A must-read for anyone still wondering why the bottom dropped out of the economy.
An authoritative account of events leading up to the current recession.
In his debut, New York Times national economics correspondent Goodman draws on extensive reporting to examine the “financial make-believe” that drove Americans to borrow and spend their way into a crisis which, by 2008, had wiped out $7 trillion worth of wealth and destroyed 2.6 million jobs. Using plain, direct prose, the author describes what happened and vividly traces the effects on more than two-dozen people among the millions caught up in the ripples of the bust. They include Dorothy Thomas, a middle-class African-American in California who lost her job and was forced to pretend to be a drug addict to stay in a homeless shelter; Willie Gonzalez, a liquor distributor who spent excessively, bought a $180,000 home with two-percent down and went bankrupt; and Fran Barbaro, a middle-aged MBA graduate with a six-figure income who spent all of her money and faced foreclosure. In this “Neverland” economy—made possible by the government’s “massive abdication of regulatory authority,” says Goodman—working Americans spent money freely, first in the technology boom and bust, and then in a real-estate market that enticed them to “buy a home, watch it climb in value and pull money from it as if it were an ATM machine, one that never required a deposit.” The author places much blame on too-easy credit—readers will be infuriated to read about brokers who sold subprime loans to recent immigrants unable to read English—greed and fantastical thinking, combined with free-market cheerleading by Federal Reserve chairman Alan Greenspan, who touted credit default swaps. Goodman argues that the country must generate high-quality jobs in such growth areas as biotechnology and renewable energy.
A must-read for anyone still wondering why the bottom dropped out of the economy.Pub Date: Sept. 15, 2009
ISBN: 978-0-8050-8980-6
Page Count: 352
Publisher: Times/Henry Holt
Review Posted Online: June 24, 2010
Kirkus Reviews Issue: Aug. 1, 2009
BOOK REVIEW
Striking research showing the immense complexity of ordinary thought and revealing the identities of the gatekeepers in our...
A psychologist and Nobel Prize winner summarizes and synthesizes the recent decades of research on intuition and systematic thinking.
The author of several scholarly texts, Kahneman (Emeritus Psychology and Public Affairs/Princeton Univ.) now offers general readers not just the findings of psychological research but also a better understanding of how research questions arise and how scholars systematically frame and answer them. He begins with the distinction between System 1 and System 2 mental operations, the former referring to quick, automatic thought, the latter to more effortful, overt thinking. We rely heavily, writes, on System 1, resorting to the higher-energy System 2 only when we need or want to. Kahneman continually refers to System 2 as “lazy”: We don’t want to think rigorously about something. The author then explores the nuances of our two-system minds, showing how they perform in various situations. Psychological experiments have repeatedly revealed that our intuitions are generally wrong, that our assessments are based on biases and that our System 1 hates doubt and despises ambiguity. Kahneman largely avoids jargon; when he does use some (“heuristics,” for example), he argues that such terms really ought to join our everyday vocabulary. He reviews many fundamental concepts in psychology and statistics (regression to the mean, the narrative fallacy, the optimistic bias), showing how they relate to his overall concerns about how we think and why we make the decisions that we do. Some of the later chapters (dealing with risk-taking and statistics and probabilities) are denser than others (some readers may resent such demands on System 2!), but the passages that deal with the economic and political implications of the research are gripping.
Striking research showing the immense complexity of ordinary thought and revealing the identities of the gatekeepers in our minds.Pub Date: Nov. 1, 2011
ISBN: 978-0-374-27563-1
Page Count: 512
Publisher: Farrar, Straus and Giroux
Review Posted Online: Sept. 3, 2011
Kirkus Reviews Issue: Sept. 15, 2011
BOOK REVIEW
IN THE NEWS
A readable, persuasive argument that our ways of doing business will have to change if we are to prosper—or even survive.
A well-constructed critique of an economic system that, by the author’s account, is a driver of the world’s destruction.
Harvard Business School professor Henderson vigorously questions the bromide that “management’s only duty is to maximize shareholder value,” a notion advanced by Milton Friedman and accepted uncritically in business schools ever since. By that logic, writes the author, there is no reason why corporations should not fish out the oceans, raise drug prices, militate against public education (since it costs tax money), and otherwise behave ruinously and anti-socially. Many do, even though an alternative theory of business organization argues that corporations and society should enjoy a symbiotic relationship of mutual benefit, which includes corporate investment in what economists call public goods. Given that the history of humankind is “the story of our increasing ability to cooperate at larger and larger scales,” one would hope that in the face of environmental degradation and other threats, we might adopt the symbiotic model rather than the winner-take-all one. Problems abound, of course, including that of the “free rider,” the corporation that takes the benefits from collaborative agreements but does none of the work. Henderson examines case studies such as a large food company that emphasized environmentally responsible production and in turn built “purpose-led, sustainable living brands” and otherwise led the way in increasing shareholder value by reducing risk while building demand. The author argues that the “short-termism” that dominates corporate thinking needs to be adjusted to a longer view even though the larger problem might be better characterized as “failure of information.” Henderson closes with a set of prescriptions for bringing a more equitable economics to the personal level, one that, among other things, asks us to step outside routine—eat less meat, drive less—and become active in forcing corporations (and politicians) to be better citizens.
A readable, persuasive argument that our ways of doing business will have to change if we are to prosper—or even survive.Pub Date: May 1, 2020
ISBN: 978-1-5417-3015-1
Page Count: 336
Publisher: PublicAffairs
Review Posted Online: Feb. 16, 2020
Kirkus Reviews Issue: March 15, 2020
© Copyright 2024 Kirkus Media LLC. All Rights Reserved.
Follow
Popular in this Genre
We can’t wait for you to join Kirkus!
It’s free and takes less than 10 seconds!
Already have an account? Log in.
OR
Sign in with GoogleTrouble signing in? Retrieve credentials.
Welcome Back!
OR
Sign in with GoogleTrouble signing in? Retrieve credentials.
bookshelf