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The New Paradigm for Financial Markets: The Credit Crisis of 2008 and What It Means | 
| Author: George Soros
Publisher: PublicAffairs,U.S.
Category: Book
List Price: £12.99
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Avg. Customer Rating:  13 reviews
Sales Rank: 282
Media: Hardcover
Number Of Items: 1
Pages: 208
Shipping Weight (lbs): 0.7
Dimensions (in): 7.6 x 5.4 x 0.8
ISBN: 1586486837
Dewey Decimal Number: 332.0973
EAN: 9781586486839
ASIN: 1586486837
Publication Date: May 15, 2008
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| Customer Reviews: Read 8 more reviews...
 Philosophy and Finance October 6, 2008
This is very much like Soros's other books: a mix of (his own) Philosophy in PART I, and its possible applicability to the Finance markets of the time in PART II.
If you like Taleb's mix of Philosophy and Finance in Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets and The Black Swan: The Impact of the Highly Improbable then you'll Soros's approach.
If you're looking to emulate Soros's success, this book doesn't tell you how to do this in concrete steps. The theory of reflexivity explains the nature of financial markets (the problem) but doesn't give a solution.
Tony Loton, author --
DON'T LOSE MONEY! (in the Stock Markets)
Financial Trading Patterns
 Waste of time September 9, 2008
Starts off ambitiously attempting to explain the credit crunch, spends a few chapters reiterating why his ideology was not accepted earlier on, and ends proposing a philosophical view of the financial markets....just to say that market performance is a function of what other people do...hardly a revelation and more importantly, no suggestion as to what to do with this "revelation". Last section explains his portfolio performance with market events, which was interesting.
I'll say that again August 29, 2008
As this was by George Soros, whom I respect greatly, I felt I had to read it but ended up very disappointed. In short, Soros feels his theory on reflexivity has been ignored and therefore needs to be repeated. This he does and further fills the book with the reasons why he needs to repeat it, particularly because he thinks the credit crunch vidicates his argument.
Very repetitive to the extent that some comments are even repeated on the same page. This is a book which says very little and, to be frank, is not really worth reading.
 Practical insights and new rules from George Soros August 14, 2008
1 out of 1 found this review helpful
Legendary financier George Soros is worried. The financial markets face the worst credit crisis since the Depression and their existing paradigm needs to be replaced. The new paradigm Soros recommends is based on what he calls the "theory of reflexivity." This book-length essay provides a crash course in the billionaire investor's philosophy and view of financial markets, the origins and consequences of the current credit crunch, the boom-bust model and the behavior of market participants. Soros intersperses his market analysis with enough personal details from his early life and career to keep the book lively. He is also quite vocal in his political beliefs; Democrats will probably appreciate the case he makes against President George W. Bush's administration and its policies. One weakness of the book, other than its repetitiveness as Soros explains his theory, is that he relies heavily on technical and financial jargon, which makes it tough to penetrate and may prove a barrier to some readers. Ironically, he seems to be fully aware of this shortcoming when he writes that readers may find one of his particularly theoretical chapters to be "somewhat repetitive and hard-going." Nevertheless, his warm personal voice and the depth of his financial experience, which spans more than half a decade, is hard to match. Thus, getAbstract notes that this book has much to offer executives, investors, and students of financial markets and theory. (As is true of every Abstract, the following views are those of the author and not of getAbstract.)
Inane Ramblings August 12, 2008
5 out of 5 found this review helpful
For some reason old men, once they have made a lot of money, turn to philanthropy and academia in an attempt to justify the wealth they have amassed and the time they wasted doing it. Soros appears to be no different.
This book is really just Soros' rant regarding his `new' theory of `reflexivity - if you are hoping for a book filled with insight into the markets or the current crisis, then avert your gaze.
So what is the theory, well, in 3 points the theory (and the whole book) boil down to;
i) equilibrium economics doesn't work (i.e. markets aren't drawn to equilibrium)
ii) people have biased views, which in turn cause biases in market prices
iii) because people participate in markets, their biased views also affect fundamentals, causing a feedback loop that leads to more biases in markets and prices
No, seriously, I'm not winding you up, that is it!
He even admits that the theory is different from equilibrium economics insofar as it cannot really extrapolate into the future, but is very good at explaining history (I can explain history - I get a history book out of the library, read it and tell others - that's not a theory).
So, we have a theory that says markets aren't perfect (from an informational standpoint), but instead are biased (for generalists please read `biased' as `wrong'), and that can tell us lots about the past and nothing about the future - BRILLIANT, GENIUS, BREAKTHROUGH (I'm being facetious).
Quoting from the book;
"How far the new paradigm can be developed remains to be seen. There is just so much one person can do on his own. Others need to be engaged. That is what has prompted me to write this book".
Firstly, he even tells you he didn't write the book to give you an insight into the current crisis (despite the title). My advice, take him at his word and don't buy the book.
Secondly, there's a reason "There is just so much one person can do on his own", and that's because the theory is not worth giving airtime to - any person who has ever sat through an Economics lecture has come up with the theory themselves ("wow, this theory of equilibrium economics is cr@p - all these assumptions about perfect information, unbiased expectation - oh well, whatever floats the Professors boat I suppose, that'll be why he's wearing those shabby clothes, if he was smart he'd be making loads of money - still I better learn the stuff, got to pass my exams so I can escape here and make lots of money in the City").
Just so you don't think I'm kidding - I quote 2 paragraphs that will save you reading the whole book;
"I was greatly influenced by the philosophy of Karl Popper, and this made me question the assumptions on which the theory of perfect competition is based, in particular the assumption of perfect knowledge. I came to realize that market participants cannot base their decision on knowledge alone, and their biased perceptions have ways of influencing not only market prices but also the fundamentals that those prices are supposed to reflect"
"I believe that the theory of reflexivity can explain the current states of affairs better than the prevailing paradigm, but I have to admit it cannot do what the old paradigm did. It cannot offer generalization in the mold of natural science. It contends that social events are fundamentally different from natural phenomena; they have thinking participants whose biased views and misconceptions introduce an element of uncertainty into the course of events. Events follow a one-directional path that is not determined n advance by universally applied laws, but emerges out of the reflexive inter-play between the participants' views and the actual state of affairs."
Give me strength ..................
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