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The Trillion Dollar Meltdown: Easy Money, High Rollers, and the Great Credit Crash |  | Author: Charles R. Morris
Publisher: PublicAffairs
Category: Book
List Price: $22.95
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Rating:  120 reviews
Sales Rank: 159550
Format: Bargain Price
Media: Hardcover
Edition: First Edition
Pages: 224
Number Of Items: 1
Shipping Weight (lbs): 0.8
Dimensions (in): 8.3 x 5.6 x 0.9
Dewey Decimal Number: 332.04150973
ASIN: B0023RT02W
Publication Date: March 3, 2008
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Product Description
The sub-prime mortgage crisis is only the beginning: A more profound economic and political restructuring is on its way. We are living in the most reckless financial environment in recent history. Arcane credit derivative bets are now well into the tens of trillions. According to Charles R. Morris, the astronomical leverage at investment banks and their hedge fund and private equity clients virtually guarantees massive disruption in global markets. The crash, when it comes, will have no firebreaks. A quarter century of free-market zealotry that extolled asset stripping, abusive lending, and hedge fund secrecy will come crashing down with it. The Trillion Dollar Meltdown explains how we got here, and what is about to happen. After the crash our priorities will be quite different. But things are likely to get worse before they better. Whether you are an active investor, a homeowner, or a contributor to your 401(k) plan, The Trillion Dollar Meltdown will be indispensable to understanding the gross excess that has put the world economy on the brink--and what the new landscape will look like.
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Showing reviews 1-5 of 120
 Hints from Morris April 18, 2010
Raymond Blohm (Oregon)
First, apologies if I'm duplicating someone's review. I gave up after reading some thirty reviews...
Morris has written a great book. It tells a sweeping 'history' rather than some narrow focus. Highly recommended.
Since other reviewers have so aptly summarized his work, I'm going to concentrate on a 'niche' (though important) issue.
Morris writes, p.146:
"Consider: Financial markets built an investment paradigm that applied high leverage to long-term illiquid instruments. Then compounded the danger by funding those instruments in the short-term debt markets. Then doubled the bet again by building the base portfolios from unusually risky securities, like subprime mortgages and leveraged loans. Then, finally, embraced a class of credit derivatives that ensured the swift propagation of any local collapse through the whole system. If a band of brainy terrorists had been hired to destroy Western finance, they could hardly have designed a more efficient assault."
In addition, the cover of the paperback gives another hint: The crumpled-up dollar bill is curiously straight in one section. Quite accidentally, I'm sure, the straight part just at the center forms a perfect (inverted) Illuminati pyramid with an Eye. Coincidence, I'm sure...
In my opinion, Morris knows more than he lets on, but cannot for some reason put it out.
For a 'rounded' look at our crisis, I encourage the reader to read this book just after reading G. Edward Griffin's "The Creature from Jekyll Island" (or many others) and forming a larger picture of current events.
(For those of a conspiracy bent, I believe that the oil/gas price shock was the carefully-timed 'charge' which initiated the start of the implosion. At that point in the bubble, the financial markets were running mainly on a blind, optimistic view of the future. The oil/gas price shock sent a pessimistic view of the future through the markets, and people started retrenching. That got the ball rolling. It was just a coincidence, of course, that what was carefully-labeled 'futures speculation' set up the oil/gas price shock by 'cornering' abundant oil/gas supplies. Think about it...)
Well Written March 6, 2010
Carol Laughlin
Well written, but somewhat dismissive of major economic movements-kind of a "what goes around comes around" attitude.
Very Best Introduction to Our Financial Situation February 20, 2010
Thomas J. Kapostasy (Carmel, IN United States)
First published in February, 2008, this short and well-written book walks the reader through the history and terminology of the finance industry, focusing on what you need to know, describing what went wrong and advocating changes to correct the situation and reduce the risks and severity of future disasters.
The author is direct and opinionated in his analysis, conclusions and recommendations. Some of his conclusions do rub the ideologues of the "free market" the wrong way, but he is no radical seeking to undercut the benefits of capitalism. Like a growing number of industry, academic and political critics, he clearly sees that the economy is subject to business cycles, innovation leads to testing of limits, greed leads to further excess, regulators often lag behind the regulated, and that the political and regulatory worlds are subject to capture by the regulated. He describes how high leverage and misunderstanding of risk is a ubiquitous feature of financial markets, even by the professionals. The incentives to make more money can blind even the "best and the brightest".
This is a quick and enjoyable read for the story it tells and the support it provides for modest financial industry regulation changes to improve transparency, improve the role of counterparties, increase independence and banish the myth of the self-regulating free market, at least with respect to the finance industry.
 Leaves out half the story January 16, 2010
Reader (California)
1 out of 6 found this review helpful
I can't share the enthusiasm of the other readers. Though Morris' writing style is lucid, he packs the book with sufficient technical-financial jargon and concepts to make this a bit of a difficult read. His main contribution is to paint Wall Street people and institutions as overly eager to invent new, highly leveraged investment strategies which allowed them to reap large, up-front profits and to pass on the risk to somebody else.
But the Wall Street earthquake is only the secondary reason for the global financial debacle. The primary reason was federal housing policy, exposed as risky ideology years ago by many critics including Harvard professor and Manhattan Institute scholar Howard Husock ("America's Trillion-Dollar Housing Mistake," 2003). The leveraged mortgage instruments and the institutions behind them became worthless because an inconceivable number of mortgages were predestined to go bad. The subprime home buyers couldn't continue to pay because they were underqualified to get the loans -- often at 100% financing -- in the first place. A decades-long series of flawed federal policies and activism by leftist community organizers such as corrupt ACORN essentially coerced banks into lending to shaky borrowers, who not infrequently provided inadequate or outright fraudulent financial statements.
Husock saw it all coming before the year 2000, when he wrote in "City Journal," the Manhattan Institute's online journal: "The Clinton administration has turned the Community Reinvestment Act...into one of the most powerful mandates shaping American cities--and...a vast extortion scheme against the nation's banks." Read Husock's article at city-journal dot org if you wish to really get to the bottom of the disaster and learn who the perpetrators are.
Morris mentions this fundamental aspect only briefly, with very little detail and more than a hint of contempt. If he has his head in the sand regarding the essence of the crisis, what should I think of his book?
Welcome to deregulated corporate America! The dream or the nightmare? December 15, 2009
Kivanc Cubukcu (NY, USA)
Terrific work going back and explaining the subprime mortgage crisis. Though I will warn you, this isn't one of those for the Average Joe. You already need to have a base knowledge about the mortgage industry, the driving factors behind the crisis to get a good feel for this book. The Author goes back to the 1970's to understand the mortgage crisis that happened in 2007-2008. He makes references to the fact that between the recent write downs and defaults of residential mortgages, corporate debt, credit card debt, and bonds the total debt will be about $1 trillion however given the fact that this book was written before the Lehman and Bear fiascos the grand total should be well above those figures!! Also he doesn't give us an idea as to how this is going to end but concludes it by saying some kind of regulation will be in place. However the book deserves no less than 4 stars for the way it was written. Very well and professionally done.
Showing reviews 1-5 of 120
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