Origins of the Crash: The Great Bubble and Its Undoing

Origins of the Crash: The Great Bubble and Its Undoing

by Roger Lowenstein

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Product Details

ISBN-13: 9780143034674
Publisher: Penguin Publishing Group
Publication date: 12/28/2004
Edition description: Reprint
Pages: 288
Sales rank: 426,048
Product dimensions: 5.40(w) x 8.00(h) x 0.70(d)
Age Range: 18 - 17 Years

About the Author

Roger Lowenstein, author of the bestselling Buffett: The Making of an American Capitalist and When Genius Failed: The Rise and Fall of Long-term Capital Management, reported for the Wall Street Journal for more than a decade and wrote the Journal’s stock market column “Heard on the Street” and also its “Intrinsic Value” column. He now contributes articles and reviews to the Journal and the New York Times Magazine and is a columnist for SmartMoney Magazine. He lives in Westfield, New Jersey.

Read an Excerpt

In the 1970s, a candidate for president advanced the novel proposition that the money in the Social Security system should be funneled into, of all places, the stock market. The candidate’s name was Ronald Reagan. The incumbent president, Gerald Ford, had a good deal of fun with this evidently zany proposition. “I am not sure a lot of people would think it was a very good place to invest funds over the longer period of time,” Ford declared. His advisers had no trouble tarring the idea as kooky. The president likened it to “something dragged out of the sky.” If not certifiably alien, then it might even be—perish the thought—an example of “wild-eyed socialism,” which was no doubt something worse.
(Continues…)



Excerpted from "Origins of the Crash"
by .
Copyright © 2004 Roger Lowenstein.
Excerpted by permission of Penguin Publishing Group.
All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.
Excerpts are provided by Dial-A-Book Inc. solely for the personal use of visitors to this web site.

Table of Contents

Acknowledgmentsix
1Origins of a Culture1
2Early Nineties--A Culture Is Rich15
3Enlightenment Gets out of Hand35
4Number Games55
5Doormen at Noon79
6New Economy, Old Errors101
7Enron127
8Bankrupt157
9Year of the Locusts189
10Epilogue217
Notes227
Index259

What People are Saying About This

Arthur Levitt Jr

Roger Lowenstein's writings have helped change the culture of America's executive suites and board rooms. His investigative talent and narrative skills make Origins of the Crash a compelling and fascinating read.
SEC Chairman 1993-2001, and author of Take On the Street: What Wall Street and Corporate American Don't Want You to Know

From the Publisher

"The perfect epitaph to an era of monumental avarice and folly on Wall Street. This is financial history at its best." —Ron Chernow

"A crucial account of an era of excess and folly...riveting...will only seem fresher with time." —BusinessWeek

Ron Chernow

Roger Lowenstein has delivered the perfect epitaph to an era of monumental avarice and folly on Wall Street. Origins of the Crash presents a chilling portrait of the collective lunacy and moral blindness that afflicted the stock market in the late 1990s. With swift, deft strokes, Lowenstein conjures up a rogues' gallery of corporate charlatans, craven accountants and lawyers, and complicit investment bankers that is guaranteed to make your blood boil, your mind race, and your soul recoil. This is financial history at its very best: knowing in its exposure of business trickery, sure in its grasp of market psychology, and eloquent in its fierce, but often poignant, sense of indignation. As newsboys bleated from every street corner after the 1929 Crash, 'Read it and weep.
author of The House of Morgan and Titan and the upcoming Penguin Press title, Alexander Hamilton

Customer Reviews

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Origins of the Crash: The Great Bubble and Its Undoing 3.6 out of 5 based on 0 ratings. 8 reviews.
neurodrew on LibraryThing 23 days ago
A very quick read, entertaining, but I think a bit light on insight. Lowenstein recounts the excesses of executive compensation in the 1990's, linking the excessive use of repeated stock options to the drive for ever upward earnings and share prices. He has many good stories of corporate greed and chicanery. Andrew Fastow and the special purpose vehicles that served to get debt off of Enron's balance sheet, Kozlowski looting Tyco, Bernie Ebbers and the Worldcom hype, and even the shenanigans between Sandy Weil and Jack Grubman are all described. Lowenstein maintains a note of disdain for the participants, and is even impassioned in his denunciations. His diagnosis of the source of all the problems, however, in stock options, is not very profound.
name99 on LibraryThing 23 days ago
Nothing I wasn't aware already aware of, but the author is entertaining.
PointedPundit on LibraryThing 23 days ago
The Theme Never Changes, Only the StoriesThere are only two emotions that motivate the stock market: fear and greed. In his latest market history, Roger Lowenstein explores how the theme of creating shareholder value morphed into unbridled greed and led to the latest stock market crash.Delving back to the 1970s and 1980s, Lowenstein spins a compelling narrative, of heavy hitters -- Jack Grubman, Sandy Weill, Frank Quattrone, Henry Blodget, Mary Meeker, Abby Cohen, Bernie Ebbers, Frank Lay, Jeffrey Skilling, Gary Winnick -- who checked their moral scruples, fiduciary responsibility and better judgment at the door in the pursuit of personal wealth. Along the path, they co-opted the system¿s traditional restraints: full disclosure, public accounts and corporate attorneys. I was disappointed Lowenstein failed to include the Richard Grasso incident. As the head of the New York Stock Exchange and regulator of virtually every individual mentioned in the book, his pursuit of personal wealth at the expense of those he was charged with regulating would have served as the icing and cherry on top of this tale of greed.Regardless, this well-researched and powerfully written portrait of the rise and fall of the bull market of the 1990s will studied by market historians for decades to come.
ElectricRay on LibraryThing 3 months ago
First off, disclosure: Penguin sent me a copy of this book to read & review for free based on an earlier review I wrote of one of Roger Lowenstein's books on this site. So I have a theoretical conflict of interest, though I am doing my best not to allow it to affect - positively or negatively - my view of this book.That being said it is a somewhat ironic marketing tactic for Penguin to use n this particular case (but one which I heartily encourage, by the way) since Lowenstein's main theme is the mischief arising from conflicts of interest suffered by research analysts when covering the stocks of companies to whom their firms are pitching for investment banking business.Be that as it may, I've disclosed it now, so you're warned.Origins of the Crash covers much the same ground as Frank Partnoy's Infectious Greed and John Cassidy's Dot Con. As usual, Partnoy can't resist hopping on his moral high-horse, or mentioning 10+ year old derivatives scandals that have nothing to do at all with the recent market turmoil; Cassidy is more measured but restricts himself very much to the Dot Com phenomenon, adding an interesting history of the internet and computers in finance.Lowenstein manages deals with the spinning, laddering and corporate governance scandals of the early part of this decade, but as many of the reviewers here have noted, doesn't really add much that you wouldn't know had you been reading the papers for the last few years.Also, as he was with his book on LTCM, he is good at wisdom after the fact and retains a weakness for the cute aphorism, though he is more circumspect with it here and doesn't allow the neat turn of phrase to undermine his argument in quite the same way. Certainly, Lowenstein writes well; the book moves at a nice clip, and you never really get the chance to be bogged down.For all that, I thought Origins of the Crash was a far more measured work than Partnoy's Infectious Greed (though not quite so comprehensive), and a better overview of the whole situation than Cassidy's Dot Con, but ultimately short on new insight or analysis. If you're looking for an entertaining overview, though, this might just be the book for you.
Exocet on LibraryThing 3 months ago
Very poor treatment of the topic, and this is a shame because the author is an excellent journalist that produced other fine works. However, this title should be avoided by anyone who is interested in knowing what went wrong during the go-go years.
Davidthemightytexan More than 1 year ago
so here is the blueprint for wrecking a stock market. this book has been out six years. there is a cast of nefarious evil-doers and their methods. but no one cared because no one read this book. lowenstein does a fine job of breaking down the causes of the great tech bubble. the device used to cause this mess was off-balance sheet entities. i studied accounting in college. professors of accounting guard their trade like priests guarding a holy relic. come to find out from this book, their are no rules to accounting at all. just ask scrushy, or ken lay. accounting, like everything else dealing with money is purely subjective.
Guest More than 1 year ago
Stunning redendition of the events of the dot-com and tele-com bubbles. While these events were going on we all knew that there was something inheirently wrong, but could not get a handle on it. Roger Lowensten masterly relates these events so that the layman can understand the gross corruption and greed that prevailed during these times. A must read for any investor or business executive.
Guest More than 1 year ago
Accomplished financial journalist Roger Lowenstein weaves a captivating tale in this history of the late 1990s market boom and subsequent bust. The story reads like a thriller, complete with powerful bad guys (played here by CEOs), innocent bystanders (ordinary investors) and hapless observers (ineffective government regulators). While it does not offer specific tips on avoiding fraud or implementing change on Wall Street ¿ indeed, the author admits that real change in that bastion of enlightened self-interest may be impossible ¿ this book is a valuable cautionary tale. Lowenstein traces the evolution of creative accounting practices that blossomed into blatant fraud and eventual bankruptcy, finally forcing the notoriously pro-business Bush administration into pushing for corporate governance reform. Along the way, he exposes the myths of the dot-com era and deconstructs the sham of shareholder value. He makes trenchant observations about a financial culture that allowed the ultra rich to get richer, while fully half of Americans never participated in the boom or benefited from it, although everyone paid the price of the bust. We recommend this book to anyone who lost money when the bubble burst ¿ better luck next time.