READ THIS: Boomerang Travels in the New Third World By Michael Lewis
When you are stuck in traffic on an interstate, it is likely because there is some kind of accident way ahead of you and as time passes, you grow more and more curious about what exactly happened ahead. For those that are not professionally involved in the financial markets, and even if you are you could not have been in every place of the world Lewis traveled to to research Boomerang, Boomerang elucidates the striking gory mess that the world is in right now, and we liken it to a car accident: a several car pile-up!
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The global financial crisis that gained momentum in 2008 with the failure of Lehman Brothers has claimed disparate victims, from the governments of Greece, Iceland, and Ireland to the savers of Germany and the taxpayers of the world’s sixth-largest economy, California.
Surveying the wreckage of these once-booming economies, best-selling author Michael Lewis is the consummate financial-disaster tourist, an incisive and witty guide to the shell-shocked money managers, investors, and ordinary citizens who found themselves on the receiving end of a historic collapse.
In his new book, BOOMERANG: TRAVELS IN THE NEW THIRD WORLD [W. W. Norton & Company; October 3, 2011; $25.95 hardcover], Lewis turns his unique reporting skills and ability to deftly and clearly explain the most complex financial schemes to these distressed locales, seeking out in each the reasons they went to the wall.
In each locale Lewis’s keen eye for detail and his sense of the profound absurdity and outlandish greed underlying these entangled global crises yield insight and understanding that most observers have missed.
In Ireland it was the real estate frenzy, driven by aggressive bankers, distracted regulators, and loose money that led to the eventual collapse of the three biggest lenders, driving them into the arms of the government and, finally, the government into the arms of the International Monetary Fund.
In Iceland—population 300,000—the problem was the generation of untrained and inexperienced financiers who sold the chilly capital Reykjavik as Wall Street on the tundra. The huge, insanely leveraged bets the Icelanders took buying a hodgepodge of assets around the world turned the country into little more than a giant hedge fund, buying its way into the upper echelons of UK banking and driven by a weirdly nationalistic egotism.
“Back away from the Icelandic economy and you can’t help but notice something really strange about it: the people have cultivated themselves to the point where they are unsuited to the work available to them,” Lewis writes. “All these exquisitely schooled sophisticated people, each and every one of whom feels special, are presented with two mainly horrible ways to make a living: trawler fishing and aluminium smelting. . . . Enter investment banking.”
In Greece Lewis seeks out a group of reclusive monks whose real estate wheeling and dealing led directly to the fall of the government and the discovery of a gigantic deficit that had been papered over for years. The result was an EU-backed bailout, kicking off Europe’s sovereign debt crisis—a mess that is still being resolved and that has since spread to other countries in the south, threatening the entire single currency project.
And in Germany, Europe’s only truly solvent leading economy, Lewis reaches deep into the national psyche—and into the darker corners of Germany’s tremendous boom—to paint a portrait of a country deeply uncomfortable with its increasingly likely role as lender of last resort.
As always, Lewis combines informed journalism and broad-ranging interviews with wit and insightful analysis, resulting in a book that explains how the world got into this mess and what may come next.
Whether it’s the Icelandic need to search secretly for elves—the “hidden people”—before building a factory; Governor Arnold Schwarzenegger’s inability to shift the encrusted entitlements that keep California’s public sector in perpetual default; or the fact that the leaders of the Greek monks are portly despite what appears to be a starvation diet, and fly business class, Lewis teases out the local angles of this global crisis while detailing the common madness behind the global blowout.
This worldwide financial meltdown, characterized by easy money and asset bubbles; pumped up by greed and hubris; and carried along by ham-handed politics, blinkered regulation, and outright fraud has left economies across the globe in shambles and has rung in a new era of austerity.
The author of numerous bestsellers including Liar’s Poker, Moneyball, and The Big Short, Michael Lewis is our foremost chronicler of human financial folly and institutionalized greed. BOOMERANG is a brilliant and essential compilation of incisive reportage and insightful analysis, Lewis’s signature testament to the most devastating and widespread economic meltdown since the Great Depression.
ABOUT THE AUTHOR:
Michael Lewis is the author of the #1 bestsellers The Big Short and The Blind Side. He lives in Berkeley, California, with his wife and three children.
TITLE: BOOMERANG: Travels in the New Third World
AUTHOR: Michael Lewis
PUBLICATION DATE: October 3, 2011
ISBN: 978-0-393-08181-7
PRICE: $24.95 hardcover