by Andrew Ross Sorkin (10/09)
From a review on Amazon.com:
The first true behind-the-scenes, moment-by-moment account of how the greatest financial crisis since the Great Depression developed into a global tsunami. Too Big to Fail is the definitive story of the most powerful men and women in finance and politics grappling with success and failure, ego and greed, and, ultimately, the fate of the world’s economy.
Andrew Ross Sorkin is the award-winning chief mergers and acquisitions reporter for The New York Times, a columnist, and assistant editor of business and finance news.
Here is an excerpt from an excerpt in the November Vanity Fair:
Wall Street’s Near-Death Experience (the full excerpt)
Day OneWednesday, September 17, 2008: After Lehman and A.I.G.
When Tim Geithner, president of the Federal Reserve Bank of New York, began his run that morning along the southern tip of Manhattan and up the East River just after six, the sun had yet to come up. He was tired and stressed, having slept only several hours in one of the three tiny, grubby bedrooms in the New York Fed’s headquarters.
As he stared at the Statue of Liberty and the first of the morning’s commuter ferries from Staten Island gliding across the harbor, he tried desperately to clear his mind. For five days his brain had been trapped in a maze of numbers—huge, inconceivable, abstract numbers, ranging in the span of 24 hours from zero for Lehman to $85 billion for A.I.G. Eighty-five billion dollars was more than the annual budgets of Singapore and Taiwan combined; who could even begin to understand a figure of that size? Geithner hoped that the sum would be sufficient to rescue the insurance giant from bankruptcy—and that the financial crisis would finally be over.
Those ferries, freighted with office workers, gave him pause. This is what it was all about, he thought, the people who rise at dawn to go to their jobs, all of whom rely to some extent on the financial industry to help power the economy. Never mind the staggering numbers. Never mind the ruthless complexity of structured finance and derivatives, or the million-dollar bonuses of those who had made bad bets. This is what saving the financial industry is really about: protecting ordinary people with ordinary jobs.
But as he passed the South Street Seaport and then went under the Brooklyn Bridge, he inadvertently began thinking about what fresh hell the day would bring.
Due to disastrous bets on Lehman paper, the giant Reserve Primary Fund had broken the buck a day earlier, causing an investor run on the money-market funds. Between that, Geithner thought, and billions of dollars of investors’ money locked up inside the now bankrupt Lehman Brothers, that meant only one thing: the two remaining broker-dealers—Morgan Stanley and Goldman Sachs—could actually be next.
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