13 Bankers: The Wall Street Takeover and the Next Financial Meltdown (Vintage) ( Reg. $15.95/$15.95)

A radical, but necessary proposal for revamping the banking and financial systems Todd Bartholomew #2010-03-30

The desire to analyze the current economic downturn has prompted a deluge of books, most focusing on how to address present and future economic ills and some narrowly focused on individual players and institutions that played a key role in the financial collapse, while others explained the events that led us to this place. "13 Bankers" explains how we got here and more importantly comes up with ideas to prevent a recurrence in the future far more concisely than many others I've read. I could be easy to dismiss Johnson and Kwak's observations as being pessimistic, as makes a very damning indictment of the banking and financial sectors in their past and present conditions and a rather trenchant argument that if these problem are not addressed we likely face another imminent meltdown. The authors give readers a quick concise history of finance and banking in the United States, something that many Americans are woefully unaware of, that points out how banks and financial institutions came to garner so much power over the economy. While efforts have been made to regulate them to varying degrees those regulations have often proven ineffective or are too often enacted AFTER financial catastrophes, much our current situation. The authors rather persuasively argue that the "too big to fail" model and the bailouts of 2008 and 2009 were misguided, arguing that nationalization would have been the better route to go. They continue the argument that the forced mergers, such as Merrill Lynch and Bank of America, were mistakes and instead had created institutions that are now truly to big to fail. In some respects it almost sounds like a Teddy Roosevelt-era trust buster and his argument that these large institutions need to be broken up to diffuse their power certainly makes sense. They also point out the corrosive effect their political clout and donations carry with the political process, hindering further efforts at regulation.

Ultimately "13 Bankers is far more satisfying a read than some recent books on the subject such as The Road from Ruin: How to Revive Capitalism and Put America Back on Top, On the Brink: Inside the Race to Stop the Collapse of the Global Financial System, Rediscovering Values: On Wall Street, Main Street, and Your Street, and America, Welcome to the Poorhouse: What You Must Do to Protect Your Financial Future and the Reform We Need. Yet the sad truth is that while the authors make a compelling argument for change the political establishment in Washington lacks the political will to break up these excessively large institutions. It wouldn't be good for THEIR business, which is getting reelected. While there are efforts afoot in Washington at reform none are as radical a surgery as proposed here, but suffice to say when the next financial catastrophe comes, and the authors argue it IS coming, there is unlikely to be any taxpayer/voter support for ANY bailout in ANY form. If anything "13 Bankers" made me mad as hell and against any future bailout, let alone continuing the current ones in place. What makes me madder still is that the politicians in both parties will likely never consider the radical proposal put forward here. It's a shame that it will take another financial crisis to get Congress and the Executive Branch to really act responsibly.

Painful History Well Told, and a Bold Prescription for the Future Great Faulkner's Gho #2010-03-30

13 Bankers takes us through he painful history of the financial crisis that brought us where we are today and that now makes it so hard to move forward. Simon and Kwak argue that absent reform, another bailout - a more costly bailout with even greater global consequences, millions of jobs lost, and a ruinous impact on our government budget - is unavoidable.

Many Americans apparently do not yet understand how much influence financial institutions have in Washington, DC. Banks used to answer to Washington and were once held accountable for their actions. That is no longer is the case. We have never had such a concentrated banking system in the United States and it's dangerous that so much of our financial future is wrapped up in the big banks.

But the book is not pessimistic. Simon and Kwak offer instances from our history when elected representatives took on concentrated financial power. Each time, most Americans initially did not grasp how the system works, and this proved a major obstacle to reform. But the political leadership was able to explain what needed to be done, and to persuade average Americans that the nature of power in and around the financial sector had become so great and so distorted that something major had to be done.

The book is not anti-finance, but it is very much against the way our biggest banks operate today. The book describes exactly what needs to be done so that what happened in 2008-09 will never be allowed to happen again. Let's hope the prescription works.

Useful, but not groundbreaking or controversial Aaron C. Brown #2010-04-13

I'm jumping in here more to vote among the opinions already expressed than to say anything new. I mostly agree with Bruce Lasker. The book is a good straightforward history of how we got to this point in American banking, but is neither deep in its analysis nor strong in its recommendations. If the reviews had been split on this issue I wouldn't have bothered, but since its 9 to 1 against Mr. Lasker, I think it's worth making it 9 to 2.

The opinion in this book is all expressed through word choice. When the authors don't like an increase in lending it is "an orgy of lending." When they do, "banks responded with capital to support growth." People they disagree with "rant," while people they like "point out" or even "prove." But there's never any analysis to back up these opinions, they're painted onto what is basically a factual history. I happen to agree with more than half of their views, but if I didn't, I wouldn't have been convinced by this book. It doesn't help that everything is based on secondary sources, from which the authors take what they like and nothing else.

On the other hand, if you want a factual history, and either agree with the authors or are willing to ignore loaded words, this is an excellent choice. It's well-written, witty, up-to-the-minute and accurate. The opinions are never intrusive, and never foolish. They feel concentrations of banking power are dangerous, which is pretty reasonable, but they ignore the problems caused by the local corruption that grew up in its place. You learn about Jefferson, Madison and Jackson's principled objection to national banking, you won't learn about politicians anxious to create local bank monopolies for their friends and associates, restraining competition in order to maximize profit and control local economies.

You'll learn how deposit insurance and limits on deposit interest reduced bank failures for 50 years, but not how it destroyed middle class savings when high inflation combined with low legal ceilings on interest; you also won't see the terrible customer service that existed until a "shadow" banking system made an end run around the regulations and offered ATM's, high-interest money market accounts, 24-hour-banking, automated deposits, Internet banking and other innovations (when I started working you got a paper paycheck every two weeks that you had to take to a physical bank on your lunch hour as they were open only 9 to 3 on weekdays and the tellers took the same lunch hour as the office workers so you didn't eat lunch on payday, no food allowed in the bank). Sneaky overcharging and predatory lending loom large in this book, with no hint of the advantage to customers when fixed commissions were smashed or companies were forced to improve accounting disclosure.

Wall Street is always the villain, local banks that lend only to their boards of directors and pals and support the local political machine, are whitewashed. The entire S&L crisis is blamed on Wall Street sharpies taking advantage of sleepy local bankers, you won't hear that virtually the entire loss was from commercial lending by oil-patch banks whose strong political connections ran through Texas, not New York. You'll read how Wall Street money flooded into Washington in campaign contributions and lobbying, you won't read about extortion from politicians introducing legislation to expropriate people's financial businesses unless they paid up. You also won't read about the constant movement of financial innovators to get away from the whole messy business of power politics, organizing off-shore, using private vehicles and leaving regulated businesses to come up with better solutions. It's always politicians trying to draw these into the regulatory framework, where they are forced to render unto Caesar, it's not financial innovators lining up to buy political backing for their ideas. Even the harm done by the gigantic financial institutions built entirely by Washington is blamed on Wall Street, not Washington.

I'm not defending Wall Street here, just pointing out there are two sides to the story. Wall Street, and more generally global financial innovation fighting entrenched local traditional practices, has done both good and bad. Mostly it does things that some people will consider good and others will consider bad. The one point of strong agreement I have with the authors is that a system of crony capitalism grew up, and led to a lot of our current problems. Personally, I would attack all crony capitalism, not just financial, as killing it in one place just tends to encourage it to spring up in another. We have crony defense contractors, medical companies, agribusinesses among many others. I grant that financial cronies are more dangerous than the others (except maybe defense contractors) but they are more alike than different. And the fundamental reform has to be political. If someone is handing out government money, it's pointless to outlaw taking it, because someone will always find a way to break the law, and then repay the giver. Stopping the handout is the point.

A new take on the crisis, stressing history and politics Richard Gibson "Rick #2010-04-04

This is another book on the recent economic crisis. The shelf is pretty full of such books already, but this one is nonetheless well worth reading for several reasons.

First, Johnson and Kwak's analysis of the crisis is unusualy well done. The broad outlines of what wrong, at this point, are pretty well agreed upon. The collapse was caused by the preceding bubble. The bubble was caused by the Fed keeping interest rates too low for too long, and by Wall Street taking on far too much risk, and far too much leverage. Wall Street did this, because it was both effectively unregulated by the government and "too big to fail." In other words, Wall Street could do what it liked, knowing that Uncle Sam would pick up the tab if things went wrong. Naturally, since they got the profits, but the taxpayers got the losses, Wall Street went nuts pursuing profit in extremely risky ways.

This view has been put forward by many writers, and it is basically correct Johnson and Kwak do an unusually fine job, however, of getting the facts right and the details correct. They have really done their homework, and it shows. If you compare this book to another fine book, Barry Ritholz Bailout Nation, for example, they have far more details of the story of how Wall Street became effectively deregulated. Bailout Nation tells the same basic story, but Johnson and Kwak have more factual back up.

Second, Johnson and Kwak are the only writers on this crisis that I have read who intelligently use history to provide context to the story. Bailout Nation tries to do this, but Ritholz just does not know the history well, so he makes a hash of it. Johnson and Kwak actually know the history, and they provide an intelligent discussion of the clash over banking policy, starting with Hamilton and Jefferson, continuing with the battle between Andrew Jackson and Nicholas Biddle and then coming down to the 20th century. This is very useful and needed context. In this old, old historical debate, they take an intermediate positon. In their view, Hamilton and his followers were right in an economic sense; big government which supports business, they feel, is better for the economy. But, they argue, Jefferson and Jackson were right in a political sense; government supported big business creates a rich elite, which gains too much power, subverts democracy and twists policy to serve its own ends. I do not entirely share this view; I think a case can be made that Jackson had a sound economic policy. At the same time, though, Johnson and Kwak perform a very valuable service by stressing the difference between economics and politics, and insisting that this issue has a huge political component, which it certainly does.

Third, Johnson and Kwak use the recent history of financial crises in developing nations to give some very interesting insights into our crisis. Paul Krugman tried to do this in The Return of Depression Economics, but I did not feel that he ever really explained why the crisis in Thailand and Korea was relevant to our situation. Johnson and Kwak cover the same material, but they explain very well the relevance of these past crises. As they explain, developing nations get into trouble due to the excess power of financial elites closely tied to the government. Our pattern is a bit different, they argue, but not as different as we would like to think; they argue with force that more or less the same thing just happened here. Their argument on this point is subtle, nuanced and extremely well put.

Fourth, Johnson and Kwak have a different policy suggestion that do most writers. They say: smash up the big banks. As they see it, the problem is that the banks are too large and too powerful. They subvert democracy and twist policy. They hold the country ransom by causing huge crises which force the government to choose between bailing them out and letting them destroy the economy. To stop this, say Johnson and Kwak, the best answer is to break up the big banks into smaller pieces.

I am glad to see somebody starting to advocate for some really forceful responses to this crisis. I think it is just amazing how little has been done to Wall Street, after all the harm that it caused to us. Personally, I think that breaking up the big banks is a good idea, which would be helpful, but I do not think it really gets to the heart of the matter. With all of their stress on politics, I think that Johnson and Kwak are a bit weak on the economics side. After all, smash them up is basically just Andrew Jackson's policy brought to modern times. It solves the political problem of an elite having too much power. It does not, however, solve the economic problem of a repeating boom and bust cycle. After all, after Jackson destroyed the 2nd Bank of the US, the boom-bust cycle continued. So, while I have sympathy for Johnson and Kwak's anti-Wall Street feelings, I think that we need to probe a bit more deeply to get to the bottom of the economic side of this pattern.

A Balanced Look at the Horrors of Wall Street C. E. Selby "Eric Se #2010-04-03

Simon Johnson is ubiquitous, appearing on a wide range of shows (at least those I watch such as NPR, PBS, and HBO). He is wonderful to listen to, a guy filled with knowledge (as well he should be since he teaches at MIT). And he has a sense of humor. And he is not one with a "conspiracy theory" which apparently one "reviewer" (one-star one) claims. So when I heard about this book, I had to read it.
I grew up in the home of a banker. But Dad was a small-town bank president in what we call "community banks." And the bank still exists and is doing well in Vermont. But my dad, when he retired in the early 70s, said, "Banking isn't banking any more." I had no idea what he was talking about, mainly because I was never much interested in banking. But I have become quite interested in it now that this country has become economically handcuffed by these so-called bankers.
This is a very well written book with a very comprehensive set of notes (footnotes) at the end. In other words, anyone writing comments about these authors being conspiracy theorists is simply ignoring the content of the book. Having said this, however, I want to acknowledge that the book isn't written for people who don't have at least a little knowledge about how the world of finance works. In other words, I found myself lost in many places. But I cannot fault the writers or the writing. I simply don't have what we English teachers would call "prior knowledge," the essential tool to reading.
The authors are not bashing anyone. The book is structured so the reader is provided with some history (and it is sourced history) before being presented with what happened and how it happened. I like how objective Johnson and Kvak are. To use a phrase that I captured from a cable channel I would never watch, this is "fair and balanced."
What most interested this reader is the case the writers make for "The American Oligarchy." Indeed that is what we have with these "financial elites" that run Wall Street. They are so tightly tied into our non-functioning Congress (and to some degree a too-tied-to-Wall-Street White House and to five very-tied-to-Wall-Street on the Supreme Court).
I intend to give this book as a gift to a few people I know who really need accurate information. But do "tea baggers" read I wonder.

Recommendations are the inevitable conclusion John Hagens #2010-04-17

Johnson and Kwak have written the best book I have read so far on the financial mess. Their historical introduction to the subject includes a description of Thomas Jefferson's concerns about banking. Their conclusion that we need to break up the mega-banks cycles back to Jefferson (and also Andrew Jackson). Some technical knowledge is needed to follow all of the arguments of the book, but the authors take great pains to make this material accessible to anyone who reads a daily paper and is vaguely familiar with mortgage backed securities, collateralized debt obligations, credit default swaps, etc. One walks away from this book upset that the new administration in Washington hasn't taken bolder steps to make finance "boring" once again. I seriously hope that Senator Dodd and Representative Frank carefully read this book, pass it to their Congressional colleagues and staff members, and push hard for serious financial reform. This country cannot afford to experience another meltdown, but as the authors (and many others) point out, this last bailout of the "too big to fails" (also known as "heads they win, tails we lose") only gives the big banks more incentive to gamble even more dangerously. We've now had the tech bubble burst (minor recession) and the housing bubble burst (serious recession). What will be the next sector to blow up?

The Power of Wall Street J.L. Populist #2010-04-16

13 Bankers is a more recent book in the crowded market of books on the financial crisis.
This book isn't written to be technical, but easily readable.
The authors offer up sensible solutions with the warning that if changes aren't made, we will experience the same crisis again. The cause of the crisis is a step that hasn't been undertaken by the government.

Page 74 contains a statement that describes American government as we currently know it-
"The basic principle behind any oligarchy is that economic power yields political power."
That's why Wall Street gets what they want.

Some of the avenues used by "the Street" are:
The close relationship with Washington.
Take Rubin, Paulson and a host of lower level crossovers from Wall Street to Washington and you have people making decisions based on their priorities and what's best for their industry at taxpayer's expense.

As deeply committed to the financial sector as Republicans are, the authors list examples of Democrats that supported deregulation and other causes that led to the meltdown. So this problem is a bi-partisan mess.

I think that the solutions detailed in this book are the more popular and those that would be fought the hardest by Wall Street.
Deregulation and size limits.
If an entity is "too big to fail" it is simply too big and that problem can be solved by breaking those companies up.
While derivatives haven't been regulated, they need to be.
Investment banks that aren't regulated should not have a safety net to cover their mistakes and greedy behavior.

This is another very good book to read if you want to know the hows and whys of the financial crisis.

Three other books that I have found to be helpful on the subject of the financial crisis are:
Freefall: America, Free Markets, and the Sinking of the World Economy
Bailout Nation: How Greed and Easy Money Corrupted Wall Street and Shook the World Economy
Meltdown: A Free-Market Look at Why the Stock Market Collapsed, the Economy Tanked, and Government Bailouts Will Make Things Worse

4.5 stars-Banker financed speculators create bubbles that turn into recessions/depressions Michael Emmett Brady #2010-04-08

Overall, I recommend this book.The authors clearly show that the purpose of practically all financial derivatives is purely speculative.They play no role at all in producing goods and services.Financial derivatives play no role in creating real wealth ,as in Adam Smith's The Wealth of Nations,because the main goal of the alliance of hedge funds,private equity firms, Wall Street investment banks( who are no longer with us),and giant commercial banks is to extract profit without production.This "shadow " banking system was and is completely unregulated.The "shadow " banking system has effectively taken control of the American economy by simply buying off all of the Presidents, and most of the Senators and Congressmen and women of both the Democratic and Republican parties, since Gerald Ford.Ford was the last President who did not go along with their plans.The authors have certainly identified what the problem is-the purely speculative shadow banking system.However,their solution,to break up the giant banks,may not be the best plan.

Their recommendation, to break up all of the giant banks into smaller banks,overlooks the fact that the Great Depression's catastrophic banking collapse,which occurred primarily due to a lack of deposit insurance and speculative finance,involved primarily small banks that were allowed to fail because the giant private bankers,such as Mellon,Rockefeller,and Morgan,Jr. ,who effectively controlled the Federal Reserve System operationally day to day,thought that letting the small banks fail would cause no significant problem and would remove their competition. Theodore Roosevelt realized that very strict regulation was a better answer. The important economies of scale and size are maintained while the speculative damages created by the bubble creators on Wall Street are eliminated. Theodore Roosevelt certainly realized that Wall Street had effective control of both parties at the turn of the century.That is why he ran for president at the head of the Progressive (Bull Moose) Party in 1912.Roosevelt knew that Woodrow Wilson was in the pockets of J P Morgan as was Taft.What America is missing today is just such an individual as Theodore Roosevelt.

In conclusion, it may be that some of the biggest banks need to be split up.However,without stricter regulation of the private commercial banks and the regulation of the purely speculative "shadow " banks, this solution alone will not lead to the elimination of the Wall Street speculators who control both major parties.A Third party explicitly dedicated to taking back the Republic from Wall Street domination is also needed.

Not a democratic republic? Conrad's Current Aff #2011-02-09

America is not a democracy? America is not a democratic republic?

America is an oligarchy? One wonders after reading "13 Bankers: The Wall Street Takeover and the Next Financial Meltdown" by Simon Johnson and James Kwak. The authors write, "We may have the most advanced political system in the world, but we also have its most advanced oligarchy." This book is a startling revelation of the power of the large banks in America. An oligarchy is defined as a form of government in which the power is vested in a few, or in a dominant class or clique. It appears that the large American banks have been powerfully influencing Washington for several decades, and culminated in the 1990's when "Wall Street translated its growing economic power into political power" that gave Wall Street "on issue after issue what they wanted."

The authors further claim that the result of the Glass - Steagall Banking Act of 1933 that separated commercial banks from investment banks and brokerages was the "safest banking system America had known in its history and booms and busts were prevented." Repealing Glass-Steagall was at the top of the commercial banks' wish list, and it was repealed in 1999. Since the 1970's, the banks have exerted power over various government agencies with the approval of Congress. The savings and loan crisis, the Long Term Capital Management (LTCM) fiasco, Enron, WorldCom, et al, didn't teach lessons needed, and Johnson and Kwak say, "the conditions that created the financial crisis and global recession of 2007-09 will bring about another crisis, sooner or later." The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2009 attempts to prevent another 2007-2009 financial crisis, and its regulations are currently being formulated. Its summary is 43 pp. long and the entire bill is 2319 pp. according to Time Magazine(7/12/10). One hopes it's not closing the barn door after the horse is out, nor that it was written blindly with Wall Street's lobbying help, nor that our representatives didn't really read it, nor that it does not conflict with the Financial Crisis Inquiry Commission's Report (FCIC) of the causes of the financial crisis, which is due January 2011.

One of the Dodd-Frank provisions, detailed in the 12/21/10 Wall Street Journal, "prohibits any bonus plan that encourages inappropriate risks at financial firms with more than $1 billion in assets." This presumably addresses Main Street's and the tea partiers' abhorrence of the enormous bonuses on Wall Street. Another provision now requires that over the counter derivatives receive the scrutiny that the former chair of the CFTC (Commodity Futures Trading Commission), Brooksley Born, warned about way back in 1998, but was rebuffed by Alan Greenspan, Lawrence Summers, Robert Rubin and others. In fact, a "group of thirty," an international advocacy group composed of private sector bankers, central bankers, and sympathetic academics, lobbied against such regulation and Congress caved in late 1999 and those derivatives were exempted from federal regulation in the Commodity Futures Modernization Act passed by a lame duck Congress and lame duck President in a appropriations act for fiscal year 2001.

The oligarchy of 13 banks is American Express, Bank of America, Bank of New York Mellon, Citigroup, Freddie Mac, Goldman Sachs, JPMorgan Chase, Morgan Stanley, Northern Trust, PNC, State Street, US Bank, and Wells Fargo. The 6 largest banks now are Goldman Sachs, Citigroup, Bank of America, JPMorgan Chase, Morgan Stanley, and Wells Fargo, and they have been busy lobbying for what they want, so the oligarchy appears to be intact. According to the same Time article, more than 2000 lobbyists were "working on financial reform" and "43 members of the Congressional financial-reform conference had received $112 million from donors associated with the finance, insurance, and real estate industries." In addition to lobbying, there is a cultural revolving door that has Wall Street operatives and government regulators going to and from the two sectors. If the Dodd-Frank bill addresses this, perhaps the authors will be wrong in saying, "By leaving banks in the hands of existing managers and going out of its way to minimize its own influence, government (is) ensuring that it (has) no way to encourage banks to do anything other than hoard the cash and in no way to affect banks' behavior in the future." There are reports about the hoarding of cash being one of the impediments to improving our economy, so is government helping the situation or inadvertently contributing to the continued economic malaise?

In legislation after legislation, Congress seems to have deferred to Wall Street's so-called "expertise." Will the authors be accurate in saying "...the conditions that created the financial crisis and global recession of 2007-09 will bring about another crisis, sooner or later?"

Their recommendations include trust-busting to break up these Too Big To Fail entities. This leads one to wonder how the many mergers and acquisitions of smaller banks by larger banks have been approved as not violating the Sherman Anti-Trust Act. Many smaller banks have disappeared. It is one thing for the FDIC to take over struggling or insolvent banks to protect consumers, but that seems different from the large banks taking over the smaller banks, even with shareholder approvals. How does the Sherman Anti-Trust Act protect us and preserve competition? Are we destined for another crisis, as the writers say?

Johnson, now a professor at MIT, was formerly a top economist at the International Monetary Fund, and Kwak, a Harvard graduate with his Ph.D. from UCBerkeley, authored The Baseline Scenario, a commentary on the global financial crisis, mostly focused on the situation in the USA. Readers wondering if the U. S economy is out of the woods will find the writing concise, yet detailed enough to ask if Robert B. Reich is right in saying on the book jacket, "Unless we separate money from politics, we'll never be safe from another financial meltdown... Read this fine book and get to work." The book contains extensive notes and recommended further readings.
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The necessity of breaking up the new banks laurens van den muyz #2010-05-24

The main message is "The thirteen megabanks used political power to obtain their license to gamble with other people's money; taking that license away requires confronting that power head on." This book is very interesting in two ways, it presents a historical perspective and makes specific convincing recommendations for the actionsgovernment should take, that differ from what the government is doing
Three important issues are (1) Changes in political thinking since America's independence (2) The "blind" faith in deregulation since Ronald Reagan (3) The missed opportunity of the Obama administration.
Right from the founding of America two competing political views were present. One view that the potential power of banks was dangerous and a threat to democracy with Jefferson as its founder and the other view of Alexander Hamilton that banking in general and central banking were essential for the development of America. The great depression in 1930 was caused mainly by failures in the banking system, with several causes similar to the 2007-8 crisis. FDR was convinced that some banks had become too powerful and acted irresponsibly (like many other smaller banks) and proposed and got approval during his first six months in power for acts to break up banks by separating investment banking from commercial baking and new regulatory organisations and new rules to protect the clients of the banking.
Ronald Reagan started to move political thinking in the other direction: deregulation is good. There is no doubt that he was right in many areas, but banking is different from other industrial segments. Various limits to banking freedom and oversight were continuously removed during the Clinton and Bush administrations with Alan Greenspan promoting the superiority of self regulation and unregulated financial innovation. Greenspan claimed and most believed that the self interest of bankers would lead automatically to the best solutions.
The banks were exerting constant pressure on the government to reduce regulation and not regulate any of the innovations the banks were developing.
The crisis of 2007- 8 did not create economic problems of the same magnitude as FDR faced, but unemployment doubled, 1million jobs lost in 2007 and 5.8 million in 2008. and the government had to bail out the big banks.
Different from FDR the G.W.Bush and Obama administration did not act to solve the cause of the problem: the overwhelming power of the big banks. Lobbying, contributions to election campaigns of the regulators, the revolving door practice (top bankers in and out of top banking and government positions). As a consequence the big banks grew substantially even in the crisis. The assets of the six largest banks grew from 18% of GDP in 1995 to 60% of GDP in 2009. The banks and the government agree the megabanks cannot be allowed to fail. The authors point to three negative consequences of accepting this concept (1) when a mega bank is on the brink of failure the government has to bail out the bank immediately because of interconnectedness with other banks ("collateral damage").(2) Taking higher risks has the possibility of higher profits. As the bankers know their bank will be bailed out they will take huge risks (3) As the banks can not be allowed to fail the banks have access to money at lower rates. Large banks paid 0.78% less than the small banks in the wake of the financial crisis. That represents $34 billion for the eighteen largest banks, accounting for about half their profit in 2009
Even though this subject has been much discussed, the authors present convincing arguments that it is impossible for the government to regulate these banks. The banks will pursue the same and new innovative practices they did in the past. Different from FDR, the Obama administration will not break up the big banks. It is a missed opportunity. It could have been done during the crisis.
Alan Greenspan is one of the few that accepted he made a huge mistake in believing self regulation of banks and said in October 2009: "The biggest problem we have to resolve is the too-big-to-fail issue". "Break them up". In 1911 we broke up Standard Oil." So what happened? The individual parts became more valuable than the whole."
The authors present a vast amount of statistical evidence to prove their points. May be they are wrong but their analysis and recommendation merit serious consideration.

Essential Read, Wrong Conclusisions T. Thayer #2010-05-11

I would recommend everyone read this to understand the background behind our current banking and financial system and the crisis we're currently in. Well researched and comprehensive, the book only falters in concluding no criminality was at the core of these issues. Add fraud to the formula and it becomes a complete story.

Good message - a little tough to read Ronald Brown "rboffp #2010-05-03

I found the main argument of this book very convincing - that the large banks have too much power. The government provided them a bailout and then enacted no meaningful reform to make sure that we won't have a recurrence of the crisis. Which of course makes it more likely that we will have a recurrence since the large banks know that they will not be allowed to fail, hence they can take large risks without having to worry about the consequences. The author's argue that this situation has arisen creating an American "oligarchy" - or government by the rich. As they explain this situation they do explain how the crisis unfolded. However, I did find the book a bit tough to read, being highly repetitive and fairly technical. If you are looking for a good understanding of the crisis, try Micheal Lewis' The Big Short: Inside the Doomsday Machine. It would be worthwhile to find a good summary of this book to read and send to your representatives in Congress demanding meaningful action on financial reform.

OK but not what it could have been Ronald Davis #2010-05-20

A very short review of Central Banking in the US, a good bit of exposition about how big corporations are big political activists and have been since the Civil War, a very good explanation of CDOs and the alphabet soup relatives, and a bit of generalization with hand waving about the future possibilities. It really isn't a bad book, but compared to Yves Smith's ECONned (& I don't even know how that wound up on my reading list), it is merely a high school essay. Yves Smith is so much more complete, so much more sophisticated in understanding how things work and better written to boot (except, perhaps, for the title). What else is there but three stars?

Excellent, Lucid, and Engaging Portrait Of The Real Banking Economy Jay H. Mani "Jaytrad #2010-04-08

First of all let me state that I am a former bond/derivatives trader on Wall Street. I have read dozens of books about the recent economic meltdown and literally hundreds more on economics and stock market history over the years. Let me tell you that this is one of the best books I have read about how corrupt and rotten to the core our financial and political system has become. The Banking and Political structure has become completely divorced from the "Real Economy" and anyone who states differently is not living in such reality. Anyone who disagrees to the central theme's in 13 Bankers either is on the Wall Street/DC Gravy Train or himself divorced from the real world. The real world is brilliantly stated in this book. Like I stated, I am from the industry and will tell you that many of the banker motives were actually "understated" by Mr. Johnson and Mr. Kwak in 13 Bankers. It's much worse! Not all Wall Street Bankers and Traders are bad guys at heart, but our motives then and now were never aligned with what's good for the economy or America. This needs to change and change fast if there is going to be a functional banking system that helps all Americans. Simply stating otherwise will just perpetuate the farce that is currently our economy.

One of the Best Looks at the Financial Collapse-- A Must Read Anonymous Reader #2010-10-11

I have read several accounts of the economic meltdown, many of them worthwhile. If I could select only one of these books to keep for posterity, this one would be it.

13 Bankers provides perhaps the most insightful look at the 2007-8 financial meltdown. Johnson and Kwak marshal both political and economic data to conclude that the financial collapse was the result of an overly comfortable relationship between financial institutions and their regulators, and a reigning policy paradigm which accepted significant risk taking as a driver of economic growth. As a result, judicious regulation was eroded in both Democratic and Republican administrations over a period of close to 30 years. Indeed, as Johnson and Kwak demonstrate compellingly, U.S. economic history has been characterized by an ongoing and inherently conservative debate as to the degree to which government should regulate financial institutions. (The creation of the Federal Reserve System represented a compromise between the forces of regulation and de-regulation.)

13 Bankers is especially helpful in that it demonstrates that the 2007-8 financial meltdown was political as well as financial in character. In insightfully exploring both dimensions of the economic collapse, 13 Bankers earns a place on your bookshelf.

Fills a good space on your bookshelf of financial horror stories Andrew Badera #2010-07-18

A decent read, though not earthshaking if you have read much else in this genre. For instance, the author mentions trader-turned-law-professor Frank Partnoy and one of his works on the subject - the ground-breaking FIASCO, Blood in the Water - where Partnoy surfaces the use of the phrase "ripping his face off" when it came to traders burning clients and making huge piles of cash while doing it, and does some of the first modern-day muckraking around derivatives and those who profit from them.

That said, 13 Bankers is a broad work that does an excellent job of chronologically telling the story of how our fat pig of a financial system got to be where it is today. It is a story of greed, lobbying, more greed, loose regulation, under regulation, you-scratch-my-back-I'll-scratch-yours lack of regulation, enforcement and serious prosecution or penalty ... and more greed.

One area that 13 Bankers illuminates well is the grotesque growth in salaries in the financial services industries since the end of World War II. Shameful and greedy, no other way to look at it. This growth mirrors the rather inorganic growth of the megabanks themselves, from once-manageable entities contributing to the growth of Main Street to the greedy Goliaths they are today.

The American government, both through active collusion and passive failures to act, has failed its citizens, and the world at large, when it comes to reining in this monolithic industry full of "too big to fail" corporate entities who happily make money off the back of the rest of America. 13 Bankers is one of those works that is destined to make you angry.

If you have read no other nonfiction work about our modern financial system, 13 Bankers is the right place to start. If your reading list on the subject is more comprehensive, 13 Bankers is worth consideration, but not a must-read.

The Great, Late Sen.Philip Hart said this in 1973 Charles M. Marstelle #2010-06-21

A conspiracy, per se, is unlikely, in this Reader's view.

The heart of the matter was raised in 1973 (and again in 1975) by the great, late Senator Philip Hart, D-Michigan who warned of concentrating markets and the need to update our laws pertaining to antitrust.

His remedy, proposed as the Industrial Reorganization Act, simply says: Oligopolies are illegal and hence, shall be divested by a Commission overseen by a Special Court for the purpose. There should no longer be a need to prove conspiracy as is required by Sherman-Clayton.

The bill had 9 co-sponsors including Kennedy and McGovern, and several Senators from the Midwest and West as well. It went to a hearing in 1974: I was there.

At a meeting of the San Francisco World Affairs Council (broadcast 6/21/10), Johnson said that he sees the need for a broader application of his remedy for "Too Big to Fail" as the concept applies to other sectors as well.

Johnson and Kwak trip up a bit on how to accomplish their goal of re-regulating banks in a methodical way that ends TBTF.

Phil Hart proposed a simpler solution and one that is more universal and also serves as an update of Theodore Roosevelt's antitrust.

I think Theodore Roosevelt would urge Johnson and Kwak to think more broadly. Roosevelt's animus to smoke-filled rooms of price-fixers has given way to a more defacto form of the trusts of Roosevelt's day.

Johnson and Kwak imply a monolithic conspiracy when clearly, there was simply a monstrous overreach of greed, power and narcissism.

In that sense their hypothesis overreaches. Our response to human nature needs a broader method of update.

Super-Rich Are Deregulating The Middle Class Out Of Existence! R. A. Barricklow "Sc #2010-04-11

The Wallstreet Bankers are the new American Oligarchy, a group that gains political power, and uses that political power for its own benefit. Runaway profits and bonuses in the financial sector were transmitted into political power through campaign contributions(the $upreme Court OK w/that) and a revolving door(money & ideology mutually rewarding) to ensure control. Thus, we may have the most advance political system in the world/BUT we also have the most advanced oligarchy.
So, as the fine work makes clear, The Core Problem of our current crisis is a concentration of economic power in an elite with the abilty to greatly influence our political system. Therefore, as again the authors make it plane & simple: Sustained Growth Requires an end to the close relationship between economic & political elites that distort the competitive environment and encourage the misallocation of capital(but the $upreme Court aka $upreme Denial is OK w/$$$ rule).
IT IS CERTAIN THAT A HEALTHY FINANCIAL SYSTEM CANNOT BE BUILT ON BAILOUT$, or even the expection of one.
Because of The Great Depression the people revolted and caused change: REGULATE the crooks so they can't do this again. Unfortunately, moneys talked and the regulations walked. Since the ENFORCED regulations of post depression 1933 the United States of America enjoyed over a half century of financial stability. The authors point this out symbolically with the 3-6-3 rule/pay 3%, lend at 6%, and make it to the golf course by 3pm.
The deregulation started with Jimmy Carter(Rockefellar man)and the airline industry and then went ON STEROIDS w/ Ronald Reagan! It continued with Slick Willy, both the King Georges, and sadly, today with Obama.

This is the best book I've read on the subject.
For those that want not only the how, who, & why/BUT the way out: READ IT!

HIGHLY RECOMMENDED !!!!!!!

P.S. Check Stephen Lendman Progressive Radio Network/then click "Archives" /then scroll down to Progressive News Hour / then scroll to 4/22/10 John McMurtry. This show discusses the 13 Bankers issues so prescient to todays society.

Another Book Review by the Aleph Blog David Merkel "Aleph #2011-02-12

Simon Johnson and James Kwak write a popular blog, The Baseline Scenario. They have written a very credible book on the crisis, which I have . It covers all of the bases in a methodical way, and there was little with which I could find fault, and it does so without conspiracy-mongering, or name-calling, while still finding fault with a great many parties.

The intro to the book begins with the 13 bankers meeting Pres. Obama at the White House in March 2009. (Thus the name of the book.) The Obama Administration treats the bankers with kid gloves, because they are afraid of a crash in the banking/economic system. But like the old saw, where if you owe the bank $1000 and can't pay, you have a problem; but if you owe the bank $10 billion, they have a problem -- the US government concluded that they had to protect the banks in order to protect the system as a whole.

Now, part of this stems from a false belief system, thinking that we had to bail out the banks -- we didn't need to bail out the banks. We could have resolved them through a new Resolution Trust Company. Rather than bail out holding companies, we could have let holding companies fail, and protected the few operating subsidiaries that people and institutions rely upon. But part of this stemmed from the influence that large banks exercised over the US Government. So many in the government benefited from campaign contributions from banks. Many had worked for the banks and had friends there; many wished to work there eventually.

The book takes us back to the beginning of the US, and all of the arguments over whether we needed a central bank or not. This is one of the few places where I disagree with Johnson and Kwak. I don't think we need a central bank, though we do need to regulate credit in order to avoid banking panics. They view Jefferson as right in viewing large banks as being a threat to government sovereignty, but naive that a central bank was not needed, while Hamilton was more practical, but would not see the risk of political corruption.

Think of the Greenspan era, which was central banking at its worst. The least little squeak during a recession would make Greenspan open up the monetary spigots, and he would keep them on well beyond when stimulus was needed. Because of demographics, his actions did not lead to price inflation, but asset inflation. Thus the bubble that we face now. Extra dollars did not chase goods; extra debt chased assets.

They take us through the international crises of the '90s which largely did not affect the US, but would sound familiar to us today. We don't think of ourselves as having aristocrats in the US, but major CEOs seem to play that role well.

They catalogue the changes in policy that allowed for securitization, for swaps, for unregulated swaps, for increases in leverage, for decreases in regulatory oversight, and increasing influence over US policy by financial companies. Further, with the regulators outsourcing much of their responsibility for setting capital levels to the rating agencies, there was a further opportunity for failure, as the rating agencies rated novel securities for which they had no track record.

With sloppy regulators like the Office of Thrift Supervision, the stage was set for and a race to the bottom in lending standards. In the short run, more lending promoted higher profits, but in the long run sealed the demise of many lenders.

The crisis hit, and the leverage that had been built up was unsustainable. It rippled through many areas of the financial sector, hitting the firms that had cheated most the hardest. Over two years, from February 2007 to March 2009, the first wave of the crisis shook the banks, and many failed. Many smaller banks continue to fail, having no influence over the government.

Their solution to part of the crisis is modest, at least, more modest than I would pursue. They suggest that the six largest banks be broken up. Good, let's do that. They suggest consumer safeguards; yes, protect dumb people to some degree, but make them wear a scarlet letter "D." (My thought, not theirs - you can't have it both ways. There should be stigma if you can't protect yourself.)

It is a very good book and one that I would heartily recommend.

Quibbles:

You have to have average intelligence to read this book. It is not a book that everyone can read. Also, very few graphs. No pictures. That doesn't affect me, but many other people have a hard time reading a book with little in graphics.

Who would benefit from this book:

Almost everyone would benefit. It does a great job laying out the problems, and the solutions that they offer are eminently reasonable. Again, you have to be willing to read a book where the words are big, the sentence structures are complex, and you already understand something about economics.

Excellent but sobering commentary on the financial system Seasoned investor #2011-01-16

I received this book (hard bound edition) as a Christmas gift because of my prior involvement in litigation involving subprime loans. Before my retirement in October, 2007 (one week before the crash), I was seeing that the securitization process would eventually cripple this country financially as reputable mutual fund companies were investing in banks promoting this junk. This book highlights it all, providing an historical perspective as well as a commentary that that deals with current events, the latter making it timely for readers right now. What is sad is the stranglehold that the large financial institutions still have over the individual consumer as well as our governmental institutions, the latter being the "bagmen" for the financial oligarchy. Once you get past the rhetoric of people that view this issue politically or ideologically and really take a hard look at the facts (the book has an extensive listing of references), you will not feel good about the future prospects for the financial security of this country. Am I pessimistic? You betcha! Knowing what I witness in Congress everyday, I don't believe that we have the the inclination to do what is truly needed to restore our trust and confidence in the financial system, notwithstanding the warnings provided by the authors.

Outstanding Elucidaton of the Recent Financial Crisis S. Hirsch "Polymath" #2010-09-15

The major value of this treatise is it's dispassionate account of the recent financial crisis and the government's response. The author's style is to present the facts in a clear analytical way, elaborating on the more difficult issues. The text is not embellished fillers such as "Paulson looked out over the Washington landscape and reflected on the future his grandchildren would inherit" that so many other treatments of this issue are. Instead we get cold-hard facts such as when discussing the details of the massive government bailout: "Instead, the government bent over backwards to make the deal attractive for the banks, charging below-market interest and eschewing any significant ownership-so shareholders, not taxpayers, would benefit when the banks recovered" and in perhaps the most eloquent summary of the panic and the consequent bailout: "Never before has so much taxpayer money been dedicated to save an industry from the consequences of its own mistakes. In the ultimate irony, it went to an industry that had insisted for decades that it had no use for the government and would be better off regulating itself--and it was overseen by a group of policymakers who AGREED that government should play little role in the financial sector"

Each page of this book contains similar pointed and insightful analysis of the crisis in a way that someone without any financial background can understand. A singular achievement!!

Pretty tough going Bradley F. Smith #2010-09-02

This financial history of the big 08 meltdown is preceded by a fairly concise economic history lesson from the founding of the republic. The problem is it's prose style is pretty thick and it never really takes off. It was co-written by a professor, and therein probably lies the problem. They seldom know how to write compellingly. Finally, the two authors offer a policy solution for the future: break up the big banks before they really kill the US economy next time. Not likely. This will be gathering dust on bookshelves in the not too distant future, like all such current events tomes finally do.

How we got here George M Woods #2010-07-26

A lucid, readable account of how the political and financial worlds mesh to the benefit of those who play in those sand boxes and to the detriment of those who don't. The authors document exactly how a deregulatory push begun under President Carter (surprise!) gained traction under President Reagan and bore fruit almost thirty years later. They focus on how "free market"ideologues have achieved their long-sought ends and the urgent need to reverse those regulatory achievements if our financial system, indeed, if democracy itself is to survive. This is largely a book, however, for the already converted, for those interested enough to have heard Simon Johnson and James Kwak speak before on PBS, for those who understand that free enterprise and democracy are not one and the same, that one requires regulation and restraint of the other. Given the evidence that they present especially the central role of campaign contributions and a wide spread belief that the markets can do no wrong, the outlook is not encouraging.

A Good Look at How Banking Regultions Changed D. White #2010-07-18

While I think this book is a good history of the regulation changes that occurred in banking from the mid to late 90s, I do not think this book does that great a job explaining the recent banking crisis. The authors clearly believe that the changes in regulation and lax regulators caused the crisis and that better/stronger regulation would fix it. They however fail to explain how if the regulators are so co-opted by the big banks that regulation on its own will work. I also feel that the authors let Fred and Fannie Mae's role in the collapse and their cozy relationship with both parties in Washington off too lightly. I wish they had spent more time developing how we measure too big to fail and how we limit or break up banks that reach that threshold.
This book will appeal manly to people who have an interest in financial and economic history, otherwise it will seem a slow read. It is a good summery of the way banking has changed over the last three decades and does give good insight into how the regulators as well as the regulations failed us over the last five years.

Academically Important, Contextual Historical, Little New Ground John G. Jazwiec #2010-04-14

There have been a lot of books that make it clear why banking reform is critical and why it is so hard to do politically. This book painfully takes us throughout our history, from Hamiliton vs. Jefferson, Jackson vs. The Second Central Bank, Roosevelt vs. the Trusts to today's largest banks vs. no one important.

The author succeeds by providing an historical context to the current banking reform dialog. Not only has there ALWAYS been a back and forth discourse between central banking and large banks, but there has ALWAYS been a tension between oligopolies that had power at their time in history and the politicians that were affected by their power.

If I could sum up the entire book in one sentence it would be - The times we are living in are not particularly novel and only great Presidents, with courage, can come to the rescue.

If you are not already a student of history, economics and current events. And you have not read other books that seem to be published every week, this is a book you should read. If on the other hand you don't have these characteristics, I would advise you not read this book.

For me - and I am only speaking for me - the book was a bunch of "dah's"

An Outstanding Contribution!!! William Dahl "On Por #2010-04-25

A splendid contribution - supplying yet another perspective on the genesis and aftermath of the U.S. and global financial crisis.

Simon Johnson hails from MIT's Sloan School of Management (Kurtz Professor of Entrepreneurship) and the Peterson Institute for International Economics. James Kwak is a former software entrepreneur and a former consultant for McKinsey and Company. They co-author the well regarded economic blog, The Baseline Scenario.

The thesis of the book is summarized in the following:

"Our goal today is to change the conventional wisdom about enormous banks. In the long term, the most effective constraint on the financial sector is public opinion. Today, anyone proposing to end the regulation of pharmaceuticals or to suspend government supervision of nuclear power stations would not be taken seriously. Our democratic system allows the expression of all views, but we filter those views based on a collective assessment of which are sensible and which are not. The best defense against a massive financial crisis is a popular consensus that too big to fail is too big to exist." P. 221

"Without a privileged inner core of thirteen (or fewer) bankers, the financial sector will be composed of thousands of small companies and dozens or hundreds of medium-to-large companies, including hedge funds and private equity firms. The financial lobby will continue to be strong by virtue of its sheer size, and the community bankers will retain their clout in Congress. But the distortion of the playing field in favor of a small number of mega banks will come to an end." P.219. Emphasis is mine.

The authors clearly tout the need for systemic financial regulatory reform, particularly as it relates the the largest of the large U.S. financial institutions. They do a superb job of unmasking the myth that "if it's complex, it must be innovative." Listen to Johnson and Kwak:

"But there is no law of physics or economics that dictates that all financial innovations are beneficial, simply because someone can be convinced to buy them. The core function of finance is financial inter mediation - moving money from a place where it is not currently needed to a place where it is needed. The key questions for any financial innovation are whether it increases financial inter mediation and whether that is a good thing." P. 108 (Emphasis is mine)....think about the recent SEC allegations regarding Goldman-Sachs.

Innovation is sometimes based upon herd-instinct and a misplaced trust (in any industry for that matter). The authors make a case that is difficult to argue with for the largest U.S. financial institutions (13 Bankers) when they declare:

"Never before has so much taxpayer money been dedicated to save an industry from the consequences of its own mistakes. In the ultimate irony, it went to an industry that had insisted for decades that it had no use for the government and would be better off regulating itself-and it was overseen by a group of policymakers who agreed that government should play little role in the financial sector." P. 164.

Economic bubbles, particularly the one these authors focus on, are based on what turns out to be speculative excesses, irrational exuberance, myths, greed -- and the suspension of disbelief, in the face of the deployment of a myriad of so-called financial innovations, that U.S. citizens will pay for for generations to come.

As the authors suggest; "At this crucial juncture in our history, as America emerges from a deep recession into an uncertain economic future." P. 190. Yet what we do with what we understand has happened requires vastly more deliberation. We should be skeptical of what appear to be "common sense" sound bites and the adrenal rush toward "quick fixes."

After all, we're attempting to regulate human behavior aren't we?

Some good information, but a selective treatment tgw #2010-12-26

This book has pros and cons about the banking crisis.

On the plus side, it gives the first explanation I've seen of the details of mortgage backed securities and how the traditional securities (bonds backed by a bunch of mortgages) could "sliced and diced" and in the end AAA rated bonds could be backed by sub-prime mortgages. In this sense it's unfortunate that the book came out before the current mortgage documentation scandal.

On the other hand, it is apparent the authors are nostalgic for the regulated banking days of the 50s and 60s. I don't remember the book saying that any of the banking changes of the last 40 years were "good", nor that any of the old regulations were "bad". While they don't advocate a return to the old regulations, I think they would like to. This would be a much stronger position if the authors explained how a banking crisis would have been avoided in the early 1980s when banks and S+Ls had to pay 12% or more on savings but were receiving 8% on mortgages.

In the end the only proposal for "reform" by the authors is limiting bank size to avoid "too big to fail", which really doesn't do much. They don't propose new regulations (though they rightly note this might be futile since Wall Street is good at circumventing regulation. Size limits might help but the current interrelationships between banks mean that even failures of small banks could avalanche into a new crisis.

Overall, read it for some information on how the system works but be aware of the author's bias.

Detail description, convincing reasoning, but weak recommendation Stephen Chung #2011-10-20

A very good book overall on the 2008 financial tsunami and its relationship to the financial industry, Wall Street in particular, and the fallacy of the Too Big To Fail mentality: It has a) very detail description of the process leading to the crisis i.e. the what, who, and when; b) very convincing reasoning i.e. the why and how the crisis occurred; c) rather weak, or in some ways too gentle, recommendations in part because the opponents do not seem to be wearing gloves when they punch (via lobbying and influence). Easy to read too for people without a lot of financial or banking knowledge though a few portions in the book appear repetitive.

Poorly organized, lacking in focus James R. Maclean #2011-09-30

What exactly was the role of the financial sector and the government in the 2008 Financial Crisis? A careful survey of reviews on Amazon would probably notice a general split between libertarians claiming the problem was too much regulation, for various reasons and liberals claiming the problem was regulatory capture. In a way, the two sides are not far apart: both would agree that government, as a regulatory "machine," was defeated by clever and ultimately opportunistic financial sector.

This book attempts to explain the linkage between regulatory capture by the banks with a larger historical struggle between rival visions of how our country was supposed to look. Johnson and Kwak take a page from Max Weber by attempting to identify the basic philosophical outlook of Americans with the protagonist of the bank regulatory struggle. Just as Weber attempted to explain the rise of capitalism in terms of Christian theology--explicitly providing a liberal alternative to Marxism--so J&K attempt to explain the evolution of the US banking sector in terms of Jefferson's and Jackson's writings on the subject. In both cases, Jefferson's and Jackson's views on commercial banking are supposedly enlightened, if a bit sentimental, and pose obstacles to the rise of the monster bank holding company.

At the same time, J&K attempt to explain a large number of basic ideas in economics and finance to the reader--explanations that are neither very wrong nor very helpful.

The philosophical-historical aspect of the book is not helpful at all; for one thing, there's no meaningful connection between banking then and banking now. Second, even if there were a meaningful connection, I cannot accept the idea that the USA has a genome that consists of the recondite opinions of Jefferson, Jackson, or Alexander Hamilton. Why them and not Salmon P Chase? Why not Carl Schurz? These are people with a lot more influence on the modern banking system. Still, I can excuse this as an mere idiosyncrasy: J&K thought Jefferson and Jackson were part of the "spiritual essence" of the Republic, perhaps, or at least wanted to hold them up as a glorious benchmark.*

Polemically, the book is uneven. They often describe "Wall Street" as an insidious villain, then deny that they are doing any such thing. They mention the "[cognitive] regulatory capture" (p.93) but fail to mount a serious challenge to that cognition; libertarian reviewers uniformly ridiculed J&K's claim that banking was deregulated or unfettered at all, and compared to banking systems in other industrialized countries, they have a point. They attempt at times to adhere to an impersonal, system explanation of the crisis, but seldom for long. As a result, readers with a different philosophical outlook are not going to be convinced.

As an explanation of the crisis, the book is not very helpful. They could have gone academic, with rigorous models (Kenneth Rogoff and Carmen Reinhart do this; their approach is not an insuperable challenge for non-eonomists, I believe). Or they could have tried something really non-academic, like Frank Partnoy did. In my view, this book doesn't really explain the crisis very well, and it doesn't really explain the evolution of the banking system very well. It tries, and it makes few major errors, but mostly it wastes a lot of time with ineffectual polemics and sentimental history.

UPDATE (3 October 2011): I relented from giving this book only 2 stars; that seems a bit harsh. There is not really anything in the book that is wrong, and I suspect my judgment was biased negatively because I had read so much of the same thing over and over again. That's not the fault of J&K.
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*Aesthetically I find this intensely irritating, but I can't assume everyone else will.

Entertaining and thoughtful reading Joe 1015 #2011-09-03

This books turned out to be informative and interesting. I've read several books about the same subject and seen as many movies. 13 Bankers was among the best.

Highly enlightening Nelson Mostow #2011-07-31

Explains the financial melt down around 2008. Emphasis is on the unhealthy relationship between a very few megabanks and the government. Makes a very cogent case for not letting banks get so big that the government cannot afford to let them fail.

Not having any background in this area, I found it compelling although difficult to digest.

I recommend it. (In fact, got a copy for my son.)

Great book, plenty of sources KD0IMH #2011-07-31

Johnson and Kwak's blog was essential reading during the financial crisis, and is still quite educational. This book is also required for Money & Banking in the fall. (I'm a bit sad because I went way over the Amazon clipping limit, so 314 of my highlights are invisible via the website.)

Johnson approaches the U.S. financial crisis from the point of view of a former Chief Economist of the IMF. That perspective allows him to see the irony of how the U.S. and the IMF advised East Asian countries through their financial crises in 1997-1998 compared to how the U.S. handled its own.

Related to my previous post, Johnson gives a history of banking and regulation in the U.S., from the first central bank charter of 1791 to Jacksonian populism, to the Panic of 1907 to the Great Recession. All of this is great, concise history.

Johnson comes down on the side of Thomas Jefferson--a distrust of centralized power of bankers as a threat to the Republic. He sees what the U.S. has now-- an oligarchy of a few large politically-influential financial institutions-- as little different from the cronyism of developing nations that the U.S. has been quite critical of. The U.S. advice to Asia in the 1990s was that no bank should be "too big to fail," and the big state-backed monopolies should be broken up. Johnson offers that same advice to the U.S. today-- find a way to break up the banks, just as Republican Teddy Roosevelt did with the Trusts of the early 1900s.

About 1/3 of this book is bibliography-- a treasure trove of sources and references. You always hear of the growth of finance, but it's nice to have specific data. The undeniable fact is that the deregulation of the financial sector in the 1970s and 80s did nothing to boost U.S. productivity and therefore did not result in an obvious better allocation of capital. The financial sector replaced manufacturing 1-for-1, and commercial & investment banking and insurance profits grew to be a much larger portion--almost 50%-- of all U.S. corporate profits by 2007. The amount of leverage taken on by financial sector firms became enormous over this time period:

"in 1978, all commercial banks together held $1.2 trillion of assets, equivalent to 53 percent of U.S. GDP. By the end of 2007, the commercial banking sector had grown to $11.8 trillion in assets, or 84 percent of U.S. GDP. But that was only a small part of the story. Securities broker-dealers (investment banks), including Salomon, grew from $33 billion in assets, or 1.4 percent of GDP, to $3.1 trillion in assets, or 22 percent of GDP. Asset-backed securities such as collateralized debt obligations (CDOs), which hardly existed in 1978, accounted for another $4.5 trillion in assets in 2007, or 32 percent of GDP.* All told, the debt held by the financial sector grew from $2.9 trillion, or 125 percent of GDP, in 1978 to over $36 trillion, or 259 percent of GDP, in 2007...In 1978, the financial sector borrowed $13 in the credit markets for every $100 borrowed by the real economy; by 2007, that had grown to $51.14 In other words, for the same amount of borrowing by households and nonfinancial companies, the amount of borrowing by financial institutions quadrupled....by the third quarter of 2009, financial sector profits were over six times their 1980 level, while nonfinancial sector profits were little more than double those of 1980."


The private sector began to wade where only the GSE's had tread before-- securitizing mortgages. Deregulation allowed the lines to blur between banks and non-banks, until the lines were at last removed in 1999. Greenspan and other regulators intentionally decided not to regulate various activities. For example, Greenspan declined to look at the books of mortgage brokers owned by bank holding companies-- even though it was in the Fed's realm to do so. If there were bad practices or "liar loans" piling up, he clearly said the problem would take care of itself (and later regretted his belief in market self-regulation).

The story is that of "bigger and better," following the textbook argument that this was well because insurance conglomerates merging with banking conglomerates merging with investment banks benefited from economies of scope and scale. Johnson, like Hayek, takes issue with this type of argument and offers some good rebuttal using various studies:

"The 2007 Geneva Report, 'International Financial Stability,'... found that the unprecedented consolidation in the financial sector...led to no significant efficiency gains, no economies of scale beyond a low threshold, and no evident economies of scope."

Basically, as banks got bigger they took on even more risk. As commercial banks and investment banks were increasing competition in the securitization game, firms began to engineer products in unique ways to differentiate their products. This caused problems of information asymmetries as very few people--including ratings agencies and the Federal Reserve-- understood the products being created. The banks could manipulate their creations to be rated well by certain risk models when actually they were quite risky. Ultimately, the taxpayer was put on the hook:

"(T)he special inspector general for TARP estimated a total potential support package of $23.7 trillion, or over 150 percent of U.S. GDP (as) theoretical potential liabilities of the government."


Johnson understands the difficulties of regulation, and while he advocated a Consumer Financial Protection Bureau, he understands regulations will do little good if banks know that they are too big to fail. He recommends that a commercial banks' assets be allowed to be no bigger than 2% of GDP, 4% for investment banks.

"Saying that we cannot break up our largest banks is saying that our economic futures depend on these six companies (some of which are in various states of ill health). That thought should frighten us into action."

I give this book 4 stars out of 5. Other reviewers have rightly noted that Wall Street isn't the only place where TBTF rules-- the government has been bailing out the auto industry for years, and various other industries ranging from steel to cotton are heavily subsidized and protected. But the sheer size of the banks, the growing percentage of U.S. GDP generated by finance, and the growing political influence of banks in our "revolving door" government is alarming.

While the book is pretty mistitled, Johnson does make it clear that we've not done much to ensure that a crisis like 2007 doesn't occur again.

Timely warning about the next crisis William Podmore #2011-07-06

This is a very useful book on the causes of the current slump. Johnson and Kwak focus on the role played by the 13 leading bankers who dominate Wall Street.

Between 1998 and 2008, Wall Street spent $1.7 billion on election campaigns and $3.4 billion on lobbying. Its people moved into Washington. Its ideology that a large finance sector was vital for the USA became all too widely accepted. As a US Senator said, "the banks ... frankly own the place."

Yet, as the authors point out, finance is a rent-seeking activity, shifting wealth, not creating it. Finance, at best, assists wealth creation, not destroys it.

So in the crisis, the bankers blackmail us - pay up or we go under, dragging you all down with us. Their mantra is - socialise losses, privatise gains. The governments give the banks whatever they want, instead of writing down the banks' debts. So we the taxpayers have been made to give the bankers blank cheques, up to $23.7 trillion. The slogan is `save the economy'; the reality is saving the banks, the bankers and the bankers' bonuses.

These guarantees (subsidies) allow the biggest banks to borrow more cheaply than their rivals, so they grow even bigger. But this is to go the wrong way. As the authors state, "The right solution is obvious: do not allow financial institutions to be too big to fail; break up the ones that are." Even Alan Greenspan, Chairman of the Federal Reserve, said, "If they're too big to fail, they're too big." And these bailouts allow the bankers to take ever-bigger risks, which will cause the next crisis.
As Johnson and Kwak conclude, "With the same conditions in place that led to the last financial crisis, it would be folly to expect any other result." One sign of madness is to do the same thing and expect a different result.
Are people going to allow yet another crunch, causing an even worse slump? We need to defeat this financial oligarchy before it ruins us all.

Very worthwhile Edward P Paules #2011-05-07

Anyone interested in the current recession will find this book very valuable in understanding what happened and why. The book is readable; it is both educational and entertaining at the same time. While the scholarship reflects the highest standards, it is the personal experience at the IMF that connects the theoretical to the applied and makes this book worth the time and money investment.

Oh to be in such an elite club Phil Cooper #2010-12-28

Best of the books so far on the position of our banking system and how "we" rushed to save them. Not too much though on how to not do it all again. The "Too Big to Fail" banks are now bigger and more vital to our economy. But still no banking reform. Appeared weaker on remedies than I expected.

Anyway, MUCH better than Sorkin's book "Too Big to Fail" which was too much who ate what for lunch during whatever meeting. !3 Bankers gives a more top down look.

An American version of an oligarchy K.S.Ziegler #2010-10-09

Simon Johnson uses his expertise in global economics to tell the story of the Wall Street meltdown and the issues involved. He draws a comparison between the oligarchies of the 90s in Korea, Singapore, and Russia - in which there was an unhealthy alliance between a few powerful economic entities and government - and the form of oligarchy which is Wall Street's relationship with Washington. The influence on government by the very banks that brought the economy to the brink has allowed them to continue to grow ever larger and even to continue to receive big bonuses despite the damage they caused.

A few charts and graphs indisputably show the ascendency of Wall Street in the last thirty years. The authors state that from the 1930s to the 1980s financial and non-financial corporate profits rose at about the same pace. From 1980 to 2005, adjusting for inflation, financial corporate profits rose all of 800 percent while the non-financial side (which includes the part of the economy that actually produces things) grew 250 percent. The book is concerned not so much with an explanation of how this lopsided condition arose so much as the issues involved in the financial crisis, especially the question of whether it was necessary that the too-big-to-fail banks were allowed to survive in tact - stronger and bigger than ever. The rise of a rather extreme form of free market ideology, of which Alan Greenspan has been a driving force, is not studied as to its origins but the role it played in bringing about the conditions for the banker's irresponsible behavior.

It's not an easy question now whether there was a better solution to the rescue that Bernanke and Geithner engineered. After Lehman Brothers was allowed to fail, there is no question that the Wall Street banks had become a house of cards: a complex, interconnected set of financial transactions that had unravelled. The credit markets seized up, with dire consequences for the economy, which is built on credit. Bernanke and Geithner acted decisively and effectively to bring confidence back into the system, and prevent a slide into a depression - a very real possibility at the time. The downside, as the authors note, is that they restored all the players and very little has been done to prevent the same perpetrators from binging on risk.

The ideological underpinnings of this book are grounded in the idea that competition on an even playing field is a good thing and that monopolies which concentrate power are ultimately bad for the economy. It is up to the people to set the rules, and make sure they are up to date and in place. In a laissez-faire, anything-goes economy where only a few determine the rules through undue influence, there is no "invisible hand", only the hands of a few powerful oligarchs.

Depressing D. B. Collum #2010-08-08

This review was first posted on another site (thus the cryptic mention of going over to Amazon)...

I am suffering "crisis fatigue". I realized why when I finished the book and looked at their recommended reading list. Out of about 50 books, I have already read about 25 of them. With that said, I was prompted to read this one by a strong recommendation by a hedge fund manager and believe that it is in the best-of-breed category.

Simon and Kwak take a decidedly political look at how the banking industry amassed its power and gained control of the political system. It covers the sequence of events leading up to the crisis, beginning with the Carter era, but it is primarily about all forms of "capture". It will make you angry and depressed. (On the bright side, they hammer Greenspan!) By the end, despite the authors best effort to leave you on a positive note, you will want to just hang it up. The authors finish with a mixed message: (1) the banking system is more powerful than before the crisis, and (2) there is still hope that the tentacles can be removed and that it will take multiple steps over many years. They conclude that the only solution is to shrink the six banks that are too big to fail. They lean a lot on Teddy Roosevelt to suggest that it can happen. I am not so sure.

I have an alternative pair of hypotheses: (1) We have another crisis and we shrink the banking system one neck at a time, which should get the attention of our elected officials, or (2) the system will shrink itself. This latter hypothesis might seem a little odd, but I have this notion that the megabanks, like many other corporations, may discover that they are too big to succeed. Are they the only industry that only consolidates? Probably not. The banking industry must cycle just like every other industry. At some point, they will start spinning off businesses to "unlock shareholder value". Heaven help the suckers who end up buying the toxic spinoffs, but the fragmentation may be achieved nonetheless.

As usual, after writing this I wandered over to Amazon to see what others thought. It got four stars. (I expected more like 4.5 stars.) There were the usual raves from those disgusted by this whole mess (especially those of us who saw it coming from a decade back.) One guy (Aaron C. Brown) did make some legitimate arguments to counter the theses of Simon and Kwak.

For those wondering why I am writing so many book reports, I am flat on my back with a pinched nerve. Lots of reading time.

Carelessness Mary E. Sibley #2010-07-22

In March 2009 thirteen bankers needed the government. The banks had a central role in causing the economic crisis, but the country's economic prosperity depended upon them. The large banks are a new oligarchy. Wall Street ideology has been embraced by both political parties. In 2000 custom derivatives wee made exempt from regulation in the Commodity Futures Modernization Act. Surviving big banks may have been the winners of the financial crisis.

Historically Hamilton favored, Jefferson opposed, the creation of a central bank. On the economy Hamilton was right. Jefferson feared the banks' political power. He was also correct. Jackson saw a powerful central bank as a corrupting influence. In any case, by the late nineteenth century there was a powerful financial elite.

1897 to 1904 saw the rise of the trusts. Absent a central bank, J.P. Morgan solved the financial crisis of 1907. (The US government deposited twenty-five million dollars to stabilize the banks, also.) After the Panic of 1907 the Federal Reserve Act was passed in 1913.

New legislation, the Banking Act of 1933, the Glass-Steagall Act, was the response to the Great Depression. Also instituted was the FDIC. Too, investment banks became subject to new regulation under the SEC.

In the 1970's and 1980's the financials services were breaking free of the constraints. Fixed commissions were eliminated. Thrift bank deregulation began in 1980. Academic finance and the Efficient Market Hypothesis had an impact.

Deregulation became an ideological crusade under Reagan. Comprehensive deregulation was derailed by the Savings and Loan Crisis in the late 1980's. Salomon Brothers, (subsequently a part of Citigroup), pioneered mortgage-backed securities and arbitrage trading. There was vast growth in bank proprietary trading activities. High-yield bonds remained popular with investors even after Milken and the Drexel concern ran into problems.

Another part of the evolution of modern finance practices was the derivatives market. (The credit default swap helped to create the current crisis.) Banks got bigger as constraints on interstate banking fell. Commercial banks pushed their way into investment banking. Laws passed in 1994 and 1999 were the means of reversing regulation enacted in the 1930's.

Revolving doors between Washington and Wall Street and regulatory capture worked to make the views of the financial services sector paramount. Wall Street positions became conventional wisdom in Washington. The book's authors cast Robert Rubin as absolutely critical to the formulation of Clinton's policies in the 1990's.

The ideology of innovation was shared by Wall Street and Washington. Unfortunately financial innovation is not like technical innovation. Financial sector jobs constitute rent-seeking activity that redistributes wealth. The sector became the most popular area in which to work with smart college graduates.

Securitized debt, mortgages and credit-default swaps caused the crash of the economy, (Wall Street crashing the economy was an idea I entertained as a matter of hyperbole), because mortgage originators shouldered no risk when the mortgages were sold off and thus, had no reason to be prudent. People who should have known better suffered from ideological blinders. Contrarians were castigated. Some banks held on to the CDOs they fabricated. In the end there was a gigantic housing bubble supported by a mountain of debt. Hyman Minsky had warned that speculative finance could become Ponzi finance.

The recent financial crisis was unique in its complexity and scale. The government recapitalized banks to end the crisis. Observers have charged that the losses have been socialized and the gains privatized. The authors believe that too-big-to-fail entities should be broken up. The book is very good, informative.

Any serious business and economics library needs this Midwest Book Review #2010-06-18

13 BANKERS: THE WALL STREET TAKEOVER AND THE NEXT FINANCIAL MELTDOWN comes from one of the most cited economists in America and offers a fine survey of U.S. financial history, documenting showdowns between American democracy and business. The roundup of events shows why our future is imperiled by finance and its gains, and makes a case for reigning in financial freedom. Any serious business and economics library needs this.

Excellent ... Kevin B. #2010-06-16

One of the best books on the crisis and how to lower the odds of it happening again. Which it will unless something is changed. I highly recommend this book. It does not read like a Michael Lewis business book/novel. The authors combine history in banking with the present crisis to show how we got here. If you don't know how you got somewhere you can't make changes that keep you from getting back to the same place.

Highly Recommended Hindflight #2010-06-09

Thanks to the authors for producing one of the more comprehensive and accessible works about the current financial crisis. This book does a fantastic job of providing a historical context to the regulatory framework that existed prior to the trend of deregulation and links together each event better than other works which focus on specific aspects of the crisis. The authors also do a great job of illustrating the importance of campaign finance reform. This issue was discussed some years ago but has been quickly eclipsed in the headlines by the deluge of other major events. Some reviewers have suggested that these deregulation trends were simply legislative oversights made on the altruistic quest to provide universal housing. The overwhelming amount of contributions from the financial sector to political candidates suggests other motives. The timidity with which the current administration has approached any meaningful reform demonstrates the power that these institutions still have over Washington. Simon and Kwak successfully show how the currently proposed measures are woefully inadequate. Some issues that may have been beyond the scope of the book but deserve some attention are:

1) The start of the deregulation trend coincided with an economic downturn in the late 1970's that may have been in part due to the rising cost of doing business in the US (labor and tort liability for example). What role did the need to stay globally competitive play as a motivator for deregulation of financials?
2) One of the problems associated with economic bubbles discussed in the book is the misallocation of resources, both capital and raw materials. During the boom years, financials were experiencing double digit percentage growth year over year. This was just like pitting athletes taking steroids (financials) vs. athletes who are not (non financials). What kind of pressure might this have put on the upper management of non financials in the "real economy"? Many "real economy" CEOs adopted a "blockbuster or bust" mentality with respect to R&D projects. If misallocation of resources is real, the opportunity cost of this fiasco is immeasurable.

Overall, this book is highly recommended, only it would be nice if more people would have read it since so many are suffering from the crisis that it successfully explains.

13 Bankers Arlene Jo Price "Sam #2010-06-08

Extremely revealing. I guess we are in for a very bad time unless the politicians are willing to get tough and take back our government from the bankers and wall street.

Power Stephen T. Hopkins #2010-06-02

Economists Simon Johnson and James Kwak present a little more than two hundred pages of clear and straightforward writing in their new book, 13 Bankers: The Wall Street Takeover and the Next Financial Meltdown. In a calm and reasoned way, the authors present an overview, context and historical perspective about many of the factors that led to the recent financial crisis, and how despite rhetoric about reform, we seem to be back to business as usual. Consistent with the principles of Thomas Jefferson, Johnson and Kwak express concern about the problems of concentrated power. They show clearly that a handful of privileged banks remain too big to fail, and continue to take risks that could lead to another crisis. Here's the point (p. 180): "The large banks used their political power to protect their money machines from government interference, and when those machines exploded they used their size and importance to force the government to bail them out." Johnson and Kwak propose capping the size of banks. At times, this book reads like a recap of the news headlines of recent years, but that adds to its readability, which is not a bad thing for a book written by economists. Any reader interested in a recap of what brought us to today's concentrated risks, how past leaders broke up powerful concentrated entities, and how the current power of big banks puts us in jeopardy, will find a lot to ponder from these pages.

Rating: Four-star (Highly Recommended)

Great Book! Lee C. Thompson "Old #2010-05-25

Everyone should read this book and learn how the finance industry has taken over our government while we sit passively by.

Boiled down Dan Clarke "World wa #2010-05-24

When there are too many words, important points get lost.

There were three important points in this book that should not be overlooked:

1. The only way to avoid the "too big to fail" problem is to put a cap on the size of financial institutions.
2. The financial industry is like rain on a flat roof -- it will find every crack in the roof and seep through it.
3. Periodically the federal government must rein in the financial industry. The time to do so is upon us.

Unfortunately, the finance reforms recently passed by the U.S.Senate do not address these points to the extent necessary. It makes me wonder why someone as obviously informed and intelligent as Simon Johnson is not in a position to assist the administration in making these needed reforms.

Solid overview of crisis J. Davis #2010-05-21

I thought the authors were right on in their analysis of the economic collapse (Disclaimer: I am not an economist). It is a fascinating read. A little known Clinton official named Brookley? Born is the Churchill of this book, warning in vain that derivatives were getting out of control. Of course, the economic elite, e.g. Larry Summers, Robert Rubin, and "Maestro" Greenspan knew better. The banks were fine, and the markets could regulate themselves. These geniuses were dead wrong, and Johnson shows the steps that led to the economic collapse.

Johnson also warns that the Obama administration has not fundamentally changed the way banks operate--Tim Geithner is portrayed as too close to Wall Street. He believes no bank should be allowed to become too big to fail, and endorses reinstating Glass-Stegall (which was repealed in 1999). A must read for anyone interested in why the system colapsed, and what can be done to prevent another collapse.

Beware Dave F. Ambrogio #2010-05-19

To really understand Financial Reform you have to understand how we got here. This book takes you through a history lesson to the present.It names names and conects all the dots. Its a wakeup call to all Americans of all parties ."Too big to fail " is a fatal reciepe for our country.Please read this book and be aware of whats happening around you.

Never Let a Crisis Go to Waste Publius #2010-05-15

In 2008, Presidential advisor Rahm Emanuel was quoted `that we can never let a crisis go to waste'. In Fall 2008, the moribund finance industry, despite massive infusions of government capital, very nearly brought down the whole economy. In "13 Bankers" Simon Johnson argues that 2009 was the time for Obama to re-organize big finance and never allow it to become "too big to fail." The administration thus lost a chance to rein in 30 years of deregulation. Mr. Johnson persuasively makes the case that concentrated wealth in the hands of 6 major banks will continue us on a repeated cycle of boom and bust instead of consistent stable growth. Overall, an excellent primer on basic finance and how we can avoid the next crisis. The frightening aspect of this whole story is when the next shock comes, will our government have enough money or will it all be gone?

Tries to give the big picture, but ultimately unsatisfying Glenn Corey "book fi #2010-10-24

I was expecting more careful, closely reasoned arguments from the authors of 13 Bankers. I've seen Mr. Johnson on TV and have been impressed with his seeming command of the subject, but I was disappointed with this book, which I had started with great anticipation. The authors use phrases such as "the free market gone wild" throughout the book, but they seem to take it for granted that what we have is in fact a free market, without ever establishing that or, hence, the justification for calling what has happened in our economy as the failure of the free market. They note Alan Greenspan's earlier paper from the 1960s about the free market and gold, but they somehow miss the irony of Fed Chairman Alan Greenspan commenting favorably about the advantages of allowing markets to regulate themselves. The very existence of the Federal Reserve is one of the main features of our economy that makes it unfree. This seems to have escaped the authors' critical faculties.

The authors also talk about how calls for new regulations ignore the fact that there was plenty of regulation already in place but that people, like Chris Cox at the SEC, dropped the ball. Thus regulation does no good without enforcement. The authors also point out correctly that new regulation is unlikely to prevent catastrophes from happening again. But then in an incredible act of wilfull amnesia, the authors in the last chapters declare their support for the creation of the new consumer finance protection agency under Elizabeth Warren. Thus, after having told us that new regulation will not prevent new disasters from happening, they champion this new regulation. I, too, am impressed by Warren. She's smart, straight talking, and seems to have the interests of the American people at heart. But I have no doubt that, over time, this new agency will prove to be as ineffectual as the SEC. Eventually, the large brokerages, banks, and Wall Street firms will find a way to corrupt the oversight process, engage in behavior that should have been noticed by the agency, and cause another financial meltdown. I was surprised at such a shallow analysis.

I can't really recommend this book as a must-read about the ongoing financial crisis. In fact, I haven't really found a single book to recommend. But you can safely pass on this one.

this confirs my opion that handcuffs are required for criminal bankers nicholas dalton #2010-05-10

THIS EXCELLENT BOOK ONLY CONFIRS MY VIEW THAT ALL THE CRIMINALS INVOLVED ,INCLUDING MR.ALLAN GREESPAN , SHOULD BE HANCUFFED ON THIER WAY TO JAIL!!!!!!!!!!!!!!! that includes GOLDMAN SACHS CRIMINALS THAT WERE TREASURY SECRETARIES STARTING WITH MR. ROBERT RUBIN, AND THE CRIMINALS IN THE SENATE THAT VOTED FOR THE ELIMINATION OF THE GLSS STEAGLE LAW !!!!!!!!!!!!!!!!!!!!! THEY ARE ALL CRIMINALS!!!!!!!!!!!!!!!!! THEY HAVE BANKRUPTED OUR COUNTRY FOLKS!!!!!!!!!!!!!!!!