Customer Reviews

Hot Money and the Politics of Debt

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This book is an in depth look at "hot money," money that can move around quickly for many reasons: it is dirty, tax avoidance, flight to safety and many more. What is surprising is that tax avoidance by transnational corporations dwarfs that of the "illegal" sources. It covers money laundering and how it evolved through enterprising individuals and equally enterprising countries. The book also shows how the debt of developing countries is linked to politics, corruption and the flow of hot money.

It is an eye opener. In 1984 Swiss banks controlled $350B in foreign assets, roughly equivalent to the net foreign debt of the world's developing countries. Coincidence? But the U.S. continues to embargo, bomb and invade defenseless countries to cause a capital flight to the safety of the U.S., which uses the hot money to finance more of the same,... and the scam goes on.

The book is serious but approaches the subject with both wit and humor: Referring to the brother of the president of Mexico, the author writes that over the 6 years he was head of the government's food subsidy and distribution, he earned $190K annually, out of which, by frugal living, he managed to save $112M, the amount found in his Swiss bank account.

It also brings up and interesting question: with all this bad debt from developing countries on the books of the major banks, how much longer can this house of cards withstand a total collapse?

This is a book every single US Senator and Representative should read.

The title derives from the reality that illicitly gotten funds create their own momentum as the funds are laundered throughout the world, creating interest, mayhem, and leaving 3rd world countries (preyed upon for weak financial regulations) struggling under massive debt they didn't really incur.