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Age of Greed: The Triumph of Finance and the Decline of America, 1970 to the Present
A vividly told history of how greed bred America’s economic ills over the last forty years, and of the men most responsible for them.
As Jeff Madrick makes clear in a narrative at once sweeping, fast-paced, and incisive, the single-minded pursuit of huge personal wealth has been on the rise in the United States since the 1970s, led by a few individuals who have argued that self-interest guides society more effectively than community concerns. These stewards of American capitalism have insisted on the central and essential place of accumulated wealth through the booms, busts, and recessions of the last half century, giving rise to our current woes.
In telling the stories of these politicians, economists, and financiers who declared a moral battle for freedom but instead gave rise to an age of greed, Madrick traces the lineage of some of our nation’s most pressing economic problems. He begins with Walter Wriston, head of what would become Citicorp, who led the battle against government regulation. He examines the ideas of economist Milton Friedman, who created the plan for an anti-Rooseveltian America; the politically expedient decisions of Richard Nixon that fueled inflation; the philosophy of Alan Greenspan, on whose libertarian ideology a house of cards was built on Wall Street; and the actions of Sandy Weill, who constructed the largest financial institution in the world, which would have gone bankrupt in 2008 without a federal bailout of $45 billion. Significant figures including Ivan Boesky, Michael Milken, Jack Welch, and Ronald Reagan play key roles as well.
Intense economic inequity and instability is the story of our age, and Jeff Madrick tells it with style, clarity, and an unerring command of his subject.
As Jeff Madrick makes clear in a narrative at once sweeping, fast-paced, and incisive, the single-minded pursuit of huge personal wealth has been on the rise in the United States since the 1970s, led by a few individuals who have argued that self-interest guides society more effectively than community concerns. These stewards of American capitalism have insisted on the central and essential place of accumulated wealth through the booms, busts, and recessions of the last half century, giving rise to our current woes.
In telling the stories of these politicians, economists, and financiers who declared a moral battle for freedom but instead gave rise to an age of greed, Madrick traces the lineage of some of our nation’s most pressing economic problems. He begins with Walter Wriston, head of what would become Citicorp, who led the battle against government regulation. He examines the ideas of economist Milton Friedman, who created the plan for an anti-Rooseveltian America; the politically expedient decisions of Richard Nixon that fueled inflation; the philosophy of Alan Greenspan, on whose libertarian ideology a house of cards was built on Wall Street; and the actions of Sandy Weill, who constructed the largest financial institution in the world, which would have gone bankrupt in 2008 without a federal bailout of $45 billion. Significant figures including Ivan Boesky, Michael Milken, Jack Welch, and Ronald Reagan play key roles as well.
Intense economic inequity and instability is the story of our age, and Jeff Madrick tells it with style, clarity, and an unerring command of his subject.
480 pages, Hardcover
First published January 1, 2011
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July 2, 2011From a review in the NYRB July 14, 2011:
"Suppose we describe the following situation: major US financial institutions have badly overreached. They created and sold new financial instruments without understanding the risk. They poured money into dubious loans in pursuit of short-term profits, dismissing clear warnings that the borrowers might not be able to repay those loans. When things went bad, they turned to the government for help, relying on emergency aid and federal guarantees—thereby putting large amounts of taxpayer money at risk—in order to get by. And then, once the crisis was past, they went right back to denouncing big government, and resumed the very practices that created the crisis.Suppose we describe the following situation: major US financial institutions have badly overreached. They created and sold new financial instruments without understanding the risk. They poured money into dubious loans in pursuit of short-term profits, dismissing clear warnings that the borrowers might not be able to repay those loans. When things went bad, they turned to the government for help, relying on emergency aid and federal guarantees—thereby putting large amounts of taxpayer money at risk—in order to get by. And then, once the crisis was past, they went right back to denouncing big government, and resumed the very practices that created the crisis."
Krugman and Wells point out that this description of the 2008 collapse mirrors at least 4 other similar events of increasing severity since the vast repeal of banking regulations and the anti-government movement begun by Friedman and Reagan but continued by Carter and Clinton.
Sounds like a must read.
"Suppose we describe the following situation: major US financial institutions have badly overreached. They created and sold new financial instruments without understanding the risk. They poured money into dubious loans in pursuit of short-term profits, dismissing clear warnings that the borrowers might not be able to repay those loans. When things went bad, they turned to the government for help, relying on emergency aid and federal guarantees—thereby putting large amounts of taxpayer money at risk—in order to get by. And then, once the crisis was past, they went right back to denouncing big government, and resumed the very practices that created the crisis.Suppose we describe the following situation: major US financial institutions have badly overreached. They created and sold new financial instruments without understanding the risk. They poured money into dubious loans in pursuit of short-term profits, dismissing clear warnings that the borrowers might not be able to repay those loans. When things went bad, they turned to the government for help, relying on emergency aid and federal guarantees—thereby putting large amounts of taxpayer money at risk—in order to get by. And then, once the crisis was past, they went right back to denouncing big government, and resumed the very practices that created the crisis."
Krugman and Wells point out that this description of the 2008 collapse mirrors at least 4 other similar events of increasing severity since the vast repeal of banking regulations and the anti-government movement begun by Friedman and Reagan but continued by Carter and Clinton.
Sounds like a must read.
March 2, 2015
This is a good book although a bit technical for the layman. Madrick's thesis is that the preponderance of financial crises in the past 4 decades (defaults on third world debt in 1982, the stock market crash of 1987, the junk bond collapse in 1989-90, the Mexican debt crisis of 1994, the Asian financial crisis of 1997, the Russian default in 1998, the collapse of LTCM also in 1998, the bursting of the high tech bubble of the early 2000's and the 2008 financial crisis) were the result of excessive greed from a small subset of people. He presents his argument by presenting short bios of eminent financiers and politicians whose decisions fed into the aforementioned collapses.
He contends that the claim by many of these financiers that the benefits that they brought to the community outweighed the costs is baseless. The claim that stock price rationally reflects the long-term prospects of the company at any time by efficient markets theory is perverted by the incentive of CEOs to create strong quarterly profits. These profits induce a raising of stock prices which CEOs often gift themselves as a way to escape paying taxes. (I'm butchering a lot of technicalities that I didn't quite understand). But who cares about the rich people right? What about us? One commonplace assumption was that as productivity rose (It rose by as much as 250% since 1950)-- wages and salaries should increase as well. Surprise! They didn't!They have been stagnated since the early 70's. All of the gains flowed towards the money makers at the top who grew fabulously wealthy. Hooray for progress!
He contends that the claim by many of these financiers that the benefits that they brought to the community outweighed the costs is baseless. The claim that stock price rationally reflects the long-term prospects of the company at any time by efficient markets theory is perverted by the incentive of CEOs to create strong quarterly profits. These profits induce a raising of stock prices which CEOs often gift themselves as a way to escape paying taxes. (I'm butchering a lot of technicalities that I didn't quite understand). But who cares about the rich people right? What about us? One commonplace assumption was that as productivity rose (It rose by as much as 250% since 1950)-- wages and salaries should increase as well. Surprise! They didn't!They have been stagnated since the early 70's. All of the gains flowed towards the money makers at the top who grew fabulously wealthy. Hooray for progress!
October 20, 2012
Not the most well-written book. However, I liked how Madrick jumped around to different people and, somewhat chronologically, showed how one person's actions led to other people doing certain things that greatly affected the economy and the world of finance. His over-arching theme - that of greediness dominating the thoughts of so many people in positions of power (and some not motivated by gobs of money, yet making decisions that contributed to financial crises) - serves as a scary reminder that just because the government helped bailout some of the struggling banks in 2008, will not prevent another equally-damaging recession from occurring thanks largely to greed.
August 2, 2012
The typos and his Democrat bias were minor irritations, but the look at the whole 40 years (1970-2009) of greed in financial services I found fascinating. Of course I worked in the industry almost that entire time and find that it's the compensation plans more than any regulation that generate the worst greed in people. However, I think all derivatives could be outlawed and the world would be a better place.
February 25, 2012
This book should be required reading for every American of voting age.
This book is fundamentally an economic history of the United States, from about 1970 to the present, but with some background information going back to the WWII. It is well written and easily understood by the lay person. It lays out a timeline of economic and business thinking, and the relationships between Wall Street, the governing political class, and economists. Very few of them emerge unscathed. In fact, bankers and economists come across as self-centered and short sighted, while the politicians cherry pick ideas to suit their ideology. The theory of unintended consequences also makes its first appearance here (S&L fiasco; Garn-St Germaine bill). This author seems to take a truly "fair and balanced" approach, with no particular axe to grind on either side of the political aisle. Both Republicans and Democrats get their well-deserved lambasting. It is also clear that economists haven't a clue; predicting economic results much beyond two months in advance is clearly beyond their capabilities. So far, the only person to emerge relatively unscathed is Paul Volcker, probably because he is a pragmatist, not an ideolog, and takes the long view.
Financial Crisis Synopsis
1982: Third World debt defaults, where loans are primarily from American banks recycling petrodollars as loans to developing nations.
1987: Stock market crash; Dow loses about 30% in one day; speculative bubble.
1989 - 1990: Thrift failures (Garn - St Germaine bill) and junk bond collapse (Milken)
1994: Mexican debt crisis; more loans peddled to a third world country that couldn't afford them.
1997: Asian financial crisis; currency traders betting against Asian currencies, and yanking their investments ("hot money" is the phrase here); too many loans for the countries to realistically service.
1998: Russian debt default; similar to the Asian financial crisis.
1998: Collapse of Long Term Capital Management; large bets on the wrong side of interest rates, without a good hedge strategy.
2000: Burst of the high tech bubble; highly leveraged "investments" in businesses that were no more than someone's wishful thinking.
2007: Bursting of the housing bubble, leading directly to the current crisis.
Each of these crises sounds different but they all have the same two underlying causes:
1. Continued erosion of the regulatory statutes and enforcements. Each crisis is worse than the one before it because of that continued erosion.
2. Failure of the financial community to fully comprehend what was happening and what could happen if the current trends at the time continued.
The loosening of the laws and regulations was done specifically at the request (lobbying) of Wall Street, who claimed that the free market was the best process for allocating capital, and therefore should be free of government regulations. But then when things go sour, these same bankers turn to the government for rescue. This cognitive dissonance appears again and again.
Just for the record, I'm a firm believer in capitalism; it's less than perfect but the best we have. But it is the government and the regulatory agencies to make certain the playing field is level and honest, that people's money and investments are placed at risk with only their informed consent, and that the financial system is safeguarded, without creating a moral hazard.
Finished the opening section on Milton Friedman, the monetarist. I remember his writings in the Wall Street Journal and always wondered how he came to his conclusions. He was always able to show correlations, but high correlations do not imply causality. I never felt that he established root cause. I'm glad to read that other people agreed with me. The review of his thinking reveals a man who thinks everything should be left to market forces: schools, roads, libraries, commerce, etc. He makes the broad, and to me entirely unwarranted assumption, that market forces will balance everything out, without the need for government regulation. He totally ignores human nature: most people want to tilt the playground in their favor. Government is there to provide equal opportunity by making certain that everyone plays by the same rules. Under Friedman utopia, Bernie Madoff was perfectly legal; people would have caught on sooner or later and left his company in the lurch.
On to the next section: Richard Milhous Nixon. This section was a reminder of just how cynical and self-centered Nixon was. Much of this I remember, having lived through the oil shocks, price controls, driving at 55 mph to conserve gas, etc. I distinctly remember his second campaign: Nixon's the one! It was all about Nixon, with very little to do with the Republican party and what the party stood for. But then, me and my buddies were really into Watergate, and could not understand why anyone would even consider Nixon for president. This inside look at the manipulation of the economy to ensure re-election just reinforces my dislike for the man.
Joe Flom and the hostile takeover: I didn't recognize the name but certainly remember the age of conglomerate building and the first use of "synergism". LBO's and hostile takeovers enabled by cheap loans became the rage. And of course they never lasted. Thorough research by economists reveals that many companies bought at a premium were later sold off at a loss because the synergism never occurred; the same thing is happening now. The same concept: Citibank and one stop shopping for all things financial. It's not working and Citibank has been struggling for over 3 years to stay afloat.
Ivan Boesky: insider trading driven by simple greed. A short section but provides an inside look at some of the more peculiar aspects of one man's greed.
Walter Wriston again, along with other bankers, the ones who demand a market economy free from government regulation: Americans kept sending dollars to the Saudis to buy oil to turn into gasoline to burn in their cars. Saudi's have to do something with all that money, so they deposit it in the large American banks. Those banks turn around and make loans to developing countries (UDCs). Those countries repay the loan using inflated dollars earned by selling their commodities. The bankers make money and everything is rosey. Except for when recession hits and commodity prices drop like a stone. Loans go sour, banks start losing money, and turn to the government to prop them up. (Sound familiar? only instead of commodities, think mortgage-backed securities.) Apparently bankers are congenitally incapable of learning from their predecessor's mistakes.
Along comes Ronald Reagan: "Government is the problem." To become governor of California, he put together a conservative agenda that included university tuition and proposed a tax limitation amendment to the CA constituion. The latter failed to pass, but not by much. It later was put in place, with far-reaching consequences.
In the meantime, Carter has now become president. Economics is not his strong suit, inflation is rampant and the economy is stagnant. Stagflation was coined, and the Carter administration kept flip flopping on economic policy. Every body wanted a quick fix, but economic growth and stability take time to put in place and become ingrained - think 3-5 years. Flip flops didn't help, neither did Carter's speech about a "crisis of confidence". Carter appoints Volcker as Fed Chairman, who proceeds to clamp down on inflation by raising interest rates, then lowers them, then raises them. But finally, inflation is tamed, but not until the Reagan presidency.
Ronald Reagan presidency: The teflon president. Not knowledgeable in economics, nor does he seem to be widely read. But he came with the ideology of less government, less regulation, and proceeded to remove most to the safe guards covering the banking industry and other industries. As one writer put it, regulations were removed or gutted based on ideology, not on a rational approach to restructuring, streamlining and reform. Remember the S&L fiasco? Lay that at the doorstep of Ronald Reagan, along with a huge increase in the national debt. On the other hand, deregulating the airline industry was definitely the right decision.
Michael Milken, the junk-bond king. "came as close to outright market manipulation as he could." Broke the law by parking stocks with Ivan Boesky; ended up going to jail. Boone Pickens and greenmail, and the LBO craze. Most of the companies that succumbed to the LBO fad were saddled with so much debt that they couldn't survive a recession. It was, overall, a debacle for everyone except for the executives who were well paid for laying off workers and selling business entities all in the name of reducing expenses. All of that borrowed money went to pay interest and salaries, virtually none of it to improve productivity.
Prior to the collapse of LTCM, Brooksley Born, head of the Commodities Futures Trading Commission, recommended that derivatives be regulated. She was prevented from doing so by Rubin, Greenspan, Summers, and Levitt, four people who should have known better. As derivatives became more complex (CDS, CMO, etc.) and more numerous, without regulation, much of these invisible loans posed huge risks for the buyers of them. Full disclosure of the associated risks was conspicuous by its absence.
Meanwhile, Sandy Weill picked up where Wriston left off, buying up different businesses to create a one-stop shop for financial services. Obviously it didn't work. But he still retired with millions.
Who can forget Enron? Faked accounting audited and approved by Anderson. What were they thinking? The manipulation of the electrical power spot market in California is described. But at least the worst offenders went to jail and had to disgorge their profits. And Anderson disbanded. But the employees of Enron lost all their savings.
Along comes the dotcom bubble. Does the phrase "new economy" ring a bell? It should. Many financial gurus insisted that it wasn't necessary for the dotcoms to show a profit! Some dotcoms were successful, most were not. The total amount of losses during this period are calculated at about $4 trillion. This is a classic case of the herd mentality; investors followed each other like lemmings, right off the cliff.
All this leads up to the current crisis, about which much has been written. I think this particular book gives the best, most comprehensive explanation because it lays out the path that leads inexorably to the worst financial crisis since the Great Depression.
All these events give the lie to the theory of "rational markets." Markets are not rational; they are highly irrational, swinging from one extreme to the other. And as this book makes clear, they are also driven, sometimes manipulated, by self-serving individuals who are only interested in a profit, not an investment. And if the profit comes at someone else's expense, so what? If the loans go sour, the government will bail them out. During the most recent crisis, the American taxpayer had some $12 trillion on the line in loans and loan guarantees to banks that had made bad bets.
Personally, I'm mad as hell and not inclined to take any more of this.
This book is fundamentally an economic history of the United States, from about 1970 to the present, but with some background information going back to the WWII. It is well written and easily understood by the lay person. It lays out a timeline of economic and business thinking, and the relationships between Wall Street, the governing political class, and economists. Very few of them emerge unscathed. In fact, bankers and economists come across as self-centered and short sighted, while the politicians cherry pick ideas to suit their ideology. The theory of unintended consequences also makes its first appearance here (S&L fiasco; Garn-St Germaine bill). This author seems to take a truly "fair and balanced" approach, with no particular axe to grind on either side of the political aisle. Both Republicans and Democrats get their well-deserved lambasting. It is also clear that economists haven't a clue; predicting economic results much beyond two months in advance is clearly beyond their capabilities. So far, the only person to emerge relatively unscathed is Paul Volcker, probably because he is a pragmatist, not an ideolog, and takes the long view.
Financial Crisis Synopsis
1982: Third World debt defaults, where loans are primarily from American banks recycling petrodollars as loans to developing nations.
1987: Stock market crash; Dow loses about 30% in one day; speculative bubble.
1989 - 1990: Thrift failures (Garn - St Germaine bill) and junk bond collapse (Milken)
1994: Mexican debt crisis; more loans peddled to a third world country that couldn't afford them.
1997: Asian financial crisis; currency traders betting against Asian currencies, and yanking their investments ("hot money" is the phrase here); too many loans for the countries to realistically service.
1998: Russian debt default; similar to the Asian financial crisis.
1998: Collapse of Long Term Capital Management; large bets on the wrong side of interest rates, without a good hedge strategy.
2000: Burst of the high tech bubble; highly leveraged "investments" in businesses that were no more than someone's wishful thinking.
2007: Bursting of the housing bubble, leading directly to the current crisis.
Each of these crises sounds different but they all have the same two underlying causes:
1. Continued erosion of the regulatory statutes and enforcements. Each crisis is worse than the one before it because of that continued erosion.
2. Failure of the financial community to fully comprehend what was happening and what could happen if the current trends at the time continued.
The loosening of the laws and regulations was done specifically at the request (lobbying) of Wall Street, who claimed that the free market was the best process for allocating capital, and therefore should be free of government regulations. But then when things go sour, these same bankers turn to the government for rescue. This cognitive dissonance appears again and again.
Just for the record, I'm a firm believer in capitalism; it's less than perfect but the best we have. But it is the government and the regulatory agencies to make certain the playing field is level and honest, that people's money and investments are placed at risk with only their informed consent, and that the financial system is safeguarded, without creating a moral hazard.
Finished the opening section on Milton Friedman, the monetarist. I remember his writings in the Wall Street Journal and always wondered how he came to his conclusions. He was always able to show correlations, but high correlations do not imply causality. I never felt that he established root cause. I'm glad to read that other people agreed with me. The review of his thinking reveals a man who thinks everything should be left to market forces: schools, roads, libraries, commerce, etc. He makes the broad, and to me entirely unwarranted assumption, that market forces will balance everything out, without the need for government regulation. He totally ignores human nature: most people want to tilt the playground in their favor. Government is there to provide equal opportunity by making certain that everyone plays by the same rules. Under Friedman utopia, Bernie Madoff was perfectly legal; people would have caught on sooner or later and left his company in the lurch.
On to the next section: Richard Milhous Nixon. This section was a reminder of just how cynical and self-centered Nixon was. Much of this I remember, having lived through the oil shocks, price controls, driving at 55 mph to conserve gas, etc. I distinctly remember his second campaign: Nixon's the one! It was all about Nixon, with very little to do with the Republican party and what the party stood for. But then, me and my buddies were really into Watergate, and could not understand why anyone would even consider Nixon for president. This inside look at the manipulation of the economy to ensure re-election just reinforces my dislike for the man.
Joe Flom and the hostile takeover: I didn't recognize the name but certainly remember the age of conglomerate building and the first use of "synergism". LBO's and hostile takeovers enabled by cheap loans became the rage. And of course they never lasted. Thorough research by economists reveals that many companies bought at a premium were later sold off at a loss because the synergism never occurred; the same thing is happening now. The same concept: Citibank and one stop shopping for all things financial. It's not working and Citibank has been struggling for over 3 years to stay afloat.
Ivan Boesky: insider trading driven by simple greed. A short section but provides an inside look at some of the more peculiar aspects of one man's greed.
Walter Wriston again, along with other bankers, the ones who demand a market economy free from government regulation: Americans kept sending dollars to the Saudis to buy oil to turn into gasoline to burn in their cars. Saudi's have to do something with all that money, so they deposit it in the large American banks. Those banks turn around and make loans to developing countries (UDCs). Those countries repay the loan using inflated dollars earned by selling their commodities. The bankers make money and everything is rosey. Except for when recession hits and commodity prices drop like a stone. Loans go sour, banks start losing money, and turn to the government to prop them up. (Sound familiar? only instead of commodities, think mortgage-backed securities.) Apparently bankers are congenitally incapable of learning from their predecessor's mistakes.
Along comes Ronald Reagan: "Government is the problem." To become governor of California, he put together a conservative agenda that included university tuition and proposed a tax limitation amendment to the CA constituion. The latter failed to pass, but not by much. It later was put in place, with far-reaching consequences.
In the meantime, Carter has now become president. Economics is not his strong suit, inflation is rampant and the economy is stagnant. Stagflation was coined, and the Carter administration kept flip flopping on economic policy. Every body wanted a quick fix, but economic growth and stability take time to put in place and become ingrained - think 3-5 years. Flip flops didn't help, neither did Carter's speech about a "crisis of confidence". Carter appoints Volcker as Fed Chairman, who proceeds to clamp down on inflation by raising interest rates, then lowers them, then raises them. But finally, inflation is tamed, but not until the Reagan presidency.
Ronald Reagan presidency: The teflon president. Not knowledgeable in economics, nor does he seem to be widely read. But he came with the ideology of less government, less regulation, and proceeded to remove most to the safe guards covering the banking industry and other industries. As one writer put it, regulations were removed or gutted based on ideology, not on a rational approach to restructuring, streamlining and reform. Remember the S&L fiasco? Lay that at the doorstep of Ronald Reagan, along with a huge increase in the national debt. On the other hand, deregulating the airline industry was definitely the right decision.
Michael Milken, the junk-bond king. "came as close to outright market manipulation as he could." Broke the law by parking stocks with Ivan Boesky; ended up going to jail. Boone Pickens and greenmail, and the LBO craze. Most of the companies that succumbed to the LBO fad were saddled with so much debt that they couldn't survive a recession. It was, overall, a debacle for everyone except for the executives who were well paid for laying off workers and selling business entities all in the name of reducing expenses. All of that borrowed money went to pay interest and salaries, virtually none of it to improve productivity.
Prior to the collapse of LTCM, Brooksley Born, head of the Commodities Futures Trading Commission, recommended that derivatives be regulated. She was prevented from doing so by Rubin, Greenspan, Summers, and Levitt, four people who should have known better. As derivatives became more complex (CDS, CMO, etc.) and more numerous, without regulation, much of these invisible loans posed huge risks for the buyers of them. Full disclosure of the associated risks was conspicuous by its absence.
Meanwhile, Sandy Weill picked up where Wriston left off, buying up different businesses to create a one-stop shop for financial services. Obviously it didn't work. But he still retired with millions.
Who can forget Enron? Faked accounting audited and approved by Anderson. What were they thinking? The manipulation of the electrical power spot market in California is described. But at least the worst offenders went to jail and had to disgorge their profits. And Anderson disbanded. But the employees of Enron lost all their savings.
Along comes the dotcom bubble. Does the phrase "new economy" ring a bell? It should. Many financial gurus insisted that it wasn't necessary for the dotcoms to show a profit! Some dotcoms were successful, most were not. The total amount of losses during this period are calculated at about $4 trillion. This is a classic case of the herd mentality; investors followed each other like lemmings, right off the cliff.
All this leads up to the current crisis, about which much has been written. I think this particular book gives the best, most comprehensive explanation because it lays out the path that leads inexorably to the worst financial crisis since the Great Depression.
All these events give the lie to the theory of "rational markets." Markets are not rational; they are highly irrational, swinging from one extreme to the other. And as this book makes clear, they are also driven, sometimes manipulated, by self-serving individuals who are only interested in a profit, not an investment. And if the profit comes at someone else's expense, so what? If the loans go sour, the government will bail them out. During the most recent crisis, the American taxpayer had some $12 trillion on the line in loans and loan guarantees to banks that had made bad bets.
Personally, I'm mad as hell and not inclined to take any more of this.
September 30, 2011
Age of Greed: The Triumph of Finance and the Decline of America, 1970 to the Present by Jeff Madrick
“Age of Greed…” is the historical development of greed over the past forty years. Jeff Madrick takes the reader through a biographical ride of the main players involved in the economic decline of America. This 480-page book is composed of the following chapters: 1. Walter Wriston Regulatory Revolt, 2. Milton Friedman Proselytizer, 3. Richard Nixon and Arthur Burns, 4. Joe Flom The Hostile Takeover and Its Consequences, 5. Ivan Boesky Wanting It All, 6. Walter Wriston II Bailing Out Citibank, 7. Ronald Reagan The Making of an Idealogy, 8. Ted Turner, Sam Walton, and Steve Ross Size Becomes Strategy, 9. Jimmy Carter Capitulation, 10. Howard Jarvis and Jack Kemp Tapping the Anger, 11. Paul Volcker, Jimmy Carter, and Ronald Reagan Revolution Completed, 12. Tom Peters and Jack Welch Promises Broken, 13. Michael Milken “The Magnificent”, 14. Alan Greenspan Ideologue, 15. George Soros and John Meriwether Fabulous Wealth and Controversial Power, 16. Sandy Weill King of the World, 17. Jack Grubman, Frank Quattrone, Ken Lay, and Sandy Weill Decade of Deceit, 18. Angelo Mozilo The American Tragedy, and 19. Jimmy Cayne, Richard Fuld, Stan O’Neil, and Chuck Prince Collapse.
Positives:
1. Well-written and insightful historical account of the events.
2. Well-researched book that is accessible to the masses.
3. Even-handed. An equal opportunity critic.
4. Doesn’t shy away from placing blame.
5. Does a real good job of capturing the most important events that transpired in a very straight-forward manner.
6. A good review on economic history over the past four decades. I particularly enjoyed presidential references.
7. A lot of great insights. Interesting how our perceptions of some of the main players change over time when in fact the reality is something else.
8. The recurring theme of dismantling the Glass-Steagall Act of 1933. The quest for deregulation.
9. The preoccupation of inflation.
10. The development and impact of the economic philosophy of Milton Friedman.
11. A lot of fascinating tidbits about Nixon.
12. The transition from long-term health of corporations, their workers, and communities they served, to Wall Street bankers.
13. The model for business takeovers established. Interesting how but the very largest companies were safe from acquisitions in the 1980s.
14. Perhaps one of the most interesting chapters, Ronald Reagan.
15. Walton’s obsession with cutting costs and how he made Wal-Mart.
16. How Jimmy Carter’s micromanagement style failed the country.
17. One of the major topics discussed is deregulation. A lot of interesting insights on this subject.
18. Federal Reserve Chairman Volcker’s views.
19. Reagan’s regressive taxes and their impact. Good stuff.
20. Reagan’s antiregulation approach. Example, the Garn-St. Germain Act to help failing savings and loan associations.
21. Jack Welch the transformation of GE.
22. Milken the junk bond king.
23. The impact of Greenspan. A major player over the years, many interesting anecdotes.
24. 2004 the year Greenspan raised rates and how it took many by surprise.
25. The impact of collateralized debt obligations (CDOs).
26. The power of hedge funds and how George Soros dominated for over 25 years.
27. The interesting rise of Sandy Weill. His rise through acquisitions.
28. Another recurring them, conflict of interests.
29. Eliot Spitzer the enforcer.
30. How the blatant corruption of some of our biggest companies stunned the nation.
31. Why stock options is key to executive pay.
32. The IPO surge, can you say Quattrone?
33. The corrupt traders, some very good examples.
34. The evil that was Enron and WorldCom.
35. How Angelo Mozilo went from respectable to greedy and his impact.
36. So who was truly to blame for the real estate bubble, find out.
37. Subprime loans, subprime loans, subprime loans…
38. And to finish with a flurry how about the impact of Jimmy Cayne, Richard Fuld, Stan O’Neil and Chuck Prince.
39. Let’s not forget the insurance companies…AIG.
40. Great notes section.
Negatives:
1. The parts are better than the whole.
2. Not the most engaging, elegant prose. A bit dry.
3. Desperately needed a cast of characters.
4. A timeline chart, graphs, would have added much value.
5. Can be difficult to follow at times particularly if you are trying to follow the takeovers and who ends up where, doing what.
6. Surprisingly doesn’t include a chapter on Bernie Madoff.
7. Links from Notes to the book but not vice versa, go figure.
In summary, this book provides so much information about the impact of greed and the main players involved. Jeff Madrick provides example after examples of the greed that took place in our country. Many accounts that will make you sick especially when you consider the impact these few men had over all our lives. The book provides invaluable information it just lacked a little bit of style for my taste. I recommend this book for the insight and education it provides, I take a star away for lack of panache.
Further suggestions: “Winner-Take All Politics” by Jacob S. Hacker, “The Monster: How a Gang of Predatory Lenders and Wall Street Bankers Fleeced America…” by Michael W. Hudson, “Perfectly Legal…” by David Cay Johnston, “The Looting of America” by Les Leopold and “The Great American Stickup” by Robert Scheer.
“Age of Greed…” is the historical development of greed over the past forty years. Jeff Madrick takes the reader through a biographical ride of the main players involved in the economic decline of America. This 480-page book is composed of the following chapters: 1. Walter Wriston Regulatory Revolt, 2. Milton Friedman Proselytizer, 3. Richard Nixon and Arthur Burns, 4. Joe Flom The Hostile Takeover and Its Consequences, 5. Ivan Boesky Wanting It All, 6. Walter Wriston II Bailing Out Citibank, 7. Ronald Reagan The Making of an Idealogy, 8. Ted Turner, Sam Walton, and Steve Ross Size Becomes Strategy, 9. Jimmy Carter Capitulation, 10. Howard Jarvis and Jack Kemp Tapping the Anger, 11. Paul Volcker, Jimmy Carter, and Ronald Reagan Revolution Completed, 12. Tom Peters and Jack Welch Promises Broken, 13. Michael Milken “The Magnificent”, 14. Alan Greenspan Ideologue, 15. George Soros and John Meriwether Fabulous Wealth and Controversial Power, 16. Sandy Weill King of the World, 17. Jack Grubman, Frank Quattrone, Ken Lay, and Sandy Weill Decade of Deceit, 18. Angelo Mozilo The American Tragedy, and 19. Jimmy Cayne, Richard Fuld, Stan O’Neil, and Chuck Prince Collapse.
Positives:
1. Well-written and insightful historical account of the events.
2. Well-researched book that is accessible to the masses.
3. Even-handed. An equal opportunity critic.
4. Doesn’t shy away from placing blame.
5. Does a real good job of capturing the most important events that transpired in a very straight-forward manner.
6. A good review on economic history over the past four decades. I particularly enjoyed presidential references.
7. A lot of great insights. Interesting how our perceptions of some of the main players change over time when in fact the reality is something else.
8. The recurring theme of dismantling the Glass-Steagall Act of 1933. The quest for deregulation.
9. The preoccupation of inflation.
10. The development and impact of the economic philosophy of Milton Friedman.
11. A lot of fascinating tidbits about Nixon.
12. The transition from long-term health of corporations, their workers, and communities they served, to Wall Street bankers.
13. The model for business takeovers established. Interesting how but the very largest companies were safe from acquisitions in the 1980s.
14. Perhaps one of the most interesting chapters, Ronald Reagan.
15. Walton’s obsession with cutting costs and how he made Wal-Mart.
16. How Jimmy Carter’s micromanagement style failed the country.
17. One of the major topics discussed is deregulation. A lot of interesting insights on this subject.
18. Federal Reserve Chairman Volcker’s views.
19. Reagan’s regressive taxes and their impact. Good stuff.
20. Reagan’s antiregulation approach. Example, the Garn-St. Germain Act to help failing savings and loan associations.
21. Jack Welch the transformation of GE.
22. Milken the junk bond king.
23. The impact of Greenspan. A major player over the years, many interesting anecdotes.
24. 2004 the year Greenspan raised rates and how it took many by surprise.
25. The impact of collateralized debt obligations (CDOs).
26. The power of hedge funds and how George Soros dominated for over 25 years.
27. The interesting rise of Sandy Weill. His rise through acquisitions.
28. Another recurring them, conflict of interests.
29. Eliot Spitzer the enforcer.
30. How the blatant corruption of some of our biggest companies stunned the nation.
31. Why stock options is key to executive pay.
32. The IPO surge, can you say Quattrone?
33. The corrupt traders, some very good examples.
34. The evil that was Enron and WorldCom.
35. How Angelo Mozilo went from respectable to greedy and his impact.
36. So who was truly to blame for the real estate bubble, find out.
37. Subprime loans, subprime loans, subprime loans…
38. And to finish with a flurry how about the impact of Jimmy Cayne, Richard Fuld, Stan O’Neil and Chuck Prince.
39. Let’s not forget the insurance companies…AIG.
40. Great notes section.
Negatives:
1. The parts are better than the whole.
2. Not the most engaging, elegant prose. A bit dry.
3. Desperately needed a cast of characters.
4. A timeline chart, graphs, would have added much value.
5. Can be difficult to follow at times particularly if you are trying to follow the takeovers and who ends up where, doing what.
6. Surprisingly doesn’t include a chapter on Bernie Madoff.
7. Links from Notes to the book but not vice versa, go figure.
In summary, this book provides so much information about the impact of greed and the main players involved. Jeff Madrick provides example after examples of the greed that took place in our country. Many accounts that will make you sick especially when you consider the impact these few men had over all our lives. The book provides invaluable information it just lacked a little bit of style for my taste. I recommend this book for the insight and education it provides, I take a star away for lack of panache.
Further suggestions: “Winner-Take All Politics” by Jacob S. Hacker, “The Monster: How a Gang of Predatory Lenders and Wall Street Bankers Fleeced America…” by Michael W. Hudson, “Perfectly Legal…” by David Cay Johnston, “The Looting of America” by Les Leopold and “The Great American Stickup” by Robert Scheer.
April 19, 2019
Madrick presents a meticulously researched and compellingly written account of how the economic crash of 2008 wasn't a fluke that no one could have predicted, but the logical end result of decades of deregulation driven by greed and free-market ideology. Along with "The Big Short: Inside the Doomsday Machine" by Michael Lewis (and the movie made from it), Madrick's book will have you "mad as hell, and ... not going to take it anymore!" Highly recommended.
June 27, 2022
I enjoyed it the first 100-150 pages or so. Got tedious by halfway through, just endless versions of the same story (people privatizing risk upside but not owning the downside).
Its end of 2010 summary that indicates tech stocks have clearly been overvalued ... has not aged well.
Well-researched but just too much details for me of people I don't find fundamentally interesting.
Its end of 2010 summary that indicates tech stocks have clearly been overvalued ... has not aged well.
Well-researched but just too much details for me of people I don't find fundamentally interesting.
June 24, 2017
Who needs Stephen King when the financial community of this country is an all-too-real nightmare of greed, power, and exploitation? And someone chose their patron saint to run this mess. God have mercy on us all.
March 11, 2017
Very interesting depictions of various political and financial people from the 1970s, 1980s, 1990s, and 2000s, from Nixon, Alan Greenspan, Michael Milken, Ken Lay to the various players that led to the 2008 Depression. Though some portraits might be only a page or two, most were longer and each gave a background of the individual, their rise to prominence and the mistakes and wrongs that they were responsible for. From the pages one gets to understand that the government hasn't much clue about the financial world and lets the financiers control the markets. As the decades pass the financial people use lobbyists and their own influence on politicians to dismantle the safeguards put in place from the first depression and other events so that they can manipulate the world markets unchecked. Most interesting was the similarity of the various crashes, almost all having to do with unbridled speculation. Within those markets many knew the wrongs being perpetrated but each looked after their own interests and lined their own pockets. Many left with millions of dollars from termination at their firms, even after reaping tens or hundreds of millions of dollars and causing unfathomable losses to companies and US citizens. What a disgrace. It makes one doubt the system we currently live under.
February 4, 2012
Essentially a financial history of the last 40-plus years, Mardrick tells his story by following the lives, machinations, frauds, and financial adventures and misadventures of key figures from Wall Street and government. He shows how over time the regulations passed by Congress during the Great Depression, whose purpose was to prevent another debilitating national economic breakdown, gradually disappeared either from piece-by-piece dismantling during both Republican and Democratic presidential administrations, subversion by clever and bold CEOs and their minions, and the regulators' incompetence and failure to enforce the regulatory laws.
There are a couple of lessons to take away from the story. One lesson is based on the recent economic horror brought about for the satisfaction of money lust for a handful of Wall Street barons who enriched themselves fabulously while almost bringing the world economy to its knees. Only US government intervention, initially initiated by the Bush administration, saved us from a fate as bad or worse than the Great Depression. Almost none of these princes of piles of money paid any price for the swindles and fraud they imposed on the companies they led or the investors they cheated or the suffering endured by tens of millions of Americans through job losses, home foreclosures, and the devastating decline of home values that eviscerated their wealth. In a more just society they would have been at least indicted.
The second lesson is that given the same circumstances of the various avoidable crises we've survived over the last several decades (oil embargoes, default on debt by Latin America countries, savings and loan failures, stock market crashes, housing and tech bubbles, high inflation, to name a few covered in the book), how many of us would have acted differently? True, many inside Wall Street firms and outside warned that disaster loomed, if not soon than certainly not much later. Those who bought short prior to the last crisis, the one beginning with the housing crisis in 2007, made billions of dollars when the banks and insurance companies could not pay off their debts and sunk in value to what seemed unimaginable depths. But for Wall Street CEOs and their analysts and advisors, the prospect of acquiring wealth in the hundreds of millions and even billions of dollars proved too irresistible. They profited while most of the rest of fixed their errors by bailing them out. How many could resist the gradual assumption of the arrogance and greed that seem to be the shared personality traits of these so-called free market capitalists?
Which lead to the most important lesson. The disasters described in the book could have been avoided had not the regulatory structure imposed due to the Great Depression been gradually but inexorably dismantled or subverted. An unfettered free market allegedly allocates resources, financial and otherwise, efficiently to those areas which have the greatest requirement. But this assumes that people are perfectly rational, that information is available to everyone equally, and that the market functions transparently. This isn't the case, has never been the case, nor will it ever be the case so long as we imperfect humans are governed more by our emotions than our brains. Corrupt practices in return for unworldly payoffs is difficult to resist, except for the very few saints among us. The paucity of saints is what makes regulation necessary. Otherwise, as this book starkly reminds us, we are fated to repeat what happens all too frequently: we eat our own over, and over, and over again until we are muzzled.
There are a couple of lessons to take away from the story. One lesson is based on the recent economic horror brought about for the satisfaction of money lust for a handful of Wall Street barons who enriched themselves fabulously while almost bringing the world economy to its knees. Only US government intervention, initially initiated by the Bush administration, saved us from a fate as bad or worse than the Great Depression. Almost none of these princes of piles of money paid any price for the swindles and fraud they imposed on the companies they led or the investors they cheated or the suffering endured by tens of millions of Americans through job losses, home foreclosures, and the devastating decline of home values that eviscerated their wealth. In a more just society they would have been at least indicted.
The second lesson is that given the same circumstances of the various avoidable crises we've survived over the last several decades (oil embargoes, default on debt by Latin America countries, savings and loan failures, stock market crashes, housing and tech bubbles, high inflation, to name a few covered in the book), how many of us would have acted differently? True, many inside Wall Street firms and outside warned that disaster loomed, if not soon than certainly not much later. Those who bought short prior to the last crisis, the one beginning with the housing crisis in 2007, made billions of dollars when the banks and insurance companies could not pay off their debts and sunk in value to what seemed unimaginable depths. But for Wall Street CEOs and their analysts and advisors, the prospect of acquiring wealth in the hundreds of millions and even billions of dollars proved too irresistible. They profited while most of the rest of fixed their errors by bailing them out. How many could resist the gradual assumption of the arrogance and greed that seem to be the shared personality traits of these so-called free market capitalists?
Which lead to the most important lesson. The disasters described in the book could have been avoided had not the regulatory structure imposed due to the Great Depression been gradually but inexorably dismantled or subverted. An unfettered free market allegedly allocates resources, financial and otherwise, efficiently to those areas which have the greatest requirement. But this assumes that people are perfectly rational, that information is available to everyone equally, and that the market functions transparently. This isn't the case, has never been the case, nor will it ever be the case so long as we imperfect humans are governed more by our emotions than our brains. Corrupt practices in return for unworldly payoffs is difficult to resist, except for the very few saints among us. The paucity of saints is what makes regulation necessary. Otherwise, as this book starkly reminds us, we are fated to repeat what happens all too frequently: we eat our own over, and over, and over again until we are muzzled.
December 22, 2012
There were some minor flaws in grammar and logical sentence structure, but that's been pretty common in books lately (unfortunately), but they don't undermine the overall impact of this book.
What you should get out of this is that the economic crisis of 2008 didn't occur in a vacuum: It took us 40 or so years to get there, there were people during that time that made conscious decisions to get us there (Glass-Steagall and Regulation Q weren't just considered obsolete by the government, there was a conscious lobbying effort to get rid of those regulations to boost corporate market share) and government was complicit not only through corporate welfare (the dreaded bailouts) but mainly through looking the other way in the name of the free market (which, the crisis should have taught us, doesn't really exist).
What was staggering to me now that I've had a chance to absorb what I've read is the 40-year effort to throw good money after bad. Business schools taught not so long ago (at least in my lifetime) that the goal of a good corporate citizen is to look after the long-term interests of their companies, customers, suppliers and communities. Now, it's to boost shareholder value. If you do the former, you invest in your workforce, innovate and maintain research and development efforts to keep on top of the competition. If you do the latter, you cut all that and use the cash you accumulate to buy back stock and boost the stock price and ... that's it. What happened in 2008 was the culmination of decades of boosting stock prices over all and shirking on those long-term commitments.
Think of it this way, if corporate America was still in the "good corporate citizen" mode, think of how much of the trillions of dollars essentially bad investments could have gone into energy and transportation infrastructure, schools and health care, instead of expecting the government to take care of all that. While they cry about government intervention in their business (regulations), they also help to foster bigger government by shirking the responsibilities they once took great pride in because it was the right thing to do, such as paying a healthy wage, providing good health care and retirement benefits, providing education for workers and their offspring.
What you should get out of this is that the economic crisis of 2008 didn't occur in a vacuum: It took us 40 or so years to get there, there were people during that time that made conscious decisions to get us there (Glass-Steagall and Regulation Q weren't just considered obsolete by the government, there was a conscious lobbying effort to get rid of those regulations to boost corporate market share) and government was complicit not only through corporate welfare (the dreaded bailouts) but mainly through looking the other way in the name of the free market (which, the crisis should have taught us, doesn't really exist).
What was staggering to me now that I've had a chance to absorb what I've read is the 40-year effort to throw good money after bad. Business schools taught not so long ago (at least in my lifetime) that the goal of a good corporate citizen is to look after the long-term interests of their companies, customers, suppliers and communities. Now, it's to boost shareholder value. If you do the former, you invest in your workforce, innovate and maintain research and development efforts to keep on top of the competition. If you do the latter, you cut all that and use the cash you accumulate to buy back stock and boost the stock price and ... that's it. What happened in 2008 was the culmination of decades of boosting stock prices over all and shirking on those long-term commitments.
Think of it this way, if corporate America was still in the "good corporate citizen" mode, think of how much of the trillions of dollars essentially bad investments could have gone into energy and transportation infrastructure, schools and health care, instead of expecting the government to take care of all that. While they cry about government intervention in their business (regulations), they also help to foster bigger government by shirking the responsibilities they once took great pride in because it was the right thing to do, such as paying a healthy wage, providing good health care and retirement benefits, providing education for workers and their offspring.
September 20, 2011
This book is an excellent education. The chapters are based on individuals and their actions during this time period including the famous economist, Milton Friedman, the heads of the Federal Reserve, the US presidents, various Wall Street moneymakers like Ivan Boesky, Michael Mulkins, Jack Welch, Sandy Weill, George Soros, John Merriweather, Ken Lay and his cohorts, etc. It also details the big brokerage firms and their actions such as the Leveraged Buyouts so popular in the 80's which did nothing for the various companies but brought in huge fees, the Savings and Loan fiasco also in the 80's, the huge loans to South American countries that nearly bankrupted them due to high interest rates, again in the 80's, the dot com bubble, the continuing deregulation of the industry during this time, and of course, the current economic collapse. The basic reason for all of it was greed, disregard of ethics, and the gov't's lack of oversight. Even with TARP, if the gov't had insisted on firing the managers like they did with General Motors, they would have had some influence but instead, everything has gone as usual and the huge bonuses have continued and no one has been prosecuted this time although Boesky, Mulkins, the Enron guys and Savings and Loan heads were earlier. This book made Bill mad but I appreciated the education. Above all, do your own research and don't trust stockbrokers. They're in it for their own wealth. Dishonesty and greed are rampant on Wall Street and through deregulation they were able to get by with it. Friedman's philosophy was that the industry was self-regulating and it is if he meant greed is paramount.
January 14, 2012
This took me a long time to read. It is dense at times with the accounts of the business regulations that governed banks and wall street, and the concerted efforts the financiers made over the last 4 decades to reverse or eliminate them. Those efforts were highly successful as the author points out for the handful of executives and sales people in the banks and on Wall Street that made outrageous fortunes, but clearly at the cost of strengthening the country overall due to the wasted and lost dollars when the subprime and other financial disasters occurred over each of the decades. The book offers profiles of the "titans" who benefited most from their business acumen, their ability to spot an opportunity to scam the system and reap huge profits. This book is a condemnation of those individuals but very broad in its scope. As Jamie Dimond identified himself and his colleagues, the "assholes" in the banking and finance world were aided along with the way with cooperative politicians from both sides of the political aisle in getting what they needed to allow them unfettered and unregulated license to exploit, manipulate and amass their personal fortunes.
Bottom line: a solid primer for understanding why our present economy is on the shakey ground and a scary tome because it makes it clear that no one in Washington or on Wall Street has the courage or integrity to rein these bastards in.
Bottom line: a solid primer for understanding why our present economy is on the shakey ground and a scary tome because it makes it clear that no one in Washington or on Wall Street has the courage or integrity to rein these bastards in.
October 17, 2011
I wish everyone who has the capacity to read this book would read it. It wasn't an easy read for me - I had to sit up to do it - but O. M. G. It lays out the whole situation that has this county - and indeed the globe - in the dire economic straits it's in. And it's even more dire than you think, because the same people who brought us all the 2008 market crash that cost the US Treasury (taxpayers) enormous sums in bailout money ARE STILL IN CHARGE. It's too tempting a game for them. Take huge shell game risks (they take some pains with their sleight of hand, but no-one's looking anyway) with other people's money, sock away gigantic personal fortunes, and waltz away from the debts. Pass them on to all those greedy teachers and firemen, small businesses and homeowner wanna-bes. The whole thing makes me pretty angry, as you can probably tell. If you do nothing else, read the Epilogue at least. Read it and weep. Or grind your teeth.
Meanwhile, I think Wall Street should convert the ground floor lobbies of its buildings into casinos, install neon everywhere, bring in the slots and acts, babes and booze - show their true colors at last and give the person on the street at least as much of a chance as Vegas gives and maybe a laugh or two along the way to being relieved of one's assets.
Meanwhile, I think Wall Street should convert the ground floor lobbies of its buildings into casinos, install neon everywhere, bring in the slots and acts, babes and booze - show their true colors at last and give the person on the street at least as much of a chance as Vegas gives and maybe a laugh or two along the way to being relieved of one's assets.
August 30, 2011
This is a very readable, slightly political presentation of how America has become sidetracked by exhorbitant salaries, particularly in the financial industry. It focuses on individuals, with chapters on Milken, Weill, Milton Freedman, and others, and that is part of its charm and confusion. The individual stories are readable and compelling, but by the end also repetitive. Afterall, each person has to undergo the same boom and bust years.
Occossaionally the point of the book is also obscured by the individual stories. The fact is these are illustrations of a system of greed inherant in the way our financial and political systems have been operating, rather than just individual examples. He does say that, but he doesn't prove it. However, after reading extensively about the financial crisis of 2008, and living only one or two degrees of separation from these people, I know that to be true.
From that standpoint, this is an excellent series of illustrations of my own point of view. What I can't tell is whether anyone who didn't start with that point of view would be persuaded that these are not just isolated examples, and that greed and compensation of the type exhibited is terrible for the country -- that, in short, Gordon Gekko is wrong.
But if you want an overview of how we got where we now are, this is quite a good book.
Occossaionally the point of the book is also obscured by the individual stories. The fact is these are illustrations of a system of greed inherant in the way our financial and political systems have been operating, rather than just individual examples. He does say that, but he doesn't prove it. However, after reading extensively about the financial crisis of 2008, and living only one or two degrees of separation from these people, I know that to be true.
From that standpoint, this is an excellent series of illustrations of my own point of view. What I can't tell is whether anyone who didn't start with that point of view would be persuaded that these are not just isolated examples, and that greed and compensation of the type exhibited is terrible for the country -- that, in short, Gordon Gekko is wrong.
But if you want an overview of how we got where we now are, this is quite a good book.
November 7, 2011
This book smashed it; Madrick is a gangster and he keeps in funky for the full 496 pages.
I read this because his pieces for the NYRB are always top-notch, illuminating and focused. I ran across this book at Dulles airport (IAD) and thought, "why not? If he's good enough to write for the NYRB, I can certainly spend some time with a full book of his."
A bit formulaic at times, but the depth of analysis and range across inter-related topics had me mentally headbanging to this blistering and thorough explanation of the past 40-odd years of ideologically-implemented changes in American culture, politics and business — to the detriment of all but the richest classes and with the increasing immiseration and decimation of the middle and lower classes.
I WKIW (Would Kick It With) Madrick, or at least attend one of his talks, without hesitation. Toss your anodyne and tranquil Thomas L. Friedman, Nicholas Kristof, or Joseph Stiglitz books to the curb...
I read this because his pieces for the NYRB are always top-notch, illuminating and focused. I ran across this book at Dulles airport (IAD) and thought, "why not? If he's good enough to write for the NYRB, I can certainly spend some time with a full book of his."
A bit formulaic at times, but the depth of analysis and range across inter-related topics had me mentally headbanging to this blistering and thorough explanation of the past 40-odd years of ideologically-implemented changes in American culture, politics and business — to the detriment of all but the richest classes and with the increasing immiseration and decimation of the middle and lower classes.
I WKIW (Would Kick It With) Madrick, or at least attend one of his talks, without hesitation. Toss your anodyne and tranquil Thomas L. Friedman, Nicholas Kristof, or Joseph Stiglitz books to the curb...
July 4, 2013
Although Madrick states, "The collapse was the product of decisions of individuals, set upon making fortunes and becoming one of the kings of the mountain, not an inevitable failure of a system", it seems that the system encourages, indeed lauds, unmitigated greed. Unfortunately, as Madrick also observes, despite the near total collapse of the economy,nothing has really changed. Government lacks the will or the ability to exercise meaningful oversight, our politicians both elected and appointed either ignoring or abetting the continuing financial abuses. The rest of us eat cake.
The book clearly substantiates its premise, although it is pretty dense at times if you are not a securities analyst. It could also have addressed in more detail how the siphoning of billions into the personal accounts of CEOs affected the millions of hard working Americans--or unemployed--who are not lined up at the Wall Street trough.
The book clearly substantiates its premise, although it is pretty dense at times if you are not a securities analyst. It could also have addressed in more detail how the siphoning of billions into the personal accounts of CEOs affected the millions of hard working Americans--or unemployed--who are not lined up at the Wall Street trough.
October 21, 2011
A very readable, and damning account of the people and policies that led to financial disaster in 2008. Madrick comes at the story of how free-market extremism and self-serving individuals brought down the financial system by telling the individual stories of many of the major players involved, including academics, politicians, and members of the business community.
Read
May 12, 2013This book has really stuck with me. It not only reveals who it was that turned 20th Century Wall Street from a regulated entity into a free-for-all, but you could all it the MAD MEN of the financial world. I highly recommend it.
May 4, 2016
This book explains how bankers and senior business executives gambled with other people's money and won why the other people paid for their gambling and they profited beyond all their wildest dreams. Why are we not learning from this?
August 26, 2012
Good book; will make you want long-term jail sentences for some of the most famous CEO's in the World. Needs more balance.
October 11, 2014
Fascinating descriptions of key persons in finance since 1970. Unless we get serious about the increasing wealth inequality gap, more economic crises are in our future.
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