Required Reading: State of the Economy

Rick wrote an amazing email that he sent to the company outlining the current state of the economy and how we got here. I’ve read a ton of articles on what’s going on and of course followed the bailout votes, but to be honest I had very little understanding of what was really going on (except there was a big problem with mortgages and the very real possibility of people not paying them off). Rick was kind enough to sum everything up in layman’s terms and it really just makes me want to read more in that tone. How come this stuff is so hard to find? Why aren’t more people writing simple explanations of these complex topics?

I actually think there are two reasons (not that this has anything to do with economics): First, most people just don’t understand it that well. There are probably lots of people who say they understand it, but when it comes time to write it, they focus on the one bit they understand. Second, there are a lot of bad writers, especially in academia. The whole idea that writing for complexity instead of simplicity was always something that drove me nuts. Sure you can have good complex writing, but most of the stuff that comes out of the academic world is anything but good (sure the ideas are good, but the explanations suck).

Anyway, that’s a really long winded way to say, stop what you’re doing and take 15 minutes to read Rick’s explanation of how we got into our current economic mess.

October 2, 2008