Wednesday, August 06, 2008

Reading while in Paris: Gorge Soros's "The New Paradigm"

"The New Paradigm for Financial Markets: The Credit Crash of 2008 and What It Means"

This is the book I started to read in Paris. It's quite different from my "holiday's readings" that you can see here. Soros analysis of what we perceive today as the financial crisis is deep. No question about that.

Traditionally, we think the current crisis is just "subprime" lending crisis. It is not. This is just the effect. The cause is deeper and has roots in processes and trends almost 10 years old.

Particularly I was intrigued by the conclusion that the cut of the rates of federal funds by Fed (from 6.5% to 3.5%) in the course of just few months of 2000, caused by Internet bubble, and the trend that get it down to 1% by 2003, has created a long term bubble in housing markets....
The examples he gives, are just breathtaking and almost unbelievable....

As in "Alchemy of Finance" he writes about his life's experiences and how thay influence his philosophy and activity. I know, Soros is controversial. But he explicitly says about the philosopher who was his master: Karl Popper. For this very reason I value Soros, as I'm also a pupil of Popper, and his Open Society ideas ....

I'm in the mid of the book now, I will write more when finished.


  1. czesc! :)

  2. Joluś - What do you mean by "czesc"
    :-) Do you want to comment on Soros's book ?