This is the area in which Cassidy's work stands out. This is a compelling synthesis that derives most of its narrative energy from the authors clarity of thought and exposition. It is redundant if you're already familiar with the separate and competing theories. Cassidy is a journalist and economist who writes for the New Yorker. I want to elaborate here, but i feel like i'd need to write a 2 page memo instead of a goodreads blurb. But he is no socialist.
Combining on-the-ground reporting, clear explanations of esoteric economic theories, and even a little crystal-ball gazing, Cassidy warns that in today's economic crisis, conforming to antiquated orthodoxies isn't just misguided-- it's downright dangerous. Cassidy, the deeper roots of the crisis lie in the enduring appeal of an idea: that society is always best served when individuals are left to pursue their self-interest in free markets. This will always be the latest edition of each resource too and we'll update you automatically if there is an upgraded version to use. Cassidy gives an entirely thorough, logical, and convincing explanation of how theory contaminated practice and tore the financial system apart. But then again, plenty of books exist for a more detailed treatment of behavioural economics Kahneman, Akerlof, Shiller, etc.
Cassidy delivers on the promise of his title, but he also offers a clear-eyed look at economic thinking over the last three centuries, from Adam Smith to Ben Bernanke, and shows how the major theories have played out in practice, often not well. However, I've been told that Cassidy exaggerates the death of equilibrium theory from these results. In an effort to debunk that 'ideology,' which he sees as holding sway in academia and among policymakers in recent decades, Cassidy marshals a deep understanding of economic intellectual history, deftly explaining the principal ideas of such towering figures as Adam Smith, Friedrich von Hayek, Léon Walras, Kenneth Arrow, Milton Friedman, and Robert Lucas. That does not make his work less valuable. Cassidy writes with terrific clarity and a finely tuned sense of moral outrage, yielding a superb book.
The second explores what Cassidy calls 'reality-based economics. This particular book is a fantastic, insightful examination of the general, underlying theories of the efficient market hypothesis and how they have failed on many, many levels as was evidenced by the events of the last few years. He shows that the Fed and other U. Those that claim that government intervention is socialist and communist by default might want to read their Adam Smith a little closer. All serve, in some manner, as cautionary philosophies and theories, often derived from psychological considerations, set against a recurrence of those terrible failures of the first half of that century: the Great Depression, massive unemployment, vast wealth destruction, and the tendency for financial markets to blow speculative bubbles. The author does an excellent job of simplifying economic theories and financial models. This is a compelling synthesis that derives most of its narrative energy from the author's clarity of thought and exposition.
Combining on-the-ground reporting, clear explanations of esoteric economic theories, and even a little crystal-ball gazing, Cassidy warns that in todays economic crisis, conforming to antiquated orthodoxies isnt just misguidedits downright dangerous. There are rare insights into how the securitisation of mortgages by banks and Wall Street firms grew in size and led to extreme risks that ultimately exploded in the face of every financial market participant. The crux of the entirety is the economic crisis of 2008, an example of dra This is a timely, lucid, well-structured and well-argued book, perhaps the best of the half-dozen or so economically- and financially-themed tomes that I have read over the past several months. Cassidy's writing is accessible, but not dumbed down. Indeed, he argues that a self regulating system is precisely the problem that ended in the 2008 financial crisis.
However, this is not just another account of the 2008 recession, as Cassidy details both the theoretical cracks and the factual errors both in the market system as a whole, and among the big investment firms and banks on Wall Street, respectively. The idea of hidden information and moral hazard is also introduced quite well here, but again, this isn't the only book to do so. What about when they lead to stock market bubbles, glaring inequality, polluted rivers, real estate crashes, and credit crunches? Friedman played a crucial role in this process. He then looks to the leading edge of economic theory, including behavioral economics, to offer a new understanding of the economy—one that casts aside the old assumption that people and firms make decisions purely on the basis of rational self-interest. But Cassidy should have been more sharp and pointed out that if firms get too big to fail then they should be too big to succeed in the first place. This was an awesome read, and I would highly recommend it.
As a writer in economics and finance at John Cassidy is well placed to produce a compelling explanation for the unfolding financial and economic crisis. I started reading this a while back as an audiobook almost on a whim on a particularly bad traffic day on I-90. Cassidy delivers on the promise of his title, but he also offers a clear-eyed look at economic thinking over the last three centuries, from Adam Smith to Ben Bernanke, and shows how the major theories have played out in practice, often not well. John Cassidy is a journalist at The New Yorker and a frequent contributor to The New York Review of Books. While Cassidy is great in describing what happened he is very weak in pointing out appropriate solutions in much detail.
But Cassidy should have been more sharp and pointed out that if firms get too big to fail then they should be too big to succeed in the first place. Of course, the goal is to explain the most recent financial market crisis. Students of market failure will appreciate his taxonomy of market imperfections, many of which are then skilfully woven together to understand more about what was happening in the financial markets in the last twenty years. Cassidy uses the financial industry and the government as examples of how free markets can fail miserably. For instance, on the subject of market externalities, Cassidy talks about a paper, presented at Harvard University in the mid-1980s by W. But what about when markets dont work? Cassidy writes with terrific clarity and a finely tuned sense of moral outrage, yielding a superb book. In doing so, the author thoroughly discredits Milton Freedman and Alan Greenspan.
Cassidy, however, fails to convince, why monopolies should be forced to co-operate with budding competitors. An ambitious book, and one that mostly succeeds. A number of other books, in particular Bethany McLean's present a far more gripping tale of this same material. By doing this, we are able to learn the truths about our ideals, the good and the bad, and we can obtain a more inclusive knowledge without all the filters that may have been added over the years. Cassidy, by structuring his work into three distinct parts, opted for what, in my opinion, served best to channel the disparate and historically deep, but quite relevantly interrelated, streams of analysis he has undertaken within. Cassidy focusses on the ideas of Alan Greenspan through the book, and his mentions go up in this segment.
He talks about Microsoft refusing to make its products compatible with those of its rivals but does not rationalise why that is such a good thing in a competitive scenario and how much of sustainable benefits it will provide to consumers. The most concise and elegantly written account, among the many that have come out, of how we got into this mess. Or, if free markets are to be allowed without restrictions, then any failures should also be allowed to happen freely without government bailouts. And Hyman Minsky who built on the works of Smith and Keynes emerges as perhaps the most prescient economist of the 20th Century. But it was worth the effort. Synopsis Behind the alarming headlines about job losses, bank bailouts, and corporate greed is a little-known story of bad ideas.