Trillion Dollar Meltdown

That's the provocative title of this book by Charles Morris.

I read it on a flight to Indianapolis last May (on my way, incidentally, to work for Barack Obama in Muncie, Indiana). It's a slim book, you can read it in a few hours.

And I suggest you do, because it is the most lucid account yet, that I have read, of why we are in this mess. By which I mean Bear Stearns, subprime mortgages, CDOs, Lehman, AIG, and so on.

If you want the even shorter outline, there is this.  Basically, too much free money (i.e., low interest rates from the Feds); too much dependence on a consumption-driven economy, fueled by over-heated real estate prices; and Wall Street barons and bankers gambling extravagantly with other people's money, turning our financial institutions into one big casino.

Oh, and the Republicans running the country for most of the past eight years not really giving a damn about any of this, running deficits of multiple kinds (budget, trade, etc) with a "What, me worry" smirk.

Morris tallies up the likely damage in his book and he estimates it is likely to be at 1 trillion dollars. With the collapse of Bear, Lehman, etc., I'm not sure where we're at. But looking at this chart, seems as if we're close — and have maybe even surpassed, now — the $1 trillion in losses mark.

And to think, in light of this, that people — some of them thoughtful and reasonable — might vote for John McCain, even though his policy would be "more of the same." 


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