Book Review: Crash of the Titans

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Farrell, Greg . Crash of the titans : greed, hubris, the fall of Merrill Lynch, and the near-collapse of Bank of America. Crown Business, 2010.

Engrossing and infuriating in equal measure, Crash of the Titans is a story of two troubled companies during the economic crisis, 2007 -2009. On the surface, this book covers the collapse of Merrill Lynch and its sale to Bank of America. But the real story is about the deeply flawed people who ran those companies, who failed to understand the risks they were undertaking and who failed to act in time to save their firms.

Author Greg Farrell, correspondent for the Financial Times, has written a riveting tale of arrogance, posturing and gamesmanship. On Wall Street, preoccupation with bonuses blinded corporate leaders to the financial risks in fixed income departments at Merrill Lynch and other firms. Colossal losses in these departments threatened to bankrupt their companies. After Merrill’s collapse, executives awarded themselves $3 billion in bonuses at the same time as they were laying off thousands of rank and file employees. Failed leadership and epic mismanagement at Merrill Lynch doomed a company that once epitomized the American spirit.

After a hasty decision to acquire Merrill Lynch, Bank of America executives in Charlotte were blindsided by additional losses. At the same time, the bank generated its own losses that the CEO could not explain. Stockholders were outraged about the bonuses paid to Merrill executives. And merging the cultures of the two companies proved difficult. In two years, a strong and profitable bank was forced to rely on federal bailout funds for survival.

Also available as an audiobook.

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

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