Too Big to Fail

Sorkin covers the 2008 crisis from the rescue of Bear Stearns to the creation of the Troubled Asset Relief Program, with the September weeks of Lehman's bankruptcy and the AIG rescue at its heart. Sorkin, the New York Times' chief mergers reporter and founder of its DealBook service, says he conducted more than 200 interviews totaling over 500 hours, and he used calendars, emails and notes to reconstruct meetings and phone calls as dialogue. The cast is huge, and the book reads like a thriller.

It won the 2010 Gerald Loeb Award for best business book and was adapted as an HBO film in 2011. James B. Stewart praised the reporting in the New York Times, and the Economist called it meticulously researched.

The main criticism is the cost of access. A review in Chief Investment Officer suggested that executives such as Jamie Dimon and Lloyd Blankfein come off well partly because they talked, that the reconstructed dialogue invites more trust than it can bear, and that the rush to publish left spelling and factual slips. Michael Taylor of Bankers Anonymous argued that the book tells the story of good guys rescuing the system without explaining the forces that built the crisis.

Pair it with The Big Short for the causes and Paulson's On the Brink for his own account.

1. Confidence is a balance-sheet item. Lehman, Morgan Stanley and Goldman were undone or threatened by lost trust and fleeing short-term funding faster than by losses.
2. Bailouts set expectations. The Bear Stearns rescue led markets to expect another, which made the decision to let Lehman fail more damaging.
3. Interconnection drives policy. AIG was saved because of its derivatives exposure to the rest of the system, not because of its own merits.
4. Regulators across borders matter. Barclays' deal for Lehman fell through when British approval could not be secured in time, a reminder that cross-border deals need more than a buyer.
5. Read access journalism critically. The detail comes from participants with reasons to tell their side, so compare it with other accounts.

The book moves chronologically and speeds up as the crisis peaks, with the September weeks taking up most of its length.

1. Warning signs. Sorkin sets out the players and the March 2008 sale of Bear Stearns to JPMorgan with Federal Reserve support, which convinced many that the government would always step in.
2. Lehman's summer. Dick Fuld hunts for capital and partners while short sellers and the market lose confidence, and Fannie Mae and Freddie Mac are placed into conservatorship in early September.
3. The Lehman weekend. At the New York Fed, Paulson, Geithner and the bank chiefs try to arrange a private rescue; Barclays' bid collapses when British regulators will not approve it in time, Bank of America buys Merrill Lynch, and Lehman files for bankruptcy on September 15.
4. Contagion. The government takes control of AIG, a money market fund breaks the buck, and Morgan Stanley and Goldman Sachs come under attack, ending with both converting to bank holding companies and raising capital from Mitsubishi UFJ and Warren Buffett.
5. The bailout. Paulson and Bernanke go to Congress for TARP, the first vote fails, and the book ends with the decision to inject government capital directly into the largest banks, followed in later editions by an afterword.

Brand New for 2018: an updated edition featuring a new afterword to mark the 10th anniversary of the financial crisis The brilliantly reported New York Times bestseller that goes behind the scenes of the financial crisis on Wall Street and in Washington to give the definitive account of the crisis, the basis for the HBO film Too Big To Fail is too good to put down. . . . It is the story of the actors in the most extraordinary financial spectacle in 80 years, and it is told brilliantly.” —The Economist In one of the most gripping financial narratives in decades, Andrew Ross Sorkin—a New York Times columnist and one of the country's most respected financial reporters—delivers the first definitive blow-by-blow account of the epochal economic crisis that brought the world to the brink. Through unprecedented access to the players involved, he re-creates all the drama and turmoil of these turbulent days, revealing never-before-disclosed details and recounting how, motivated as often by ego and greed as by fear and self-preservation, the most powerful men and women in finance and politics decided the fate of the world's economy.