Books I’ve read

If you want to understand the current financial crisis so many ciites are having try this one: “While America Aged” which is fascinating and scary. It is non-fiction (which is why it is so scary) and gives three actual case studies of American pensions run amok. The author analyzes GM, the Public Transit System in New York City, and the public employees in San Diego. In all three cases, unsustainable promises for pension and health care benefits were made to unionized employees. In the case of GM, it is arguably a big part of what drove them into bankruptcy. In the other two cases, it is appalling because politicians from both parties made promises they knew were unsustainable, but they did it to get re-elected. Why does it matter to you and me? Because the US gov’t–that would be us, as taxpayers, through the pension guaranty system, will end up footing the bill for this folly.

I read awhile ago: “Little Heathens, Hard Times and High Spirits on an Iowa Farm during the Great Depression“, written by Mildred Armstrong Kalish. This is fascinating–couldn’t put it down, even with other things going on–heartwarming and a wonderful glimpse into the world of America in the 1930′s. It made me think of what so many of that era have said: “We were poor, but we didn’t know it.” Mildred’s father left her mother with four young children, and they all lived half the year with her grandparents (so they could walk to school) and half the year with their Mother, on a nearby farm her grandparents owned. They grew all their own food, butchered hogs, chased bees for honey, sewed their own clothes, read by kerosene lamp–and on and on. It struck me repeatedly as I read it that the phrase lately heard everywhere is ‘the greatest economic crisis since the Great Depression’; this book really made me ask myself if those of us alive today, myself included, are up to the task our great-grandparents and grandparents did during that Depression. Despite the times, this is not a sad book; it is cheerful and very interesting, especially for people who like history (I do). She reports, for example, that their public school did not get inside plumbing until the late 1930′s. Can you imagine that today? I would recommend this to anyone.

Another great non-fiction book is: “Appetite for America : Fred Harvey and the Business of Civilizing the Wild West–One Meal at a Time” 

This is about the legendary Fred Harvey, who was in many respects the founder of the chain or franchise restaurant. Fred Harvey built his business along the path of the Atchinson, Topeka and Santa Fe line which ran from Kansas to California. Harvey Houses were known for quality food, which was unique at the time; his policy of employed young single women as waitresses (Harvey Girls) is credited with supplying wives to many of the men in the West. He was an outstanding entrepreneur, and many of his principles stand the test of time: “Courtesy and a Smile Pay Dividends”; “Real Service is Without Discrimination” “Preserve or Create–Never Destroy”; “Tact is an Asset and HONESTY is still a Virtue”. The author is Stephen Fried; as usual for me, I got this book from the library.

If you like non-fiction, try Michael Lewis’ “The Big Short”. If you want a view of the mortgage meltdown from the other side of the table, read this book. Lewis tracks three different individuals (who did not know each other) who separately figured out that all the CDOs (Collaterialized Debt Obligations) backed by the bad mortgages, put into tranches, rated by Moody’s and Standard and Poor’s, insured by AIG, and sold, sold, sold were a house of cards. All three of these individuals figured out ways to bet against the prevalent opinion (housing will keep going up and up and up forever) and made big money “shorting” the market. If you are in the real estate business, you will find yourself asking (as I have done for years) how could these Wall Street “geniuses” be so stupid? One of the investors, who took apart the prospectus for the CDO was attacked for “using bad data”–he replied to his critics: “It’s your data”. It’s a fascinating read, and if you are as interested in this meltdown as I am, you’ll like it. By the way, you’ll understand at the end why TARP did not fix the problem, nor will any problems be fixed without involving “fixing” Fannie Mae and Freddie Mac.

A great read is “Unto The Sons” by Gay (Gateano) Talese–which begins in the United States during World War II, told from the perspective of a young Italian-American boy. The book takes you back through the history of his family, in Italy during both World Wars. Fascinating book; learned many things I did not know about that era, and a great read.