Money, Greed, and Risk : Why Financial Crises and Crashes Happen

The world seems awash in financial crises. The Asian crisis of 1998, the near-demise of Long Term Capital Management, and the black hole of Russia are just a few of the most recent. Are they the result of greedy speculators, crony capitalism, or the warp speed of the forces of globalization? Can we send in the repairman and get things fixed through the legal and regulatory systems?

Or are other causes at work that may be beyond our control?

Money, Greed, and Risk is that rare book which, through adroit analysis of both historical and contemporary events and their leading players, lends new insights into the causes of financial turmoil.  Charles Morris:

  Explores the eternal cycle of financial crises: from brilliant innovation to gross excess and inevitable crash, before investors and institutions catch up.

  Explains why the American financial system grew from a capital-starved backwater in the nineteenth century to one that plays the leading role in the world today.

  Examines the technological, economic, demographic, and industrial experiences that caused the financial engine to kick into such high gear in the 1980s and 1990s.

  Shows how the boom-and-bust cycle in early American history helps illuminate recent events in South Asia and Russia. In the process we become more realistic about what to expect during the nascent stages of capitalism and market development everywhere.

  Explains that globalization is nothing new. The investment system in the nineteenth century was perhaps even more global than the world today.

  Looks at contemporary financial geniuses--Michael Milken is a good example--and shows that they didn't invent any financial instruments that nineteenth-century counterparts like Jay Gould hadn't already thought of.

There are a handful of books about finance and the financial markets that are substantive enough to provide intellectual grist for sophisticated investors while also providing intriguing explanations of contemporary events that will be of interest to a general audience. Money, Greed, and Risk is one of them.

Finance is the plumbing that makes capitalism run. And, like a good plumbing system, finance is invisible when working well. But just as a broken pipe can be a disaster, so too when the financial system breaks and crises and crashes occur. We look to understand the causes and Charles Morris provides unusual insights that bring our understanding to a new level.

Charles R. Morris has many highly praised books to his credit, ranging from Computer Wars (on the fall of IBM) to American Catholic (on the rise of the American Catholic Church). He has published his opinion pieces in The New York Times, The Wall Street Journal, The Atlantic Monthly, The New Republic, and the Harvard Business Review. He was for many years managing partner of a consulting firm specializing in the financial-services and investment-banking industries, and was also a group executive at Chase Manhattan bank.