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

3.38  ·  Rating details ·  1,323 ratings  ·  124 reviews
In the midst of the most serious financial upheaval since the Great Depression, legendary financier George Soros explores the origins of the crisis and its implications for the future. Soros, whose breadth of experience in financial markets is unrivaled, places the current crisis in the context of decades of study of how individuals and institutions handle the boom and bus ...more
Hardcover, 163 pages
Published May 1st 2008 by PublicAffairs (first published January 1st 2008)
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Average rating 3.38  · 
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 ·  1,323 ratings  ·  124 reviews


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Chris
Dec 03, 2008 rated it really liked it
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
Apr 02, 2012 rated it it was ok
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
Richard Budge
Dec 06, 2013 rated it did not like it  ·  review of another edition
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
Bart
Nov 03, 2008 rated it it was amazing
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 from,
...more
sleeps9hours
Nov 21, 2008 rated it really liked it
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
...more
Peter
Aug 21, 2008 marked it as did-not-finish
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
Jacob
Nov 22, 2010 rated it did not like it
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
Ajay Palekar
May 27, 2018 rated it really liked it
As with all the finance books written shortly after the financial crisis, this one has its more forgettable and misguided moments. Written as it was during a time of fear and profound lack of confidence in the system. But George's quite intimate understanding of the machinery, his more philosophical view of things, and his candor about his own failings make this a far more interesting read.

His argument is not one of fear, but a rational analysis of what he sees to be more fundamental
...more
Rob
Apr 12, 2008 rated it liked it
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
Dennis Littrell
Aug 30, 2019 rated it really liked it
Russell's paradox in the financial markets

George Soros has forgotten more about finance, economics and trading than most of his critics will ever know. He has made more money than most of his critics put together will ever make. So when George Soros speaks on matters to do with money, I listen, and when he writes a new book, I read it.

When Soros speaks about politics, which he frequently does, I also like to listen. He is a sharp critic of the United States especially und
...more
InvestingByTheBooks.com
Aug 22, 2018 rated it it was amazing
Can we observe the market objectively, being participants as well? What is reflexivity, and why is it a must to understand it? What is George Soros’ long-term scenario for the financial markets? This book consists of two parts: (1) Perspective and (2) The Current Crisis and Beyond. The second part is good. The first is great. For the first time, I believe I understand his thoughts on the two driving forces behind reflexivity. And now, in the current dangerous monetary experiment - it’s obvious w ...more
Jeffrey
Interesting book in many ways. It is Soros' attempt to gain further recognition for his theory of Reflexivity first outlined in The Alchemy of Finance by applying to the financial crisis as it unfolded in the 2008. Not only does Soros attempted not to narrate the events and their causes, but also their implications, which as his own theory makes clear, are inherently unknowable. In many ways he is holding himself to account by setting down his thoughts - this in itself should be applauded (few, apart from Dalio, ...more
Alton Motobu
Oct 24, 2018 rated it did not like it  ·  review of another edition
Difficult reading at best. I could not understand the technical and theoretical portions of it and ended up skimming and speed reading most of it. I had expected it to be what the title stated: an analysis of the crash of 2008 and what it means for the American people. Instead it turned out to be a continuation and explanation of his first book, The Alchemy of Finance, with details about his Theory of Reflexivity.

The book was in three parts: (1) background including various economic theories an
...more
Bob Edwards
Aug 20, 2017 rated it liked it
Anyone as successful as him is worth reading about, but his economic theory was not sufficiently fleshed out and was difficult to understand. Still in all, it was worth reading. He used this information which he developed through 40 years of investing to accumulate over 25B in assets, primarily by not following the precepts of traditional economics, realizing the principal of reflexivity, that similar to quantum mechanics, the presence of investors impacts economic equilibrium. The book was publ ...more
Emily Patrick
May 09, 2019 rated it really liked it
Regardless of his politics, which I disagree with, there is no doubting Soros' financial markets knowledge. The lessons from this book have still not been absorbed by the financial community. This does not bode well for the next financial crisis, which will be even worse than 2008.
Yuni Amir
Mar 18, 2017 rated it it was amazing
I suspect Soros was aspired to be a politician. This book discusses less about money, but more on how to understand the world around us by taking the Global Meltdown in 2008 as an example. Reflexivity is the word.

PostScript: There is a chapter dedicated on his political aspiration in Russia.
Darsh Bakshi
Dec 27, 2018 rated it did not like it
Finishing this book was a difficult task in itself. The language is overly complicated and complex to comprehend. Repeating one idea over 30 times in a book doesn't make any sense. Moreover this is something that almost everyone knows already. Not wasting my time on this anymore.
Hallie
Oct 12, 2018 rated it did not like it
Not a fun read. Way too theoretical and philosophical and rambling.
Madam Anastasija
Apr 27, 2018 rated it liked it
IMNO, the author is too selfminded.
Curtis Rother
Jan 06, 2019 rated it liked it
Soros has an interesting, and I think valid, view of what drives markets. However, he repeats the same explanations over and over instead of truly teaching how to apply his perspective.
Sharath Reddy
Jul 27, 2019 rated it liked it
Alchemy of finance is better
This book is incomplete, but has key ideas in it.
Geoff
Aug 26, 2012 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
...more
Austen
Nov 04, 2008 rated it did not like it
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
...more
Greg
Jul 08, 2008 rated it liked it
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 th
...more
Peter
Dec 13, 2008 added it
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
...more
Alberto Lopez
Feb 23, 2017 rated it it was amazing
Shelves: my-favorites
A great book about Soros' philosophical take on the impossibility of scientific evaluations of social sciences; namely economics. I very much liked his Theory of Reflexivity. This book seems parallel in value to "the black swan" by Taleb.
Eric
Sep 23, 2008 rated it it was ok
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
...more
Max Stone
Aug 26, 2008 rated it it was ok
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
...more
Jon
Nov 07, 2008 rated it it was ok
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
Wayne
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
...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
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