Let’s get this straight, with a hat tip to CaryGEE:
In his book “I.O.U”, Lanchester writes at p. 55 about the famed late economist John Maynard Keynes:
“As Keynes – he who made himself and his college rich by spending half an hour a day in bed playing the stock market – once observed, there is nothing so disastrous as a rational policy in an irrational world. Keynes was preoccupied by the difference between risk in the sense of the mathematical calculation of probabilities and uncertainty, the more profound unknowabilities of life and history… Confuse risk with uncertainty, and you have dug a tank trap for yourself.”
Dwight Garner reviews Lanchester’s book at the New York Times in Laughing All the Way to the Bank:
“If you wanted to try to make sense of the global banking crisis, instead of merely weeping openly at your A.T.M. balance, 2009 was a very good year. Bookstores were filled with volumes that, with expert 20-20 hindsight, explained how capitalism went to hell….
Few if any of these books will be as pleasurable — and by that I mean as literate or as wickedly funny — as John Lanchester’s “I.O.U.: Why Everyone Owes Everyone and No One Can Pay.”
“I.O.U.” crosses over into black satire when Mr. Lanchester describes how bankers used their new tools to make money from poor people, the worst credit risks, by prying their cash loose through predatory lending, then pooling this money and selling it off. Who cared if these people defaulted on their mortgages? The risk had already been passed along to others, and ultimately, when banks failed, to taxpayers. Mr. Lanchester calls this “a 100 percent pure form of socialism for the rich.” [emphasis added by LawPundit for the benefit of all those honest but misguided people out there who think socialism is something going from rich to poor – not true]
With steam shooting from his ears, he summarizes: “So: a huge, unregulated boom in which almost all the upside went directly into private hands, followed by a gigantic bust in which the losses were socialized. That is literally nobody’s idea of how the world is supposed to work.”
Our comment to that last paragraph is: BRILLIANT!
Read the full review here. And you might consider reading the book.