The full extent of our madness
There was a fantastic op-ed piece in the New York Times on Saturday about the financial crisis. it’s by Michael Lewis and David Einhorn, and it’s called “The End of the Financial World as We Know It.” (It’s seven pages long, so set aside some time for reading. The first four pages are at the link above, and the last three are here.) The tone is set in this early paragraph:
Incredibly, intelligent people the world over remain willing to lend us money and even listen to our advice; they appear not to have realized the full extent of our madness. We have at least a brief chance to cure ourselves. But first we need to ask: of what?
Lewis and Einhorn answer this question both thoroughly and clearly. If you’re really unfamiliar with stock market vocabulary you may occasionally need to look up a word or two. Aside from that, it’s an immensely understandable explanation of the confluence of events leading up to the state we’re in now, in particular the knotted web of incentives that make self-correction next to impossible. Additionally, rather than just describe problems (however artfully that may be done), they go on to describe solutions and explain why those solutions would be more effective than those being attempted in the status quo. It’s not partisan or political at all; it’s mathematical and logical, which ought to appeal to everyone without regard to party affiliation.
I strongly recommend that you make yourself comfortable and settle in to read all seven pages. If you’ve been keeping up with financial news lately, you’ll find it a refreshing piece of writing (and possibly even a bit inspiring). And even if you feel like you’ve fallen too far behind in the news coverage to catch up, now is your golden opportunity.