Third World countries owe commercial banks around the world about half a trillion dollars, an awe-inspiring sum that is unlikely ever to be repaid. How did the banks mess up so badly?
Los Angeles journalist and former banker S. C. Gwynne provides part of an answer in "Selling Money," which chronicles the international bank-lending frenzy of the 1970s and 1980s.
Gwynne's book is addressed to a lay audience unfamiliar with the language and logic of the brotherhood of international finance. It is a simple explanation of a complicated subject, perhaps oversimple in that it lays the bulk of the blame for the foreign-debt problem on the banks, who were but one of several foolish and guilty parties. The borrowing nations, with their grand spending schemes and their larcenous elites, bear a share of the responsibility, as do the governments of the developed nations who pressed the banks to overlend.
Despite that flaw, it is a well-written and useful volume, an accessible addition to the growing catalogue of literature on the most important and least understood economic dispute between the world's rich and poor countries.