Lena's Reviews > I.O.U.: Why Everyone Owes Everyone and No One Can Pay

I.O.U. by John Lanchester
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Feb 12, 11

bookshelves: non-fiction
Recommended to Lena by: Trevor

If you're looking for a good story, a novelist is not a bad person to turn to. At its core, after all, the financial crisis is a really good story - one full of high hopes and big dreams, smart innovations and even smarter deceptions, big egos and fatal flaws. It has all the makings of a classic tragedy, in fact, one whose consequences, unfortunately, are far more real than fiction.

John Lanchester is by trade a novelist rather than a financier, and he brings his full bag of tricks to bear on the telling of the financial crisis tale. He's a good person for the job, someone who has done enough research to be able to describe the crisis in all its full glory, while using language to do so that can be understood by anyone.

This is no small task, either, since the various events that lead to the crisis are woven together in a tangled knot of extreme complexity. But in Lachester's capable hands, pieces of thread clearly begin to take shape. Whether he is talking about the fundamentalist belief in laissez faire capitalism that lead to the steady erosion of regulations put in place to prevent this sort of thing from happening in the first place, or the misplaced faith in sexy new mathematical formulas used by Wall Street to assess risk, or the intense pressure to create new homes for the giant pool of investment capital floating around the globe, or the moral hazard created by people making loans they would immediately sell to other investors, thus relieving themselves of any motivation to determine whether borrowers were truly credit-worthy or not, a picture how this enormous disaster developed becomes painfully clear.

While this book is highly readable, it is not necessarily easy to read, since it is impossible to do so without getting very, very angry at those individuals at the top of the financial food chain who reaped enormous rewards at the expense of pretty much everyone else on Earth. The system described, in which profits were privatized into the hands of a few while the risks were underwitten by those of us least able to afford it, is so fundamentally wrong it's hard to imagine how we ever got to this place. But we don't have to imagine it, because Lanchester has so clearly described it for us, leaving us instead with the question of just now what do we plan to do about it? While he does offer solutions, he does so with a healthy dose of skepticism about whether or not what needs to be done can be accomplished in our current political climate. A good place to start, however, would be for everyone to read this book.
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Comments (showing 1-3 of 3) (3 new)

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message 1: by Lisa (new)

Lisa Vegan Your review makes it very tempting but I honestly don't see how my blood pressure can take it.


Lena An understandable concern. Definitely worth reading, though - maybe in small doses?


message 3: by Lisa (new)

Lisa Vegan Perhaps. It does sound worthwhile to read.


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