Arts & Culture

How to Sound Smart This Week: Subprime Meltdown Edition

No time to read The New Yorker, The Atlantic Monthly, the Sunday New York Times, Harpers, The Nation, The New Republic, and New York Magazine during your morning commute? Don’t worry – "How To Sound Smart This Week" will help … Read More

By / January 28, 2008

No time to read The New Yorker, The Atlantic Monthly, the Sunday New York Times, Harpers, The Nation, The New Republic, and New York Magazine during your morning commute? Don’t worry – "How To Sound Smart This Week" will help you convince those around you that you’re a big ball of erudition.

Start the conversation with an eye-opening statistic: “Did you know that thanks to the subprime meltdown, American households are losing over two trillion dollars a year?”

Follow up by referencing ‘60s-era economist Hyman Minsky (bonus chutzpah points if you refer to him as “my favorite 60s-era economist”), who believed that Wall Street placed too much emphasis on taking risks. “Minsky predicted all this years ago,” you could add, “and he thought the only solution was to change the culture of Wall Street. Once you wind up in a period of panic like the one you’re in, it’s too late for politicians to do anything.” That, at least, is the gist of this week’s New Yorker piece on Minsky.

Of course, you might go on, that won’t stop those politicans from trying. The Nation points out that while both Edwards and Clinton have called for an end to foreclosures and a freeze on interest rates, the Obama campaign has taken a much more centrist approach.

“Essentially,” you could say, “Obama is blaming people who took out irresponsible loans, rather than financial industry. Max Frazer in the Nation thinks this might be because he’s received almost $10 million in support from people involved in the real estate market. Then again, Clinton’s raised even more, and she’s not banging the personal responsibility drum.”

As for the Republicans, there’s not much they can do about the meltdown if they want to hew to good conservative principles – or so says Ross Douthat in a video conversation at the Atlantic website.

Bringing things full circle, you could end with another fun stat: “Did you know that there are currently more choreographers in the US then metalcasters?” What that means, according to Christopher Caldwell in this weekend’s Times Magazine, is that Republican candidates need to stop talking about liberating entrepreneurs from tight restrictions, and Democrats need to give up the rhetoric about backing the factory man over the fat cats. The new economy is firmly in place, and any solution to the mortgage meltdown is going to have to pay attention to the choreographers.

Last week: Cloverfield

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