Professor Gary Gorton’s new book is mandatory reading for anyone who wants to understand why financial crises are a recurring feature across time and distance for capitalism. There are no secret solutions on the pages of Misunderstanding Financial Crises: Why We Don’t See Them Coming for the simple reason that none exist. Instead, the book offers an explanation, relatively short and to the point. Considering how so many people misread cause and effect with financial crises, the book is an important contribution for peeling away the confusion.

Continue reading →