Fidelity's World: The Secret Life and Public Power of the Mutual Fund Giant [Paperback]

Diana B. Henriques (Author)

Book Description

Publication Date: March 6, 1997

Called "trail-blazing and hard-hitting" ("Christian Science Monitor"), this in-depth portrait of an investment empire reveals Fidelity's dramatic impact on America's corporations and individual investors. of photos.

Editorial Reviews

From Publishers Weekly

The image of Fidelity Investments' mutual fund empire as a safe haven for small investors is outmoded, asserts New York Times business reporter Henriques. Pushed by Fidelity's constant innovations, including junk bond funds and other gimmicky products, the mutual fund industry is now a speculative bazaar, she maintains. This swiftly told, incisive history chronicles Fidelity's rise from a sluggish, conservative Boston fund with a $5 million investment portfolio in 1944 to the world's largest mutual fund company, with over $4 billion under its control plus a huge stock-trading operation?a company so powerful that it virtually dictated the terms under which both R.H. Macy and Federated Department Stores were reorganized after their respective bankruptcies and then single-handedly brought about the merger of these chains. Henriques is troubled by what she describes as Fidelity's bullying tactics in the 1980s to force the liquidation or reorganization of small companies, and by its recent entry into the "vulture market" of bankruptcy investing. Author tour.
Copyright 1995 Reed Business Information, Inc. --This text refers to an out of print or unavailable edition of this title.

From Library Journal

Henriques, an investigative business reporter for the New York Times, has written an important but scary book about the growth of the mutual fund industry and, in particular, Fidelity, which holds billions of dollars worth of small investors' retirement savings. Henriques sees regulatory laxity and conflicts of interest by portfolio managers as alarmingly common. Because of the influence of services that rate the funds according to their yields, funds have taken irresponsible risks with investors' money to get higher ratings. The author was never allowed close to the elusive head of Fidelity, so much of this study is taken from public documents. The large cast of characters and complicated financial maneuvers will probably limit readership to those with some financial background, but this belongs in most business collections.?Sue McKimm, Cuyahoga Cty. P.L., Parma, Ohio
Copyright 1995 Reed Business Information, Inc. --This text refers to an out of print or unavailable edition of this title.

See all Editorial Reviews

Product Details

• Paperback: 432 pages
• Publisher: Touchstone (March 6, 1997)
• Language: English
• ISBN-10: 0684832232
• ISBN-13: 978-0684832234
• Product Dimensions: 9 x 6 x 1.2 inches
• Shipping Weight: 1.5 pounds (View shipping rates and policies)
• Average Customer Review: 3.2 out of 5 stars  See all reviews (4 customer reviews)
• Amazon Best Sellers Rank: #1,055,750 in Books (See Top 100 in Books)

More About the Author

Diana B. Henriques is an award-winning financial journalist and contributing writer for The New York Times, where she has worked since 1989. She was previously a staff writer for Barron's magazine, a Wall Street correspondent for The Philadelphia Inquirer, and an investigative reporter for The Trenton (N.J.) Times. In 2005, she was a finalist for a Pulitzer Prize and won a George Polk Award, the Worth Bingham Prize for Investigative Reporting and Harvard's Goldsmith Prize for her 2004 series exposing insurance and investment rip-offs of young military consumers. She is the author of "The Wizard of Lies: Bernie Madoff and the Death of Trust," a New York Times bestseller about history's largest Ponzi scheme; in May 2011, the book was optioned by HBO, which is exploring its development as a film project. Henriques is also the author of three previous books focusing on business history: "The Machinery of Greed," "Fidelity's World," and "The White Sharks of Wall Street."

Customer Reviews

Most Helpful Customer Reviews

15 of 15 people found the following review helpful:

3.0 out of 5 stars Useful, but it has its limitations, April 3, 1998

By A Customer

This review is from: Fidelity's World: The Secret Life and Public Power of the Mutual Fund Giant (Paperback)

This is a book that needed to be written: the explosive growth of the mutual fund industry in the past 20 years is one of the seminal events of our generation, and Fidelity is the most important mutual fund company out there. That having been said, I think that Diana Henriques could have done a much better job. The text is often jumpy and disjointed, and the actual events as Henriques relates them often don't warrant the build-up that she gives them in her introduction to them. More disturbing, I disagree strongly with many of her criticisms of Fidelity. Don't get me wrong: there are many valid criticisms of Fidelity that can be made, from the exorbitant fees it charges for average performance to the many ethical lapses that have plagued Fidelity in the past 10 or 15 years. But Henriques carries it too far. In one breath, she criticizes Fidelity for selling massive amounts of stock early on Black Monday in 1987 to meet the equally massive redemption requests that its funds had received over the previous weekend because most Fidelity funds did not have sufficient cash on hand; in the next, she criticizes the Fidelity Magellan fund for having too much cash on hand in early 1996, thus missing the big market rally that was in progress then. Likewise, she criticizes Fidelity's active role in corporate governance and then later criticizes Fidelity's policy that Fidelity funds in the aggregate cannot own more than 15% of any company. You can't have it both ways -- any organization which controls more than 15% of a publicly-traded company is going to have a big influence on the way that company is run. At its core, I think that Henriques's fundamental problem is that she believes that the Americans are and ought to be complete financial waifs who cannot be expected to make decisions about their finances in a responsible and informed manner. This assumption causes her to take Fidelity to task for things that Fidelity should not be taken to task for, and it undermines her books credibility.

8 of 10 people found the following review helpful:

4.0 out of 5 stars tantalizingly incomplete, April 6, 1998

By A Customer

This review is from: Fidelity's World: The Secret Life and Public Power of the Mutual Fund Giant (Paperback)

The author tells the very interesting history of Fidelity Investments and FMR, from Ed to Abby Johnson, and through it, a history of the mutual fund industry in America. The author makes a case for Fidelity being an autocracy geared to selling shares in mutual funds at all costs. Certainly, the last few years have shed a lot of light on the seamy side of Fidelity. In Fidelity's defense, little is told of the "good guys" at Fidelity like longtime manager George Vanderheiden, and even the tale of Magellan is told haphazardly (what happened to Morris Smith?). Still, I found that I was pretty much unable to put it down for long, and it was pretty good read.

4 of 6 people found the following review helpful:

2.0 out of 5 stars Not an insider, June 12, 2002

By 

GEORGE R. FISHER (Boston MA United States) - See all my reviews
(REAL NAME)   

This review is from: Fidelity's World: The Secret Life and Public Power of the Mutual Fund Giant (Paperback)

Wouldn't it be interesting to know what really goes on inside Fidelity? They own every company in America and their proxies ought to control the outcome of every boardroom battle, what a subject! Plus, this is one man's creation and certainly a discussion of who he is and what he does would be interesting.

But, no. Unfortunately, you can't look here for much of any insight into any of these subjects. Too bad.