This Time is Different: Eight Centuries of Financial Folly, by Carmen Reinhart and Ken Rogoff
Book description:
Throughout history, rich and poor countries alike have been lending, borrowing, crashing—and recovering—their way through an extraordinary range of financial crises. Each time, the experts have chimed, "this time is different"—claiming that the old rules of valuation no longer apply and that the new situation bears little similarity to past disasters. This book proves that premise wrong. Covering sixty-six countries across five continents, This Time Is Different presents a comprehensive look at the varieties of financial crises, and guides us through eight astonishing centuries of government defaults, banking panics, and inflationary spikes—from medieval currency debasements to today's subprime catastrophe. Carmen Reinhart and Kenneth Rogoff, leading economists whose work has been influential in the policy debate concerning the current financial crisis, provocatively argue that financial combustions are universal rites of passage for emerging and established market nations. The authors draw important lessons from history to show us how much—or how little—we have learned.
Using clear, sharp analysis and comprehensive data, Reinhart and Rogoff document that financial fallouts occur in clusters and strike with surprisingly consistent frequency, duration, and ferocity. They examine the patterns of currency crashes, high and hyperinflation, and government defaults on international and domestic debts—as well as the cycles in housing and equity prices, capital flows, unemployment, and government revenues around these crises. While countries do weather their financial storms, Reinhart and Rogoff prove that short memories make it all too easy for crises to recur.
An important book that will affect policy discussions for a long time to come, This Time Is Different exposes centuries of financial missteps.
This book is from Princeton University Press. Reinhart is an economics professor at the University of Maryland and Rogoff is an economics professor at Harvard.
Posts
The time may not be different, but this is DC!!! The place is! The DC area will NEVER go back to fundamentals!!!
ReplyDeleteYou forgot to mention that you dislike DC's restaurants, and the music scene. And that its residents are a bunch of sheep. SHEEP I TELL YOU!!!
ReplyDeleteAlways enlightening. "Fundamentals", though. Fundamentals.
DC will get back to fundamentals. Its just that the fundamentals here (particularly income) have risen an awful lot since the bubble started.
ReplyDeleteThe most recent census data (out 2 weeks ago) showed while the rest of the country had falling income, DC area incomes were rising, particularly in Immunington where they were up 6.6% over last year.
"The most recent census data (out 2 weeks ago) showed while the rest of the country had falling income, DC area incomes were rising, particularly in Immunington where they were up 6.6% over last year."
ReplyDeleteThat was a real shocker over at Novabubble. The housing haters were hyping up the release of that data. Since it showed income falling on a national scale, they figured it would on a local scale too. They were so excited to have new evidence to throw in the bulls faces.
When the results came out and income grew (and in cases like Immunington) grew strongly, their jaws just hit the floor. It was funny to watch them go silent, or simply backpedal to call what they were previously hyping, as suddenly "unimportant".
I guess it goes to show - some people never change.
"The most recent census data (out 2 weeks ago) showed while the rest of the country had falling income, DC area incomes were rising"
ReplyDelete...and yet the median home price is still 8-9 times the median income.
"You forgot to mention that you dislike DC's restaurants"
ReplyDeletenah, fundamentally, the cheesecake factory and the starbucks here tastes just as good as anywhere else in the middle of nowhere.
...and yet the median home price is still 8-9 times the median income.
ReplyDeleteSource?
"...and yet the median home price is still 8-9 times the median income.
ReplyDeleteSource?"
The interwebs
its funny how defensive oboe gets when someone says they think DC is boring. You would think they are talking about his mother or something.
ReplyDeleteOboe does everything you are revolve around your street address? Does it personally hurt your feelings when someone says the restaurants here suck?
"Source?
ReplyDeleteThe interwebs"
Ha - no kidding. Heres a source, about 3/4 of the way down the page where someone says the average home price is 8-9X the average salary:
http://bubblemeter.blogspot.com/2009/09/new-bubble-book.html
"...and yet the median home price is still 8-9 times the median income.
ReplyDeleteSource?"
Just a quick search on the net shows this...
"According to a 2007 estimate, the median income for a household in the CDP was $154,370" -wikipedia
and
"The average listing price for Potomac homes for sale on Trulia was $1,791,440 for the week ending Sep 23" - trulia
So median income is $150K and the average home is $1.7M
So that guy underestimated its not 8 times the median income its TEN TIMES!!!
One doesnt have to search the internet to know that montgomery county is way over priced though...The only places that a doctor or lawyer in this area can afford, none of the neighbors know english.
sorry, the income that I posted was also potomac as well.
ReplyDeleteMedian home to median income is such a poor indicator for what prices "should be". I remember the first time I looked up Georgetown - it was like 11X the average back in the pre bubble days - then up to 18X in the bubble now back to like 14X
ReplyDeleteWorst was NYC which was 20X pre bubble - up into the 30s for a while and now falling back toward its 20X historical average.
According to Zillow, the median home value in Potomac, MD is $752,400.
ReplyDeleteits funny how defensive oboe gets when someone says they think DC is boring. You would think they are talking about his mother or something. Oboe does everything you are revolve around your street address? Does it personally hurt your feelings when someone says the restaurants here suck?
ReplyDeleteHmm. Let me look inward... What emotion is it I feel when I read attacks by some of the bitter provincials--who clearly live in places where there are "Cheesecake Factories"--complain about a lack of DC culture.
Is it anger? Hmmm, nope, not feeling it.
Wait, I've got it! It's a complex melange of derision and amusement!
Meanwhile, there's this:
http://online.wsj.com/article/SB10001424052748703787204574442912720525316.html?mod=WSJ_hpp_MIDDLENexttoWhatsNewsForth
"According to Zillow, the median home value in Potomac, MD is $752,400."
ReplyDeleteyeah isnt that a just "zestimate" though? I thought the figures at trulia are actual sales prices of homes averaged out.
p.s. Oboe, you need to chill dude. The only person who sounds bitter is you. Why do you care so much that someone thinks DC sucks?
Its funny that a guy who loves DC so much gets "amusement" bitching and moaning with anonymous internet people. You only prove their point that DC is boring, cause the only fun thing to do here is argue on a blog.
As regards the Reinhart-Rogoff book, I would be very interested in knowing what the two economists were saying prior to the financial crash, which in fact occurred in spring 2007. Were they bears or bulls? Even at that time housing values had peaked and were headed downwards in Florida, Nevada, Arizona, and California.
ReplyDeleteIts funny that a guy who loves DC so much gets "amusement" bitching and moaning with anonymous internet people.
ReplyDeleteOnly thing funnier is an Internet scold bitching about someone else's bitching.
well.. it's like I thought!
ReplyDelete