June 8, 2011
There have been plenty of books about the Wall Street crisis of 2008 but fewer, to date, about the sovereign crisis that followed it. (The standout work to date is This Time is Different by Carmen Reinhart and Ken Rogoff but that takes a very long-term view.) So it is good to be able to recommend Jason Manolopoulos’s work, Greece’s Odious Debt: the Looting of the Hellenic Republic by the Euro, the Political Elite and the Investment Community.
Don’t let the overlong title put you off; for a while, I thought it might be a nationalist polemic against the Germans or international speculators. But Mr Manolopoulos is actually a hedge fund manager who takes a very clear-headed view of the crisis. Blame is spread liberally around, with his fellow citizens taking their share. On Greek corruption, there is a nice list of fun facts, such as: 321 dead individuals over 100 were receiving a pension; 324 homeowners in northern Athens said they had a swimming pool but 16,974 were detected by satellite photography; and (best of all) although Lake Kopais was drained 53 years ago, a staff of 30 full-time civil servants still manage its “affairs”.
The author draws some nice parallels between Greece and Argentina, two economies that initially appeared to benefit from a currency link (in the 1990s, Argentina had a currency board based on the dollar) but which did not undertake the reforms necessary to maintain the link. As Mr Manolopoulos rightly remarks
A currency arrangement can bolster a strong economy but it cannot create one
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