Customer Reviews

The Return of the Great Depression

5 star:		(31)
4 star:		(7)
3 star:		(3)
2 star:		(2)
1 star:		(1)

 

 

Admittedly, I didn't know what to expect from this book. I am a frequent reader of Vox Day's blog, and do find his views on a variety of topics both insightful and thought-provoking. However, having read a number of "Doom and Gloom" predictor books in the past, only to have the author's assertions not only fail to come true, but their methodology proven eminently suspect.

The first thing that stands out about this book is the delivery. It's fluid, conversational, and devoid of economic jargon that permeates most books on the subject. The book also exhibits none of the haughty arrogance displayed in books more suited for overworked graduate students of economics than public consumption. The graphs illustrate and illuminate rather than confound and confuse. There are ample anecdotes used to illustrate Day's points. Having read von Mises' "Theory of Money and Credit", "The Anti-Capitalist Mentality", "Socialism", and Rothbard's "America's Great Depression", "Return of the Great Depression" is about as easy to read and understand as Hazlitt's "Economics in One Lesson".

As far as the book's content goes, it's thoroughly researched and uses cites numerous sources to illustrate his points. Though Day is a student of the Austrian School of economics, the manner in which he methodically examines the historical events and the personalities involved displays no trace of any personal bias. That isn't to say that the book itself is devoid of his own viewpoint, rather, it is to say that he makes it tacitly clear where the line between the "science" of his deconstruction of history ends and where his personal opinions begin. His expertise on economic metrics and their application is exemplary. In my opinion, the portion of the book that discusses the utter uselessness of economic metrics published by the government alone should be photocopied and given out to any student enrolled in an undergraduate economics course.

In conclusion, whether you're an ardent student of economics, or merely the kind of person who wants to learn a little more about how we wound up in our current economic situation and how to decipher what the media pundits are really saying about unemployment, CPI's, and GDP, you will find this book quite enlightening.

Cross-posted from [...]

Once in a while, a book comes along that shakes so many of your core beliefs that you are left questioning either the integrity of what you have read or your own knowledge. In this particular case, I had the privilege of a sneak peek at The Return of the Great Depression by Vox Day and with most certainly can state, it is the latter. RGD as it shall be referred to from now on, as can be inferred from its title makes a very compelling case as to the state of our economy and where this nation is potentially headed. However do not be mislead by its name, for this is much more than a prophecy, it is principally and foremost an economic text diligently spending the majority of its efforts in explaining why we are standing on the edge of a precipice.


A non trivial task to say the least as the American public has been on the receiving end of political pundits, commentators, journalists, politicians, bloggers and friends all who wish to explain in their own unique way the reasons behind our financial turmoil. Inevitably the information regarding such pertinent details as to the state of our economy gets lost in the constant scuffle of bipartisanship, ideology and mudslinging. What is unique about RGD's approach and the difficulty of the task undertaken is to not only provide an explanation rooted in strong economic foundation, but to also tackle and examine the prevalent economic explanations and their egregious falsities. One must expend a great deal of energy to elegantly deliver one's point of view, but must expend even greater energy to successfully understand opposing views and intelligently be able to ascertain their effectiveness or lack thereof. Mr. Day skewers the conventional wisdom with such bravado that all questions of its merit quickly evaporate.

RGD takes you on a gripping journey with such ease and suspense you will quickly forget you are reading a complicated economic textbook and will need to reminded by loved ones that sleep is as useful as understanding the economy. We begin in the hay day of Japan's economic boom and ultimate bust, the history of which is unknown to many, but crucial to understand for all. We then zoom to the culmination of the housing collapse laying the groundwork for what unfolds to be a Pandora's Box of financial witchcraft. RGD focuses on a most crucial and underlying theme of the book, illustrating the housing boom while profound, is but the tip of the proverbial iceberg. Through language designed for the layman supported by numerous charts and tables, RGD hones in at the very root causes of the financial terror gripping our nation. Virtually no stone is left unturned as the fundamental flaws of our entire economy are exposed in a glaring and sometimes brutal fashion. No one is spared as Mr. Day tackles head on the central bank, economic theories, philosophies, flawed fiscal policies, media, economists and economic data finally arriving at the most logical and obvious conclusion. All this is done with awe inspiring brevity and a personal touch so often missing in great economic works of our time. It is amazing to find within one page an explanation of why the government's unemployment numbers are chronically faulty yet also learn of Mr. Day's raids within World of Warcraft, although his penchant for the Alliance is regrettable - long live the Horde!

RGD's rollercoaster gently winds down and the most likely scenarios are presented. At this point the reader can choose from a buffet of options ranging from a widely believed economic recovery to a possibility of another Depression. Rest assured, like a good Hollywood movie the ending leaves the reader with hope for the future and the author's well crafted remedies for even the worst of outcomes.

Regrettably, the book suffers from one slight handicap although this is no fault of the author given the task at hand. While great attempts were taken to wrap the difficult material into a pill the layman could swallow, such a wide spectrum of economic, historical and political knowledge is covered the pill's size becomes unmanageable. As with all important discoveries, the magnitude of this revelation largely depends on your existing knowledge and the entrenchment of your economic beliefs. For me, familiar with at least basic economic concepts, libertarian viewpoints and the history behind the Great Depression the completion of the book was bittersweet. Sweetness in appreciating the underlying theme and enjoying a profoundly expanded horizon, bitterness in the recognition that as many questions were raised as answered. I cannot understate the importance of this profound text nor ignore the paradox facing America; a majority of the people must read this book, but only a minority will understand it. Let not this warning dissuade you for any amount of information extracted out of this historical text will be both enlightening and mind changing hopefully for the collective good of our ailing nation.

Full review: [...]

Very good read that probes the reasons behind our economic mess. The book starts off in Japan during the boom years, which develops a baseline for the remainer of the book insofar as the futility of government to correct the subsequent bust.
The book does a good job deconstructing various macro-economic theories before addressing the one theory that fits well with most of the available evidence. Vox describes the limits inherent to GDP, CPI, and unemployment figures that are at the center of mainstream economic thought. Vox subscribes to the Austrian School of economics currently as that school best explains historically our economic plight and what we can expect in the future.
The book postulates that our past and current crisis is a result of cheap money via easy credit that lead to false prosperity and mal-investments. This in-turn will result in needed contraction. I will use my own simple anology to expand. Imagine that I make $1 million a year, but have a super credit card that affords me a limit of $5 million a year, which I max out each year. Instead of me living within my means, I decide to build a factory (with my extra money) to build bicycles for all the kids in my neighborhood. My factory soon suffers losses secondary to a glut of bicycles on the market. Naturally, my factory should go out of business because it was a mal-investment. Currently most of what I have is built off credit (debt), and I am much poorer than what you can measure by my assets (thus the folly of standard measures of economic health). To correct this problem, I need to liquidate what I can, payoff what debt I can and start living within my means; although this will be painful. The sooner I can correct this problem, the sooner I can return to fiscal health.
However, our mainstream economist recommendations call for me to increase my credit limit significantly to avoid the inevitable. Their recommendations will prolong and worsen my agony; thus the name of the book: The Return of the Great Depression.
My analogy is limited in many ways (especially in scope and other factors involved that are elaborated further), but you get the picture. The book is much more detailed, and provides a wealth of data/charts.
Towards the end of the book, the author provides possible scenarios, as well as solutions (albeit ones that will not likely occur).

Vox Day's Return of the Great Depression is an short, ambitious book which attempts to make a case that the mainstream economists are very wrong about where things are headed economically, and more importantly that we are headed towards another depression with will be worse than the first. While technical subject matter by nature it is written in a readable style and peppered personal anecdotes, pop culture references, and some humor.

The book starts out with the boom in Japan which the author experienced first hand in 1988 and relates those experiences with Japan's subsequent poor economic track record to what is happening in the US and abroad. There are some strong similarities here and a lot of wishful thinking on the part of people who think we will avoid this sort of fate.

Over the next two chapters Day, covers what an economic bubble is composed of and how the latest was formed and then burst. This is invaluable information about the reality of bubbles and ends with a large section on the current policy creation of more debt to stimulate economic growth.

The book then enters into its most technical chapters which demonstrate the very shaky foundation of government supplied economic measurements like GDP, unemployment figures, and CPI. CPI is and especially pernicious little statistic which has been used and abused by business and government to set policy like Social Security cost of living increases. He also covers Keynesian economics and the Fed in this part and how they have worked together to bring about our current economic world.

Austrian theory is the next stop as Day lays out the basics of the theory in relation booms and busts with interest rates. Day is very careful here as to not oversell the Austrian theory, as economic theories are notoriously inaccurate, but he does make a good case that the Austrian Business Cycle Theory is more accurate than a Keynesian one. He then lets Noble prize winning author Paul Krugman take shots at the Austrian theory. It appears that Day had to restrain himself in these chapters or the book could be twice as long and bogged down in a lengthy discussion of Austrian Theory.

All of the above is the prelude to the penultimate chapters of the book in which Day lays out possible economic scenarios of what happens now. They range from a rapid recovery to world wide chaos and war. He gives good reasons and economic data (insofar as the data can be trusted thanks to the inherent limitations of the data) to support his contention of another Great Depression is here. He puts his reputation on the line because if he is wrong then people will take little heed of anything he says in economics again.

The end of the book lists some ways to help things which the politicians will never do and a bit of economic poetry.

In all an excellent, if too short of a book, which one would do well to read and decide for oneself which way the economic winds are blowing.

Return of the Great Depression (RGD) is a relatively fast paced, informative economic read. Readers may come away wishing it were a work of fiction, but the reality is simple - it is not. From the lost decade of Japan to the sub-prime housing market, derivatives, and bailouts, RGD will take you where perhaps you do not wish to go. Ignorance can be bliss. It can also be deadly. The red pill is not for everyone, but it should be.

Imagine you're drowning in debt and your investment adviser or banker, trusted TV pundit, or some Nobel prize winner recommends you take on more debt and all will be made well. Vox Day explains what should be the obvious lunacy of such, but if one is familiar at all with current events, apparently isn't.

RGD is highly educational. I recommend everyone read it, and perhaps just once listen to your instincts and you might be the better off, viewing critically what those having a vested interest have been telling you.

The recession has been declared over. Jim Cramer said so. We dodged that bullet. Do you believe it? If you don't but can't quite articulate why, RGD may just help in that respect.

This is a thorough and integrated analysis of the economic schools of thought that are driving economic policy in America. I started off with the same "hunch" as the author so I cannot say that the book has made me a convert to his viewpoint but rather it has helped me create a mental framework within which I can approach the concepts he communicates. The last two chapters are the "so what" chapters where he spells out the potential scenarios that could unfold and his suggestions on what macro-economic policy changes need to take place. It is the macro focus that has left me less than fully satisfied with the book, there is no micro analysis that would help me in deciding what I need to do to insulate myself from the scenario he believes will unfold. So on academic analysis the book is 5 stars, on practical application 2 starts at best. I still view the book as a useful read as it will provide you with the insights required to recognise the "answer" when you see it. Now where is this illusive "answer" on how to insulate yourself from the approaching depression..

The book is simply a brilliant masterpiece. It is written remarkably well and gets you to read more and more. It provides a balanced mix between telling a story and zooming in on the economic fundamentals. Right from the very beginning, it becomes perfectly clear to the cognoscenti that Vox is a member of a small, ultra-elite club that has figured out the fundamental flaws of our modern-day Keynesian economic dogma, as well as the finest points of the Austrian school that only few people in the world are familiar with and understand. As an Austrian myself, it is easy to see how sophisticated Vox is in the area.

I am a professor in Economics who has been trained in and disillusioned from the mainstream economics. As an economist, I was completely reborn when I became an Austrian 7-8 years ago. Ever since, I have been teaching economics and finance mostly as an Austrian. During the Spring semester of 2008, I was teaching a course on the Financial Crisis at the American University in Bulgaria. My biggest regret is that I did not have at that time available to use Vox's book for my course. It would have been perfect. The book may be somewhat difficult for first year Econ 101, but it is absolutely perfect for juniors and seniors - it could well be the book that will make them rethink their mainstream economics foundations. For my course, I had to use Peter Schiff's "Crash Proof" (see my review of "Crash Proof"), as the very best available at the time. If I had to do it today again, I would use "The Return of the Great Depression" as my primary book. When combined with "Crash Proof", it provides a killer combination that would open the eyes to any student willing to read. My third choice would be, without doubt, "Meltdown" by Thomas Woods.

Enough praising Vox and his book. Do not hesitate to get your copy and read it - I guarantee that you would be glad you did it. To learn more about me, check out my web site: [...]

Ordinarily I do not pick up an economics text with the same enthusiasm as a chocolate chip cookie. In fact, it is more with the sense of starring in a root canal. So to say that I was oh so pleasantly surprised at the experience of reading "The Return of the Great Depression" (RGD) would be an understatement. I was blown away. Holy mole! This is a great read, every bit as good as chocolate, and far less fattening.

If you've been a reader of Vox Day, you know his dry humor, and you also know his intellectual rigor - both are present in spades in RGD. If you haven't read his stuff before now, you're in for a treat. Did articles on the subprime mortgage crisis leave you thinking you had listened to people speaking in tongues? This will explain the process of how banks were enticed to jump off the cliff and the underlying political/economic assumptions of our time that led up to the jump. Furthermore, you'll have the big picture, too, for Day is a fan of history as well as economics.

An economy is too complex to be managed by any centralized human entity - banking or government. Unfortunately, politicians don't understand that. When government and central banking geniuses apply failed economic tenets to economies, they produce unforeseen results. Just what the final result of the current world-wide economic contraction will be is a matter of theory, but Day lays out some of the most possible outcomes. The facts are here for your review. Day discusses the train wreck that approaches with clarity and the fair mindedness of a referee. If I weren't on the train, I would have to say it is outrageously comic in a way. But if you can figure out how to get off, will you call me?

Domo arigato, Vox-san. RGD is ichiban.

Nagging doubts about the economy? You can either trust those same bought & paid for priestly economists that the government trots out every day or you can read Vox Day's book, "The Return of the Great Depression" and find out what's in store.

Finally an understandable primer on the various schools of economic theory; RGD walks you through the mandatory fundamental economic training you've avoided all of your life in a most entertaining manner. I recommend reading it carefully; read every word, then reread the sentences and paragraphs and if you have any questions. For gosh sakes read the endnotes! I promise that when you are done you will gain a valuable understanding of the various economic frameworks used to evaluate "the invisible hand".

You'll appreciate the clear analysis...
You'll appreciate the straightforward approach...
You'll appreciate knowing why everyone is laughing at Paul Krugman behind his back at the cocktail parties.

The Return of the Great Depression

The reviews already written for this book say exactly what needs to be said about the content. I just want to add that the Kindle version is currently $1.59, which is about the price of a 20oz soda. Needless to say, this was the best $1.59 I have spent since gas was less than a dollar a gallon.