I humbly believe Andrew Ross Sorkin‘s Too Big to Fail: The Inside Story of How Wall Street and Washington Fought to Save the Financial System–and Themselves is not only a great read and one of the best books written about the Wall Street catastrophe — it is a rather unique history book for this crisis.
BTW: This is the best book I have read this year.
Sadly this book reads like an intense thriller. Yet the truth reveals how Wall Street’s greed and “good ol-boy network” was too dumb to act in time to save the country from falling into a recession.
Sorkin’s revelations about those so called “financial titans” were more accurately described as totally clueless to the catastrophe surrounding them. Ego — really was the chief reason for making so many horrible financial decisions. Its rather shocking especially as the impact of the crisis rippled further away from Wall Street and into the homes and businesses of everyday Americans.
I cannot think of a more striking example Sorkin described as the Board members of Bear Stearns. They voted to send the firm into Chapter 11 bankruptcy — with one board member “choosing” not to participate in the vote because he was playing in a professional card tournament in Detroit and instructed his secretary not to be interrupted.
Titans….ha! Sorkin paints a more accurate picture of these guys closer to the attitudes of the out-of-touch imperialist British monarchy. Defined by The Dictionary of Human Geography, Imperialism is “the creation and maintenance of an unequal economic, cultural and territorial relationship, usually between states and often in the form of an empire, based on domination and subordination.” Sorkin’s reinforces this definition about that failed Wall Street Empire.
I was amused to actually see a photograph of Mitsubishi’s $9 Billion check for Morgan Stanley….yep NINE zeros. Making it probably the biggest check ever written and the IQ of everyone who supported that decision. Simply shocking.
Sorkin even outlined the US Treasury’s secret plan to save the banking system 5 MONTHS before TARP was introduced when Fed Chairman Ben Bernanke developed a “Break the Glass” recapitalization plan. However by that time the panic on the inside of Wall Street was well underway.
Goldman Sachs’ alumni were running the Fed and Treasury and they put Wall Street’s financial responsibility on the American taxpayer? Why not call in the emerging banks in China? Well, they were talking to them too.
Is it really hard to believe Fannie Mae, Freddie Mac, Lehman, AIG and Bear Stearns could conduct business in such a way that set up the financial crisis? The underlying message in a globalized world is simply how any local organization can place money into funds that teeter of the efforts of banks half way around the world.
Welcome to financial globalization 4.0….Too good to put down.
Tags: Andrew Ross Sorkin, Too Big to Fail, Bear Stearns, Wall Street, Morgan Stanley, Lehman, Freddie Mac, Fannie Mae, recession, AIG, trends