13 Bankers is a book that charts the rise to immense power of the financial sector and forcefully argues that we must break up the big banks if we want to avoid future financial catastrophes. The authors, Simon Johnson and James Kwak, contend that the world was too nice to Wall Street for quite a long time and that the time has come to separate big banks.
They argue that Wall Street has gotten what it wants for too long and that the time has come to break up big banks.
The book examines the reasons that, even during the appearance of the new world order after the enormous 2007-2009 financial crash, Wall Street looks remarkably the same. Money and power are concentrated in fewer hands, but the Street’s fundamental philosophy, favoring light regulation and markets dominated by a few huge banks, survives.
The authors cover oft-trod turf, but their novel premise that the government must break up the big banks counters conventional wisdom.
The book presents a compelling narrative that examines the reasons why Wall Street continues to operate in the same way despite the financial crisis. It argues that capitalism stopped being upsetting in the 1990s, which enormously helped Wall Street’s campaigning. The book concludes that for all the talk of a new world order after the devastating 2007-2009 financial collapse, Wall Street looks remarkably the same.
Useful takeaways from the book include:
- The economic crisis allowed President Barack Obama to break up Wall Street’s big banks. Instead, he chose to protect them from failure.
- This shows just how deeply Wall Street’s beliefs in lax bank rules and quick fiscal innovation are ingrained in U.S. culture.
- The only way to truly prevent another financial crisis is for Congress and the White House to reduce the size of the nation’s largest financial institutions such as JP Morgan and Bank of America.
Overall, 13 Bankers is an eye-opening account of the troubled political economy that provides insight into the history of Wall Street and how it functions. It is recommended to all readers who would like to gain insight into the financial crisis and its aftermath.
What I Liked
I love how the book gets into the gritty details of the financial crisis. I was a lumber salesman in 2007, saw the crisis up close, and ended up laid off because of it. This book is one of many that shows just how badly people at the top behaved.
What I Did Not Like
Not a whole lot – good read on the GFC.