Just added a new review of Liaquat Ahamed’s Lords of Finance in the FF Bookclub. It opens:
Americans do not easily imagine the Great Depression as a global event. Yet if asked for a short answer to the question, “What caused the Depression,” the best reply would be: “the First World War.”
The war left every former belligerent except the United States desperately indebted. Germany and Austria, cut off from global finance, had borrowed massively from their own people. Russia and the minor belligerents had borrowed from France. France and Italy had borrowed from Britain. Britain had borrowed from America.
At war’s end, the French and Belgian demands for reparation had piled another load of debt onto the structure.
Read the rest here.
3 responses so far
1 ChristianMiller // Jun 20, 2009 at 12:46 pm
No one cares. No one cares about your opinion Frum. You want only your opinion heard so why bother offering comments. You don’t have to have a comment section, you know.
2 ottovbvs // Jun 21, 2009 at 8:50 am
I’ve just finished reading the book. On a personal note the author is my daughter’s former boss and she recommended it to me. It’s a delight. Well written by someone who really understands the way in which the financial system works being as he is an active participant. He presents a easily understood picture of the economic world as it existed between 1914 and 1933 but doesn’t stint on the detail. His portraits of Schacht, Moreau, Norman and Strong are sympathetic because as he makes plain these weren’t stupid or incompetent men even if eccentric by our standards. They were just prisoners of out of date ideas, notably the essential nature of gold as the basis of currency and credit. This as Ahamed, and Keynes at the time, explained is a nonsensical fallacy but it was conventional wisdom then as was a committment to restoring the pre-war economic order for Norman and Moreau. Keynes was right about gold as he was about most things economic which is why the world principally functions according to the precepts of Keynesian economics athough some complain about it.
3 ottovbvs // Jun 23, 2009 at 6:07 am
I often wonder why so few people comment on David’s book reviews and what it tells you.
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