Boomerang : travels in the new third world

by Michael Lewis

Paper Book, 2012

Description

As Pogo once said, "We have met the enemy and he is us." In this book the author offers a scathing assessment of fiscal blunders in foreign lands, and details how economic repercussions are sure to be felt on American soil. Financial bubbles grew and burst, not only in the U.S. but in countries as diverse as Iceland, Germany, and Greece. Mixing humor with prescient insight, he depicts a precarious situation that demands attention. The tsunami of cheap credit that rolled across the planet between 2002 and 2008 was more than a simple financial phenomenon: it was temptation, offering entire societies the chance to reveal aspects of their characters they could not normally afford to indulge. Icelanders wanted to stop fishing and become investment bankers. The Greeks wanted to turn their country into a piñata stuffed with cash and allow as many citizens as possible to take a whack at it. The Germans wanted to be even more German; the Irish wanted to stop being Irish. This investigation of bubbles beyond our shores is so sadly hilarious that it leads the American reader to a comfortable complacency: oh, those foolish foreigners. But when he turns a merciless eye on California and Washington, D.C., we see that the narrative is a trap baited with humor, and we understand the reckoning that awaits the greatest and greediest of debtor nations. - Publisher.… (more)

Status

Available

Call number

330.9

Publication

New York : W. W. Norton & Company, 2012.

User reviews

LibraryThing member mldavis2
Lewis is a journalist who specializes in political analysis. This is a thoroughly documented history of economic meltdown in Iceland, Germany, Ireland and Greece resulting from unregulated banking and socioeconomic policies that have failed these countries and that threaten much of the western
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world as well. It is a warning to those who will listen. While the topic may seem heavy, it is well written and relatively easy to read, as well as being entertaining. It is a "must read" for anyone even remotely interested in world economic failures and current policies.
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LibraryThing member GShuk
Uses story to tell how countries default on their debts. An easy entertaining insightful audio to listen to.
LibraryThing member dickmanikowski
Thank you, JoAnn, for recommending this book to me. It wasn't until I located the book at a local library that it was written by Michael Lewis, the author of one of my favorite books--Moneyball.
The subtitle says it all: Travels in the New Third World. Michael Lewis provides context for the
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international economic crisis by visiting and profiling four regions that were semi-willingly victimized by it. Three of the regions are obvious in retrospect--Iceland, Ireland, and Greece.
He also visits and profiles a region that finds itself at the epicenter of the world economy: Germany. Germany finds itself in the unenviable position of being the most likely source of funds to bail out the failing economies of other European countries.
But it wasn't until the final chapter that I grew really uneasy. The fourth region that's on its way to joining the Third World is California. While his comments on former governor Arnold Schwarzenegger are laudatory (the guy did his legitimate best to govern an essentially ungovernable state and actually had some limited successes), the overall prospects of The Golden State are pretty bleak. The book closes with a visit to the bankrupt city of Vallejo, CA.
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LibraryThing member damcg63
This book scared the heck out of me.
LibraryThing member Periodista
Certainly well written. It's the breezy style befitting Vanity Fair, where just about all these pieces originated. And yet terrifying. There are minute personality sketches (How about the Greek monks?), dubious national character sketches and mind-boggling stats.I had already read the Greece,
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Iceland and Ireland ones for free. I think the only new one might be the last one about California, where the first town had gone bankrupt and it sure looks like more are to come, starting with San Jose.

This books is actually better than The Big Short in that Lewis attempts an overview of each country. The straits of Greece, Iceland and Ireland are so different, tho it defies rationality why there weren't whistle-blowers, journalists, investors and the IMF screaming the these economies could only go off the cliff. I now keep coming across pundits and comment slugs explaining the Greek crisis. But they only cite one thing at a time when what makes Greece's problems so intractable. But it's just so many things, in fact: the massive amounts of nat'l budget expenditures kept off the books, the national pastime of avoiding personal and corporate taxes, the generous benefits to hairdressers, railway workers, teachers, etc. retiring at 55. Not to mention all the govt workers employed in phantom jobs. Hard for me to understand why Germans (and the French) weren't better informed about the way Greeks do business.

I found the rationale for Germany's own financial mess the least convincing: It bought stupid sub-prime bonds from Lehman Bros et al and lent so many billions to the Greek govt because Germans are so trusting and naive and believe numbers will keep them safe? Germany ain't Iceland and Germans have been doing international investment and trade for a very long time. They must know how to judge a govt solvency and corruption ration. OTOH, a great chunk of the reckless lending to Asian banks up to 1997 was by German banks. Lewis doesn't seem to be aware of this at all.

I have long heard that a lot of municipal bonds all over the US might go bad but Lewis doesn't really show that the reasons for the underfunding of California's cities and towns are the same as in the rest of the country. I mean, Californians certainly are capable of raising and paying taxes. They are wealthy enough. They just aren't willing to. But it does remind of a theme in a recent New York interview of retiring rep Barney Frank. As Franks says, Americans want govt to provide all these services (so they are more politically liberal than most realize) but they don't want to pay taxes to pay for them. Which is how you end up with deficits, deficits that mount up over time.
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LibraryThing member vguy
Laugh out loud funny, but also a clear explanation of much of what has brought the financial system into the present mess. Good character readings and cultural observations ( Schwarzenegger's crazy bike ride as metaphor of his political style, the icelanders who bump into you all the time, the
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german obsessions with rules and scheisse, Irish long-suffering in misfortune). overall we get a sense of a world gone mad and wonder how anything works at all.
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LibraryThing member RobinThoman
As Pogo once said, "We have met the enemy and he is us."

The tsunami of cheap credit that rolled across the planet between 2002 and 2008 was more than a simple financial phenomenon: it was temptation, offering entire societies the chance to reveal aspects of their characters they could not normally
Show More
afford to indulge.

Icelanders wanted to stop fishing and become investment bankers. The Greeks wanted to turn their country into a piñata stuffed with cash and allow as many citizens as possible to take a whack at it. The Germans wanted to be even more German; the Irish wanted to stop being Irish.

Michael Lewis's investigation of bubbles beyond our shores is so brilliantly, sadly hilarious that it leads the American reader to a comfortable complacency: oh, those foolish foreigners. But when he turns a merciless eye on California and Washington, DC, we see that the narrative is a trap baited with humor, and we understand the reckoning that awaits the greatest and greediest of debtor nations
Show Less
LibraryThing member klh
Entertaining and insightful. Puts human faces on the 2008 crash. Happy economies are all happy in the same way. Unhappy economies are each unhappy in their own unique way.
LibraryThing member Bigl
This is collection of essays on several countries affected by the global financial crisis. The selected counties include some of the so called PIGS and Germany with California. All of the essays are light and amusing yet reflect the serious side of a financial world gone out of control with clowns
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and pretenders squandering money like tomorrow would never come.

Faults and follies of both the borrowers and lenders are pilloried in amusing detail with irony and some compassion. My favorite stories include the bank with the toilet at the summit of an office tower so that the CEO could say they he was crapping over his rivals, the Greek manner of taxation described as both corrupt and corrupting, the tax office that was never asked how much tax was collected by an about to become bankrupt government, and the preservation of elves in Iceland. (It appears that some Icelanders believe that elves can be made homeless so that when an alumina refinery was built some time and money was spent to ensure that no elves would be trapped by the building.) Such is the power of the writer that I was left wondering what and where are the elves in Australia.
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LibraryThing member Daniel.Estes
Boomerang could be Lewis' unofficial sequel to his prior book, The Big Short, given that he's now looking beyond Wall Street at the effect of the global financial crisis on specific countries. Those earning a bit of scrutiny are Iceland, Greece, Ireland, Germany and California (not a country,
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obviously, but has a GDP that rivals one).

Excellent journalism here, but not as engaging as The Big Short unless you follow the confusing language of global finance. The narrative does get stronger with each successive chapter so give it time to grab your attention.
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LibraryThing member herschelian
If anyone had told me that I would become completely absorbed by a book about the finacial crises which have gripped the Western world during the past five years, I would have said they were nuts.
But Boomerang gripped me, and made me laugh several times - mind you, it did help that it is a short
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book, anything longer I might have given a miss. Michael Lewis has a very direct manner, and cuts to the nub of things very quickly. I learned a great deal about what craziness the global money men stirred up, with little thought for, or knowledge of, what the outcomes could be for people and countries.
My one gripe is that there is no index or bibliography, and a glossary explaining some financial terminology to the lay reader would have been helpful.
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LibraryThing member Angelina-Justice
This tour of both foreign and domestic economies is equal parts enlightening and frightening. I think the conclusion of this journey is much more complicated than what Lewis conveys in summation. But this book is a strong first step for the layman.
LibraryThing member jmatson
I finally understand (somewhat) the global financial crash of 2008 and beyond after reading this book.

It's truly a Looney Tunes world.

Good read, btw.
LibraryThing member JerryColonna
Feels a bit out of date but Lewis' writing is brilliant AND scary.
LibraryThing member dougcornelius
Michael Lewis packages his stories on the effects of the global financial crisis in Iceland, Greece, Ireland, Germany, and California into one book: Boomerang. If you had ready the stories when they were published in Vanity Fair, then you've ready the book. If you missed some (or all) of those
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stories then this book is great viewpoint on how five countries got themselves into trouble with excessive debt.

I had already read the first four articles when they appeared in Vanity Fair, but I had not yet gotten to the article on California. In fairness, Boomerang was a given to me as a gift so I did not come out of pocket to put it on my bookshelf. I enjoyed revisiting the four stories and the new California story.

They each seemed to work better in the collection than standing on their own. Since each story is relatively short, they lack the depth and understanding I'm used to getting in one of Michael Lewis' books. Collectively, there is bit more depth as you can see how the five different countries got into trouble in different ways by becoming over-leveraged.

It's a Michael Lewis book, so that means it's easy to read and smart. He has a gift for taking complicated subjects and using individuals to highlight how his theories work in the real world.
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LibraryThing member pidgeon92
Best book I listened to this year.
LibraryThing member everfresh1
As all Michael Lewis' books it's insightful and entertaining at the same time. It's a combination of anecdotal evidence and serious investigation that shows how such different countries as Iceland, Greece and Ireland took different paths to the same sad current state of affairs. It also shows -
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which we kind of knew - that US haven't fallen into the same financial abyss just by certain amount of luck and financial flexibility that we have. However, if nothing will change we will also get there. I wish that some descriptions of countries and politicians wouldn't look so like caricature though.
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LibraryThing member thejazzmonger
Excellent, highly readable account of the global real estate/securities bubble and subsequent crash.
LibraryThing member PeskyLibrary
There is a constant barrage from the media about the state of the economy, and Boomerang by Michael Lewis attempts to explain to the average person why we are where are today. On the evening news on any given night, you may hear a 30-second blurb about foreclosure rates, unemployment, or the
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European debt crisis, but most of us want to know more. Lewis puts a face behind the economic crisis as he recounts a meeting with hedge fund manager, Kyle Bass, who saw the impending financial crisis. He noticed that debt (both public and private) had doubled in the years following 2002. People were borrowing when they couldn’t afford to repay, and since banks are an extension of the government in most countries, that winning combination wreaked havoc in the financial markets.
Lewis begins the world tour of the financial crisis in Iceland. There, they grew their banking system from assets of a few billion dollars to $140 billion between 2003 and 2006: Icelandic family’s wealth tripled during this time period. Lewis proposes that the influence of life as a fisherman, full of risk, caused the Icelandic people to take tremendous risks in the banking industry.
In Greece, Lewis thinks that the culture of the Greek people led them to make bad decisions. They doubled their public wages in the past twelve years so the average public employee makes three times as someone in a private sector job. Yet, they don’t want to pay taxes – their culture encourages and expects cheating. Unlike the Icelandic people who are taking responsibility for the situation they’re in, the Greek people are taking to the streets to protest any reforms to get public spending under control.
In Ireland, Lewis blames a real estate Ponzi scheme for unraveling the economy. The Irish banks lent money to developers to buy land at any price, and have now heaped the burden of debt caused by this on the Irish people. In Germany, they feel the pain from money they lent to Icelandic banks ($21 billion), American subprime loans ($60 billion), and Irish banks for real estate ($100 billion). Lewis then turns to California to highlight the effects of the economic crisis. The average Californian had $78,000 worth of debt for a $43,000 income: the same is probably true for most cities and towns. One thing is for sure, it’s not sustainable.
Reading Boomerang is a great way to gain a better understanding of the financial crisis. MLM Jan 2012
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LibraryThing member Kathleen828
Funny, incisive, mordant, clear and informative. Lewis encapsulates much of the current European economic chaos, and does not fear to share the blame around. One of the best 10 books I've read this year. Highly recommended.
LibraryThing member starkravingmad
Moderately entertaining and informative, but lacking insight and a well-developed thesis that links the vignettes. He's written much, much better.
LibraryThing member teckelvik
This is a well-written, interesting overview of the economic collapse of 2008-2010, viewed from the different countries that were affected. I'm a regular reader of "The Economist," and there was nothing really new here, but it was put together well, with telling local details and an overarching
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analysis that I found helpful. I suspect that people who don't read "The Economist" or other financial publications would find it even more informative.

I was very interested that it ended on an optimistic note. I hope that view is correct!
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LibraryThing member gbelik
This is an economics book which is really sociology and it is a delight. Iceland, Greece, Ireland, Germany and California and how economic catastrophe has played out in each of these societies. Witty and wise.
LibraryThing member addunn3
A quick read that reviews the status of Ireland, Iceland, Greece, Germany, and California in the face of economic collapse.
LibraryThing member rivkat
Greece, Ireland, Iceland, Germany, and the US: all places where people did very strange, foolish, and criminal things with money in the past decade, sometimes more than one of those at once, and where people (some of them overlapping with that first set) are now suffering for it. Lewis is more
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interested in looking for national differences than in causation, really, producing a book rich in small details and impoverished in explanations: everyone he meets seems bewildered about what happened, and he never does a lot to clear it up.
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Language

Original publication date

2011-10

ISBN

0393343448 / 9780393343441
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