Book Review: Fool’s Gold

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Tett, Gillian. Food’s Gold: How the bold dream of a small tribe at J.P.Morgan was corrupted by Wall Street greed and unleashed a catastrophe. Free Press, 2009.

In 2003, Warren Buffet described derivatives as “financial weapons of mass destruction.” He was later proved to be a prophet. Yet a decade earlier, when credit derivatives were first conceived, they appeared to be a win-win for the financial world, freeing up capital, diversifying risk and increasing profits.

This is the story of a small group of young employees at J.P.Morgan investment bank, who discovered the latent power of derivatives, products which initially seemed so promising, but later evolving into cyber-world instruments that even the financiers struggled to understand.

Fool’s Gold is a lively narrative that reports behind the scenes about the workings of an elite company and its bankers. The story also describes the complicated financial instruments and shows how they combined with greed and stupidity to create a global financial disaster.

© Reviewer: Meg Trauner & Ford Library – Fuqua School of Business.
All rights reserved.

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