Extreme Money

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

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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 shadowsThe cult of risk and the growth engine that isn t - How financial engineering replaced real engineering and illusions replaced realityFinancial alchemy and the  Doomsday Debt Machine - The rise of the global financial machine we cannot escapeThe new global oligarchy and the nihilistic games they play - Too smart, too fast, too greedy, too self-absorbed and far too dangerous
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Product details

  • Paperback | 540 pages
  • 152 x 232 x 32mm | 839.14g
  • Pearson Education Limited
  • Harlow, United Kingdom
  • English
  • 0273723979
  • 9780273723974
  • 93,579

Back cover copy

"A true insider's devastating analysis of the financial alchemy of the last 30 years and its destructive consequences. With his intimate first-hand knowledge, Das takes a knife to global finance and financiers to reveal the inner workings without fear or favor."
-Nouriel Roubini, Professor of Economics at NYU Stern School of Business and Chairman of Roubini Global Economics "Das describes the causes of the financial crisis with the insight and understanding of a financial wizard, the candor and objectivity of an impartial observer, and a wry sense of humor that reveals the folly in it all."
-Brooksley Born, Former Chairperson of the U.S. Commodity Futures Trading Commission (CFTC) "This is the best book yet to come out of the financial crisis. Das is a graceful, witty writer, with an unusually broad range of reference. He is also a long-time master of the arcana of the netherworlds of finance and nicely balances historical sweep with illuminating detail. Extreme Money is lively, scathing, and wise. "
-Charles Morris, Author of "The Two Trillion Dollar Meltdown: Easy Money, High Rollers, and the Great Credit Crash"" ""Like Hunter S. Thompson's Fear and Loathing in Las Vegas, Extreme Money launches you into a fascinating and disturbing alternative view of reality. But now greed predominates, the distorted world of finance is completely global, and the people making crazy decisions can ruin us all. This is an informative, entertaining, and deeply scary account of Hades's new realm. Read it while you can. "
-Simon Johnson, Ronald A. Kurtz Professor of Entrepreneurship at MIT Sloan School of Management and Author of 13 Bankers: The Wall Street Takeover and the Next Financial Meltdown "You know when Lewis Caroll, Max Weber, Alan Greenspan, and Sigmund Freud all appear on the same early page that you are about to read an intellectual tour de force. Das is an authoritative and colorful critic of modern markets, and here he weaves financial history and popular culture into an entertaining and blistering social critique of how so many people have come to chase endless financial reflections of the real economy. Extreme Money speaks truth to power. "
-Frank Partnoy, George E. Barrett Professor of Law and Finance at the University of San Diego and Author of "F.I.A.S.C.O, Infectious Greed," and "The Match King" 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. You'll learn how everything from home mortgages to climate change has become financialized, as vast fortunes are generated by individuals who build nothing of lasting value. 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. 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"
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Table of contents

Prologue: HubrisSub-prime dialectsBest in show The Physical Impossibility of Death in the Mind of Someone LivingRetreatSwiss inquisitionsIdea of an investmentAmbushMega presentationsFording streamsLiquidity and leverageDemocracy of greedPick and payBlack Sea real estateLife on the marginRacing daysDr DoomExtreme money Part 1 Faith1 Mirror of the timesSome kinda moneyTrading placesThe invention of moneyBarbarous relicThe real thingThe Hotel New HampshireCollapseMoney machinesDebt clockMoney is nothingThe mirrored room 2 Money changes everythingMrs Watanabe goes to Wall StreetFX Beauties ClubPlutonomyTrickling down, trading upI shop, therefore I must be!Spend it like Beckham!Golden yearsTax avoidanceJapanese curseThe god of our time 3 Business of businessLimited consciencesA brilliant daring speculationDirty tricksMarriages and separationsThe house that Jack builtCapital ideasWWJD  watch what Jack did!Business dealings 4 Money for saleIt s a wonderful bank!Pass the parcelLoan frenzyPlastic fantastic moneyCasino bankingConfidence tricksThe Citi of moneySign of the times 5 Yellow brick roadMonumental moneyThe battle of the  pond Cool BritanniaBarbarian invasionsUnlikely centresEl-Dollardo economicsThe unbalanced bicycleForeign treasureFool s goldLiquidity vortex 6 Money honeyPrinting itColumn inchesVideo moneyStuds, starletsFinancial pornSpeedy moneyLiterary moneyMoney for all Part 2 Fundamentalism 7 Los Cee-Ca-Go boysDismal scienceChicago InterpretationEconomic politicsAcademic warfareThe Gipper and the Iron LadyPolitical economyNew old dealThe monetary lensUnstable stability? 8 False gods, fake propheciesMystery of priceDemon of chanceCorporate M&MsRisk tamingSlow and quick moneyCorporate practiceEverything is just noisePerfect worldsFinancial fundamentalismFata morgana Part 3 Alchemy9 Learning to love debtFixed floor coveringsBy the bootstrapsLeverage for everythingCutting to the boneProfessor Jensen goes to Wall StreetDrowning by numbersCensored loansHigh opportunity bondsFallen angelsJunk peopleMilken s mobstersThe sweet envy of bankersThank you for borrowingOne bridge too farNational treasure 10 Private vicesExcess returnsSexy private equityInflight entertainmentSelling the family silverHoley dollarMoney for nothingPublic squalor, private profitsLocust plaguesVain capitalAmateur hourTurbulence 11 Dice with debtSecuritisation recipesSlice and diceAlmost as safe as housesSynthetic stuffGet copula-edSticky messSeveral houses of one s ownCheaper cuts of mortgageARMs raceHeroes for one day 12 The doomsday debt machineAlpha-debt soupIn the shadow of debtVirtual loansCounting on the abacusIntellectual masturbationUsed to be smartChain reactionPhase transitionTerra icognito 13 Risk supermarketsMind your derivativesParticle financeHedging your betsSewer bondsHarvard case studiesThe Italian jobBetting your hedgeTARDIS tradesI will kill you laterFirst to loseToxic municipal siblingsPlaying swaps and robbersThe Greek jobMadman s games 14 Financial arms raceShock-GenEvil KervielSoldier monksMystere KervielRisk is our businessFree moneyCredit s fatal attractionPost-modern contradictionsDerivative deconstructionPinata parties 15 Woodstock for hedge fundsKeeping up with the JonesesIn search of Moby DickStyle gurusMagic wandLucky manSharpe practiceEmbeddedIn the long run, we are all deadThe gameThe more things changeHedgestock 16 Minsky machinesAffinities and cursesCrowded hoursCrime without punishmentFast cars, slow hedge fundsFast corneringChildren of privilegeMake money not war Part 4 Oligarchy17 War gamesBorrowed timesLiquidity factorySix degrees of separationPaper chainsToxic pathologiesRelying on the ZoharBlind capitalRent collectorsBest in best possible world 18 Shell gamesCentral bank republicsGames of old maidProtection racketsStockholm syndromeFree speechNo accounting for valuesMark to make believeOut of sightCreeping crumbleManagement by neglectDirecting traffic 19 Cult of riskGrowth for all seasonFinancial groupthinkCelebrity central bankingDealing with dissentNoneofuscouldanodeJe ne regrette rien!Last supper 20 Masters of the UniverseMoney illusionsFactories for unhappy peopleWar versus moneyShop floorsSmiling and killingPay gradesMuch more than thisAttachedBonus seasonPlentyTipping points 21 Financial nihilismCosmetic consumptionThe physical impossibility of spending the amount earned by someone livingCelebrity financeManque not monkeyWizard and mugglesIn the midnight hourLast ritesSafe asSnuff moviesFinancial nihilism Part 5 Cracks22 Financial gravityAir pocketsMass extinctionERThis is not a seminar!ICUCountry for saleCrying gamesFinancial gravity 23 Unusually uncertainBotox economicsChina syndromeRegulatory dialecticPatient zeroNowhere to run, nowhere to hideBuilt to fallEnd of Ponzi prosperity?Losing the commanding heightsZen financeUnusually uncertain Epilogue: NemesisMarginalWidows and orphansNauseaCrunch porn, crash litEconomic rock starsShowtimeMeta moneyEconomic trivialitiesThis time, it is no different!Suicide is painlessThe turning world NotesSelect bibliography Index
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Review quote

Long listed for Financial Times/ Goldman Sachs Business Book of the Year 2011 Listed in Bloomberg s Top Business Books of the Year 2011 One of ninemsn.com.au s best business books of 2011 " a powerful book highly readable and informative Anyone who decodes the ratings of the three major agencies so amusingly  CCC means "Russian roulette with five bullets in the chamber" and D means "scrape your brains off the wall and place in a plastic bag"- demands to be read."Lindsay Tanner, former Australian Minister of Finance inThe Monthly, August 2011" While the run-up to the global financial crisis has been well documented, Das provides his own unique insights."Luke Faulkner, Hedge Funds Review, August 2011"...virtually in a category of its own  part history, part book of financial quotations, part cautionary tale, part textbook. It contains some of the clearest charts about risk transfer you will find anywhere. ...Others have laid out the dire consequences of financialisation ("the conversion of everything into monetary form", in Das s phrase), but few have done it with a wider or more entertaining range of references...[Extreme Money] does... reach an important, if worrying, conclusion: financialisation may be too deep-rooted to be torn out. As Das puts it  characteristically borrowing a line from a movie, Inception  "the hardest virus to kill is an idea". Andrew Hill "Eclectic Guide to the Excesses of the Crisis" Financial Times, 17 August 2011 an idiosyncratic yet withering analysis of how 30 years of financial alchemy and excessive credit have plunged us into what feels like a slow-motion depression addresses, one by one, the overarching themes of the great credit boom and bust of the late 20th century.Black humor is Das natural medium, and he gave me a rueful chuckle every few pages. You know that a writer is hard to pigeonhole when the advance praise compares him to both Candide and Hunter S. Thompson. I prefer to view Das as a modern-day Ishmael with an attitude, a weathered seaman who has witnessed firsthand the crazed hunt of hedge-fund captains for alpha, the great whale of superior investment returns.  I could only endorse the conclusion.  There is no simple, painless solution to the fix we re in, Das writes.  The world has to reduce debt, shrink the financial part of the economy, and change the destructive incentive structures in finance. Individuals in developed countries have to save more and spend less. Doomsday Debt Machine Roars as Wizard Das Chides Buffett: Books, By James Pressley, Sep 19 2011 a fast paced ride...Das manages to be both an insider and outsider  much of what he covers is based on first hand experience...there s no of the faux glamour that infuses many otherwise critical books on finance.... this is a thoughtful, interesting and unusual book that deserves to jostle for shelf space alongside classics such as Charles Kindleberger s Manias, Panics and Crashes and Devil Take The Hindmost by Edward Chancellor. It is well worth a read by anyone seeking to grasp the broader impact of the recent crisis."Chris Sholto Heaton, Money Week, November 2011  ...Mr Das has a keen eye for an anecdote .... give[s] the reader plenty of chances to chuckle at the hubris he reveals.. the views of people like Mr Das were consistently ignored in the run-up to the debt crisis.. More luck than judgment, The Economist, 15 October 2011  ...Extreme Money is not about the financial crisis, as such. It is about the history of money and the journey that brought us to 2011. Das writes in a clear, straightforward manner that is approachable to all readers and takes in a diverse range of references from Hollywood movies to mediaeval literature, with plenty of gags and reflections from his career in the industry, which make for an easy read. Nick Ferguson  A history of extreme money , 21 September 2011, Finance Asia " exposes the shambles of a system characterised by bogus and failed economic market theory, a shamelessly rapacious finance industry, and a broad failure by governments to protect either their citizens or their productive industries from a finance industry driven by the most perverse incentives .Das writes colourfully, in short punchy sections, and countless memorable aphorisms Politicians, please read this book."Richard Thwaites  Dangerous money games Canberra Times, 17 September 2011  Das is a chatty writer, with a style that combines elegance with wit, erudition and a large dollop of cynicism. He is also widely read, given to inventing unusual metaphors and quoting from sources as diverse as Trollope and Groucho Marx. As a result, he has succeeded in producing an entertaining page-turner on a subject considered both numbingly dull as well as frighteningly opaque. Devangshu Datta  World money, salted and seasoned Business Standard, 16 December 2011  Extreme Money is about much more than the financial crisis. ... Das is writing about the society that has been built under the suzerainty of finance over the last few decades. He uses the references to highlight, underline and contrast some of the features of this crazy society. At one level, Das gives us the conventional narrative of the crisis. ...At another level, he elaborates on the economic theory that provided the intellectual sustenance for the financial revolution. ... But at a more fundamental level, this book is about the corruption in values caused by what Das terms Extreme Money, by which he means not only the dangerous speculative games played with money, but also the attitudes and culture that have emerged out of casino capitalism. At the deepest level, this book is about hubris and the nemesis that inevitably follows. Manas Chakravarty  The money shot:The global society formed by the financial currents of the last few decades Live Mint , 9 December 2011  This is probably the finest financial history of the period.... , it tells with great authority the real story of modern finance how money mutated into a rogue virus something that finance students will otherwise never know. The book is a mirror of our financial times, a must-read for all. Debashis Basu  Extreme Money: Modern Finance The Rogue Virus Moneylife, 24 December 2011  ...Das dons a professorial cap to weave financial history and popular culture into an entertaining and blistering social critique of how so many have come to chase endless financial reflections of the real economy...  No loss in the telling Hindustan Times 23 December 2011  Extreme Money is a morality tale of the cascade of massive wealth into the pockets of financial wizards at the cost of the stability of the global financial system.... a cautionary tale from Faust warning what happens to those who trade their souls for lucre."Andrew Allentuck, Financial Post,5 Noof financial alchemy... lays bare the investment bankers schemes and machinations which culminated in the worldwide financial crisis and Great Recession of 2007 to date.... an illuminating text that has much to teach you about the world of high finance. Thomas Herold  An Inside Look Into The Masters of The Financial Sandbox , 30 August 2011  Das' irreverent and sardonic wit permeates the book, making it an enjoyable read despite its dark tone. Barbara Whelehan  Money books for holiday giving Bankrate.com, December 16 2011 "...an absolutely brilliant examination of the world of money and finance... a realistic, confronting and amazing critique of the machinations and workings of the global financial industry.. an enlightening dissection of the world of high finance, policy making, and supposed regulation, and reveals how illusory is the ability of central banks and governments to control and manage economies ... The amount and depth of information in this book is amazing. It is essential reading for all those with an interest in the financial markets, delving into areas and subjects that most writers with a vested interest in the markets don't and won't cover.."Your Trading Edge (May-June 2012)
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About Satyajit Das

Satyajit Das is an internationally respected expert in finance with 33 years experience. He has worked for the  sell side (Citicorp Investment Bank and Merrill Lynch), the  buy side (as Treasurer of the TNT Group), and as a consultant advising banks, investors, corporations, and central banks worldwide. Das is the author of many highly regarded standard reference books on derivatives and risk management. In 2006, he published the international bestseller Traders, Guns & Money, an extraordinary insider s account of the world of derivatives trading. In Traders and in a series of speeches in 2006 entitled - The Coming Credit Crash, Das anticipated many of the problems that became apparent in the financial crisis and are still affecting the global economy. He was recently featured in Charles Ferguson s 2010 Oscar (R)-winning documentary Inside Job and the 2009 BBC documentary Tricks with Risk.
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Rating details

342 ratings
3.61 out of 5 stars
5 24% (82)
4 31% (105)
3 32% (109)
2 10% (33)
1 4% (13)
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