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This Time Is Different: Eight Centuries of Financial Folly
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This Time Is Different: Eight Centuries of Financial Folly

3.76 of 5 stars 3.76  ·  rating details  ·  3,576 ratings  ·  197 reviews

Throughout history, rich and poor countries alike have been lending, borrowing, crashing--and recovering--their way through an extraordinary range of financial crises. Each time, the experts have chimed, "this time is different"--claiming that the old rules of valuation no longer apply and that the new situation bears little similarity to past disasters. With this breakthr

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Hardcover, 460 pages
Published October 1st 2009 by Princeton University Press (first published September 1st 2009)
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Understanding the Financial Crisis 2008
15th out of 105 books — 162 voters
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77th out of 208 books — 221 voters


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Community Reviews

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Whitaker
OMFG!! This was originally four stars. I was super-impressed by the fact that their conclusions were supported by data underlying the research. Guess what? That was NOT the case! When they finally agreed to release their data sets and other economists tried to replicate their results with their data, they found the following:
We replicate Reinhart and Rogoff and find that coding errors, selective exclusion of available data, and unconventional weighting of summary statistics lead to serious erro
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Jason
This book’s an A- graduate paper glorified into 400+ pages. It has impressive academic rigor, an appendices & reference list as long as the body, and charts galore. Unfortunately it’s written as blandly as Ben Stein speaks. I was jazzed to find this at the library, but let down.

Mercifully, in the preface the authors tell us that the book is organized so you can skip to the last 4 chapters if you‘re interested only with “The Second Great Contraction” which began in the US late 2007. They warn
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Hadrian
If you're going to release a seminal report on the relationship between debt and GDP, you had better make damn sure that you don't fuck up your Excel charts.

Now that debt/GDP growth isn't as strongly correlated anymore, does that mean people will stop pushing austerity policies?

http://www.peri.umass.edu/fileadmin/p...
Frank Stein
As almost everyone who reviews this book mentions, this is truly an impressive piece of work. The authors, Carmen Reinhart and Kenneth Rogoff, have assembled an amazing history of government defaults, hyperinflations, banking crises, and currency crises for the past 800 years in dozens of countries spanning the globe. They didn't, understandably, compile a narrative of these hundreds of independent events, but coded them into a massive statistical database with which they could compare the relat ...more
Gordon
This book is the current darling of the financial set, and I understand it has become required reading by economists, bankers, policy-makers and the more thoughtful financial pundits alike. That’s a rare feat. The book assembles a vast data set on financial crises, from many countries both developed and emerging, and reduces it to a mass of charts and graphs along with text. The title, as you might guess, refers to the fact that “this time is different” always turn out to be famous last words – ...more
Brion O'quigley
Another reviewer pointed out that some of the analysis in the book is based on faulty data. Be that as it may, the book still provides generic findings about the financial cycle that are still valid. It is a cogent analysis of hundreds of years of financials crises. Contrary to what the Fed continuously repeats, it is possible to predict financial cycles and this book proves it by examining how bubbles have burst since the invention of money. It provides an excellent explanation of the predictab ...more
Richard
Aug 21, 2011 Richard rated it 2 of 5 stars
Recommends it for: economists, statisticians, professional investors
It might be unfair for me to rate this book (giving it 2 stars). My rating is subjective. This isn't the book I was looking for, and that isn't the authors' fault. So please view my rating with that in mind.

This book is clearly aimed at an academic or professional economic audience. The book is chock full of tables and graphs. The amount and quality of data is impressive.

As for the writing style, Alan Greenspan would be proud. Here is a typical sentence (pp 192-3): "Interpreting the (uncondition
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AC
Dec 05, 2009 AC rated it 4 of 5 stars
Shelves: markets
The thesis of this book is important, but I cannot say it is worth actually "reading" very closely -- The gist can be extracted in a short time -- and the charts/data scanned. Only time will tell whether the authors' fears are to be realized...

There's an old market adage that bears almost ALWAYS have the better argument; but that bulls, when the day is done, are most often right.... Of course, being bullish today is a relative concept. As Doug Henwood says, "flat is the new up".


This book, to my
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John
Well, this is one of the few books I tried to finish but couldn't.
First I downloaded it from Audible.com. However, this book has a ton of graphs and tables. The reader of the audiobook frequently makes statements like "As can be seen from table 2.2..." The listener is unable to "see" table 2.2 as no tables or illustrations are provided either with the download or on the internet. So that's frustrating. Then I checked the book out in hardcopy from the library so as to be able to see the tables,
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Nancy
Don't curl up by the fire intending to read this book.

For most people reading this book would be a real slog. It is dense and full of charts and tables. However, picking it up, opening it to an interesting looking chapter and examining the tables and charts can be very engaging. If you get bogged down, don't give up. Pick it up from time to time and read a section. You'll learn a lot about finance.

While I did not read the whole book I got some good pointers from it. One is that there was never a
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E
Sobering study of fiscal failures

Every so often, experts sucker people into bidding up the prices of stocks or real estate because they announce that the economy has fundamentally changed. As the aftermath of the real estate bubble illustrates, the basics of economics don’t really change, no matter what fantasies people come to believe. Economics professors Carmen M. Reinhart and Kenneth S. Rogoff present a thorough historical and statistical tour of financial hubris through the centuries, a po
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linhtalinhtinh
I was about to say unratable. Not because this book is a classic, nor because it is too scholarly for me to apprehend. The reason is that I feel like it is too much like a draft. The book is full of graphs, boxes, tables, albeit with quite detailed descriptions and brief explanations. Put in another way, I feel like it is a preliminary analysis, where you throw out all raw materials you have, graphs, summaries, descriptives, and only with a very rough idea of what you are going to say. This time ...more
Ed
This time is never different: after any prolonged period of financial calm, policy makers and their advisers either forget history or invent reasons to believe that historical experience is irrelevant so the cycle of overvalued assets, huge trade imbalances and rapid acquisition of debt begins with the cheerleaders in academia and the business community telling each other (and everyone else) that this time the old valuation rules don't apply; we are smarter, have better systems and have learned ...more
Jay
This is the most important book that no one will ever read. The data provided is enormous, and presented in a manner that only economists would truly grasp. I know of few people that could fully grasp the information provided in the work, myself included at times. However, the information is sobering and necessary. Nothing in our current economic situation is new, and this work proves the point that this time is not different. People can attempt to read into this work and slant that data anyway ...more
Phil
It's data. Hooray data!

The authors aren't trying to write a book for a wide audience. It's mathematical and dry; that's the point. I hold a Bachelor's degree in Economics from a top-25 university--my coursework included International Finance and Econometrics--and I still found this book difficult. It's worth it if you are interested in economics and you don't get nervous when the authors don't apologize for being experts. A relatively simple passage from this book is something like, "A country c
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Liam
Poyais -- fictional Latin American country issues sovereign debt in the 1820s debt boom (93)

"Recognizing the significance of domestic debt can go a long way toward resolving the puzzle of why many countries default on (or restructure) their external debts at seemingly low debt thresholds. In fact, when previously ignored domestic debt obligations are taken into account, fiscal duress at the time of default is often revealed to be quite severe." (119)

"The incidence of banking crises proves to be
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Amrahs Jarihd
A veritable tome of a book, with more than 100 pages of data appendices and references. It packs a lot of authority and will be influential for years to to come but most readers can easily skip more than two-thirds of the book - the first four sections - without missing much and without losing the crux of the message. Financial crises in the shape of sovereign default, domestic debt default, banking crisis, currency crashes and inflation have happened with alarming frequency and regularity in bo ...more
Flipniesten
Onderzoek naar de oorzaken van de financiele crises door de eeuwen heen. Het gemeenschappelijke kenmerk van de crises is dat men altijd, voorafgaand aan de crisis, denkt dat de financieel economische omstandigheden geheel verschillen. Weliswaar spelen er altijd een veelheid van oorzaken een rol bij een crisis maar een van de gemeenschappelijke factoren volgens dit onderzoek is dat een crisis altijd vooraf gegaan wordt door het afschaffen van wetten/regels die de financiele of andere bedrijven mo ...more
John Esterly
This book was a bit overwhelming in its nature. The authors start by saying that casual readers may want to skip the bulk of the book, starting on chapter twelve, which begins the analysis of the recent economic crisis of 2007. I would second this statement - the first eleven chapters dig deep into historical data, data analysis, and data collection process and theory. If you do not have a specific interest in these subjects, the authors package the last section of the book as a more or less sta ...more
Joe
Right at the beginning of the book, and in the middle of the book, the authors warn you that this book is not a narrative history of financial folly and that the book is pretty technical and dry. Believe them. There were several times I almost gave up and only a sense of completion and achievement kept me from eating my own face in order to return a sense of feeling and life to my body and then giving up on the book.

But I made it. Was it worth it? Hard to say. I do have a greater understanding o
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Rendall
I loved the first 15 pages, then hit a dense, intractable wall. I gave it a good go. I'll try again someday, but with such interesting things to read and a short life, why waste time struggling with a book you're not enjoying?
Chris Elkjar
This book is fantastic. I'd been looking for some type of actual statistical analysis of banking / currency / default crises and this covers everything I wanted. While I still don't believe that countercyclical interventions can do anything to prevent the business cycle this book does paint some rather interesting pictures about how we are never exempt from risk and how history repeats itself very often.

The main thesis covers the myth that "established" countries are not susceptible to the same
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Aharon
If you read only one book this year on serial sovereign defaults in the 14th through 18th centuries, make it this one.
Rogier Potter van loon
The book is written in a rather boring and technical manner, as if it were an academic article. This would be okay, if it weren't for the fact that everything that's shown is descriptive statistics. Every other page seems to mention how they have this 'unique new big dataset' and how this allows for new insights and analyses, but these analyses are never shown. The book is really just one big description of their dataset. Nowhere in the book is there a convincing case, for example, that the 'Thi ...more
Rick
Somewhat dry, but meticulously researched. Many graphs. This book puts financial crises into perspective. They've been going on for a long, long time. Somehow, the world manages to soldier on. This book is a good remedy for those with short memories who shudder at the prospect of currency flight or national debt default, thinking this surely portends the end of days. The authors do point out that data on states, counties, and large communities should be looked at, since certain regions, like the ...more
Charles
Unfortunately, this book is nearly unreadable. Oh, I’m sure it’s readable if you’re a professional or academic economist. But for the casual reader, even one with a pretty good background knowledge of economics, it’s mostly an endless series of highly technical, loosely related charts, graphs and conclusions. All this to agree with the writer of Ecclesiastes, 2500 years ago, that “The thing that hath been, it is that which shall be; and that which is done is that which shall be done: and there i ...more
Ju-hyun Kim
good sequel of kindleberger's manias, panics and crahes: a history of financial crises.

이책은 금융위기를 다루는 책이다. <광기, 패닉, 붕괴. 금융위기의 역사> 라는 명저의 계보를 잇는 책인데, 이는 로고프 교수가 킨들버거 교수의 제자이기 때문이기도 하다. 이 책과는 달리 800년간의 데이터를 분석하여 금융위기에 대한 일반적인 설명을 하는 것이 이책의 가장 큰 메시지이다.

800년에 걸친 데이터를 분석하는 것은 어려운 일이었겠지만, 책에는 간결한 도표로 나타난다. 그 결과 "이번엔 다르다"라고 금융위기 직전에 통상 이야기 하다가, 막상 금융위기가 발생하곤 하는 상황이 반복된다는 것이 저자들의 이야기이다.

국가부채와 기업의 부채의 차이점을 이야기 하다가, 국가부채는 상환능력 만큼이나 상환의지가 중요하다는 설명을 하면서, 그런 상황을 이해하지 못하고 겨울에도 전기와 유류공급을 끊고 외채 상환을 결정한 1980년
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Harry Barnett
A more appropriate title for the book would have been "This Time is Different: Four Hundred Pages of Quantitative Analysis". The author gets it right in the Preface when he calls the book "a quantitative history of financial crises in their various guises". He goes on to say "earlier works take an essentially narrative approach, fortified by relatively sparse data". Reinhart and Rogoff provide you with data overload and no narrative. This results in some pretty dry reading. If you read and enjoy ...more
Mikeg53
A thought provoking analysis of economic activities (inflation, deflation, currency collapses, debt defaults, currency crises, root causes and common indicators prior to these events, average recovery times)over eight centuries occurring in both developed and developing countries, this book provides a rigorous academic analysis of these economic events. It's an excellent resource for those seeking to understand economic history and design their own investment philosophies based on objective anal ...more
Adam
Densely informative with very little analysis. The breadth of the data compiled for this book is impressive and Reinhart and Rogoff do find some interesting things, but the tone throughout is dry fact delivering. I got reasonably well informed about the recurrence of financial crises over time, but the authors avoid prescriptive advice at every turn. They recommend not having too much debt (though hedge all over the place about what level of debt would constitute too much - too be fair this leve ...more
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A Decade of Debt The Second Great Contraction: From "This Time Is Different" Money, Crises, and Transition: Essays in Honor of Guillermo A. Calvo Dealing With Capital Inflows: Are There Any Lessons? (Research For Action) The First Global Financial Crisis of the 21st Century - Part I: August 2007-May 2008

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“These findings on capital flow bonanzas are also consistent with other identified empirical regularities surrounding credit cycles. Mendoza and Terrones, who examine credit cycles in both advanced and emerging market economies using a very different approach from that just discussed, find that credit booms in emerging market economies are often preceded by surges in capital inflows. They also conclude that, although not all credit booms end in financial crisis, most emerging market crises were preceded by credit booms.” 0 likes
“Of course, the problems of external default, domestic default, and inflation are all integrally related. A government that chooses to default on its debts can hardly be relied on to preserve the value of its country’s currency.” 0 likes
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