Money To Live

January 14, 2009

Review: The Jungle

Filed under: Uncategorized — by moneytolive @ 5:00 am

The Jungle by Upton Sinclair

For a long time, I hesitated reading The Jungle because I had heard that its description of the meat packing industry is graphic. I finally got up the courage to read it, and the book is indeed graphic and very sad. What surprised me the most was Sinclair’s detail to personal finances.

Jurgis and his bride-to-be and her family head to Chicago from rural Lithuania for a better life. They hear about how high the wages are and imagine living richly – but they don’t know that expenses are also higher.

They make it to Chicago and buy a house but do not understand mortgages. They are told the monthly payment is $12, but really there is a monthly principal payment of $12 and a monthly interest payment of $7. They spend their entire savings on a down payment and keep up with the monthly payments for several years but eventually fall behind after a few incidents and are evicted.

Change $12 to $1,500 and $7 to $3,000 and you’ve got a story of the modern-day mortgage crisis.

While I think that the current financial crisis is quite different from the corruption of Chicago in the early 20th century, it makes me wonder – will there be books like this about the mortgage crisis?

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