Financial Shock: A 360 Degree Look at the Subprime Mortgage Implosion, and How to Avoid the Next Financial Crisis Book

A little hard (for me) to follow, and to some extent OBE (overtaken by events), as evidenced by his claim near the end that the worst was over, but fairly readable summary of events leading up to current economic disaster (to use Pres. Obama's term from yesterday).

In hindsight it all looks so foreseeable that you wonder why nothing effective was done by way of prevention, but prediction is obviously tougher than summary and retrospective analysis. Just last summer with oil at 140/barrel and gas 4/gallon I was hearing that it would keep going up, up, up for reasons x, y, z. Glad I didn't switch what little is left of my retirement account into oil futures!

Book does nice job of showing how some decisions that make sense for individuals add up to deepening/extending societal problems -- e.g., "reverse wealth effect" -- as your paper wealth declines (value of house you own, for instance), you spend less (e.g., less likely to take home equity loan or use home equity line of credit to pay for home renovation, college tuition, new car.......). Reasonable reaction by that person/family, but as it becomes widespread, the drop in spending deepens/extends recession.

Very terse description of what he recommends should be done now -- a top 10 list long on general wishes ("overhaul" such and such aspect of finanical system) and short on detailed consideration of the mechanics and politics of each idea. But in fairness I guess that's where things stand now -- fairly good historical understanding of what happened, less clarity on how to fix.