Reviews

摘要

The financial crisis is the Elephant of our time. Over the last couple of years, more than six wise men and women have written books purporting to explain the financial crisis and many more such books are surely in the works. Most of these wise ones suffer from the same limitations as the learned men of the poem. As each reaches out, he or she can make out only one small part of Our Elephant—maybe the rampant fraud at mortgage origination or the distortions of short term profit seeking or the complexity of the Collaterized Debt Obligation-Squared—but go on to confidently opine on the essential nature of this beast. The Subprime Virus is cut above the books that have come before it because of its authors' breadth of knowledge of financial institutions and consumer protection. Kathleen Engel and Patricia McCoy come to this project after many years of writing rigor ous, data-driven scholarly articles on banking and consumer law topics. Indeed, their 2002 Texas Law Review article, "A tale of three markets", is widely considered to be the seminal article on the law and economics of predatory lending and the two of them have been mentors to many who came later to this field (including me). In the book they slightly move away from their scholarship by revealing some of the frustrations that they have suffered over the years as their scholarly work on the subprime sector was dismissed by lending industry executives and government regulators who should have known better. So in 2011 they are entitled, like Cassandra, to demand, "Hear me! Understand!" The Subprime Virus is thus written as something of an indictment of many of the players who are responsible for various aspects of the crisis. That being said, the authors remain committed, through their scholarly work, to a careful analysis of the facts before them.