| Chasing Goldman Sachs: How the Masters of the Universe Melted Wall Street Down . . . And Why They'll Take Us to the Brink Again |  | Author: Suzanne McGee
Publisher: Crown Business
Category: Book
List Price: $27.00
Buy New: $14.90
as of 9/10/2010 07:42 CDT details
You Save: $12.10 (45%)
New (36) Used (12) from $13.19
Seller: luisa1310
Rating:  10 reviews
Sales Rank: 22,932
Media: Hardcover
Edition: 1
Pages: 416
Number Of Items: 1
Shipping Weight (lbs): 1.6
Dimensions (in): 9.4 x 6.4 x 1.6
ISBN: 0307460118
Dewey Decimal Number: 332.660973
EAN: 9780307460110
ASIN: 0307460118
Publication Date: June 15, 2010
Availability: Usually ships in 1-2 business days
| |
| Features:
| • | ISBN13: 9780307460110 | | • | Condition: New | | • | Notes: BUY WITH CONFIDENCE, Over one million books sold! 98% Positive feedback. Compare our books, prices and service to the competition. 100% Satisfaction Guaranteed |
|
| Also Available In:
|
| Similar Items:
| |
| Editorial Reviews:
Product Description
You know what happened during the financial crisis … now it is time to understand why the financial system came so close to falling over the edge of the abyss and why it could happen again. Wall Street has been saved, but it hasn’t been reformed. What is the problem?
Suzanne McGee provides a penetrating look at the forces that transformed Wall Street from its traditional role as a capital-generating and economy-boosting engine into a behemoth operating with only its own short-term interests in mind and with reckless disregard for the broader financial system and those who relied on that system for their well being and prosperity.
Primary among these influences was “Goldman Sachs envy”: the self-delusion on the part of Richard Fuld of Lehman Brothers, Stanley O’Neil of Merrill Lynch, and other power brokers (egged on by their shareholders) that taking more risk would enable their companies to make even more money than Goldman Sachs. That hubris—and that narrow-minded focus on maximizing their short-term profits—led them to take extraordinary risks that they couldn’t manage and that later severely damaged, and in some cases destroyed, their businesses, wreaking havoc on the nation’s economy and millions of 401(k)s in the process.
In a world that boasted more hedge funds than Taco Bell outlets, McGee demonstrates how it became ever harder for Wall Street to fulfill its function as the financial system’s version of a power grid, with capital, rather than electricity, flowing through it. But just as a power grid can be strained beyond its capacity, so too can a “financial grid” collapse if its functions are distorted, as happened with Wall Street as it became increasingly self-serving and motivated solely by short-term profits. Through probing analysis, meticulous research, and dozens of interviews with the bankers, traders, research analysts, and investment managers who have been on the front lines of financial booms and busts, McGee provides a practical understanding of our financial “utility,” and how it touches everyone directly as an investor and indirectly through the power—capital—that makes the economy work.
Wall Street is as important to the economy and the overall functioning of our society as our electric and water utilities. But it doesn’t act that way. The financial system has been saved from destruction but as long as the mind-set of “chasing Goldman Sachs” lingers, it will not have been reformed. As banking undergoes its biggest transformation since the 1929 crash and the Great Depression, McGee shows where it stands today and points to where it needs to go next, examining the future of those financial institutions supposedly “too big to fail.”
|
| Customer Reviews:
Showing reviews 1-5 of 10
 Investment Banks race to the top and bottom July 13, 2010
Steve Burns (Nashville, TN)
5 out of 6 found this review helpful
Author Suzanne McGee has done a great job in this book showing her readers how investment banks obsessive pursuit to beat Goldman Sachs' return on equity lead to the financial crises. The author explains that Wall Street's core function is as an intermediary financial utility providing investors with ways to invest their capital in sound businesses. Unfortunately Wall Street morphed into being a self-serving, risk-taking machine for generating profits. These out sized profits helped inflate the stocks of the businesses in the financial sector and provided billions in bonuses for executives and traders that help make these profits. Investment banks drifted form making profits by serving clients and more from trading and investing for their own accounts along with creating innovative investments with little regard to the risk profiles of these new creatins. The madness really went to a new level with the huge profits that came from creating CDOs from bundled mortgages. The banks really gave way to the fiduciary responsibilities it had to its clients and just focused on profits which led to huge amounts of risk for themselves and their clients which eventually led to meltdown of 2008 and 2009. Risk managers at these firms were silenced or shown the door as the money making machines cranked up to full throttle.
The reality is that the business of Wall Street isn't innovating, or creating some flashy new product to boost its own profits; it's providing the wherewithal for corporate innovation. Whenever financial innovation-the kind Wall Street indulges in-ends by making capital less available to corporate innovators, that is when you know Wall Street has drifted too far from its mission. This lock down of available capital is what caused the credit markets to lock up during the crises. The book does a great job of telling the tale of the investment banks and why one went bankrupt, others were acquired for pennies on the dollar, and how Goldman Sachs and J.P Morgan Chase were the winners. Also you will get an idea of what the future may hold for Wall Street in regulation and smaller financial institutions that want to step in and grab business from the legacy firms. I found the book interesting and informative.
4.5 stars-Superb,but overlooks the historical contributions of Keynes,Smith and Mandelbrot June 23, 2010
Michael Emmett Brady (Bellflower, California ,United States)
10 out of 14 found this review helpful
The author has done an excellent job in demonstrating what happens when speculative behavior,aimed at extracting economic profits without the production of any good or service by manipulating the values of financial securities,such as collateralized debt obligations and other kinds of derivatives,becomes the primary goal of a network of giant, private, " too big to fail " commercial banks,investment banks,hedge funds and private equity firms.This expanding network can be termed " Wall Street ".The primary goal of Wall Street is profit without production.This is called "securitization ".The goal is obtained through what is called the "
shadow " banking system.The shadow banking system,as it has developed over the last 35 years, has not been subject to any financial scrutiny or regulation in the USA or the World.The way in which this has been accomplished essentially involves paying off the various Democratic and Republican Presidents,senators and representatives to allow them to operate with impunity.
However,the fig leaf of private self regulation/self correction, based on an appeal to " free markets " ,where " free" is interpreted from the libertarian/anarchist/nihilist point of view, was necessary.The author,while she does mention Taleb and the failure of all extant risk management models, could have done a better job in this area by discussing the role played by various libertarian/anarchist University of Chicago economists and business school instructors,such as Milton Friedman,Gary Becker,Eugene Fama,Robert Lucas,Jr.,George and Stephen Stigler,etc., in providing the academic support for the claim that normal distribution (log normal distribution)based approaches,such as the Black -Scholes equation,Capital Asset Pricing Model(CAPM).Value at Risk model (VAR),Rational Expectations Theory(RATEX.),Efficient Market Hypothesis(EMH),etc.,were accurate and reliable statistical models for all financial markets' time series data.Therefore,all financial regulations could safely be done away with since the private financial markets were self regulating.
All of these claims were shown to be false by J M Keynes,in his A Treatise on Probability (1921),in his debate with Tinbergen in 1939-40 in the Economic Journal,by Benoit Mandelbrot in a series of books and articles written between 1963 and 2006 and by Adam Smith in his The Wealth of Nations.None of these earlier books are covered .The events of 2007-2010 are not Black Swans.They are events that repeat .This repetition has been noted by Smith ,Keynes and Mandelbrot.The author could have strengthened her book by devoting a few pages to summarizing these experts from the past .
However,these are minor flaws.The author is correct that nothing has been done to prevent the Wall Street speculators from repeating the events of 2007-2009 all over again.Main Street will again be subjected to a collapsing bubble as long as Americans continue to elect George W Bushs,Barack Obamas,Dodds,Schumers,Franks,etc.as Presidents,senators,and representatives.
Well researched June 22, 2010
John M. Dabbar (Moscow Russia)
9 out of 14 found this review helpful
Excellent book! really well written, explains what and more importantly WHY it happened. Lots of primary sources and references -- well researched. Easy to read - would be a great novel if it weren't true.
The Emperor has stolen your clothes. A prescient and impressive piece of investigative journalism. July 16, 2010
Joshua Adelstein (Tokyo, Japan)
6 out of 10 found this review helpful
I'm one of those people who's head hurts when he has to figure out how much change he should get back at 711. This is not only one of the most interesting pieces of financial journalism I've ever read, it sheds a harsh light on the dark entity that is Goldman Sachs and its colluders. Japan has a nine-fingered economy where the Japanese mafia has an inordinate amount of power and influence on the financial markets and cheats investors out of billions; the United States has Goldman Sachs. I have often characterized the modern-day yakuza as "Goldman Sachs with guns"--I'm thinking of apologizing to some yakuza for making that comparison after reading this book. At least the yakuza pretend to have honor and be preserving the social order. At least they make the pretense and they don't always just buy their way out of jail. McGee-san has written a book that should be mandatory reading at any business school.
Greed, Greed and More Greed. Greed is Good for Lack of A Better Word August 3, 2010
H. F. Miglino (Old Bridge, New jersey United States)
1 out of 3 found this review helpful
From the movie Wall Street. I enjoyed the book and will say the author did not high brow the book or make the novice reader get lost. If you are a "hedge fund" type of guy, wall street honcho, don't read the book you will not enjoy it. You don't even have to read the book from the beginning you can pick a chapter and just read that. The theme is the same, chapter after chapter, greed is good for the investment banks. We can debate the morality of the bonuses, pay, compensation for weeks at a time but the Wall Street your mom and dad knew are long gone. Ask yourself the question how good is capitalism without any morals or ethics? The public good be dammed, EVERYTHING IS SHORT TIME PROFIT. Wealth was typically created over a life time not in a day or a week. Many people became overnight multi- millionaires. As long as everyone was making money no one asked questions. Fees, fees and MORE FEES need to be generated and the book says there will be new and bigger risks in the future and says that Wall Street can't help themselves to regulate themselves, ie see Bernie Madoff. As Vito Corleone says in the book the "Godfather", one lawyer with an attache case and a pen can do more damage then 100 stickup guys. One banker with a computer....., you fill in the rest.
Showing reviews 1-5 of 10
|
|
|
Copyright © 2009 Market, Limit and Stop Orders
| |
