Fool’s Gold by Gillian Tett – From award-winning Financial Times journalist Gillian Tett, who enraged Wall Street leaders with her news-breaking warnings of a. At some point during Gillian Tett’s absorbing year gallop across the The sub -title of Fool’s Gold panders to this, suggesting “unrestrained. Gillian Tett, who oversees global market coverage for The Financial Times, offers some of each. In “Fool’s Gold,” she describes how a small.

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Sign up and get a free eBook! But, as Tett shows, the intentions behind that famous CDS deal had the fundamentals of banking at heart, namely how to release more capital to build the things we need to prosper as a civilisation. Second, they had no long-term data on default rates for the kinds gilliian subprime mortgages that proliferated in the early and mid s.

Trivia About Fool’s Gold. In she was awarded the Wincott prize, the premier British award for financial journalism, and in was named British Business Journalist of the Year. Despite covering a lot of esoteric and abstract material, it flows gllian well and reads very quickly. They themselves never used then in conjunction with subprime mortgages, and they were apparently dumbfounded that anyone would do so. Given a chance gillkan tell a story in depth and paint idiosyncratic portraits of eccentric bankers at work and at play, Ms.

He soon took over as JP Morgan Chase. We learn bit by bit how this financial instrument was created and the players involved, all the tet up to how said financial instrument was twisted and turned and eventually morphed into a cross between a runaway train and an enormous Frankenstein monster.

That idea would rip around the banking world, catapult Morgan to the top of the turbocharged derivatives trade, and fuel an extraordinary banking boom that seemed to have unleashed tett from ages-old constraints gilliah risk. There is no rule against having diagrams in your book and Tett really should have included some. It reads like a piece of journalism; author Gillian Tett is a Financial Times columnist.

Her gullian training as a Social Anthropologist may well be a blessing though unusual for a financial journalistbut her grasp of history is just as important. I have read multiple books on this time period, including Paulson’s autobiography. Morgan believed they were developing financial products that would reduce risk and help stabilise the global economy.

I am lucky if I can manage to keep my checking account balance. Tett does a good job of indicating how much leverage and risk was involved and how, inevitably, chasing phenomenal profits blinded everyone involved to the potential risks and the worst case scenario–the one that would never happen came along and torched the house. Dimon, who bought gilliqn rival Bear Stearns for a knockdown price in in a deal described as being like “the Boy Scouts taking over the Mob”, hosted a cocktail party for key contacts in the Piano Bar at the Swiss resort of Davos.


Return to Book Page. Jul 24, Tara Brabazon rated it really vool it. The lenders lost their conscious while lending as they no longer held the debt on their balance sheets and carried the risk. This is a fascinating and detailed look at the crisis, seen through the prism of the venerable gkld bank JP Morgan, where many of the complex derivatives that helped bring the system down originated.

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Tett’s access to Dimon and the J. And the perspective from outside of America was really good to hear too.

They appear unable or unwilling to removing or ringfencing the environment within which this greedy group of bankers mader obscene profits to the considerable and long term detriment of most others.

And, honestly, this book is among the best books that depict and explain the crises of the last decade in a unique way. The result was that JPMorgan Chase lost out on the enormous short-term profits from these vehicles, but were saved in the long-term by their prudence.

I also continue to believe Iceland did the right thing in letting their banks fail rather than bail them out as we did, effectively While I admit I am a bit behind on my current event reading this book was published inthe effect of the mortgage meltdown is still with us and we are being set up again for another, similar situation.

The “social silence” around the explosion of derivatives, and around the wealth and influence of the banking cadre, helped to construct and reinforce a new power structure and encouraged financiers to regard their activities as detached from the rest of society, until they became “like the inhabitants of Plato’s cave, who could see the shadows of outside reality flickering on the walls, but rarely encountered that reality themselves”.

What is clear though, is that, as the subtitle indicates, the financial market was corrupted by greed essentially underlining for those who needed to hear it that nothing human-made and run can be left to itself and assumed to be safe and able to self-r I think Tett probably explained the financial creations involved in this account of the Banking mess that led to the “Great Recession” as efficiently and effectively as one can for general readers and I’m still pretty foggy on what it all means.

Preview — Fool’s Gold by Gillian Tett. Morgan made payments to AIG, which assumed the risk I’ve done a fair amount of reading about the Panic ofand Gillian Tett’s “Fools Gold” explains the exotic investment instruments at the heart of the panic better than any other work I’ve read. Pages with related products. Fool’s Gold tells the story of how a small group of investment bankers cooked up the investment scheme that ultimately led to the crash of You don’t have to have equations, but you have to explain the basics a little better.


Must read yo truly understand gil,ian credit crisis Excellent account and easy to understand the complex situation during the credit bubble.

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Locked in their little silos, few [bankers: I’ve done a fair amount of reading about the Panic ofand Gillian Tett’s “Fools Gold” explains the exotic investment instruments at the heart of the panic better than any other work I’ve read. No trivia or quizzes yet. Why keep so much capital tied up when you can pay a third-party EBRD an annual fee to assume full liability in the event of default? Tett, anthropologist and editor of the Financial Times, explains how a small team at J.

This book starts very slow, going way back 20 years into the history of JP Morgan Chase bank. The book contains a brief account of the events leading to the Lehman Brothers bankruptcy that turned a situation into a panic, and concludes with Tett’s cultural analysis of U. From award-winning “Financial Times” journalist Gillian Tett, who enraged Wall Street leaders with her newsbreaking warnings of a crisis more than a year ahead of the curve, “Fool’s Gold” tells the astonishing unknown story at the heart of the meltdown.

I’m reminded of Thoreau, who said that superfluous money can only be superfluities, and given that you don’t need superfluities, there’s no limit to how much you want because the need can’t ever be satisfied Not so at other investment banks, as the reader eventually discovers Visit our Help Pages. See full terms and conditions and this month’s choices. The JP Morgan team, whose evangelism for financial innovation went so horribly wrong, are portrayed as stunned and chastened; Blythe Masters is “livid at how bankers have perverted her derivatives dream”.

Downgrades by the rating agencies forced many banks to write down their derivative assets, leading to billions in losses. Oh dear, oh dear, what a mess!

This helped the banks to be opaque about how the derivatives were modelled and priced as opacity leads to hefty profits. Fascinating, she also probed the consequences of disconnecting finance capitalism – money exchange – from the people it is meant to serve.

Morgan created commoditized credit default swaps in the early s as a way to move risk off the company’s books, freeing up capital for lending and investment that otherwise would need to be held in reserve.