| One of the biggest questions of the financial crisis has not been answered until now. What happened at Lehman Brothers and why was it allowed to fail, with aftershocks that rocked the global economy? In this news-making, often astonishing book, a former Lehman Brothers Vice President gives us the straight answers—right from the belly of the beast.
In A Colossal Failure of Common Sense, Larry McDonald, a Wall Street insider, reveals the culture and unspoken rules of the game like no book has ever done. The book is couched in the very human story of Larry McDonald’s Horatio Alger-like rise from a Massachusetts “gateway to nowhere” housing project to the New York headquarters of Lehman Brothers, home of one of the world’s toughest trading floors.
We get a close-up view of the participants in the Lehman collapse, especially those who saw it coming with a helpless, angry certainty. We meet the Brahmins at the top, whose reckless, pedal-to-the-floor addiction to growth finally demolished the nation’s oldest investment bank. The Wall Street we encounter here is a ruthless place, where brilliance, arrogance, ambition, greed, capacity for relentless toil, and other human traits combine in a potent mix that sometimes fuels prosperity but occasionally destroys it.
The full significance of the dissolution of Lehman Brothers remains to be measured. But this much is certain: it was a devastating blow to America’s—and the world’s—financial system. And it need not have happened. This is the story of why it did.
Annotation:
Of all the astonishing and unfathomable collapses which have wracked the economic landscape in the first decade of the 21st century, perhaps none has been so baffling as that of Lehman Brothers, a 150-year-old financial institution which seemingly evaporated overnight and left an expanding circle of devastation in its wake. Lawrence G. McDonald, a former vice president of the company, attempts to explain the logistics of the disintegration, eventually tracing the trail of mistakes to a single ill-conceived home loan near San Francisco. McDonald is scathing in his criticism of the former leaders of the firm, whom he claims could have applied a tourniquet to the damage at any time, but instead chose to continue recklessly pursuing their flawed strategies of endless expansion at all costs. With an assist from Patrick Robinson, co-author of the riveting LONE SURVIVOR, McDonald crafts a terrifying portrait of how the greed and arrogant ambition of a privileged few has permanently damaged the chances of prosperity for millions of people around the world.
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Praise| "Reading...A COLOSSAL FAILURE OF COMMON SENSE, one might be tempted to think that Lehman's bankruptcy, whatever its supposed effects on the wider world, was too mild a punishment for the firm's management. The book is, in part, a brief against Lehman's former chief executive, Richard Fuld, who appears by turns arrogant, stupid, greedy, reckless and clueless. - James Freeman 08/11/2009 |
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