In Boomerang, author Michael Lewis travels to five financial hot zones -- 'the new third world' as he calls it -- to better understand what the hell happened with the economic meltdown.
Lewis travels to Iceland, Greece, Ireland, Germany and sunny bankrupt California; he tells the stories of their financial misadventures and disasters by letting the real characters tell their stories. Descriptions of people are funny, insightful, playful and sometimes cutting. Think of it as the Cliff Notes version of a text book mixed with one-liners from a roast (the book is based on a serves of Vanity Fair articles).
Bankers and politicians fare badly in Boomerang, coming across as anywhere from inept to corrupt.
While the Icelanders' tale is almost comical in their greedy naiveté, the German bankers come across as shocked - just shocked!!! - that Wall Street bankers would rip them off, and in Greece and in California the players come across as morally bankrupt and probably criminal. Ireland might be the most interesting of them all, as their egos and national bravado simply outrun their common sense.
Boomerang is told through colourful conversations with the key players, from Icelandic fishermen to Greek monks to Irish bankers to a Dallas hedge-fund owner to former California Governor Arnold Schwarzenegger. Ah-nold, in case you were wondering, comes across as well-intentioned but shallow and hugely egotistical.
There are no heroes here.
Lewis has a reputation as an entertaining business writer, and this book lives up to that. While Boomerang probably oversimplifies both the cause and effect of world economic issues, it is an insightful and enjoyable read.
The Greece section was probably the most newsworthy as that country is so much in the headlines right now with their European Union bailout. Lewis describes cultural and political practices that contributed to the country's debt problems. Those include a widespread practice of citizens and companies avoiding taxes... they don't wanna pay and no one is gonna make them. Some poor schmuck of a tax collector who actually tries to do his job ultimately loses that job. It feels like everyone is corrupt there...
"In Athens, I several times had a feeling new to me as a journalist: a complete lack of interest in what was obviously shocking material," Lewis writes, describing his many interviews with bankers, tax collectors and a former member of parliament. "Scandal after scandal poured forth. Twenty minutes into it I'd lose interest. There were simply too many: they could fill libraries, never mind a book."
When the Greek government learned their finances were not healthy enough to get them into the European Union, they simply cooked their books and hid many billions of debt. The more I learned about Greek finance the less sympathy I had for them.
During Boomerang I alternated between laughing out loud and saying "WHAT THE FUCK?" out loud. Yes, while alone in my car...
By the end of his journeys, Lewis concludes that the root cause of the meltdown is human nature, specifically greed and short term thinking. Americans want monster houses they cannot really afford, Icelandic fisherman don't want to be fishermen anymore, and so on. He's right, and he might be underplaying the accountability... while many people lost everything, many others got very rich and walked away.
We were all misled. Justice has not been served. And while Boomerang is not a full picture of where we are or how we got here, it is a fascinating piece of the puzzle...