Author(s): Andrew Ross SorkinDownload
Publish: Published October 20th 2009 by Viking (first published 2008)
ISBN: ISBN 0670021253 (ISBN13: 9780670021253)
Andrew Ross Sorkin delivers the first true behind-the-scenes, moment-by-moment account of how the greatest financial crisis since the Great Depression developed into a global tsunami. From inside the corner office at Lehman Brothers to secret meetings in South Korea, and the corridors of Washington, Too Big to Fail is the definitive story of the most powerful men and women in finance and politics grappling with success and failure, ego and greed, and, ultimately, the fate of the world’s economy.
“We’ve got to get some foam down on the runway!” a sleepless Timothy Geithner, the then-president of the Federal Reserve of New York, would tell Henry M. Paulson, the Treasury secretary, about the catastrophic crash the world’s financial system would experience.
Through unprecedented access to the players involved, Too Big to Fail re-creates all the drama and turmoil, revealing neverdisclosed details and elucidating how decisions made on Wall Street over the past decade sowed the seeds of the debacle. This true story is not just a look at banks that were “too big to fail,” it is a real-life thriller with a cast of bold-faced names who themselves thought they were too big to fail.
Some Reviews: 31,567 ratings 1,252 reviews in Goodreads.com
Perhaps the most alarming thing (or hopeful, depending on your politics) this book reveals is how close the entire financial system came to utter collapse. To see some of the most obscenely wealthy and powerful people on the planet spooked and feeling around in the dark trying to figure out whats going on is a rare, if grim, treat.
For the most part, Sorkin treads very carefully through this in terms of empathy. We learn a fair bit about the lives of the lavishly monied people at the heart of this tale, and yet the prose is detached enough that we are never made or asked to sympathize or pity any of them, which is as it should be. All in all, it’s a staggeringly well researched book that turns an economic nightmare that touched all of us into a propulsive, demanding read. Even ~10 years after the fact, it’s a powerful read.
Starting from the fall of Bear Stearns(fifth largest investment bank of the US) the story goes through struggle around the Lehman Brothers, its further collapse, a threat under the AIG and all institutions tied up to toxic assets to Troubled Asset Relief Program signed into law in October 2008.
The book also depicts a lot of bargaining, when it comes to selling the assets and getting rid of the toxic ones. It adds tension that the time is limited and stocks are decreasing every second, and the market is panicking.
I would call the book a good fictional introduction to real-world finance. A big bubble, which aroused in the mortgage market, and a variety of complex financial products which insured bad mortgages lead to the fact that nobody knew the real value of those assets later called toxic. This situation is very well shown during Lehman’s CEO Richard Fuld attempts to make a deal with Bank of America, Korean investors, and Barclays.
For me, a downside of the book is too much unnecessary detail given. There are a lot of characters in some positions which are hard to keep in memory. However, 2008’s crisis wasn’t one person’s fault, and not one person overcome it, so it is acceptable for the sake of fullness of the narrative. Also, it requires some prior knowledge of macroeconomics in order to understand the context and the limits of state regulators.
In general, it is a very good example of moral hazard and dealing with it and a thrilling story of greed and conceit which could lead to the collapse of the whole system.
Too Big to Fail – Too Long to Read.