I am really pleased Peston found the time to write this book. I am a lay person in economics and as economic problems of one sort or another have dominated the news for recent decades it has been hard to understand what actually goes on in the banking system and the national economies. This book really does cover many topics of current interest - the credit crunch, the eurozone, USA, Japan, China. Now I feel I understand a little of how derivatives and bonds work and why they were created, why Germany doesn't want eurobonds and that derivatives aren't just a side issue but a major part of the financial system, that banks reserves were incredibly low compared to what they were borrowing and lending (and why), that the eurozone and Japan really do have problems and so may China eventually. It was good to have all issues of the past two decades explained in detail, and even developments in 2012. There are of course problems with it as both other reviewers have pointed out. It was obviously written in a bit of a rush and I would have liked more careful explanations at times but this seems a bit carping when I'm glad to read anyone really explaining the subject at all. The style is good with human interest among the drier economics and the odd amusing aside. It does seem a bit OTT pessimistic at times but I imagine this is due to his journalistic style (or perhaps the pessimism is justified?!) However as one reviewer has commented, it seems a bit odd that Peston explains the basic banking instability - that it can never pay more than a small proportion of its customers back simultaneously, so that if a bank is highly leveraged with tiny reserves it only needs one person crying 'wolf' to cause the pack of cards to come crashing down with queues on the streets - and then complains when other people don't like him crying 'wolf' at precisely such a point! However for anyone with the slightest interest in our current economic situation then do read this book - it's a must.
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