Friday, 19 August 2011

Michael Lewis breaks news from 2008

Michael Lewis, of Liar's Poker fame, has emerged as a leading writer of the credit crisis and its aftermath. I wish there were 10 of him. And if only one of them were European. His latest piece, on Germany, is kinda funny and kinda accurate.


He writes that the Germans got way over-exposed to dodgy debt in the credit boom, as long as it was foreign and had a AAA rating. He ties this financial stuff with genuinely funny observations about the Germans he meets, as well as claiming they have a scatological obsession. Lewis is American so it reads a bit National Lampoon's European Vacation for my taste but the financial stuff is solid.


However ... Germans' obsession with AAA-rated credit (and Norwegians' for that matter) is well known in the markets and has been a topic extensively explored since the explosion of CDOs in late 2008/early 2009. That this is still news 2-3 years after the event suggests financial journalists in Europe are simply not doing their job, are unable to explain complex finance or have failed to find ways to explain it in interesting enough ways.

No comments: