In Michael Lewis’s book Boomerang: Travels in the New Third World, he captures the financial insanity that gripped so many countries. He goes on a financial tour of several of them to discover why their economies collapsed or how they avoided catastrophe. Lewis writes with a travel writer’s flair for each country’s idiosyncrasies, and Boomerang is filled with compelling information about every place he visits. Here are some examples.
In Iceland, fishermen became investment bankers and quickly plunged the country into terrible investments, bankrupting both the banks and the nation.
In Greece, a culture of dependence on the state, along with endemic tax fraud and the resulting lack of revenue, sank the country, and the country then sank the banks, not the other way around. Greek government officials earn remarkable salaries, and a huge number of government workers can retire very young. The rich and corporations largely avoid taxes. In fact, almost no one pays them, not because of the laws but because of lax enforcement.
In Ireland, cheap and easy credit brought on an insane housing boom, followed, of course, by a bust and bankrupt banks.
The German people, by contrast, didn’t take the cheap and easy credit. German banks weren’t perfect, and one bank in particular made some terrible mistakes and got sucked into the U.S. subprime mortgage mess. But Germany itself was in excellent shape and was being pushed to bail out the rest of Europe.
Lewis also touches on the U.S., particularly its cities, the high cost of public pensions, and whether they can keep paying retired workers pensions close to what they earned while working.
This is a great read, with lots of fascinating anecdotes, people, and cultural color. The German fascination with poop is one of the most memorable.
Boomerang: Travels in the New Third World by Michael Lewis shines a bright light on economic destruction around the world.
Find Boomerang: : Travels in the New Third World by Michael Lewis on Audiobooks, Amazon/Audible, and Bookstores who are not Amazon.
You might also enjoy Detroit: An American Autopsy by Charlie LeDuff.
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