Too Big to Fail: The Inside Story of How Wall Street and Washington Fought to Save the Financial System—and Themselves A good book – Lonnie Lewis – Detroit, MI
Read this book if: you want the behind-the-scenes look at the conversations and day-to-day events leading up to the failing/rescue of Lehman Bros, AIG, Morgan Stanley, etc.
Don’t read this book if: you are looking for background on commercial banks, investment banks, CDOs, credit default swaps, and other aspects contributing to what caused the problems.
Overall, a good book.
If you have ANY curiosity about the financial crisis, this is the very first book you should go read. Although there are quibbles one can have with Sorkin’s writing style (more on this in a minute), it is unarguable that he had tremendous access to hundreds of people involved and that he delivers a ‘you are there’ narrative that would make Bob Woodward envious.
The book really centers around Hank Paulson, the third Treasury Secretary in Bush’s term. That’s appropriate as the Treasury was central to the crisis. However, there is a panoply of other government characters ranging from the energetic Tim Geithner, then head of the NY Federal Reserve, the political Shelia Bahr, head of the FDIC, and the hapless Christopher Cox, head of the SEC. The latter two do not come across well.
In addition, there are scores of bank executives portrayed. Everyone knows that Lehman Brothers was the biggest casualty of the bust, but there is plenty of time spent on Bear Sterns, AIG, Merrill Lynch, Morgan Stanley, Goldman Sachs, and others banks key players. Dick Fuld, CEO of Lehman gets almost as much coverage as Paulson, which is also right since Fuld was the key driver of the failed flight to keep Lehman alive.
One thing I liked in all of these portrayals is that Sorkin tells the back story on each executive with enough detail to make them real, but economically enough that we do not get bogged down. There are literally scores of important players in this story (what else would you expect when we’re talking trillions of dollars here?) and it is amazing that Sorkin manages to tell such a detailed story in less than 550 pages.I liked especially that he shows how one party really doesn’t understand the perspective of the other, sometimes due to ego, but more often due to the fact the world was moving into uncharted territory as the crisis deepened.
I don’t like spoilers in reviews as it takes away the pleasure of reading the book itself. I have about 6 friends reading it now and every single one of them agrees that it is a ‘Can’t put down’ book.
There are a few things I wish Sorkin had thought through better. One would have been to give the time frame for each chapter as a chapter heading. It’s only in retrospect you realize that he spends ~ 200 pages on a just a few key days. I also believe that he could have shown better judgment on what details to include or skip. For instance, at one point he makes a fleeting reference to a ‘MAC out’ clause in a term sheet for a merger. ‘MAC (Material Adverse Change) outs’ are EXTREMELY important parts of any merger or takeover term sheet. They can be explained in a few paragraphs, but Sorkin only give it a sentence of explanation. Yet, every time some executive is driven somewhere, Sorkin feels it is important for the reader to know what type of vehicle they were riding in.
If Sorkin couldn’t catch the above, a good editor should have been all over it.
My other complaint is that the author’s political and professional biases come up from time to time in a manner far less professional than the rest of the book. Commenting upon his rival newspaper, the Wall Street Journal, he lambasts them for unsigned editorials (the New York Times’ editorials I read every day aren’t signed) and being “right wing.” I read both papers and I think both the Journal coverage and its editorials on the crisis stand the test of time really well. And, again, a good editor would have taken those comments out.
But at the end of the day, Sorkin takes a story with an incredible number of threads and large personalities, and delivers a concise narrative of one of the most important events of our times. And his short epilogue of reflections comes across as thoughtful and fairly objective.
Upon reflection, I haven’t read a business book that reads so quickly since I read Barbarians at the Gates on a cross country flight. In addition to sharing essentially the same colored cover, they both tell the story of large personalities who get caught up in something so much bigger than they are that they’re totally unprepared.
We came very close to the collapse of the US economy and banking systems in the fall of 2008. That’s not a fact any of us should forget, and if you read Too Big to Fail, there’s no danger you ever will. : A real-life thriller about the most tumultuous period in America’s financial history by an acclaimed New York Times Reporter
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 never disclosed 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.
Too Big to Fail: The Inside Story of How Wall Street and Washington Fought to Save the Financial System—and Themselves
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