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kottke.org posts about 2008 recession

Money, Power and Wall Street

Frontline is doing a four-hour show about the world financial crisis, which, according to many people featured on the program, is ongoing.

Since 2008, Wall Street and Washington have fought against the tide of the fiercest financial crisis since the Great Depression. What have they wrought? In a special four-hour investigation, FRONTLINE tells the inside story of the struggles to rescue and repair a shattered economy, exploring key decisions, missed opportunities, and the unprecedented and uneasy partnership between government leaders and titans of finance that affects the fortunes of millions of people around the world.

The program airs on April 24th.


New book from Michael Lewis: Boomerang

Michael Lewis’ next book will be out in October; the subtitle is Travels in the New Third World. It’s a business book about the economic bubbles he’s been writing about in Ireland, Iceland, Greece, and the US.

The tsunami of cheap credit that rolled across the planet between 2002 and 2008 was more than a simple financial phenomenon: it was temptation, offering entire societies the chance to reveal aspects of their characters they could not normally afford to indulge.

Icelanders wanted to stop fishing and become investment bankers. The Greeks wanted to turn their country into a pi~nata stuffed with cash and allow as many citizens as possible to take a whack at it. The Germans wanted to be even more German; the Irish wanted to stop being Irish.

Michael Lewis’s investigation of bubbles beyond our shores is so brilliantly, sadly hilarious that it leads the American reader to a comfortable complacency: oh, those foolish foreigners. But when he turns a merciless eye on California and Washington, DC, we see that the narrative is a trap baited with humor, and we understand the reckoning that awaits the greatest and greediest of debtor nations.

No Kindle version available yet, just like last time. If you’d like to see one, click on the “I’d like to read this book on Kindle” below the cover image. (thx, brian)

Update: Just got word from Lewis’ publisher that the ebook version (including Kindle) will be available the same day as the hardcover.


The Celtic Paper Tiger

Michael Lewis continues his tour of economic disasters β€” he wrote about Greece and Iceland for Vanity Fair and wrote an entire book on the US subprime mess β€” with a piece on Ireland and the country’s spectacular rise in becoming Europe’s mightiest economic engine and even steeper fall to third-world economic mess.

Even in an era when capitalists went out of their way to destroy capitalism, the Irish bankers set some kind of record for destruction. Theo Phanos, a London hedge-fund manager with interests in Ireland, says that “Anglo Irish was probably the world’s worst bank. Even worse than the Icelandic banks.”

Ireland’s financial disaster shared some things with Iceland’s. It was created by the sort of men who ignore their wives’ suggestions that maybe they should stop and ask for directions, for instance. But while Icelandic males used foreign money to conquer foreign places β€” trophy companies in Britain, chunks of Scandinavia β€” the Irish male used foreign money to conquer Ireland. Left alone in a dark room with a pile of money, the Irish decided what they really wanted to do with it was to buy Ireland. From one another. An Irish economist named Morgan Kelly, whose estimates of Irish bank losses have been the most prescient, made a back-of-the-envelope calculation that puts the losses of all Irish banks at roughly 106 billion euros. (Think $10 trillion.) At the rate money currently flows into the Irish treasury, Irish bank losses alone would absorb every penny of Irish taxes for at least the next three years.

In recognition of the spectacular losses, the entire Irish economy has almost dutifully collapsed. When you fly into Dublin you are traveling, for the first time in 15 years, against the traffic. The Irish are once again leaving Ireland, along with hordes of migrant workers. In late 2006, the unemployment rate stood at a bit more than 4 percent; now it’s 14 percent and climbing toward rates not experienced since the mid-1980s. Just a few years ago, Ireland was able to borrow money more cheaply than Germany; now, if it can borrow at all, it will be charged interest rates nearly 6 percent higher than Germany, another echo of a distant past. The Irish budget deficit β€” which three years ago was a surplus β€” is now 32 percent of its G.D.P., the highest by far in the history of the Eurozone. One credit-analysis firm has judged Ireland the third-most-likely country to default. Not quite as risky for the global investor as Venezuela, but riskier than Iraq. Distinctly Third World, in any case.


Portrait of a housing bust

From the Big Picture, a selection of aerial photos of houses and housing developments in southwest Florida.

Florida housing


The Big Short is out on Kindle

The Big Short by Michael Lewis is finally out for the Kindle (well, it came out two weeks ago, about a month after the hardcover). You might remember the hubbub about the lack of a Kindle version.

Anyway, the book is excellent; I read it pretty much nonstop until finished. Lewis cleverly recasts the story of one of the biggest financial disasters in American history as a heroic tale. Heroic!


Built to fail

When I pointed to the last week’s news that the SEC was suing Goldman Sachs for fraud, several people pointed me to an episode of This American Life that ran a couple of weeks ago.

A hedge fund named Magnetar comes up with an elaborate plan to make money. It sponsors the creation of complicated and ultimately toxic financial securities… while at the same time betting against the very securities it helped create. Planet Money’s Alex Blumberg teams up with two investigative reporters from ProPublica, Jake Bernstein and Jesse Eisinger, to tell the story. Jake and Jesse pored through thousands of pages of documents and interviewed dozens of Wall Street Insiders. We bring you the result: a tale of intrigue and questionable behavior, which parallels quite closely the plot of a Mel Brooks musical.

The allegation against Magnetar is that they helped create extremely risky CDOs, bought the worst part (the lowest tranche) of those CDOs for a little money, and then bought a bunch of insurance against the CDOs for a lot of money. The CDOs were basically built to fail and when they did, Magnetar lost a little money on their purchase but made a bunch more from the insurance. Pro Publica has the whole story.


US Gov’t accuses Goldman Sachs of fraud

The SEC has filed a lawsuit against Goldman Sachs for fraud. Specifically:

According to the complaint, Goldman created Abacus 2007-AC1 in February 2007, at the request of John A. Paulson, a prominent hedge fund manager who earned an estimated $3.7 billion in 2007 by correctly wagering that the housing bubble would burst.

Goldman let Mr. Paulson select mortgage bonds that he wanted to bet against β€” the ones he believed were most likely to lose value β€” and packaged those bonds into Abacus 2007-AC1, according to the S.E.C. complaint. Goldman then sold the Abacus deal to investors like foreign banks, pension funds, insurance companies and other hedge funds.

But the deck was stacked against the Abacus investors, the complaint contends, because the investment was filled with bonds chosen by Mr. Paulson as likely to default. Goldman told investors in Abacus marketing materials reviewed by The Times that the bonds would be chosen by an independent manager.

Goldman’s stock price is currently off about 12%.


My First Toxic Asset

The Planet Money podcast bought a toxic asset and is tracking what happens to the 2000+ mortgages that are bundled up into it over time.

We bought one of those things that no one wanted, one of those things that almost brought down the global economy: our very own toxic asset. This one has more than 2,000 mortgages in it. We paid $1,000, with our own money, for our piece. It used to be worth more like $75,000. Click on the timeline and roll over the states to watch a disaster in progress.

Somewhat of a surprise: they’ve made more than a third of their money back already.


Excerpt from Michael Lewis’ new book

Vanity Fair has a lengthy excerpt from Michael Lewis’ new book The Big Short (out today).

As often as not, he turned up what he called “ick” investments. In October 2001 he explained the concept in his letter to investors: “Ick investing means taking a special analytical interest in stocks that inspire a first reaction of ‘ick.’” A court had accepted a plea from a software company called the Avanti Corporation. Avanti had been accused of stealing from a competitor the software code that was the whole foundation of Avanti’s business. The company had $100 million in cash in the bank, was still generating $100 million a year in free cash flow-and had a market value of only $250 million! Michael Burry started digging; by the time he was done, he knew more about the Avanti Corporation than any man on earth. He was able to see that even if the executives went to jail (as five of them did) and the fines were paid (as they were), Avanti would be worth a lot more than the market then assumed. To make money on Avanti’s stock, however, he’d probably have to stomach short-term losses, as investors puked up shares in horrified response to negative publicity.

“That was a classic Mike Burry trade,” says one of his investors. “It goes up by 10 times, but first it goes down by half.” This isn’t the sort of ride most investors enjoy, but it was, Burry thought, the essence of value investing. His job was to disagree loudly with popular sentiment. He couldn’t do this if he was at the mercy of very short-term market moves, and so he didn’t give his investors the ability to remove their money on short notice, as most hedge funds did. If you gave Scion your money to invest, you were stuck for at least a year.

Really fascinating. In a recent review, Felix Salmon called The Big Short “probably the single best piece of financial journalism ever written”.


Products that did well during the recession

They include camping gear, Hyundai cars, and upscale generic products. (via mr)


Those big bank earnings explained

Phil Greenspun’s finance buddy explains how JPMorgan Chase and Goldman Sachs made $6.8 billion in profit last quarter. Basically they borrowed money from the US Govt at 0% and then bought bonds from the US Govt that paid 2-3%.

What kind of bonds are they buying? Are they investing the money in American business? “No, they are mostly buying Treasuries.” So the money is just being shuffled from one Federal bank account to another, with each Wall Street bank skimming off $1 billion per month for itself? “Pretty much.”

(via @linklog)


The giant pool of money, an update

This American Life recently aired a follow-up to their well-received program about the recent financial crisis called Return To The Giant Pool of Money.

We catch back up with the people we met in 2008, to see how they’ve fared over the last 18 months. We talk to Clarence Nathan, who in 2008 received a half million dollar loan that he said he wouldn’t have given himself; Jim Finkel, a Wall Street finance guy, who put together and managed complicated mortgage-based financial securities; Richard Campbell, the Marine who was facing foreclosure; and Glen Pizzolorusso, the mortgage company sales manager who led the life of a b-list celebrity.


Bringing the oyster back to New York

Michael Osinski grows oysters out on Long Island, now an unusual pursuit in an area that used to support dozens of oyster companies…New York used to be the place for oysters (see also).

If you’d like to try them out, Widow’s Hole sells their oysters to several NYC restaurants, including Gramercy Tavern, Union Square Cafe, and Bouley. Osinski achieved a bit of notoriety earlier this year when he wrote an article about his experience writing software for Wall Street firms called My Manhattan Project: How I helped build the bomb that blew up Wall Street. (via serious eats)


How did economists miss the crash?

Paul Krugman writes in How Did Economists Get it So Wrong? (where the “it” is the 2008 recession):

As I see it, the economics profession went astray because economists, as a group, mistook beauty, clad in impressive-looking mathematics, for truth. Until the Great Depression, most economists clung to a vision of capitalism as a perfect or nearly perfect system. That vision wasn’t sustainable in the face of mass unemployment, but as memories of the Depression faded, economists fell back in love with the old, idealized vision of an economy in which rational individuals interact in perfect markets, this time gussied up with fancy equations. The renewed romance with the idealized market was, to be sure, partly a response to shifting political winds, partly a response to financial incentives. But while sabbaticals at the Hoover Institution and job opportunities on Wall Street are nothing to sneeze at, the central cause of the profession’s failure was the desire for an all-encompassing, intellectually elegant approach that also gave economists a chance to show off their mathematical prowess.

Unfortunately, this romanticized and sanitized vision of the economy led most economists to ignore all the things that can go wrong. They turned a blind eye to the limitations of human rationality that often lead to bubbles and busts; to the problems of institutions that run amok; to the imperfections of markets - especially financial markets - that can cause the economy’s operating system to undergo sudden, unpredictable crashes; and to the dangers created when regulators don’t believe in regulation.

He goes on to describe the history of macroeconomics (in brief) and how the current theories are flawed. Very interesting long read.


Overconfidence

Malcolm Gladwell’s piece in this week’s New Yorker about the psychology of overconfidence is pretty much a transcript of the speech he gave at the New Yorker Summit a couple of months ago. Gladwell’s thesis is that the overconfidence of experts caused the current financial crisis.

“I’m good at that. I must be good at this, too,” we tell ourselves, forgetting that in wars and on Wall Street there is no such thing as absolute expertise, that every step taken toward mastery brings with it an increased risk of mastery’s curse.


New Michael Moore movie

I’m not sure there’s any reason to watch the trailer for the as-yet-untitled Michael Moore documentary on the global economic meltdown; don’t we pretty much know where he stands at this point?


Scenes from the bailout

In her own words, the wife of a CEO whose bank accepted TARP funds describes her hard times.

As you can see, being a TARP wife means, in short, making decisions according to a complex algorithm: balancing the need to look like your world hasn’t crumbled beneath you β€” let’s not alarm the investors! β€” with the need to appear duly repentant for your subprime sins.

I realize that happiness is relative when dealing with money and social status, but it was difficult to keep that in mind while reading this. (Yes, this article is a couple months old. Do not read if you’re allergic to information generated less than 30 seconds ago. Instead, you can check to see if the professor has given you another pellet yet.)


Too complex to exist

In an analysis of the global financial system, Duncan Watts says that we should limit the complexity of these sorts of systems because “once everything is connected, problems can spread as easily as solutions”.

Traditionally, banks and other financial institutions have succeeded by managing risk, not avoiding it. But as the world has become increasingly connected, their task has become exponentially more difficult. To see why, it’s helpful to think about power grids again: engineers can reliably assess the risk that any single power line or generator will fail under some given set of conditions; but once a cascade starts, it’s difficult to know what those conditions will be - because they can change suddenly and dramatically depending on what else happens in the system. Correspondingly, in financial systems, risk managers are able to assess their own institutions’ exposure, but only on the assumption that the rest of the world obeys certain conditions. In a crisis it is precisely these conditions that change in unpredictable ways.

No one, for example, anticipated that an investment bank as old and prestigious as Lehman Brothers could collapse as suddenly as it did, so nobody had that contingency built into their risk models. And once it did fail, then just as the failure of a single power line increases the stress on other parts of the system, leading to further “knock on” failures, so too did Lehman’s unlikely collapse render other previously unlikely failures suddenly much more likely.

This is essentially the same point that Nassim Taleb makes in The Black Swan re: Extremistan and Mediocristan.


On owning GM

What I Learned Today crunches the numbers on GM and the results are not pretty.

So $83,000,000,000 is what New GM would have to be worth in order for us to break even on our investment. But $56,000,000,000 is what GM was worth at its all time peak in 2000.


Michael Lewis’ The Big Short

Michael Lewis’ book about the ongoing financial collapse has a name: The Big Short: Inside the Doomsday Machine.

A brilliant account β€” character-rich and darkly humorous β€” of how the U.S. economy was driven over the cliff. Truth really is stranger than fiction. Who better than the author of the signature bestseller Liar’s Poker to explain how the event we were told was impossible β€” the free fall of the American economy β€” finally occurred; how the things that we wanted, like ridiculously easy money and greatly expanded home ownership, were vehicles for that crash; and how shareholder demand for profit forced investment executives to eat the forbidden fruit of toxic derivatives.

It’s not out until November 2 but you can pre-order it from Amazon. (thx, brian)

Update: The book is out on March 15 and there’s an excerpt in the April issue of Vanity Fair.


Economics reporter gets caught in mortgage bubble

Edmund Andrews, an economics reporter for the New York Times, confesses that he got caught up in “catastrophic binge on overpriced real estate” and signed a “reckless mortgage” for more money than he and his new wife could afford.

What about my alimony and child-support obligations? No need to mention them. What would happen when they saw the automatic withholdings in my paycheck? No need to show them. If I wanted to buy a house, Bob figured, it was my job to decide whether I could afford it. His job was to make it happen.

“I am here to enable dreams,” he explained to me long afterward. Bob’s view was that if I’d been unemployed for seven years and didn’t have a dime to my name but I wanted a house, he wouldn’t question my prudence. “Who am I to tell you that you shouldn’t do what you want to do? I am here to sell money and to help you do what you want to do. At the end of the day, it’s your signature on the mortgage - not mine.”

Andrews and his family aren’t all that bad off, but my mouth got all cottony while reading this as I extrapolated from his story to the millions of people who made similar deals under much more dire circumstances. A chilling first person tip-of-the-iceberg tale. (via the laboritorium, which calls the piece “an instant classic of economic crisis journalism”)

Update: According to a nice bit of reporting by Megan McArdle, Andrews failed to mention that his second wife has declared bankruptcy twice, once while married to Andrews.

Moreover, pesky bad luck isn’t really the picture painted by either filing. Rather, Ms. Barreiro seems to have spent most of the last two decades living right up to the edge of her income, and beyond, and then massively defaulting. If you structure your finances so that absolutely everything has to go right, it’s hard to blame the mortgage company when you don’t quite make it.

Andrews has been admirably open about many of the poor decisions and the wishful thinking that led him deep into debt. Nonetheless, he has laid much of the blame onto irresponsible bankers and mortgage brokers. The missing bankruptcies substantially undermine this basic narrative arc of Andrews’ story. Particularly in his book, the bankers are the villains, America’s current troubles are the inevitable denouement of their maniacal greed, and the Andrews household stands in for an American public led, by their own greed and longing and hopeful trust, into the money pit.

Seen through this lens, it’s not so much that Andrews was done in by a overly large mortgage…it was that he married a financial anchor.

Update: Andrews responds to McArdle’s claims:

These bankruptcies did occur, but they had nothing to do with our mortgage woes. They were both tied to old debts from before we were married or bought a house. They had nothing to do with my ability to get a mortgage; nor did they have anything to do with our subsequent financial problems.

And McArdle responds to his response. (This is getting complicated!)

Andrews seems to now be arguing that the Chapter 7 filings are not relevant because they didn’t affect his ability to get a mortgage. But of course the article and the book is not just about himβ€”rightly, because unless your marriage is pretty dysfunctional, it’s a financial partnership. The two bankruptcies seem to reveal that one partner has demonstrated a historic inability to live within their means. So though the bankruptcies don’t tell us anything about their ability to get a mortgage on their house, they may tell us quite a bit about their willingness to take on a mortgage. This decision is at least as important as the bank’s. I’m sure banks would have given me all kinds of stupid mortgage loans in 2004, but I didn’t avail myself of the opportunity.

(thx, pamela)


An ode to B&H

Joel Spolsky sings the praises of B&H, the mega photography and electronics store on 34th Street in Manhattan.

No, wait: The most amazing thing is that I have often gone into B&H to purchase a specific product, only to be talked into something cheaper. For example, once I went in to buy a field video monitor to use for some interviews I was conducting. I expected to pay $600 until the salesperson said, “Why don’t you just get one of these cheap consumer portable DVD players? They have video inputs, they work just as well, and they’re under $100.” This was no accident. “The entire premise of our store is based upon your ability to come in, touch, feel, experiment, ask, and discuss your needs without sales pressure,” B&H’s website says.

Re: Circuit City, I’d wager that many of the businesses that have gone under so far have not done so because of the poor economy but because they were poor or unsustainable businesses. (via @anildash)


A world without Black Swans

Nassim Nicholas Taleb lists ten principles for a Black Swan-proof world. Most points relate directly to the current economic situation in the US.

No socialisation of losses and privatisation of gains. Whatever may need to be bailed out should be nationalised; whatever does not need a bail-out should be free, small and risk-bearing. We have managed to combine the worst of capitalism and socialism. In France in the 1980s, the socialists took over the banks. In the US in the 2000s, the banks took over the government. This is surreal.

It was difficult to choose just one of Taleb’s points to excerpt; they’re all worth considering. BTW, a Black Swan is an event that is rare, has a large impact, and is deemed predictable after the fact. I might have to push Taleb’s book of the same name to the top of my reading list.


Michael Lewis telling fish tales?

Jonas Moody, who has lived on Iceland for the past seven years, takes Michael Lewis to task for some inaccuracies and other odd things in his Vanity Fair piece about the country’s economic crisis.

5. “Icelanders are among the most inbred human beings on earth β€” geneticists often use them for research.”

Now this is insulting. Icelanders’ DNA shows their roots to be a healthy mix between Nordic Y chromosomes and X chromosomes from the British Isles. The reason genetic-research company deCODE uses Icelandic genes for its research is not because the codes are so homogeneous, but because the population has kept excellent genealogical records dating back thousands of years.

I sort of shrugged my shoulders at this stuff when I read the piece and forged ahead for the financial meat and potatoes, but it doesn’t read so well when collected all in one place like this. Was the piece supposed to be a farce? If not, it doesn’t reflect well on Lewis or his editors at VF. (thx, micah)


Up in a down market

Mother Jones magazine has a list of ten people who have profited from the current financial crisis.

[John] Paulson is a hedge fund manager who has been ridiculously successful betting against banks and other entities that had exposure to the subprime crisis: In 2007, his funds were up $15 billion. In 2008, he didn’t do as well: His main fund rose 38 percent in a year when the S&P 500 fell almost 40 percent. His 2007 earnings were in the neighborhood of $3.7 billion. According to Forbes, while 656 billionaires lost money last year, Paulson was one of the 44 who added to their fortunes.

This is the peculiar thing about financial markets: if you know something bad is going to happen (you know, like the global collapse of the financial markets), you can either sound the alarm and save a lot of people a lot of grief or you can make a billion dollars.


Michael Lewis on Big Think

Speaking, as we briefly were, of Big Think, they have several short video interviews of Michael Lewis about the current financial crisis and other things. Worth a look see.


What happened to Iceland?

Michael Lewis, who is seemingly cranking out 10,000 words a day about finance and sports these days, writes in the pages of Vanity Fair about the Icelandic financial collapse. It’s an amazing story.

That was the biggest American financial lesson the Icelanders took to heart: the importance of buying as many assets as possible with borrowed money, as asset prices only rose. By 2007, Icelanders owned roughly 50 times more foreign assets than they had in 2002. They bought private jets and third homes in London and Copenhagen. They paid vast sums of money for services no one in Iceland had theretofore ever imagined wanting. “A guy had a birthday party, and he flew in Elton John for a million dollars to sing two songs,” the head of the Left-Green Movement, Steingrimur Sigfusson, tells me with fresh incredulity. “And apparently not very well.” They bought stakes in businesses they knew nothing about and told the people running them what to do β€” just like real American investment bankers!

But it was all essentially make-believe.

A handful of guys in Iceland, who had no experience of finance, were taking out tens of billions of dollars in short-term loans from abroad. They were then re-lending this money to themselves and their friends to buy assets β€” the banks, soccer teams, etc. Since the entire world’s assets were rising β€” thanks in part to people like these Icelandic lunatics paying crazy prices for them β€” they appeared to be making money. Yet another hedge-fund manager explained Icelandic banking to me this way: You have a dog, and I have a cat. We agree that they are each worth a billion dollars. You sell me the dog for a billion, and I sell you the cat for a billion. Now we are no longer pet owners, but Icelandic banks, with a billion dollars in new assets. “They created fake capital by trading assets amongst themselves at inflated values,” says a London hedge-fund manager. “This was how the banks and investment companies grew and grew. But they were lightweights in the international markets.”


Recession cocktails

The New Yorker shares some cocktail recipes for the recession.

BlackBerry Sling
Discover that your BlackBerry doesn’t work because you haven’t paid the bill. Sling it against the wall, then buy a pre-paid phone and make some rum in your toilet.

I LOL’d at Nasdaiquiri.


Got to. This America, man.

Some think it’s unfair that the former president of Countrywide Financial, a mortgage company that played a big (and negative) role in the subprime mortgage debacle, is now the head of a company making big money buying troubled mortgages from the US government for cheap and then refinancing with the owner, making big money in the process.

But as a Baltimorean explains to McNutty in the very first scene of the first episode of The Wire, that’s how America works.

McNulty: Let me understand. Every Friday night, you and your boys are shootin’ craps, right? And every Friday night, your pal Snot Boogie… he’d wait til there’s cash on the ground and he’d grab it and run away? You let him do that?
Suspect: We’d catch him and beat his ass but ain’t nobody ever go past that.
McNulty: I’ve gotta ask you: if every time Snot Boogie would grab the money and run away… why’d you even let him in the game?

(thx, aaron)


How the Crash Will Reshape America

Right or wrong, How the Crash Will Reshape America, Richard Florida’s analysis of how different areas of the United States are going to be affected by the current financial crisis, is full of fascinating bits.

The University of Chicago economist and Nobel laureate Robert Lucas declared that the spillovers in knowledge that result from talent-clustering are the main cause of economic growth. Well-educated professionals and creative workers who live together in dense ecosystems, interacting directly, generate ideas and turn them into products and services faster than talented people in other places can. There is no evidence that globalization or the Internet has changed that. Indeed, as globalization has increased the financial return on innovation by widening the consumer market, the pull of innovative places, already dense with highly talented workers, has only grown stronger, creating a snowball effect. Talent-rich ecosystems are not easy to replicate, and to realize their full economic value, talented and ambitious people increasingly need to live within them.

And:

But another crucial aspect of the crisis has been largely overlooked, and it might ultimately prove more important. Because America’s tendency to overconsume and under-save has been intimately intertwined with our postwar spatial fix β€” that is, with housing and suburbanization β€” the shape of the economy has been badly distorted, from where people live, to where investment flows, to what’s produced. Unless we make fundamental policy changes to eliminate these distortions, the economy is likely to face worsening handicaps in the years ahead.

Others have written about it elsewhere, but the few paragraphs Florida devotes to Detroit are stunning. (thx, peter)