A prominent genre in the history of financial crises, especially banking crises, consists of monographs written by financial journalists. Utilizing the backing afforded by their ties to large, international media conglomerates, financial journalists arguably have some of the best access to contemporary financial actors and events in real-time and, by extension, the largest audiences. Recent work on the 2007-8 international financial crisis includes Peter Goodman’s Past Due (2009), Andrew Ross Sorkin’s Too Big to Fail (2010), Gretchen Morgenson and Joshua Rosner’s Reckless Endangerment (2011), Michael Lewis’s The Big Short (2011), and Charles Ferguson’s Inside Job (2012) and Predator Nation (2013). Earlier examples of this genre include Connie Bruck’s The Predator’s Ball (1989), a history of the failure of Drexel, Burnham Lambert; Stephen Pizzo, Mary Fricker, and Paul Muolo’s Inside Job (1989), a story of the Savings and Loan Crisis of the 1980s; and Roger Lowenstein’s When Genius Failed (2001), a chronicle of the failure of Long Term Capital Management, from which the title of this paper is derived.
One of the most significant aspects of this literature is its microeconomic view of people and firms at the center of financial crises and scandals in contrast, for example, to macroeconomic studies of financial crises, such as Carmen Reinhart and Hugh Rogoff’s This Time is Different (2011). Financial journalists and economists alike, however, acknowledge the significance of storytelling, such as detailed in Robert Shiller’s Narrative Economics (2019).
Thinking of the genre of financial true crime as a body of literature and a kind of storytelling, the paper studies how it offers a social metric of the flow of capital and the institutions of global finance, in contrast to economic metrics of interest rates and the like.
Susie J. Pak is an Associate Professor in the Department of History at St. John’s University (New York). A graduate of Dartmouth College and Cornell University, she is the author of Gentlemen Bankers: The World of J.P. Morgan (Harvard University Press, 2013). Pak has served as a Trustee of the Business History Conference, and she serves as co-chair of the Columbia University Economic History Seminar and as co-editor of the Global Enterprise series of Cambridge University Press. She is a member of the Editorial Advisory Boards of Business History Review, Financial History, and Connections, the journal of the International Network of Social Network Analysis.
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