Germans did not go nuts during the global credit boom. They did not spend beyond their means and run up massive deficits; citizens did not buy a bunch of overpriced assets they couldn’t afford; former government financial officials did not dash off to make bundles at investment firms. But that doesn’t mean that they were blameless or that they won’t suffer, Lewis notes. Not only did German banks become top creditors for all those spendthrift European nations, but they also lost a pile in America’s subprime mortgage debacle, purchasing assets they thought were safe. Why? Because, Lewis writes, Germans believe in rules, not just excrement.
“The Germans took the rules at their face value: They looked into the history of triple-A-rated bonds and accepted the official story that triple-A-rated bonds were completely risk-free.” Even when they weren’t. Lewis quotes a Wall Street trader, circa 2007, explaining who was still buying the securities he was peddling: “Stupid Germans in Düsseldorf.”
Now Germany’s “preternatural love of rules” will come into play as the world waits to see if it bails out the E.U. After all, when the Germans signed on to the euro, they didn’t think they were signing up to be Europe’s insurance policy — but what did they know? “The same instincts that allowed them to trust Wall Street bond salesmen also allowed them to trust the French, when they promised there would be no bailouts, and the Greeks, when they swore that their budget was balanced,” Lewis posits. Those silly Germans — so gullible!
Lewis has a wonderful talent for distilling complicated stories, whether bond trading in New York (“Liar’s Poker”) or a baseball-analysis revolution in Oakland (“Moneyball”), in simple terms and with telling detail. “Boomerang” — adapted from a series of essays he wrote for Vanity Fair — doesn’t disappoint on this score.
Everyday Irish people speak in “basis points” rather than percentages, indicating how deeply finance has penetrated their lives. The vacancies in Reykjavik’s posh 101 Hotel — “the sort of place bankers stay because they think it’s where the artists stay” — embody the city’s sudden collapse. And the conundrum of ascetic Greek monks somehow getting fat on a menu of cucumbers and raw onions suggests that not all was as it seemed.
But the book’s incessant moralizing and stereotyping may leave readers wondering why Lewis, beyond traveling throughout Europe, also took the path from master storyteller to itinerant scold. “Boomerang” is full of wonderful characters and unforgettable scenes. But it’s also preachy, even angry, and the mix is as distracting as it is enlightening.
Carlos Lozada
is Outlook editor at The Washington Post.
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