an irrational exuberance not grounded in
sensible economic fundamentals, fails to acknowledge the way in which sensible

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investment behavior has actually been redefined as contingent upon a greater appetite
for speculative risk, and with this risk itself redefined not as something to avoid as
risky but as an opportunity to leverage and embrace.
In contrast to the focus on irrational behavior in the era of speculation, greed, and
debt bingeing that the crisis supposedly brought to a head, its important to recognize
the much wider assemblage of political and cultural rationalities that emphasize an
image of the enterprising and responsible citizen who seeks out opportunities for continuous social and material improvement and asset accumulation, both as a sign of a
self-directed and autonomous life and as a much-needed source of welfare and security over the life course. This indicates instead that in a way homebuyers were simply
being exuberantly very rational, especially when there really did seem to be little alternative to jumping on board and becoming an investor in the ownership society, the
shareholder nation, the property-owning democracy.
Declaration of Conflicting Interests
The author(s) declared no potential conflicts of interest with respect to the authorship and/or
publication of this article.

Funding
The author(s) received no financial support for the research and/or authorship of this article.

Notes
1. Mirowski (2009) states that What holds neoliberals together first and foremost is a set of
epistemic commitments (p. 417).
2. This was a phrase used by many to describe the decline of economic volatility in the closing
decades of the 20th century. See remarks by Governor Ben S. Bernanke, at the meeting of the
Eastern Economic Association, Washington, DC, February 20, 2004. Available from http://
www.federalreserve.gov/BOARDDOCS/SPEECHES/2004/20040220/default.htm
3. This theme is addressed extensively in Langley, The Everyday Life of Global Finance; For
Susan J. Smith, there is the appearance of an investor figure who demonstrates very specific and strategic motivations in relation to individual housing wealth and what she terms
the new financial order of housing and home ownership (Smith, 2008).

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Bio
Fiona Allon is senior lecturer and Australian Research Council (ARC) future fellow in the
Department of Gender and Cultural Studies at the University of Sydney. She is the author of
Renovation Nation: Our Obsession With Home (University of NSW Press, Sydney, 2008).

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