Customer Reviews

The Greed Merchants: How the Investment Banks Played the Free Market Game

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Those are the last words of the book, and was written in 2005. The author was presciently warning his reader. Some might feel that its outdated, but it makes very relevant, if not interesting reading. The thesis of the book is the cartel (mafia)-like monopolization of the world-wide financial lifeblood (commercial credit) by financial institutions. That lifeblood is what is needed by everyone from the budding entrepreneur to the blue chips companies to run and expand their companies. The repeal of the Glass-Steagal Act allowed the 'innocent' household name commercial banks (with your deposits and mortgages) to compete in this avaricious environment. And boy, did they. They tried to outsmart each other through the often indecipherable derivative packages that were being financially engineered, akin to the latest car or bridge. Even after the Internet bust, Enron and Worldcom, many emerged to become even stronger; Bear Stearns, Lehman Bros. AIG, Merrill Lynch, Citigroup included. I can only imagine Mr. Augar having a field day with a followup, post 2008.

This book is a very informative book and would prove useful for someone who wants a critical perspective on modern investment banking. The author's facts are based up with citations. Furthermore, he takes a very balanced approach to making his point, don't let the title fool you, the book is not as moralistic as its title. Occasionally, the writing lack vitality, but the author is not a professional writer, he is a veteran i-banker and this is probably as about as good writing as you are going to get out of a banker. His insider perspective is very useful and he tells it as it is without resorting to jargon.

My biggest concern is that this book takes too negative a view of investment banks. It seems to assume that investment bankers must play an altruistic role and look out for everyone's interest except their own. This is unrealistic, no other company does this. [......]

Few books honestly expose the investment banking game for what it really is. It is all about maximizing compensation for those who run the investment banks, regardless of the expense or toll it takes on ordinary citizens or an actual country.

Investment bankers and all Wall Street have an insiders edge and they use it to overcompensate themselves. Bankers and investment bankers have no qualms about looting investors, a company or country and driving it into bankruptcy so they can make their Christmas bonuses...

Philip Augar's The Greed Merchants: How the Investment Banks Played the Free Market Game is a wonderful and simple expose on all the inherent conflicts of interest in banking, whether it be commercial or investment banking.

I highly recommend it.

Sincerely,

Barry J. Dyke, RIA
Hampton, NH

This is a thoughtful analysis of the new integrated model investment bank that seems to have taken over the world financial system. Whether you want to work for one of them or tear them down, this is an essential read.

a very intriguing book, describing modern-day banking cartel, describing the major players of investment banking on Wall Street but does not really go into full details of describing the cartel in action but rather describes it from the view of an outsider

I do appreciate the author's sincerity of warning the public against the legal and moral problems of the greedy and corrupted investment banking industry. The author, an ex Group Managing Director of Schroder, had fully leveraged his insider experience and knowledge to explain why a handful of big firms continue to monopolize and thrive in the midst of heavy public and governmental scrutiny. Dont know whether the topic had been too serious or what, it fell into the same trap which caught "Infectious Greed by Frank Partnoy", that the writing seemed too descriptive or even dry at times. In case you want to read something relatively light, entertaining but still relevant, Liar's Poker by Michael Lewis, Fiasco by Frank Partnoy and Wall Street Meat by Andy Kessler are good choices.