Extreme Money : The Masters of the Universe and the Cult of Risk

This witty and accessible introduction to the world of extreme money tells the stories of the well-known - and not so well-known - financiers and traders whose market exuberance and audacious financial risk-taking have resulted in extraordinary returns for themselves and their backers. Cover......Page 1 Praise for Extreme Money......Page 2 Extreme Money......Page 6 Contents......Page 12 Figures and tables......Page 20 Sub-prime dialects......Page 24 Best in show......Page 26 The Physical Impossibility of Death in theMind of Someone Living......Page 27 Retreat......Page 28 Swiss inquisitions......Page 29 Idea of an investment......Page 30 Ambush......Page 31 Mega presentations......Page 33 Fording streams......Page 34 Liquidity and leverage......Page 35 Democracy of greed......Page 36 Pick and pay......Page 37 Black Sea real estate......Page 38 Life on the margin......Page 39 Racing days......Page 40 Dr Doom......Page 41 Extreme money......Page 43 Part 1: Faith......Page 46 Some kinda money......Page 48 Trading places......Page 50 The invention of money......Page 51 Barbarous relic......Page 53 The real thing......Page 55 The Hotel New Hampshire......Page 57 Collapse......Page 59 Money machines......Page 61 Debt clock......Page 62 Money is nothing......Page 64 The mirrored room......Page 65 Mrs Watanabe goes to Wall Street......Page 68 FX Beauties Club......Page 69 Plutonomy......Page 71 Trickling down, trading up......Page 72 I shop, therefore I must be!......Page 73 Spend it like Beckham!......Page 75 Golden years......Page 78 Tax avoidance......Page 79 Japanese curse......Page 81 The god of our time......Page 82 Limited consciences......Page 84 A brilliant daring speculation......Page 85 Dirty tricks......Page 87 Marriages and separations......Page 90 The house that Jack built......Page 92 Capital ideas......Page 94 WWJD – watch what Jack did!......Page 95 Business dealings......Page 97 It’s a wonderful bank!......Page 98 Pass the parcel......Page 100 Loan frenzy......Page 103 Plastic fantastic money......Page 104 Casino banking......Page 106 Confidence tricks......Page 108 The Citi of money......Page 109 Sign of the times......Page 111 Yellow brick road......Page 114 The battle of the ‘pond’......Page 115 Cool Britannia......Page 117 Barbarian invasions......Page 118 Unlikely centres......Page 119 The unbalanced bicycle......Page 121 Foreign treasure......Page 122 Fool’s gold......Page 124 Liquidity vortex......Page 125 Printing it......Page 126 Column inches......Page 127 Studs, starlets......Page 129 Financial porn......Page 131 Speedy money......Page 132 Literary money......Page 134 Money for all......Page 137 Part 2: Fundamentalism ......Page 138 Los Cee-Ca-Go boys......Page 140 Dismal science......Page 141 Chicago Interpretation......Page 143 Economic politics......Page 145 Academic warfare......Page 146 The Gipper and the Iron Lady......Page 147 Political economy......Page 149 New old deal......Page 152 The monetary lens......Page 153 Unstable stability?......Page 154 False gods, fake prophecies......Page 156 Mystery of price......Page 157 Demon of chance......Page 158 Corporate M&Ms......Page 159 Risk taming......Page 161 Slow and quick money......Page 163 Corporate practice......Page 165 Everything is just noise......Page 167 Perfect worlds......Page 169 Financial fundamentalism......Page 170 Fata morgana ......Page 172 Part 3: Alchemy ......Page 176 Fixed floor coverings......Page 178 By the bootstraps......Page 180 Leverage for everything......Page 181 Cutting to the bone......Page 182 Professor Jensen goes to Wall Street......Page 183 Drowning by numbers......Page 185 Censored loans......Page 187 High opportunity bonds......Page 189 Fallen angels......Page 190 Junk people......Page 191 Milken’s mobsters......Page 192 The sweet envy of bankers......Page 194 Thank you for borrowing......Page 195 One bridge too far......Page 196 National treasure......Page 198 Excess returns......Page 200 Sexy private equity......Page 202 Inflight entertainment......Page 203 Selling the family silver......Page 205 Holey dollar......Page 206 Money for nothing......Page 208 Public squalor, private profits......Page 209 Locust plagues......Page 210 Vain capital......Page 212 Amateur hour......Page 213 Turbulence......Page 215 Securitisation recipes......Page 218 Slice and dice......Page 220 Almost as safe as houses......Page 223 Synthetic stuff......Page 224 Get copula-ed......Page 227 Sticky mess......Page 228 Several houses of one’s own......Page 230 Cheaper cuts of mortgage......Page 232 ARMs race......Page 235 Heroes for one day......Page 237 Alpha-debt soup......Page 240 In the shadow of debt......Page 244 Virtual loans......Page 248 Counting on the abacus......Page 250 Intellectual masturbation......Page 252 Used to be smart......Page 253 Chain reaction......Page 256 Phase transition......Page 259 Terra incognita......Page 260 Mind your derivatives......Page 264 Particle finance......Page 266 Hedging your bets......Page 267 Sewer bonds......Page 269 Harvard case studies......Page 270 The Italian job......Page 271 Betting your hedge......Page 272 TARDIS trades......Page 274 I will kill you later......Page 275 First to lose......Page 277 Playing swaps and robbers......Page 279 The Greek job......Page 281 Madman’s games......Page 283 Shock-Gen......Page 284 Evil Kerviel......Page 285 Soldier monks......Page 286 Mystère Kerviel......Page 287 Risk is our business......Page 288 Free money......Page 290 Credit’s fatal attraction......Page 292 Post-modern contradictions......Page 294 Derivative deconstruction......Page 295 Piñata parties......Page 296 Woodstock for hedge funds......Page 300 Keeping up with the Joneses......Page 301 In search of Moby Dick......Page 302 Style gurus......Page 303 Magic wand......Page 304 Lucky man......Page 306 Sharpe practice......Page 307 Embedded......Page 309 In the long run, we are all dead......Page 310 The game......Page 312 The more things change......Page 313 Hedgestock......Page 314 Affinities and curses......Page 316 Crowded hours......Page 317 Crime without punishment......Page 319 Fast cars, slow hedge funds......Page 321 Fast cornering......Page 323 Children of privilege......Page 324 Make money not war......Page 326 Part 4: Oligarchy ......Page 328 War games......Page 330 Borrowed times......Page 331 Liquidity factory......Page 334 Six degrees of separation......Page 336 Paper chains......Page 338 Toxic pathologies......Page 339 Relying on the Zohar......Page 340 Blind capital......Page 342 Rent collectors......Page 343 Best in best possible world......Page 345 Central bank republics......Page 348 Games of old maid......Page 350 Protection rackets......Page 351 Stockholm Syndrome......Page 352 Free speech......Page 354 No accounting for values......Page 355 Mark to make believe......Page 356 Out of sight......Page 358 Creeping crumble......Page 359 Management by neglect......Page 361 Directing traffic......Page 363 Cult of risk......Page 366 Growth for all seasons......Page 367 Financial groupthink......Page 368 Celebrity central banking......Page 370 Dealing with dissent......Page 373 Noneofuscouldanode......Page 375 Je ne regrette rien!......Page 376 Last supper......Page 377 Money illusions......Page 380 Factories for unhappy people ......Page 381 War versus money......Page 382 Shop floors......Page 383 Misinformed......Page 384 Smiling and killing......Page 386 Pay grades......Page 387 Much more than this......Page 388 Attached......Page 391 Bonus season......Page 392 Plenty......Page 393 Tipping points......Page 394 Financial nihilism......Page 396 Cosmetic consumption......Page 397 The physical impossibility of spending the amount earned by someone living......Page 398 Celebrity finance......Page 400 Manqué not monkey......Page 403 Wizard and muggles......Page 404 In the midnight hour......Page 405 Safe as......Page 409 Snuff movies......Page 411 Silent mass murder......Page 413 Part 5: Cracks ......Page 414 Air pockets......Page 416 Mass extinction......Page 417 ER......Page 419 This is not a seminar!......Page 421 ICU......Page 423 Country for sale......Page 424 Crying games......Page 426 Newtonian economics......Page 427 Botox economics......Page 430 China syndrome......Page 432 Regulatory dialectic......Page 434 Patient zero......Page 437 Nowhere to run, nowhere to hide......Page 440 Built to fail......Page 442 End of Ponzi prosperity?......Page 444 Losing the commanding heights......Page 447 Zen finance......Page 449 Unknown unknowns......Page 450 Marginal......Page 452 Widows and orphans......Page 454 Nausea......Page 455 Crunch porn, crash lit......Page 457 Economic rock stars......Page 458 Showtime......Page 460 Meta money......Page 461 Economic trivialities......Page 462 This time, it is no different!......Page 464 Suicide is painless......Page 467 The turning world......Page 469 Notes......Page 472 Select bibliography......Page 510 Index......Page 522

The human race created money and finance. But our inventions re-create us. Mankind mistook money—a lubricant of society and human well-being—for an end in itself. Finance, the monetary shadow of real things, came to dominate human reality. Extreme Money tells the story of how this happened—and, in so doing, it tells the story of the modern world.

Bestselling author Satyajit Das draws on 33 years of personal experience at the heart of modern global finance to narrate this story. Das reveals the spectacular, dangerous money games that have generated increasingly massive bubbles of fake growth, Ponzi prosperity, sophistication, and wealth—while endangering the jobs, possessions, and futures of virtually everyone outside the financial industry.Das shows how “extreme money” has become ever more unreal; how “voodoo banking” continues to generate massive phony profits even now; and how a new generation of “Masters of the Universe” has come to dominate the world.

Extreme Money is about:
The new financial fundamentalism: false gods, false prophets - Faith in money, faith in risk, faith in shadows
The cult of risk and the growth engine that isn’t - How financial engineering replaced real engineering and illusions replaced reality
Financial alchemy and the “Doomsday Debt Machine”- The rise of the global financial machine we cannot escape
The new global oligarchy—and the nihilistic games they play - Too smart, too fast, too greedy, too self-absorbed—and far too dangerous

The human race created money and finance. But our inventions re-create us. Mankind mistook money--a lubricant of society and human well-being--for an end in itself. Finance, the monetary shadow of real things, came to dominate human reality. Extreme Money tells the story of how this happened--and, in so doing, it tells the story of the modern world. Bestselling author Satyajit Das draws on 33 years of personal experience at the heart of modern global finance to narrate this story. Das reveals the spectacular, dangerous money games that have generated increasingly massive bubbles of fake growth, Ponzi prosperity, sophistication, and wealth--while endangering the jobs, possessions, and futures of virtually everyone outside the financial industry. Das shows how 3extreme money4 has become ever more unreal; how 3voodoo banking4 continues to generate massive phony profits even now; and how a new generation of 3Masters of the Universe4 has come to dominate the world. Extreme Money is about: The new financial fundamentalism: false gods, false prophets - Faith in money, faith in risk, faith in shadows The cult of risk and the growth engine that isn2t - How financial engineering replaced real engineering and illusions replaced reality Financial alchemy and the 3Doomsday Debt Machine4- The rise of the global financial machine we cannot escape The new global oligarchy--and the nihilistic games they pla y - Too smart, too fast, too greedy, too self-absorbed--and far too dangerous "The human race created money and finance. But our inventions re-create us. Mankind mistook money - a lubricant of society and human well-being - for an end in itself. Finance, the monetary shadow of real things, came to dominate human reality. Extreme Money tells the story of how this happened - and, in so doing, it tells the story of the modern world. Bestselling author Satyajit Das draws on 33 years of personal experience at the heart of modern global finance to narrate this story. Das reveals the spectacular, dangerous money games that have generated increasingly massive bubbles of fake growth, Ponzi prosperity, sophistication, and wealth - while endangering the jobs, possessions, and futures of virtually everyone outside the financial industry. Das shows how extreme money has become ever more unreal; how voodoo banking continues to generate massive phony profits even now; and how a new generation of Masters of the Universe has come to dominate the world."--Publisher's description