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Must Read: Bailout Nation by Barry Ritholtz

June 16, 2009 Business, Economy, Read No Comments

Barry Ritholtz’s timely book, Bailout Nation is a must-read for those interested in not only learning about how we got in the current global, economic mess, but also in getting an idea on the outrageous path the current administration has us on (if they don’t get their heads out of their asses soon, we will end up with a much bigger problem that may be impossible to fix). It is also a good lesson on Moral Hazard.

The collapse of many storied institutions, like Bear Stearns, Lehman Brothers, AIG, and the auto industry, are explored. The faulty reasoning behind the US Fed and Treasury’s current actions are presented. Most importatly though, root causes are identified, and how events of the last 30 years institutionalized Moral Hazard, which led to the Financial Crisis of 2008, are explained.  There is some financial jargon but for the most part, everything is defined and written in plain english – a major plus that keeps this book flowing at a good pace.

In addition to the amusingly appropriate book cover, there are also pictures and graphs galore to illustrate points…

Click on the picture for a better view.

….as well as cartoons and quotes to keep things in perspective, like these gems:

Ritholtz does a fine job at keeping things concise, while providing enough details for the layman to understand the role of the myriad of contributing players. People (Alan Greenspan seems to get most of the blame), government actions and policies (both Democrat- and Republican-driven), as well as long-held belief systems (i.e. free market and deregulation) are questioned and analyzed for their role in turning us into a Bailout Nation (sheepishly supporting corporate welfare and asset prices).

Jam-packed with facts intertwined in the Bailout Nation story, the book is rounded out with thoughts and interesting ideas from some of Ritholtz’s respected contemporaries, like Doug Kass and Ned Davis, that the current administration would be hard-pressed to ignore.

To truly appreciate the historical time we are in, this book is highly recommended; I don’t get any kick backs for promoting this book. With that said, the book can be had for cheap at Amazon.com.

BarryRitholtz’ Blog, The Big Picture
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John Sherffius

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