Essays

Sale-leaseback: Corporations’ New Scheme To Steal American Homes

Maybe you are elderly and on a fixed income, or for some other reason you cannot afford a major increase in your cost of living, but you live in a Midwestern city where the cost of living is traditionally low. You’ve owned your home for years and have plenty of equity, so you should have financial security, right?

Not so fast. Private equity firms and other “property investors” have bought up homes in your neighborhood to flip them and/or rent them out, driving up house prices. Your county assessor raised their appraisal of your home, and now you can’t afford your new property tax bill. But have no fear, the millionaires and billionaires who caused this problem for you are also here to offer a solution.

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Book Reviews

Book Review: The Big Short

the big short

The Big Short is more technical and more entertaining than I had expected. When it comes to coverage of the 2008 financial crisis, there are few in books or media who do an adequate job of explaining the mortgage-backed securities, collateralized debt obligations, credit default swaps, and other technical finance concepts involved. Michael Lewis manages to make sense of a complex system of debt speculation that the people who were responsible for understanding didn’t seem to understand. It is exactly what one might hope to get out of this book, but it’s not the thing that makes this book truly special.

What is really surprising about this book is its tone. Wall Street investors can be very brash. The investors covered by Lewis are outsiders. They share many characteristics with Wall Street stereotypes, but for various reasons they don’t fit in to those social circles. They are rogue investors, searching for any niche they can find, striving to be contrarian. They speak with a colorful vernacular; Lewis doesn’t bowdlerize. In fact, Lewis adopts a bit of the voice of his characters to better tell their story.

As the story progresses, the tone drastically changes. The events that unfold have huge implications for capitalism, democracy, and the history of the world going into a new century. Seeing how the men who predicted it profited from it and eventually reacted to it is what The Big Short is really about.