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In 1920s Paris, a cadre of writers—Ernest Hemingway, F. Scott Fitzgerald, Ezra Pound, James Joyce, Gertrude Stein, and others— flowed in and out of Left Bank bars like their livers would never shrivel, their youth would never fade, and their talent would never die. The Great War was their influence and foil; it hardly would be controversial to claim that A Farewell to Arms would never have reached classic status had Hemingway not driven an ambulance in Italy, that The Great Gatsby would be missing its haunting melancholy without Fitzgerald’s exposure to the sorrow of post-war Europe.
Now, William Cohan’s Money and Power is not The Sun Also Rises or Ulysses. I know this, William Cohan knows this, but it is not outside the realm of reality to claim that we are living through a similar renaissance in financial literature. Our Great War is the global financial crisis; our masterpieces are the works of Cohan and his brethren.
I’m not sure Cohan was always in this group—which could be said to count Michael Lewis and Roger Lowenstein as its founding members—but, with this attempt, he is now. The best of financial journalism today must combine two things: details that entice, and a narrative arc that unites. In his earlier work—The Last Tycoons, his pre-crisis book on the history of Lazard Freres, specifically— Cohan leaned toward the encyclopedic. Details of any size were included. If you wanted to know what Felix Rohatyn ate for breakfast in 1975, you would check with Cohan. With Money and Power, however, the author tends toward 21st century literary prudence: still providing detail, but more willing to replace the mundane with the juicy. There is plenty of juice to go around: to read about the putsch orchestrated by Hank Paulson against Jon Corzine is worth the price of the book alone, saying nothing of the schadenfreude experienced during the section on Fabrice Tourre, the young man who, along with his indiscreet e-mails, was thrown to the wolves/ Congress by Goldman. (It turns out that the Fabulous Fab enjoyed messaging both his co-worker girlfriend and his Columbia grad-school mistress from his work e-mail account). While Tycoons was a good read, it bordered on forsaking readability for details; Money and Power balances the two, to the benefit of the reader. Proof of this can be seen in the very structure of the book. Like many an investment bank, Goldman had humble beginnings, and Cohan spends a respectable amount of time detailing the path of German immigrant “Marcus Goldman, Banker and Broker…buying and selling IOUs from local businessmen” in New York City following younger days in the “peddlers paradise” of Philadelphia but, unlike with Tycoons, perhaps, he realizes that the reader isn’t sitting on his couch in desperate anticipation of what Goldman did next with his reams of corporate paper. An overwhelming number of those who bought the book will have done so to gain insight into its more recent past, and Cohan gets this: The firm was founded in 1869 but, less than halfway through these 600 pages, we’re already in the Reagan-era boom.
This is a book for a different time in the financial world than when Tycoons was produced—and perhaps a different time in P Cohan’s world as well. It is not enough to be well-written—a book, to make an impact, must be well-read. Cohan seems to have come to this understanding, and the reader is the better for it. The majority of his time seems to have been spent pounding the driveways of current and former Goldman partners, and this research—much more so than the archival digging he will have had to do for the beginning of the book—brings it alive.
In the age of instant communication, it has become increasingly difficult to provide readers with something they haven’t read before. Hemingway could be relatively certain that there were inefficiencies in the coverage of the Italian front, thus allowing him space to fill with originality. Cohan, dealing with Goldman Sachs, has no such luxury. Lloyd Blankfein has stonewalled reporters before, and he’ll do it again. We now know plenty about how hedge fund billionaire John Paulson advised Goldman on an ABACUS synthetic CDO with the intent of choosing the worst mortgages possible so that his fund could short them. Like any efficient financial market, the good stories have been told. This leaves authors such as Cohan at a disadvantage compared with both a Wall Street Journal reporter and literary masters from a century ago.
What must be realized is that this doesn’t make books like this any less important or entertaining. Like Lewis, Lowenstein, and other works (Andrew Ross Sorkin’s Too Big to Fail comes to mind), Money and Power provides convenient access to the history, ancient and recent, of what now must be considered one of the most American of all institutions. Wall Street will now wait to see which subject he chooses next—and so will we. —Kip McDaniel
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