Planet Ponzi [Hardcover]

Mitch Feierstein is a successful hedge-fund manager based in New York. This book is a scorching attack on greedy bankers and useless venal politicians. It tells the story of `how politicians in Washington and the bankers on Wall Street jointly created the largest Ponzi scheme in history'. What is a Ponzi scheme? It involves huge amounts of rapidly mounting debt, poor, nonexistent or inadequate assets, deceitful or nonexistent accounting, feeble, inert, or toothless regulators, a get-rich-quick culture, ignorant, lazy, greedy investors and an astonishing capacity for self-delusion. And it caused the present crisis.

Then governments force cuts on the public, not on the 1 per cent who caused the crisis. Between 1998 and 2010 Wall Street and insurance companies added just 4.3 per cent to US output, yet took 28.9 per cent of all US profits.

US politicians blew $3 trillion on the Iraq war and $1 trillion on the Afghanistan war. The US Federal Reserve secretly lent $7.7 trillion to the bankers - RBS got $1.2 billion. In 2008-9 the US government bailed out AIG. Goldman Sachs, Merrill Lynch, Société Générale, Deutsche Bank and UBS got $32.7 billion. Goldman Sachs paid out $16.2 billions in bonuses in 2009. Gordon Brown also borrowed to bail out banks and bank creditors, many of them foreign.

The total US bailout has cost taxpayers $23.5 trillion so far, a loss which equals 170 per cent of national income. By contrast, Sweden is 15 per cent to the good, because when it had a bank bust in the early 1990s, it made the shareholders bear the costs.

But Ponzi schemes are not limited to the USA. Feierstein writes, "The euro was misconceived from the first, its flaws baked into the design: no central treasury, no credible penalties for the profligate, no central political guidance, and no orderly exit mechanism." British banks are exposed to the eurozone's debt. They lent to French banks and to German banks which are over-committed to France.

Yet Feierstein is all at sea when he writes about Britain. One minute he absurdly claims that the government will `restrain the banks', the next he concedes that "the Conservative Party is essentially the City of London's lapdog." (As of course Labour and the LibDems are too.) He embraces the City's big lie that we must cut public spending (so cutting growth and adding to the deficit).

And he writes, "Firm action would have involved facing up to the crisis. Forcing creditors to take losses. Making shareholders lose everything." But the government has done none of this; instead it has made taxpayers take all the losses.

Feierstein warns us, "We are still in the middle of a massive Ponzi scheme. ... The debts are still there. The bad assets are still there. The same corrupt incentives are still in place. The same degree of profiteering. The same blindness to risk. The same astonishing tolerance for ever-increasing debt." So we face another crisis, if we allow it.

Having read almost all of the books written about the 2007/8 "Credit Crisis" and ensuing events, I have to say that "Planet Ponzi" is definitely one of the best by far.

Mitch Feierstein forensically details the shockingly dubious and some might say "fraudulent" accounting practices of governments and financial institutions all over the world and explains how trillions of dollars are spirited out of thin air while massive debts are "hidden" in financial black holes.

If you want to know what's really going on with our hard-earned taxes then I definitely recommend this book.

Considering how refreshingly eye-opening, fascinating, exposing and informative this book is, I am surprised "they" haven't tried to ban it being published.

More people should read this book - it's absolutely gripping and you will be amazed.

10/10 - Highly recommended!

This book explains in normal, human, understandable language just why and how the world finances are in such a mess. In essence I found this book extremely good for a number of reasons, but the clarity is uppermost for me. One of the reasons I never entered the "banking/finance/theft" business, despite having a certain aptitude for it, is because at a very basic, logical sense, it made no sense. In other words, the "value" and "accounting processes" used by banks and their ilk is completely fictitious.
In addition to this the gobblydigook double-speak of the fork-tongued individuals who mainly populate this realm is enough to send you into a catatonic stupor within seconds. And finally, it has been my experience (and I have rubbed shoulders with several multi-millionaires and worked for a few billionaires) that the people in this field tend to have characters so devoid of ethics it is genuinely difficult for me to relate to them. Feierstein deconstructs all the veils and shadows and the boring language and writes in an entertaining as well as educational style. His sense of humour is a mixture of the British dry and the American gut-punch, making him very funny indeed. His sense of ethics is impeccable too and the book is an easy read, as he does not use any of the banking jargon without first explaining (usually in a funny way) what any of it means in normal language.. My only reservation, though it makes no impact at all on the quality of the book or the information within it (which I verified independently on several instances), is that there is precious little information on Mitch or his hedge fund online. There is also no information on his hedge fund registered with companies house. None of this is particularly suspicious though, it is also my experience wealthy people and hedge fund managers are notoriously careful about leaving their details all over the net. And his hedge fund may be registered somewhere other than the UK.
In any event, the book is a joy to read and it should really be required reading for everyone. His advice at the end of the book on steps you can take to protect your money and investments (regardless of whether it's a few hundred bucks in the bank or a few millions) is extremely pertinent and valuable. I highly recommend this book to anyone and everyone.