Wow, what a great book.
This is one of the best non-fiction books I’ve ever read. Michael Lewis has a nack for finding a topic that is fundamentally interesting, timely, and thought-provoking and then putting together research to bring that topic to light in a way that makes it something you want to talk about.
The writing style is smooth and balanced with a fair amount of humor thrown in to make it a super-fast read.
Brief synopsis: during research for the awesome book The Big Short, Lewis interviewed several money-managers who made big bets against the sub-prime housing market that ended up making them each Billions. One of those interviews was useless for that book because the gentleman had already moved on to the “next thing” that had him excited. What would that be? The sovereign debt crisis. From that starting point, Lewis takes us on a journey of how the world has gotten to our current point. The mass-delusions of Iceland and Ireland are covered in detail. The Greece-Germany axis is covered well and is extremely interesting. The German involvement in the American sub-prime mess comes next. Finally there is some discussion of America’s debt situation, mainly focusing on municipal debt.
My one criticism of the book is that there isn’t enough coverage of the overall sovereign debt and state debt situation in the U.S. Nor is there enough space dedicated to the discussion of what this means to Americans and how we can change it. Essentially, I think Lewis is trying to say, without doing so directly, that the nation’s debt crisis is parallel to the situation in California. Everyone wants services and they aren’t willing to pay for them. And the government has been trying to provide just that. There is some element of mass-delusion in the idea that all of these entitlements are ok. Politicians are doing nothing to change the mindset of the people because they are too concerned about reelection to consider what is genuinely best for the future of our country. Maybe he is trying to inherently draw a parallel between the U.S. and Greece/Ireland.
I will say that despite the strongly political nature of the topic, Lewis has somehow managed to remain completely politically unbiased. In my read, there was no overt or implicit liberal or conservative bias. I suspect liberals might consider even covering the topic to be a conservative action. But if you actually read it, there is no bias. Because there is no narrative on how we should change our policies or direction, Lewis is able to escape this entirely. Personally, I wish he could have added a section describing a country who had come to the brink and then pulled themselves out of it to become financially solvent and prosperous because of it. Perhaps that would have been able to paint a picture of a future direction without entering the politcal-hot-water you would expect from covering it directly. I suppose this would be difficult or impossible using a modern example, though.
This is an extremely timely read. No matter which side of the political fence you sit upon, you will learn something here that will probably alter the way you think about our nation’s (and the world’s) debt situation. Profoundly. If you read Boomerang and don’t want to make some changes in how you prepare for the next 10 years, you’re either doing an excellent job already or have your head in the sand.
Honestly, I think anyone with even a passing concern about world finance and the potential for financial disaster needs to read this book