The Big Interview: Is the United States a Third World Nation?

Michael Lewis, author of the new book "Boomerang," says the United States and many European nations suffered a moral failure that led to economic collapse. Lewis insists that the U.S. economic situation will get much worse before it gets better.

Quote Of The Day

´You can tell a lot about a country by observing how much better they treat themselves than foreigners at the point of entry.` - Michael Lewis

"With the possible exception of Bank of America, there is no such thing as a leaderless organization" - in Twitter

"He's really the finest writer of narrative non-fiction out there." - Malcolm Gladwell on Michael Lewis, in Fast Company

How You Measured Success In New Orleans

"What was important inside New Orleans was who your mama was, what carnival organisation you belonged to, where you went to school. It wasn't that there was an attitude that was hostile to success; it was that success was family; it was, "Did you give pleasure to people?" It was just kind of being. It wasn't achieving." - in smh.com.au

Looming Threats

We have identified two looming threats:

The first is the shifting relationship between ambitious young people and money. There’s a reason the Lower 99 currently lack leadership: Anyone with the ability to organize large numbers of unsuccessful people has been diverted into Wall Street jobs, mainly in the analyst programs at Morgan Stanley and Goldman Sachs. Those jobs no longer exist, at least not in the quantities sufficient to distract an entire generation from examining the meaning of their lives.
Our Wall Street friends, wounded and weakened, can no longer pick up the tab for sucking the idealism out of America’s youth. But if not them, who? We on the committee are resigned to all elite universities becoming breeding grounds for insurrection, with the possible exception of Princeton.

The second threat is in the unstable mental pictures used by Lower 99ers to understand their economic lives. (We have found that they think in pictures.)

For many years the less viable among us have soothed themselves with metaphors of growth and abundance: rising tides, expanding pies, trickling down. A dollar in our pocket they viewed hopefully, as, perhaps, a few pennies in theirs. They appear to have switched this out of their minds for a new picture, of a life raft with shrinking provisions. A dollar in our pockets they now view as a dollar from theirs. Fearing for their lives, the Lower 99 will surely become ever more desperate and troublesome. Complaints from our membership about their personal behavior are already running at post-French Revolutionary highs.

We on the strategy committee see these developments as inexorable historical forces. The Lower 99 is a ticking bomb that can’t be defused. They may be occasionally distracted by, say, a winning lottery ticket. (And we have sent out the word to the hedge fund community to cease their purchases of such tickets.) They may turn their anger on others -- immigrants for instance, or the federal government -- and we can encourage them to do so. They may even be frightened into momentary submission. (We’re long pepper spray.) - in Bloomberg

Credit Agencies, An Excerpt From The Big Short

To judge from their behavior, all the rating agencies worried about was maximizing the number of deals they rated for Wall Street investment banks, and the fees they collected from them.

Moody’s once a private company, had gone public in 2000. Since then its revenues had boomed, from 800 million dollars in 2001 to 2.01 billion dollars in 2006. Some huge percentage of the increase –more than half, certainly, but exactly how much more than half they declined to tell Eisman –flowed from the arcane end of the home finance sector, known as structured finance.

The surest way to attract structured finance business was to accept the assumptions of the structured finance industry. “We asked everyone the same two questions,” said Vinny. “What is your assumption about home prices, and what is your assumption about loan losses.” Both rating agencies said they expected home prices to rise and loan losses to be around 5 percent – which, if true, meant that even the lowest-rated triple-B, subprime mortgage bonds crafted from them were money -good.” it was like everyone had agreed in advance that five percent was the number,” said Eisman. “They all said five percent. It was a party and there was a party line.” - an excerpt from the “Big Short”

"The Valley Girl Show" Interview with Bestselling Writer Michael Lewis

Michael Lewis on the Valley Girl Show.

CNBC: Bullish On Books

Boomerang is cited on CNBC`s "Best Books For The Holidays 2011":

“Boomerang: Travels in the New Third World”
By Michael Lewis
224 pages
Publisher: W. W. Norton & Co.
List: $25.95

A must read for anyone who wants to know more about what caused the global financial meltdown and how we are all affected by what happens “over there.” Written by the acclaimed author of "Moneyball," "The Big Short," "The Blind Side," and the iconic "Liar's Poker," this book is based on articles Michael Lewis wrote for Vanity Fair covering "financial disaster tourism, traveling to Iceland, Ireland, Greece, and beyond." Brilliantly written, and at times sadly hilarious knowing what we know now about just how little we knew about our money and those people we trusted.

A Reflection On Greece

Even if it is technically possible for these people to repay their debts, live within their means, and return to good standing inside the European Union, do they have the inner resources to do it? Or have they so lost their ability to feel connected to anything outside their small worlds that they would rather just shed their obligations?

On the face of it, defaulting on their debts and walking away would seem a mad act: all Greek banks would instantly go bankrupt, the country would have no ability to pay for the many necessities it imports (oil, for instance), and the government would be punished for many years in the form of much higher interest rates, if and when it was allowed to borrow again.

But the place does not behave as a collective... It behaves as a collection of atomized particles, each of which has grown accustomed to pursuing its own interest at the expense of the common good. There’s no question that the government is resolved to at least try to re-create Greek civic life. The only question is: Can such a thing, once lost, ever be re-created? - in nybooks.com

Related: National Bank Of Greece (NBG)