I read this book not long after "Too Big to Fail." It has the benefit of being a first-hand account by the senior government official in the midst of the 2008 financial crisis: we learn much more in this book of the background thinking and concerns of top Treasury and Fed officials who were trying to cope with the onset of financial panic and meltdown. Put another way, the book offers much clearer context and explanation of the policy thinking than did the Sorkin book. The book keys on personal conversations and meetings, which keeps it interesting. There are revealing sketches of Mr. Paulson's interactions with Congressional leaders and the President, which show how completely unprepared they all were for the scope and severity of the financial crash. The weakest part of the book is the Afterword in which Mr. Paulson lays out the policy reforms that are needed in order to avoid a like financial disaster in the future. Although a vitally important and urgent reform (and one Congress and the Administration to their shame have still not addressed 18 months after the 2008 meltdown), this part of the book reads like a bland press release from the Treasury Department.
This book is well worth reading for a better understanding of the 2008 financial collapse. It is focused on the response to the financial meltdown at the highest levels of government and industry. It does not, however, provide particular insights into the irresponsible business practices that led to the crisis in the first place.
This is an excellent, thoughtful and insightful account for anyone with an interest in how the US government works at the highest levels. Don Rumsfeld???s government service in influential positions began during the Presidency of Lyndon Johnson and continued through his service as Defense Secretary to George W. Bush. What emerges is a picture of high-level policymaking based on incomplete information, evolving facts, good-faith differences among Cabinet officials, and subject to pressures from damaging news leaks, often-inaccurate news reports and partisan opponents, as well as the changing mood of public opinion. Throughout his account Mr. Rumsfeld offers his personal critiques of colleagues he differed with on particular issues and of policy choices that were made. He does not exclude himself from such criticism. However, the book never descends into personal attacks or attempts to ???trash??? his former colleagues. Rather, the critiques appear more in the nature of explaining why he felt things could have been done better or why a colleague???s statements or actions were ???unhelpful,??? as he often liked to say.
There are opinions he shares in this account with which many will disagree. His defense of the decision to go to war against Iraq is one such example. He points out, however, that the critics of the war have to answer whether we would be better off with the alternative: a Saddam Hussein regime still in power and having reactivated its WMD programs in clear defiance of UN resolutions. I personally was not persuaded by his criticism of Jerry Bremer???s early decision when on the ground as the Coalition administrator in Iraq to slow down the pace of the handover of government to the Iraqis.
I think Bremer may well have been right to be concerned that handing over power too early to an Iraqi group not equipped to govern might have resulted in something like the ???Weimar Republic??? that led to disaster for Germany in the 1930's
I have read a number of books on the 2008 Financial Crisis, and yet learned a lot from Mr. Geithner’s book. He emphasizes two key points that are critical for understanding why things became so serious:
1. The financial institutions that fueled the “subprime” crisis were highly leveraged. I already knew that, but had not appreciated the point that they were leveraged by means of extremely short-term debt—“overnight” repos in many cases. Thus, once confidence left the financial markets, these institutions were literally hours away from running out of money to pay their debts as they came due. Also important here is the fact that the most important players in the subprime market frenzy were “Wall Street” institutions outside the traditional banking system and thus outside the extensive examination and reporting requirements imposed on the traditional banks.
2. The financial markets were gripped by "Panic" once the players woke up and actually appreciated the fact that the subprime loans were not supported by any realistic credit review, but merely by the expectation that US real estate values would continue to rise and allow the loans to be refinanced. Once panic set in, investors wanted out period. They were not ready to analyze distinctions in credit quality, they simply wanted to avoid losses. That set in motion a vicious self-fulfilling cycle in which all tranches of CDO portfolios fell in value, buyers disappeared, and forced sales of securities through margin calls or funding obligations led to sales at “fire sale” prices and serious capital losses.
Mr. Geithner also addresses a point that most people (myself included) found very troubling in the government’s response to the financial crisis: the government’s approach of throwing lots of money and government guarantees at institutions who were clearly guilty of highly irresponsible management practices. In other words, these were institutions that deserved a punch in the jaw rather than taxpayer cash in their wallets. Geithner points out quite persuasively that although such sentiments are fully justified they are not useful responses to a financial crisis that endangers the whole economic system. “When the neighborhood is on fire, the focus should be getting the fire contained and out, rather than chasing down the arsonists who started the fire,” or words to that effect, is how he frames the issue.
I will add one point of serious criticism I have about the book. Mr. Geithner touches only very briefly and superficially on his role as head of the New York Fed in failing to
supervise properly the lending practices of Citibank and Citigroup in the run-up to the 2008 financial crisis. Citi was the only traditional banking institution (though it combined a large securities trading operation after the merger with Smith Barney) that had such large subprime loan exposures on its books that it has to be classified as one of the principal culprits in the irresponsible subprime lending frenzy. How did the NY Fed miss its exposures and why? There are no doubt important “lessons learned” from those questions that Mr. Geithner might have explored in depth but did not.
50yrs old / audible member for 5 yrs library. 75% nonfiction, 15% classics and 10% fiction. History/Science/biography/Eng.18th cent fiction
This is the most popular book of the multi book johnson bio. Unfortunately many of the other books have yet to come to audible which is kind of unbelievable to me !! I cant rate this book highly enough. Its content is so incendiary and insightful, and the outstanding quality of the writing will spoil you. You will surly want to check out Caro's other masterpiece after this called THE POWER BROKER . These 2 books are truly must reads .
There is one thing that is very wrong with this book and it bothers me greatly. it's that your paying 3 credits in the end for 1 book. This dividing books into volumes is a sneaky and unfortunately encroaching method of drawing out more of your credits than you may be fully aware of. This book isn't THAT long to fairly divide it up into ``volumes`` nor are many of the other books this has been increasingly done to.
So lets call a spade a spade, Its a three credit book o.k.` I see Mcculloughs latest unabridged offerings are offered as 3 credit books with no shell game. those of us that spend freakishly long hours on this site have noticed this recent move to increase the credits for books in the above manners and more. email them and tell them this 3 credit crap is to much!! Thats at least $30 for 1 book! When it comes to that, its worth getting them from the library for free. I love this site, I have over 900 titles, The reason I keep spending all this money is because it has been good value. Theres no longer any point in continuing when so many of the titles double or triple in price.If their testing the waters to see what they can get away with,,the result will be the permanent loss of their most ardent subscribers.