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The Crash of 2008 and What It Means: The New Paradigm for Financial Markets

3.36  ·  Rating Details ·  1,098 Ratings  ·  108 Reviews
A "New York Times" bestseller on the financial crisis-now updated to address the current economic landscape
ebook, 288 pages
Published May 14th 2014 by PublicAffairs (first published 2008)
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Dec 03, 2008 Chris rated it really liked it  ·  review of another edition
Recommended to Chris by: Matt
The other reviews for this book mostly get it right, so I will not rehash what they have written. I have read the last few books by Soros, and his philosophy takes a while to sink in, but I did not find this book to be overly complex or confusing. Rather, I feel that in explaining the current crisis, Soros's theories on reflexivity, fertile fallacies and his attacks on market fundamentalism are perfectly timed - and if people are serious about a more sophisticated and subtle understanding of the ...more
Bruce Caithness
Let me start my review of George Soros’s “The New Paradigm for Financial Markets” by stating that there is much I like in this book, however there is also much that I don’t like. I can only marvel at his skill as a fund manager and his rebuttal of the foolishness of efficient market assumptions. I also applaud his evangelising the philosophy of Karl Popper. If Karl Popper is not the greatest 20th century philosopher I don’t know who else could possibly take the mantle. It is precisely over Karl ...more
Aug 21, 2008 Peter marked it as did-not-finish  ·  review of another edition
Maybe it's just me, but this book felt overly complex. I personally believe the true mark of genius is someone who can both understand what is seemingly infinitely complex, while at the same time convey that concept to lay people with ease and in simple terms. George, while likely intelligent (I can't tell, I spent too much time trying to decipher what he was trying to say... and not much time really understanding what he was talking about) either cannot, or chose not to do this. The book is com ...more
Richard Budge
Dec 06, 2013 Richard Budge rated it did not like it
This book was painful to read because of it's all-too-frequent idiocy. He obviously has figured out how to recognize when markets are vulnerable and can be manipulated to the downside, but he isn't a thinker, no matter how much he tries to imitate one. His constant insistence that markets operate according to phenomenon only seen in quantum mechanics at a sub-atomic level is beyond ludicrous. Even if you ignore those theories, he still contradicts himself regularly and his logic is tortured. I o ...more
Nov 22, 2010 Jacob rated it did not like it  ·  review of another edition
I was hoping to find an intelligently written response to Forbes' advocacy for free markets in "How Capitalism Will Save Us," but only found the ego of George Soros. His son, Robert, summed him up best, "My father will sit down and give you theories to explain why he does this or that. But I remember seeing it as a kid and thinking, Jesus Christ, at least half of this is bullshit. I mean, you know the reason he changes his position on the market or whatever is because his back starts killing him ...more
Apr 12, 2008 Rob rated it liked it  ·  review of another edition
I felt let down by this book. At first it gives a good overview and timeline of the current credit crunch (although nothing someone wouldn't have known from reading the paper once and a while over the past 6 months). Then, it delves into Soros's theory of "reflexivity", which attempts to debunk efficient market theory. I was highly disappointed in this section. I didn't think it was convincing at all, which says a lot since I'm not a big believer in efficient markets to begin with! All in all, i ...more
Nov 03, 2008 Bart rated it it was amazing  ·  review of another edition
Recommends it for: Those interested in the economic theory of reflexivity
This book marks what George Soros promises is his final treatment of the invaluable theory of reflexivity. The New Financial Paradigm is too long by half, yes, and Soros occasionally tries to cram reflexivity into his explanations of unrelated phenomena. But for all that, reflexivity is a wonderful tool that has been both undeservedly dismissed and undeservedly unremarked upon.

The term reflexivity is derived from Romance languages’ transitive and self-referential verbs. Effectively it is derived
Ali Miremadi
Feb 01, 2017 Ali Miremadi rated it really liked it  ·  review of another edition
Very good short book. The opposite of 'The Alchemy of Finance', in that the first half on the philosophical underpinning of the social science of markets is expounded, whereas the second half with its trading diary is less interesting. Disturbing to be reminded of the disregard George W had for the truth when we compare it to Trump's even greater excesses. Great knowing irony in explaining how forecasts of the future (or explications of the present) are almost always wrong and then filling the c ...more
Nov 21, 2008 sleeps9hours rated it really liked it  ·  review of another edition
The first Soros I've read. Very interesting. I like his philosophical take on the machinations of the financial markets. Very timely.

Copious notes:

p. 36 Scientific laws cannot be verified; they can only be falsified. That is the role of testing. Scientific laws can be tested by pairing off initial conditions with final conditions. If they fail to conform to the scientific law in question, that law has been falsified. Statements that are not subject to falsification do not qualify as scientific.
Aug 26, 2012 Geoff rated it did not like it  ·  review of another edition
This is not good literature. Mr. Soros’s writes in a condescending tone throughout the whole thing and uses “I” waaaay to much. He doesn’t explain his theory of Reflexity in a clear, succinct manner. Really couldn’t tell you what it means, other than what you think affects what see and experience, kinda like self-actualizing.. but again, I could be off, b/c Soros does not explain things at a simple level.
His bias permeates the whole book. He constantly impugns Bush administration, but give no fu
Álvaro da Luz
As longas viagens a trabalho têm vários aspectos positivos. E um deles é que a solidão dos hotéis acaba deixando muito tempo livre para colocar as leituras em dia. Assim, consegui terminar o livro O Novo Paradigma para os Mercados Financeiros de George Soros, lá para os lados do Vale Europeu (Itapocu para os íntimos).

George Soros é um investidor bastante conhecido, talvez o mais conhecido do mundo pelos não financistas. Boa parte de sua fama vêm das histórias terríveis de como ele ataca países
Nov 04, 2008 Austen rated it did not like it  ·  review of another edition
Recommended to Austen by: Amanda Yaggy
"People want to know what lies ahead. I cannot tell them because I do not know. What I want to tell them is something different. I want to explain the human condition."

I am not an economist, nor do I participate in financial markets in any significant way. Really, I never even took a business course as an undergraduate. I mention this because many of the specific details that Soros presents are cloaked in a specialized language that is almost totally unfamiliar to me. Even Wikipedia can't help m
Jul 08, 2008 Greg rated it liked it  ·  review of another edition
Soros turns philosopher and develops his "theory of reflexivity". The way he does this is by repeating it about three dozens times. Repeating oneself does not equal profundity. Throwing in a plethora of anecdotes about how one made or lost money doesn't do it either. I kept waiting for this amazing theory to be developed. Then I hit the end of the book.

The "theory," he admits, is not really a theory, but a rejection of the idea of market equilibrium. One reason is that equilibrium theory assumes
Soros' theory of reflexivity is interesting, even if I am not sure that what he is talking about is really what should be called a theory. I mean what he has to say about reflexivity is more along the lines of descriptive. But difference between description and theory is so hard to draw. He has a lot to say about why Economics is not a science. I think few would disagree.

However the book is obsessed with random references to various other authors, all of which seem like apostrophes. Certainly h
Sep 23, 2008 Eric rated it it was ok  ·  review of another edition
Shelves: economics
Picked up this book three weeks ago as it seemed timely. Just finished it last night, not quite so timely!

Soros wants to be a philosopher, but he should just stop with that and read some more. He has the Theory of Reflexivity - that real people and their thoughts are a part of market dynamics, and thus markets don't behave according to the dominant equilibrium analysis. There is feedback between facts and thoughts, and between thoughts and thoughts. He spends way to much time on this without pro
Max Stone
I have the more-or-less standard criticism of this book, I assume. The author is a great and famous investor, and a not-so-great and not-so-famous philosopher, and again he has written a book that is 85% about his philosophy and added just enough stuff about current financial markets that people will buy it to read his investing opinion. on the positive side, he is very upfront that that is what he is trying to do.

the problems with his philosophy (which very briefly, is that markets are inheren
Nov 07, 2008 Jon rated it it was ok  ·  review of another edition
If you haven't read any Soros books in the past then you'll be frustrated by the first half of the book. He talks about his reflexive theory which his attempt at providing some kind of philosophic idea. The problem with this presentation is that 1/3rd of the time he apologizes for his previous books and attempts to explain reflexive theory. Unfortunately you're not given enough information in this book to fully understand the theory nor make a determination of his motives of this theory. (I alwa ...more
I really want to like this book and can't deny that Soros obviously has some fundamental truth to his Reflexivity Theory.

The first half of the book is spent explaining his theory of reflexivity and how it contradicts to the financial equilibrium theory. Both theories are philosophical ideas and the first half of the book reads like a mixture of a philosophy text and an short autobiographical summary of his role in the financial market. This is also the part that I leaves me finding it hard to r
Anna Murray
Apr 04, 2012 Anna Murray rated it did not like it  ·  review of another edition
I paid $2.97 for this book. It was regularly priced at $22.95. I was ripped off! Now I know how the Bank of England felt!

It is amazing that George Soros could be a billionaire, yet have such convoluted and immature thought processes. While he repeatedly claims to be seeking the historical truth, he utterly fails to acknowledge (even once!) the Community Reinvestment Act of 1977 and its ramifications on the current financial crisis. While he seems to want to be an oracle of the economy, he makes
Berhan Polat
Nov 17, 2015 Berhan Polat rated it really liked it  ·  review of another edition
I read many comments of fellow readers ofthis book. I agree that he repeats himself, especially stressing the reflexivity concept and one can also argue that many things are maybe not clear even in the mind of the writer. However, he explains a critical relationship between the asset fundamentals and their valuation, which may end in a crash. This is a powerful argument and needs to be taken seriously. Moreover, this suggestion wipes out many theories which are feeded by market fundamentalism. H ...more
Jul 06, 2010 Celine rated it did not like it  ·  review of another edition
We were used to Soros thinking of himself as a genius of financial markets - he's been pretty successful (read: lucky) at dodging black swans, you can't take that from him... Now meet the Soros who thinks of himself as a genius of economic theory - one step short of a genius full stop. He confesses to having started "reading classical philosophers in [his:] early teens" (!) and now rubs his 2 neurons together to try and deliver a holistic theory of financial markets through a rather shallow and ...more
Jul 04, 2010 Lucas rated it liked it  ·  review of another edition
Shelves: economics
It's best to avoid any book with 'paradigm' in the title, but it was the only financial crisis book I could find in the Good Will I was in. The first third of the book should have been cut in half, Soros repeats himself using mostly the same phrasing many times. Also his invented terms for what already has good names in other fields is annoying. One thought provoked was that his view of the economic system that has participants with faulty knowledge (rather than the perfect knowledge assumption ...more
Interesting and thought provoking concerning Soros' theory of "Reflexivity," silliness raised to a power of ten when Soros accuses others of being ideological. Curiously, it does not look like most of the predictions he had the cojones to make at the end of the book have come to pass. Yet.

I would also have liked more information on the "Super-bubble" he posited, and whose start date seemed to shift from the end of World War II to the election of Reagan and Thatcher, to whenever was most convenie
Feb 04, 2009 Robert rated it really liked it  ·  review of another edition

First off, I must start by saying that I have a tremendous amount of respect and admiration for George Soros! I think he has achieved an incredible amount of good with his wealth while showing the world what is possible when the powerful apply themselves to highest of human ideals. His Open Society foundation is a remarkable achievment and a grand testament to those ideals.

Having said all that, he really needs to move on from this whole Karl Popper/Reflexivity thing. I understand and agree with
George, I'll just take your word for it. If you invested $10,000USD with George Soros when he started his hedge fund in the late 60's and stayed with him into the late '00's when he closed it, your payout would have been $43,000,000. Suffice to say Soros knows what he is talking about when it comes to investing. Unfortunately, you'll need to be similarly intellectually endowed to grasp his ideas. Soros covers his concept of reflexivity first as an abstract philosophical framework and later as a ...more
ajay Kumar
i liked the book but even though i believe the idea is not that revolutionary as he of the chapters is pretty heavy but he himslelf advises to skip the same if u r not greatly interested....

very few people now believe that markets are completely rational all the time...the only reason that i believe that we still study the same in finance is the simplicity of explaning the things with the rational assumption...every theory needs to have certian assumptions to reach a
Jun 16, 2008 Scott rated it really liked it  ·  review of another edition
Recommends it for: Those with a strong thirst for financial market knowledge and current affairs.
For those of you who don't quite understand why the economy is not doing so hot and the causal factors that have led to the housing bubble as well as the "super-bubble" as Soros puts it, this is the book for you. Soros combines both philosophy and financial/economic expertises in relaying his message that the causal factors of the aforementioned "bubbles" can be tied to a term "reflexivity." In a nutshell reflexivity has two main parts, a cognitive function (what we know) and the manipulation fu ...more
Steve Venick
Jul 30, 2009 Steve Venick is currently reading it  ·  review of another edition
Recommends it for: anybody trying to understand the financial crisis from a somewhat "philosophical" perspective
I'm not very far into this book so I'll reserve my final judgement until I've finished, but already I find it extremely compelling. The strength of this book is that Soros is very explicit about the conceptual framework that he uses to understand and explain the financial crisis. This allows the reader to judge the argument on its merits because Soros' perspective is out in the open (which is not often the case). The added bonus is that his conceptual framework (he calls it "reflexivity") is, in ...more
Jul 27, 2010 Joel rated it really liked it  ·  review of another edition
Very good. Soros is a prescient hedge fund manager and seems to anticipate major moves in financial markets before anyone else. His lack of ego and concerted will to what is right are admirable. The chapters on reflexivity and the fundamentally irrational nature of the human psyche have much broader implications that just financial markets. I also found the section on ways to provide more secure housing and mortgage markets fascinating; in this case, by creating better bankruptcy judges and deve ...more
Ben Pu
Oct 22, 2009 Ben Pu rated it it was ok  ·  review of another edition
As a work of philosophy, obtuse and pedantic. Applied outside of the markets, Soros' philosophies are a nice intellectual exercise, but he himself offers very little insight. Additionally, his work is overly simplistic to apply to finance. Reflexivity is a reductionist philosophy that manages to remove the actual insight required to make intelligent investing decisions. His, and any good, investment decisions are based first and foremost on sound fundamental data, good counsel, research, and imp ...more
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George Soros is a Hungarian-American financier, businessman and notable philanthropist focused on supporting liberal ideals and causes. He became known as "the Man Who Broke the Bank of England" after he made a reported $1 billion during the 1992 Black Wednesday UK currency crises. Soros correctly speculated that the British government would have to devalue the pound sterling.

Soros is Chairman of
More about George Soros...

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