Reckless Endangerment: How Outsized Ambition, Greed, and Corruption Led to Economic Armageddon

by Gretchen Morgenson

In "Reckless Endangerment", Gretchen Morgenson, the star business columnist of "The New York Times", exposes how the watchdogs who were supposed to protect the country from financial harm were actually complicit in the actions that finally blew up the American economy. Drawing on previously untapped sources and building on original research from co-author Joshua Rosner - who himself raised early warnings with the public and investors, and kept detailed records - Morgenson connects the dots that led to this fiasco. Morgenson and Rosner draw back the curtain on Fannie Mae, the mortgage-finance giant that grew, with the support of the Clinton administration, through the 1990s, becoming a major opponent of government oversight even as it was benefiting from public subsidies. They expose the role played not only by Fannie Mae executives but also by enablers at Countrywide Financial, Goldman Sachs, the Federal Reserve, HUD, Congress, the FDIC, and the biggest players on Wall Street, to show how greed, aggression, and fear led countless officials to ignore warning signs of an imminent disaster.

• ISBN10: 0805091203
• ISBN13: 9780805091205
• Publish Date: 24 May 2011
• Publish Status: Out of Print
• Out of Print: 9 February 2012
• Publish Country: US
• Imprint: Times Books
• Format: Hardcover
• Pages: 352
• Language: English

Reviews

[dpfaef]

Grecthen Morogensen and Joshua Rosner do an excellent job of explaining the involvement of Fannie Mae and Freddie Mac in the housing crisis of 2008. The authors lay the blame for the failure of Fannie Mae at the feet of James A. Johnson the CEO of Fannie from 1991 to 1998. When Johnson stepped down in 1998 Franklin Raines continued the same policies.

Morogensen and Rosner basically say that Washington and the financial sector became so entwined that any sort of accountability was impossible. It was the perfect storm the government trying to encourage the market and the market taking full advantage of the situation. Sadly, neither party has learned anything from what occurred in 2008, and it will most likely continue to happen. I think that the private sector has the money and the connection to do just about anything they want.

I would recommend as additional reading Naomi Klein's Shock Doctrine: The Rise of Disaster Captialism; Sheila Bair's Bull by the Horns, and Bruce Bartlett's The New American Economy. There are a lot of books out there on this subject and I found all that I have read interesting.