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Posts Tagged ‘financial crisis’

I’d heard good things about this debut novel about a young couple from Cameroon living in New York, trying to become Americans, around the time the Great Recession starts. I like books that offer a perspective different from my everyday life, so I gave it a try.

It was an entertaining read. The main characters, Jende and Neni, are working hard, trying to reach their American dream. Jende came first, working and living in a cheap apartment with several other people in order to save enough money to bring Neni and their son, Liomi, to New York. Neni gets a student visa and enters community college, hoping to become a pharmacist. She works, too, as a health aide. Jende gets a job through his cousin, working as chauffeur to a Lehman Brothers executive, Clark, and his family.

But Jende’s visa has run out and his application for asylum doesn’t seem to be going well. The novel deals with how this family decides what to do — stay in New York illegally, continuing to struggle and try to avoid any potential legal issues, or return to Cameroon. Meanwhile Clark’s family, wealthy beyond Jende’s and Neni’s imaginations, suffers a number of “first world problems” which only get worse as the financial crisis begins.

This juxtaposition between Jende and Clark and their fates and families is interesting reading. Mbue allows her characters to be flawed and conflicted — no one in this book has a smooth path or impeccable morals. The story got bogged down a few times, maybe to reflect the slow, imperfect progress of the immigration system? The ending was a little bit of a letdown, but again, this may be more art than accident, because there is no clear end of the story for the characters, only more change.

Mbue writes very well, and Behold the Dreamers kept me reading. Worth an evening or two of your time, if only to imagine what life is like for someone whose life is very different than your own.

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As I’ve listened to the presidential campaigns, news analysts and comedians argue about whether Americans are better off now than four years ago, I’ve been reading The Big Short by Michael Lewis. My dad sent me a copy last fall and I finally pulled it off the “to read” shelf, in light of the economic debate and because I recently read Ira Glass‘s take on the book.  I also thought it would be interesting to read as Teen the Elder studies American politics this semester and Teen the Younger learns about psychology.

The Big Short is about the murky world of subprime mortgage backed securities, credit default swapscollateralized debt obligations, hedge funds, and other financial stuff most people will never fully understand. To his credit, Lewis makes it slightly less murky even for this English major with finance-phobia. But the book is also about a handful of people who knew what was happening —  and in one case even tried to alert the media and the SEC — and were mostly ignored. Lewis’s handling of these characters make the book a good read.

I’d argue that the story Lewis tells is also a psychological drama, with very rich, very powerful bankers and investors indulging in self-protective cognitive tactics to avoid facing what they could not imagine or believe. Traders and regulators ignoring what they could not understand, or refusing to believe there was anything beyond them. And ordinary people placing blind and undeserved trust in the system that lends money to potential homeowners and sells them property beyond their means as well as the system in which most retirement money now sits in 401k’s.

The Big Short isn’t obviously political, but I think Lewis exposes the way the U.S. government (both the previous and current administration; this is a bipartisan critique), also acting in fear and ignorance and also convinced of its own ability to understand the unfathomable, blundered around the financial system, rescuing some firms and allowing others to go bankrupt, bandying about the term “too big to fail” (coined much earlier by a man called Jamie Mai in a memo to his two partners in a very small firm called Cornwall Capital) as it snowed the public into believing everything was under control.

I finished this book convinced of a few things. The first is that Michael Lewis is a very talented writer who brings people right off the page — I could almost hear the folks he profiled talking. Lewis manages, as Ira Glass noted, to make readers love the “rich know-it-alls” who saw the crisis coming, he humanizes them, but he also points out that without exception the people who saw what was happening, who understood, were also complex moral figures. Also as Glass points out, these “contrarians” are funny. I think their stories are unbelievably entertaining; they could be characters straight out of a tragedy.

The second thing I’m convinced of is that our economy and our government are too big and complicated for the people working inside them ever to fully grasp, and that reform is unlikely because the systems are absurdly complicated and influenced by money. Who is better off now than in 2007/2008? Well, Wall Street for one. A few firms went under, were bought out and absorbed into other firms, or downsized, but the financial sector’s recovery has been quite good considering the size of the crisis.

Worse, there has been no psychological recovery — the hubris and greed that allowed the financial industry to create the entire mess has never gone away. Just look at the Facebook IPO and the “selective disclosure” of key information in the days before it by firms like Morgan Stanley, Goldman Sachs, and JP Morgan Chase (who all appear in The Big Short). Or the Libor scandal.  Michael Lewis tells readers at the beginning of The Big Short that he had personally given up on waiting for “the end of Wall Street as I had known it,” (his first book, Liar’s Poker, is about his time at Salomon Brothers). He says there is no “scandal or reversal . . . sufficiently great to sink the system.”

I wonder where he invests? Anyway, Dad, you were right, it’s a good read. Absurd. Horrifying. But well done.

 

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