It was while reading this third section that my disappointment The more I read of Crashed the less I liked it. It was while reading this third section that my disappointment crystalized. Each of these chapters is almost entirely standalone and reads like a run-of-the-mill, not very spectacular The Atlantic article on the subject. The section on Trump's election is probably the worst example of this.
A normal accident analysis of the mortgage meltdown
Ukraine, Brexit, Trump's election, further European developments particularly in Greece , even China's stock market slump. In a book that is both a year retrospective and carries the subtitle "how a decade of financial crises changed the world" it actually spends most of its time in "at the moment" journalistic re-telling rather than looking back historical analysis.
What I mean is: you'll get lots of "and then Merkel had a meeting and said X; and then Geitner had a meeting and said Y". You get far less of "and now that 8 years have passed we can see that Merkel's statement X was totally off base because of A, B, C". Well, they eventually settled on a number and 10 years have passed. Surely there's been some research? Were the bankers completely wrong?
Were the regulators? Instead of clarity brought to us by the passing of time we are just left with a "he said, she said" argument. Much of this book could have been written shortly after the respective events; you'll notice, for instance, that when discussing most of the references are to things published in the period. For the Eurocrisis, most of the references are to things published in And the situation is even worse for the more recent events, simply because very little time has passed since most of them have occurred. There are times where it feels like Tooze is trying to show us major recurring themes or make explicit the linkages between all of these events.
I would have liked to see that priority inverted -- bring those themes to the forefront and just put in the details as needed to support the themes. There's another thread about the surprising solidification of US supremacy via dollar-denominated debt but it only comes up occasionally and the consequences of it aren't explored in much detail.
Don't let my low review make you think this is a bad book. If you've never read anything else on the crisis or the Eurocrisis, this is a pretty good place to start. Jun 17, Alex rated it really liked it. This is an undoubtedly brilliant account of the financial crises, both laying out the causes and the long term economic and political consequences of the events.
But it's a highly technical account and a bit too dense for what I feel like consuming at this time. Dec 17, Dax rated it really liked it Shelves: nonfiction , 4-stars. Financial crisis leads to sovereign debt crisis which leads to the rise of populism which paves the way for a Trump election. There have been hundreds of books written about the financial crisis, but Tooze's new work is the first I have come across that illustrates the path that lead us to where we are today. In the age of global integration, financial markets and political policy walk hand-in-hand, and Tooze does a nice job of showing us how the markets have shaped the course of events for the Financial crisis leads to sovereign debt crisis which leads to the rise of populism which paves the way for a Trump election.
In the age of global integration, financial markets and political policy walk hand-in-hand, and Tooze does a nice job of showing us how the markets have shaped the course of events for the last decade. It's not a particularly cheerful read, but it is valuable and informative. Recommend it for those who want to understand how we got here, rather than just gnash their teeth and complain about it. May 21, Mona rated it really liked it. This book requires full reader's attention and is not an easy read.
Author is very knowledgeable on the topic, he did very good research and in eloquent way presented facts related to financial crisis. The strength of this book lies in its global approach to the problem, not focusing only on the US likely because autor is a Brit. The interconnections among different markets are well described. The political background to financial decisions was well presented. However, I have to admit tha This book requires full reader's attention and is not an easy read. However, I have to admit that this book overwhelmed me at times. I think I reached for it at the wrong moment, I may come back to it in the future.
I felt like I lacked some basic data and knowledge to understand all presented nuances in depth. I don't have any grounded financial background and I think having it would allow me to gain more from reading this book. This book requires time. Some financial background would be helpful. It is very good and comprehensive for prepared mind. Aug 16, Henri Tournyol du Clos rated it it was ok. This book feels like being post-prandially cornered in your living room by a somewhat inebriated and chatty guest that goes on and on telling in no particular order unfocused anecdotes and grand ideas he gathered from other people or read about, throwing in some political commentary to boot.
Although the author sometimes, out of the blue, makes some apt statement, he seems to lack the ability to discern between what is really important and what is not, and to order his thoughts. Having myself tr This book feels like being post-prandially cornered in your living room by a somewhat inebriated and chatty guest that goes on and on telling in no particular order unfocused anecdotes and grand ideas he gathered from other people or read about, throwing in some political commentary to boot. Having myself traded through several major financial crises, written a textbook, and taught seminars on the subject, I find this offering not wholly uninteresting but quite underwhelming.
Dec 02, Christine rated it it was amazing Shelves: general-nonfiction , history-general. Honesty, a very good and scary book. Want to understand where we are today? Read this.
Despite its length, it is not a slog. It will make you think. Tax, regulation, transparency and accountability are four words which terrify all members of the global financial system. They prefer words like allowances, opacity, freedom and impunity and that is what they usually get. It is often a cynical and disheartening affair reading about so many egotistical politicians and bankers acting consistently with such naked self-interest, prioritising their own jobs over everything else, but it is certainly an eye-opener.
If there ever was any remaining doubt about this then we only have to look at the action taken during the global financial crisis in the States. This was all made possible thanks to Barack Obama. Look at his cabinet and how many men were from Wall Street. What will history say about how Obama fared in comparison to the last people in charge during the last major crash? Well during the depression of the 30s, Franklin D Roosevelt brought in a number of life- saving and transformative measures under the New Deal.
One of the other measures the Democrats implemented was to create the Glass-Steagall legislation of This created a vital barrier between investment banking and commercial banking. This did a fine job, but it was slowly chipped away in the succeeding decades until Bill Clinton, another Democrat, destroyed it altogether at the end of So what did Obama do in comparison? Though perhaps the most maddening and sickening factor, is while millions of Americans and others in many countries on many continents were losing their jobs, houses, savings and minds, the men responsible for it all, were not only not being prosecuted, but they were still in the same jobs.
He also elaborates on how countries impact on each other due to the flow of vast amounts of money running through one to another, through trade, borrowing and aid etc, and we see that that money was almost like blood tainted with a virus, which is why so many nations caught it and suffered the horrendous consequences.
After a while the sums of money being thrown about begin to lose all meaning once you start getting into trillions it becomes abstract. It also shows us how much money is being kept by these global institutions and makes you wonder where it all comes from and who has to pay to give it to them in the first place.
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I did enjoy this but it was simply too long for my tastes. A lot of this has been written about many times before elsewhere. Tooze clearly knows his subject in depth and has done a phenomenal amount of research, and I certainly learned a lot, though unfortunately most of it was pretty depressing and merely confirms all the negative stereotypes attributed to leading politicians and the guardians of high finance.
Jan 05, Charles rated it it was amazing. The world has become financially interdependent in a way that challenges our global institutions and indeed our imagination. The linkages of debt and monetary policy are worldwide in scope but the policy instruments to address problems are parochial and nationalistic. But what sets this book apart is the sweep and detail as the ripple effects are felt in the next decade around the world. Reviewers, including those who have posted on this site, have been laudatory or critical depending upon their own economic and political views. Overall, the deadlock within the EU drove tens of millions of citizens in the Eurozone into a s style depression.
What, if anything, could have been done differently to reduce the impact of this crisis? Tooze has a point of view, which is Keynsian, and he lays out his arguments. At times his rhetoric could have been a good deal less polemical, so as not to derail readers who disagree. Unlike the US, where the Fed mandate was price stability and maximum employment, the Europeans particularly the Germans focused on price stability alone, creating unnecessary suffering.
This influenced their vote in We now face the global economic risk of an overheated Chinese economy. There is little reason to be complacent about the ability of national and multinational institutions to address the next crisis. This is not an easy book to read, even for those with some economic and financial background. It would have been helpful to have a glossary of the many acronyms used by Tooze throughout the book.
It would also have been useful to have a reference list of the individuals who influenced decisions during the decade. Whatever your economic philosophy, there is reason to be concerned about the current US political climate of contempt for national and international institutions that can address financial crises.
In our current politically polarized climate, a particular worry is the possibility of Fed and Treasury paralysis during the next crisis. US leadership prevented the global crises of the last decade from becoming worse, and that leadership is now in some doubt going forward. Mar 13, Christine Nolfi rated it it was amazing. A sober, riveting account of the monetary practices that led to the financial crisis of Highly recommended.
Sep 29, Daniel rated it it was amazing. There have been many books about Financial Crisis of , and this is the most comprehensive. Many factors caused the subprime crisis in America. Most people were not aware of huge flow of money from Europe into the subprime market. Many middle eastern and some Chinese money go through Europe as well. Thus when the crash came, European banks also failed. After Lehman collapsed, the whole world lost confidence and it was only thanks to the heroic efforts of Paulson, Bernanke and Geithner that the bankers were saved. However, resistance was fierce from some Republicans and in the end Republican leaders with Democrats saved the day.
That also meant that helping people who actually lost their homes were politically impossible. Meanwhile bankers continued to award themselves millions of bonus and none were punished. That would come back to haunt the Democrats in The Fed also extended swap-lines to help its friends in Europe, and some Asian countries including Singapore. That swap line had been extended until now and that is great help because it essentially guarantees that these countries will never run out of the greenback.
I am very grateful to the Fed for that. Unfortunately most other countries were not lent this crucial lending hand; Eastern European countries were plunged into severe recession because they had to ask the scary IMF, which had shown devastating to countries that received their aid during the Asian Financial Crisis. It was also telling that when crisis struck, money left countries in trouble and went to America and Treasury.
No matter what people say, the American dollar still reigns supreme. When recession struck, at first European countries were oblivious to the swap line that the Fed had extended to their banks. Sarkozy pulled no punches especially.
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Then the recession pushed a lot of their counties into sovereign crises, Ireland, Greece and Portugal had to be rescued by the dreaded IMF and suffered the punishment of austerity which further increased their debt to GDP ratio. Also all these austerity caused people to get angry and vote for extremist parties. Of note also was German insistence of not allowing Greek debt restructuring, even asking Russia and China to back off from helping it.
Russia doubled down, and was first saved by the high oil price. When oil price crashed from the fracking evolution, and sanction from America and Europe, Putin asked the oligarchs to help and it pulled through. The Asian countries including China had learnt their lesson and built up loads of reserve so escaped relatively unscathed.
British people were also sick of the rich Londoners that was responsible for the crisis, cheated LIBOR , yet get richer and richer. This together with the fear of mass migration of Eastern Europeans, Brexit happened and it looks like it is going to be a hard exit. And then there is Trump, who was adept at directing public anger and xenophobia towards his election. He is going to put America first, other countries be damned.
We will witness the effects of his tariffs soon enough. China was rocked by the unwinding of the 3 QEs. Money now flows back to America and all the developing countries are under stress as money leaves them back to US. China fortunately managed to severely restrict money flowing out while stimulating the economy and exporting its manufacturing capacity by the Belt and Road initiative. Amazingly Xi now holds the bastion of globalisation and free trade!
Sep 02, James Meanwell rated it it was amazing. An excellent work of modern political economy. Adam Tooze covers the antecedents, effects, and fallout of the Global Financial Crisis GFC , through to the electoral turmoil troubling America and Europe in recent years.
There is an enormous amount covered in the book, including the US and European response to the crisis; the fallout on smaller countries incidentally exposed to the crises e. Ireland, Greece, Hungary ; the political responses sought and required; the centrality of finance to th An excellent work of modern political economy. He shows how the emergence of China played a role, and the very different responses and outcomes of policy in that country.
The Federal Reserve System in the US tried to help stabilize the global economy by setting up enormous currency swap lines with those European countries most heavily exposed to the dollar, and these lines were again used throughout the European crisis. These facts help explain that while the US dollar might have seemed on the brink of losing its dominant currency status prior to perhaps to the Euro or the Yuan , its position was massively reinforced by continuing need for funding, and the continuing weakness of non-US bank balance sheets.
Indeed, Europe might have weaned itself off dollar-dependence at the same time as strengthening the Euro if it had worked co-operatively to recapitalize banks early on. Tooze contrasts this with the relative success of US government bank bailouts and the massively monetary stimulus provided by the Fed in the form of the quantitative easing programs. Overall, an excellent book. Can not recommend it enough. An absolute must-read for social scientists or any general students of the Global Financial Crisis.
Oct 04, David Dayen rated it it was amazing. I didn't think there was a lot more to say about the financial crisis, but Tooze fills his book with interesting and new insights on practically every page.
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The historical distance serves him well here. The book also sets the stage for how this decision had consequences, both politically and socially. A masterwork. Jan 16, Lance L rated it really liked it. Take some of the points and conclusions of Matt Taibbi, and get to them by way of a very extended Paul Krugman "Wonky" column and you get something close to this book.
It should absolutely NOT be the first book one reads on the subject of the financial crisis and its aftermath - it is far too inside baseball for that. But, it does add a lot of detail, context and some excellent analysis of the interrelation of the Eurozone crisis, the crisis, and the fallout of Brexit, Trump and maybe Take some of the points and conclusions of Matt Taibbi, and get to them by way of a very extended Paul Krugman "Wonky" column and you get something close to this book.
But, it does add a lot of detail, context and some excellent analysis of the interrelation of the Eurozone crisis, the crisis, and the fallout of Brexit, Trump and maybe a bit less convincingly Ukraine. A damn fine addition to the literature of the global financial meltdown. Jan 05, Frederico rated it it was amazing. This was perhaps the best nonfiction book I've read to understand the current times. The author traces an arc from the financial crisis to Brexit and Trump.
If anything, the book encompasses too much - I've learned hot to better understand the politics in the Ukraine, for example. I filled the book with highlights for future reference. And the future looms dire indeed. Tooze has written what I imagine will be the definitive history of the financial crises of the late s and early s. Can't praise this highly enough for the sheer amount of detail, along with the massive amount of work that went into building a coherent narrative.
I knew these crises were complex, but Tooze does an excellent job of unpacking their origins, the global responses to them, and their consequences. I helped write a book about the financial crisis and the Obama administration's r Tooze has written what I imagine will be the definitive history of the financial crises of the late s and early s.
I helped write a book about the financial crisis and the Obama administration's response, and I still learned TONS for example, the incomprehensibly large size of China's stimulus coming out of the financial crisis. There are charts galore, and I'm tempted to buy a physical copy of this to see those more easily. Though I was grateful for the ease of notetaking on the kindle edition! Tooze's perspective is often equal parts empathetic and critical -- throughout, he recognized the tough choices policymakers faced but also how the neatest immediate solutions exacerbated inequalities, saved the big banks that had created many of the problems, and further concentrated power.
He gives a hard time to policymakers that dawdled but highlights that the most immediate "solutions" often just amounted to bailing out the banks from their poor decisions, with rescues for Main Street being viewed as impractical as exacerbating the situations. Heads-I-win, tail-you-lose, indeed.
Crashed was at times a slog, but only because there's just so, so much in here. The sequencing is quasi-linear, but there are enough jumps back forward and backwards in time that a timeline for each chapter might have been nice. But those are minor complaints, really. I would recommend this book to anyone with a serious interest in political economy, financial crises, or related global issues. It's work, but it's worth it.
Jun 02, Siah rated it liked it. A better book would have stayed away from including these events. I would have enjoyed this more if I were getting an advanced degree in history of the financial markets. The author also includes minute by minute account of events during the meltdown and I am not sure I really care about that. And these anecdotes really obscure the big picture. Nov 04, John Mihelic rated it it was amazing. Many of the books that dealt with the crisis were in the first three or four years, so what Tooze benefits here is from some deep reporting but more from the benefit of time.
He is able to link the crisis in the North Atlantic with the Euro crisis of several years later and then draw a line that comes with the Brexit vote and the election of Donald Trump. The h having read dozens of books on the financial crisis, and dozens more that touch on it tangentially, Tooze here puts out one of the best. The hope is that this move to populism is the last chapter in the crisis, but history doesn't end, it keeps moving. Sep 05, Eric Bottorff rated it it was amazing. The best single volume yet written on the financial crash and its consequences. This book is a comprehensive account of the financial crisis of and what has followed.
Recommended reading if you wish to understand the world we find ourselves in today. Aug 29, Jonny rated it it was amazing. Tooze strikes an excellent balance between contemporaneous narrative which will be familiar to anyone who has been reading the news, and in-depth analysis which illuminates concepts particularly around the relationships between central banks even for people who have been following the detailed policy response. It offers up more food for thought - particularly around what the relentless dysfunction of the US political system and the slow, legalistic decision-making process of the EU will mean for the next phase of the post-crisis world.
Oct 12, Graeme Newell rated it it was amazing Shelves: overdrive. So many of those other books told the American part of the story, leaving out the expansive global causes and consequences. Tooze does an amazing job of making this incredibly complicated story understandable and approachable. This book was exhaustively researched and reveals the backroom dealings of players throughout the globe. It has a plot that is more akin to a novel, telling the fascinating story of oversized egos, reckless greed, selfless bravery, and misguided intentions.
It is breathtaking how close the world came to another great depression. Were it not for the foresighted risk taken by a few key individuals, all of us would still be living with the after effects of a world economic implosion. This book also showed me the catastrophic consequences when well-meaning but clueless politicians meddle in monetary policy. Fixing economic woes usually requires making hard and often unpopular choices. We hear so many bad things about government bureaucracies, but the real heroes of this story were the governmental economic wisemen who had the courage to do the hard things that needed doing.
They were crucified by the press and politicians but they quietly stayed the course and kept the world from falling over a monetary precipice. Politicians come and go, but it is the government bureaucracies that best understand how to fix the problems of education, the environment, defense and monetary policy. Tooze shows that bureaucrats will usually provide better solutions than interlopers who suddenly appear advocating recklessly uninformed, simplistic fixes.
The scope of this book is impressively grand. He takes us through country after country, explaining how each of the players reacted and the implications of their decisions. The economic juggernaut of the past ten years was the catalyst for remaking the world as we see it today.
A normal accident analysis of the mortgage meltdown | Emerald Insight
Tooze reveals how the good things and the bad things we live with now have their foundations in the economic crucible we have all struggled through these past ten years. Sep 12, M rated it it was amazing. A first-cut global history of the post-Great Recession world. Because the old theories of macroeconomics could not account for the crisis, the managers of the 'commanding heights' of the glo A first-cut global history of the post-Great Recession world. Because the old theories of macroeconomics could not account for the crisis, the managers of the 'commanding heights' of the global economy were deeply disoriented when it arrived.
The book is also a meditation on the questions of world order, how it is constructed, maintained, and lost. The torsions in the economic structure of society, coupled with an ineffectual and hypocritical elite politics, occasioned a kind of mass cognitive rupture. Thirty years of neoliberal common sense suddenly appeared inadequate to the tasks at hand.
The old centrist political coalitions anchoring democratic politics began to fall apart. These were the basic coordinates for the new political mobilizations of left and right roiling the world. Crashed also shows how the seemingly impersonal institutions at the commanding heights of world power are in fact full of living, breathing human beings. As the narrative follows the elites through the halls of power, Tooze examines their subjectivities i.
It tells you what it promises in the title.
What I learned from Crashed: - Obama had the right idea of trying to prevent a recession with stimulus, but was hampered by congress. He was too timid to punish the banksters responsible for the crisis. It was a slippery slope that ended in a cliff. The federal debt had swelled to 40 percent of gross domestic product in from 16 percent in Faced with strident calls from both Republicans and members of his own party to balance the federal budget , President Franklin D. Roosevelt and Congress raised income taxes , levied a Social Security tax which preceded by several years any payments of benefits and slashed federal spending in an effort to balance the federal budget.
The Federal Reserve did its part to throw the economy back into recession by tightening credit. Wholesale prices were rising in , setting off inflation fears. The possible causes of the ensuing stock market plunge and steep contraction in the economy provide fodder for just about everyone in the current political debate. Republicans can point to the Roosevelt tax increases. Democrats have the spending reductions, which coincides with Mr. But taken together, they suggest that policy makers moved too quickly to withdraw government support for the economy.
If anything, critics fault it for being too accommodating, raising many of the same issues that led the Fed to tighten in Ben S. Bernanke , the Fed chairman, is a student of Depression history and is well aware of Mr. This should lead investors to seek income from riskier assets, leading to lower interest rates across the spectrum, including mortgage rates. That will be a benefit and should boost confidence. But monetary policy can only do so much, especially if fiscal policy is moving in the opposite direction.
That urge needs to be resisted. Yet both political parties have strapped themselves to the mast of deficit reduction, one through spending cuts, the other tax increases. The recent market plunge may reflect not the largely symbolic S. No one seriously disagrees that the budget deficit has to be addressed, either through spending cuts or tax increases or in some combination of the two. The question is when. View all New York Times newsletters. The good news about the recession, severe though it was, is that it lasted just a year, from May to June by most calculations.
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