Busted: Life Inside the Great Mortgage Meltdown by Edmund L. Andrews

From the Publisher

A veteran New York Times economics reporter, Ed Andrews was intimately aware of the dangers posed by easy mortgages from fast-buck lenders. Yet, at the promise of a second chance at love, he succumbed to the temptation of subprime lending and became part of the economic catastrophe he was covering. In surprisingly short order, he amassed a staggering amount of debt and reached the edge of bankruptcy.

In Busted, Andrew bluntly recounts his misadventures in mortgages and goes one step further to describe the brokers, lenders, Wall Street players, and Washington policymakers who helped bring that money to his door. The result is a penetrating and often acerbic look at the binge and bust that nearly bankrupted the United States.

Enabled by know-nothing complacency in Washington, Wall Street wizards used "collateralized debt obligations," "conduits," and other inscrutable financial "innovations' to put American home financing into hyperdrive. Millions of Americans abandoned the safety of thirty-year, fixed-rate mortgages and loaded up on debt. While regulators insisted that the markets knew best, Wall Street firms fragmented and repackaged unsound loans into securities that the rating agencies stamped with triple-A seals of approval.

Andrews describes a remarkably democratic debacle that made fools out of people up and down the financial food chain. From a confessional meeting with Alan Greenspan to a trek through the McMansion bubble of the OC, he maps the arc of the Frankenstein loans that brought the American economy to the brink.

With on-the-ground reporting from the frothiest quarters of the crisis, Andrews locates what is likely to be the high-water markin America's long-term embrace of higher borrowing, higher risk-taking, and the fervent belief in the possibility of easy profits.

Publishers Weekly

"As I write in February 2009, I am four months past due on my mortgage and bracing for foreclosure proceedings to begin." Thus begins this cautionary and critical examination of the housing crisis, a story that turned personal when New York Times economics reporter Andrews got caught up in the housing bubble after falling in love with a woman and a house. Bringing in $120,000 a year in salary-most of which went to child support and alimony to his ex-wife, Andrews says he was able to get a "don't ask, don't tell" mortgage with the assumption that his new wife, Patty, would be able to get a job to keep them afloat, an expectation that didn't work out as planned. Because of his economics journalism background, Andrews says he "should have avoided the mortgage catastrophe," and he castigates himself as well as fellow borrowers, the financial industry that took advantage of them and a government that didn't put the brakes on the crisis that many economists warned about but that Alan Greenspan, the Bush administration and others ignored. This deeply personal exposé is timely and sobering in its candor. (June)

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