The 10 best credit crunch books


Too Big to Fail: Inside the Battle to Save Wall Street by Andrew Ross Sorkin

Based on more than 500 hours of interviews with more than 200 people, this is a doorstopper account of the crisis, told from the point of view of the Wall Street protagonists. If you want to peek through the keyhole at Park Avenue apartments and sleek black Lexus cars, this is the book for you. Sorkin is long on the inside story of the financial titans, giving a fly-on-the-wall view of key meetings and showdowns, but short on the reforms needed to cut them down to size.

Fool’s Gold: How Unrestrained Greed Corrupted a Dream… by Gillian Tett

An elegant and expert account by the UK’s most prescient financial journalist of how bankers at JP Morgan invented the credit derivatives that were perverted into instruments of mass destruction. FT writer Tett, who has a doctorate in social anthropology, is fascinating on how an elite banking “tribe” gained so much power over the rest of society. Readers will have to decide for themselves whether she lets off JP Morgan too lightly.

House of Cards: How Wall Street’s Gamblers Broke Capitalism by William D Cohan

A masterly portrayal of Jimmy Cayne, the bridge-addicted, spliff-smoking boss of Bear Stearns. This account of the 10 days leading to the collapse of the bank is brilliant on the technicalities, and even better on the psychology of the flawed banker/gamblers. Cayne wasn’t the only unorthodox character at the helm of Bear: his predecessor, Ace Greenberg, used an alter ego to harangue staff, and made charitable donations to studiers of dwarfism as well as providers of free Viagra for men who couldn’t afford it.

The Devil’s Casino: Friendship, Betrayal and the High-Stakes Games Played Inside Lehman Brothersby Vicky Ward

A terrific tale of the weird and not‑so‑wonderful world of Lehman Brothers: the personalities, the bonuses, and best of all the backstabbing politics of the Louboutin-shod bankers’ Wags. The now-vilified former CEO, Richard Fuld , is portrayed not just as the aggressive “Gorilla” of Wall Street lore but as a human sponge who absorbed the attributes of smarter colleagues to the point of stealing their entire personality.

Payback: Debt and the Shadow Side of Wealth by Margaret Atwood

The Canadian writer (above) has taken an erudite look at how the concept of debt is embedded in religion, morality, the law and literature. Her dissection of the complex social relationship between debtor and creditor is masterly, showing how notions of indebtedness go beyond the financial sphere and inform our sense of fairness, obligation and revenge. She draws heavily on literary sources from Goethe’s Faust to Thackeray’s Vanity Fair, and makes much of notions of debt in the Christian tradition.

A Week in December by Sebastian Faulks

A novelist’s view of how the amorality of financiers such as the main character, odious hedge fund manager John Veals, infects the rest of society. Faulks’s characters live in hermetically sealed, unreal worlds: a young female tube driver is addicted to a fictional version of Second Life, a devout Muslim youth succumbs to the warped logic of Islamic terrorism, and a TV show has mentally disturbed inmates competing to win treatment. Short-selling is rife, not just in the form of Veals’s depraved scheme to bring down a bank, but also in a cynical book reviewer’s trashing of his rivals.

The Big Short: Inside the Doomsday Machine by Michael Lewis

In the 1980s, Michael Lewis proved himself a master-chronicler of Wall Street with Liar’s Poker, which laid bare the machismo and excess at Salomon Brothers. More than 20 years on, his sequel shows how little was learned. The twist in this tale is that it is told from the point of view of the “winners” – the handful of men who made huge sums by betting correctly on a meltdown. An unputdownable book, but it’s uncomfortable to identify with people who became indecently rich because their predictions of misery proved right.

The Way We Live Now by Anthony Trollope

Trollope’s masterpiece, first published in 1875, is not, of course, about the current financial crisis, but its examination of how hopes of easy money can corrupt individuals and sections of society remains relevant today. The appearance of luxury living wipes out moral questioning, and society is vulnerable to the machinations of financial fraudsters because it has lost its sense of values. It is all too easy to imagine the “Great Financier”, Augustus Melmotte (played on TV by David Suchet in 2001 , above), a shadowy, egotistical and tyrannical swindler, at the top of a contemporary investment bank.

Crisis Economics by Nouriel Roubini and Stephen Mihm

Crises are not exceptional, but an intrinsic part of capitalism, according to “Dr Doom” Roubini (he prefers to be called Dr Realist), who predicted the banking meltdown and the sovereign debt crisis. Roubini and his co-author walk the reader through past crises, the causes of the current one, the radical remedies needed and the risks ahead if policymakers shirk reform. This is a highly persuasive attack on the neo-conservative ideology that allowed a lightly regulated finance sector to bring the global economy to the brink of ruin. An informative – and terrifying – tome.

Freefall: Free Markets and the Sinking of the Global Economy by Joseph Stiglitz

Stiglitz, formerly chief economist at the World Bank, is another of the rare dissident voices who did not share the belief in unfettered markets that set the stage for the worst financial crisis since the Great Depression. He mounts a devastating attack on the financial sector and the politicians and regulators who allowed it to run amok. He argues persuasively that we have so far failed to fix the problem: instead, “we called in the plumbers who installed the plumbing”. The banking industry is still calling the shots.