Street Fighters by Kate Kelly (Portfolio, 245 pages)
On the Brink: Inside the Race to Stop the Collapse of the Global Financial System by Henry M. (Hank) Paulson, Jr. (Business Plus, 496 pages)
“Bear Sterns, as it turned out, was only the first in a long string of financial firms to suffer mortal harm. …By September 2008, just six months after Bear’s sale to J. P. Morgan, the investment banking industry had effectively ceased to exist.” Kate Kelly
Kate Kelly’s book, subtitled The Last 72 Hours of Bear Sterns, the Toughest Firm on Wall Street, proves once again that less can be more. This is a riveting, fly on the wall, account of the rapid demise of the once-powerful Bear Sterns investment firm. Sterns was Wall Street’s fifth-largest investment bank with a market value of $25 billion dollars – with a “b.” It was virtually given to J. P. Morgan for the fire sale price of $236 million – with an “m.”
Kelly’s book, an expansion of a three-part series of articles that she wrote for The Wall Street Journal, tells us how this all came to pass in less than half a week in March of 2008. These were mad-crazy times, the beginning of this country’s fiscal implosion and she covers it in a manner that brings to mind Robert (Bob) Woodward’s reporting. As with Woodward, Kelly interviewed hundreds of individuals who were present at the meetings and events described here and quoted them without attribution. But in some instances the reader can clearly tell who the source was, as in cases where an underling criticizes a supervisor. However, Kelly’s style is smoother and less choppy than Woodward’s first drafts of history.
Street Fighters has 229 pages of actual content and it appears to be just right. The typical reader will finish the true tale thinking that everything essential was told and little was left out. There’s both a new preface and a prologue to the trade paperback edition for those who don’t choose to supplement the account with Google searches.
That the length appears to be just right is not something that can be said of On the Brink, the loveable Hank Paulson’s 496 page account of the U.S. and the world’s financial meltdown. If the mention of 500 pages doesn’t make the point, consider that it takes 13 full CDs to contain the unabridged audiobook version. Apparently no editors were employed to deliver this effort.
What’s mind-boggling, and often frustrating, about Paulson’s account is that he appears to cover every meeting, every phone call, every thought over a period of weeks and months with dozens of important figures. Yet he tells the reader that he does not maintain briefing papers, nor ask his staff members to do so, and does not keep records (including e-mails) other than phone call and meeting logs. From this, he’s recreated virtually everything that happened from an apparently perfect memory – or could it be that recordings were used? It doesn’t really matter. It’s just that there is so much detail that this reviewer was worn out less than a third of the way through.
There are also some contradictions apparent in Paulson’s telling. He gives us several of his seemingly expert opinions about the financial events of the last two years before reminding us that, “I’m not an economist.” This has the same effect as someone writing about brain surgery and then stating, “I am not a physician.” He also tells us that he’s not a sentimental person, but he writes of the often-criticized Tim Geithner like a father writing about his favorite son. One half expects to read that Geithner solved the financial crisis by walking on water.
For those looking for an explanation as to why the U.S. government saved or bailed out some companies but not others, the explanation is not here. Why did the government ensure that Morgan purchased Bear while permitting Lehman Brothers to fail? All that can be said is that Paulson provides a few non-explanatory explanations. In the end they just do not add up.
And lastly, as Bob Seger might have warned, what to leave out is just as important as what to leave in. Kate Kelly in her nonfiction account nailed it. Paulson was not even close.
Take Away: Street Fighters is highly recommended.
A copy of Street Fighters was purchased by the reviewer. A copy of On the Brink was provided by the publisher.