Ten years on from the financial crisis seems like an appropriate time to recognise one of the few people who saw it coming at the time.
Gillian Tett is a long standing FT journalist who started running the FT’s capital markets team in late 2005 and had the dubious pleasure of spending time with the very traders who were moving around the toxic instruments that later triggered the collapse. Her book on the subject, Fool’s Gold, is one of the best reads of the financial crash.
Depending on how it is measured the 2007 financial crisis lost the global economy anywhere between the GDP of the U.K. and several times the GDP of the entire planet. The costs are still being felt today as ten years on many people have suffered from stagnant wage growth and those who have no capital have been largely economically left behind. The medicine used to ‘cure’ the crisis may well have just made the next crisis bigger. Very few people have been held accountable for what happened and many of those individuals have done rather nicely out of it.
It could be argued that the real reason behind the crisis was how the banks had become global and started lending huge sums to each other. When this inter-bank lending seized up the whole banking system crashed and needed a Ctrl Alt Delete. Undoubtedly though the trigger was the implosion of a series of opaque financial contracts that very few people were aware of and even fewer understood. All of a sudden we were all trying to grapple with what CDOs (Collateralised Debt Obligations) were and why they were making us all poorer . Either way Gillian spotted that something was brewing and started writing about it.
It is perhaps because of her background and interest in Anthropology that she has remained such a compelling read ever since. The number of writers on economics that are actually readable is a small one but Gillian manages to find the human story behind many of the major issues. Her writing is worth seeking out and worth reading.