Review of 'Other People's Money' by Nomi Prins, New Press £14.99
The word amateur is an understatement when referring to my knowledge of worldwide financial issues. Nouns like 'stocks and shares' terrified me, and for most of my life I've thought that economics was a food technology course studied at school.
So you can appreciate the fear I endured when beginning Other People's Money - a book exposing the goings on in Wall Street. What would I know? Well, I now know and understand a damn lot more than I did a week ago and it's something I'll never forget or stop learning about.
Nomi Prins' book surpassed all my expectations both in the style it is written in and the information that she provides.
For 15 years Prins worked as an investment banker in some of the most powerful banks in the world like Goldman Sachs, Bear Stearns and Lehman Brothers, but by the end of it she was left feeling thoroughly disillusioned with her profession and began attending anti-capitalist rallies around the world. Her book tells, with immaculate detail and precision, the engrossing and horrifying tale of the corruption involved in a number of high flying corporations. Her revelations are primarily focused on the opulent 1990s which disastrously led to economic slump.
In a passionate, succinct and witty style, Prins lays out the complex issues involved - explaining the motivations of the ego-driven executives, telling how the consolidations of companies within the energy, telecom and banking markets, together with drastic deregulation laws and corporate leaders living in a cocoon of craven denial, ultimately led to the 'stock bubble'.
The boasted prosperity in the US economy turned out to be just a dream. With figures based on bogus valuations, the country was buggered left, right and centre. It turns out that the phrase 'efficient accounting' actually meant 'systemic accounting fraud'.
But it wasn't the chief executive officers who had previously awarded themselves a 288 percent salary rise who suffered the fall. And it certainly wasn't the group of 85 percent white male partners who had in earlier days treated themselves to a $250,000 bonus each for their efforts to promote diversity.
Of course, these people were barely aware of the effects. They cut and ran, and cashed out small fortunes in stock options before deliberately driving their companies bankrupt.
Meanwhile, over 2 million employees lost their jobs, workers' pensions vanished and in many cases lives were shattered.
The insider information Prins is able to provide us with is priceless. I was hooked on the book; when I wasn't reading it, I was rambling to my peers about the latest scandals I'd learned of. My newly found scepticism of the financial world has only helped me better understand how capitalism only leads to a pitiful world of deception, consumption and greed.
With an often humorous tone, Prins makes it impossible not to chuckle throughout the book (during the breaks between disbelieving gasps). The problem is, the final joke only ever seems to be on us.