Share this story
Close X
Switch to Desktop Site

Boomerang: Travels in the New Third World

Next Previous

Page 2 of 3

About these ads

First stop: Iceland. Here grossly inexperienced Icelandic bankers caused three of their global banks to collapse, leaving the nation with debts amounting to 850 percent of their gross domestic product. Iceland’s principal distinction today, says Lewis, is that it’s now “the only nation on earth that Americans could point to and say, ‘Well, at least we didn’t do that.’ ”

Next stop is Greece – a nation saddled with an outstanding government debt of “roughly $400 billion (and growing).” How did it happen? When they thought no one was looking, explains Lewis, Greeks hoped to “turn their government into a piñata stuffed with fantastic sums and give as many citizens as possible a whack at it.”

In Ireland a single bank lost $3.4 trillion, largely on bad property deals. This mess, says Lewis, “was created by the sort of men who ignore their wives’ suggestions that maybe they should stop and ask for directions, for instance.” (Among other indelible images from Ireland: a brand-new, abandoned village in the middle of a rain-swept former potato field. Apparently no one bothered to ascertain before building it whether or not anyone would want to live in it.)

The story Lewis follows in Germany is different in that – rather than greed or out-and-out incompetence – the Germans seem to have been guilty of massive credulity. Because German bankers tend to play by the rules, says Lewis, they couldn’t comprehend that American bankers often do not. So when “extremely smart traders inside Wall Street investment banks” created “diabolically complicated bets” and then went in search of “some idiot” to “take the other side,” it turned out that “a wildly disproportionate number of those idiots were in Germany.”

Next Previous

Page:   1   |   2   |   3

Follow Stories Like This
Get the Monitor stories you care about delivered to your inbox.