Friday, November 6, 2020

Review of Boomerang: Travels in the New Third World by Michael Lewis

This review was written by Eugene Kernes

Book can be found in:
Genre = Economics, Finance
Intriguing Connections = What Goes Into An Economic Crisis?

Elaborate Description

Financial crisis that start with one country can have a contagion effect that creates a ripple and causes other countries have a financial crisis as well. The financial crisis may have started in the U.S., but as Michael Lewis shows in this book is that, that every country that experiences a financial crisis has to blame internal problems as well. The book follows the aftermath of the U.S. 2008 financial crisis and tries to understand how it was started in other countries.

In Iceland, bankers borrowed from one another at inflated prices and relent it to others to purchase foreign assets. In Greece, everyone from the public who is supposed to pay taxes and government who is supposed to collect taxes is part of a systems that helps each person not pay any tax. In Ireland bankers kept on lending money to property developers that build more homes than was needed with little expectation that anyone would live in them. In Germany, the people trust in rules and regulation allowed them to think that the Greek's would play by the rules of being in the Euro and the strategies the U.S. banks had were sanctioned by the Fed or SEC with the result of buying a lot of subprime mortgages that were unexpectedly poor quality and became the only country able to pay for the debt of the countries in the Euro. In California, or most likely in the whole U.S., people vote for those that seek to rectify the problems and help the people but with a system that insures any fix is not given its due which in tern creates dissatisfaction with the public. It seems that the culture of each region is unique and had an impact as to how financial institutions and problems developed.

This was an easy read. The stories provided gave credibility to the situation in the respective country. The book did a good job with explaining financial corruption in each country presented, but it does seem to be more superficial. Superficial because the stories and explanations seem to only explain the surface of the situation. The best parts have been when the undercurrents of the decisions were expressed and the book would have been better should more depth was given to each country. Also, the countries presented were only in the Europe and the U.S., it would have been interesting to see the financial experience of other countries.

Book Details

Edition ISBN:  9780393343441
Pages to read:   228
Publication:     2012
1st Edition:      2012
Format:            Paperback

Ratings out of 5:
Readability    5
Content          5
Overall           5