Reckless Endangerment How Outsized Ambition, Greed, and Corruption Created the Worst Financial Crisis of Our Time

Gretchen Morgenson and Joshua Rosner

St. Martin's Griffin



Trade Paperback

368 Pages



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In Reckless Endangerment, Gretchen Morgenson, the business columnist of The New York Times, exposes how the governement watchdogs who were supposed to protect the country from financial harm were actually complicit in the actions that finally blew up the American economy.

Drawing on previously untapped sources and building on original research from coauthor Joshua Rosner—who himself raised early warnings with the public and investors, and kept detailed records—Morgenson connects the dots that led to this fiasco.

Morgenson and Rosner draw back the curtain on Fannie Mae, the mortgage-finance giant that grew, with the support of the Clinton administration, through the 1990s, becoming a major opponent of government oversight even as it was benefiting from public subsidies. They expose the role played not only by Fannie Mae executives but also by enablers at Countrywide Financial, Goldman Sachs, the Federal Reserve, HUD, Congress, the FDIC, and the biggest players on Wall Street, to show how greed, aggression, and fear led countless officials to ignore warning signs of an imminent disaster.

Character-rich and definitive in its analysis, this is account of the financial crisis will interest and enlighten students of today's economy.


Praise for Reckless Endangerment

"In a series of clearly written narratives with many names, dates and figures, [Gretchen Morgenson and Joshua Rosner] show that government officials took actions that benefited well-connected individuals, who in turn helped the government officials. This mutual support system thwarted good economic policies and encouraged reckless ones . . . While many economists—including this reviewer—have argued that government actions caused the crisis, Morgenson and Rosner use their investigative skills to dig down and explain why those actions were taken. To avoid reckless policies in the future, we need to understand their causes, and the authors' identification of government-industry links deserves careful consideration by anyone interested in improving the economy. The book focuses on two agencies of government, Fannie Mae and the Federal Reserve . . . The book certainly does not let the private sector off the hook, but it is very hard to imagine that heavily regulated banks could have engaged in such extreme risk-taking without the support of regulators. Nobel prize-winning economist George Stigler warned long ago about 'regulatory capture'—the tendency for regulated firms to get protection from their regulators—and the authors provide considerable evidence of it in this book . . . It is important to take such claims and evidence seriously and to introduce government reforms as necessary. This, unfortunately, has not happened yet, as the authors emphasize in the conclusion, pointing to 'the irony of having two of the nation's most strident defenders of Fannie Mae sponsoring' the Wall Street Reform and Consumer Protection Act of 2010, which did not reform Fannie Mae."—John B. Taylor, professor of economics at Stanford University and senior fellow at Stanford's Hoover Institution, The Washington Post

"Americans who read this outstanding history of the financial crisis will know, by the end, exactly who created the meltdown of 2008 and how they did it. At times Reckless Endangerment unfolds like a hideous mirror image of the classic war movie Midway . . . In Ms. Morgenson and Mr. Rosner's book, a bipartisan parade of famous Washington movers-and-shakers appear in cameos to do some disservice (now largely forgotten) to taxpayers . . . Perhaps the most amazing part of this tale is that so many of those responsible for the disaster remain in power. [An] excellent story."—James Freeman, The Wall Street Journal

"Most explanations of the financial calamity have been indecipherable to people not fluent in the language of ‘credit default swaps' and ‘collateralized debt obligations.' The calamity has lacked human faces. No more. Put on asbestos mittens and pick up Reckless Endangerment, the scalding new book by Gretchen Morgenson, a New York Times columnist, and Joshua Rosner, a housing-finance expert . . . Reckless Endangerment is a study of contemporary Washington, where showing ‘compassion' with
other people's money pays off in the currency of political power, and currency."—George F. Will, The Washington Post

"The authors are at their best demonstrating how the revolving door between Wall Street and Washington facilitated the charade . . . Although the rest of America has paid dearly, we seem more recklessly endangered than ever."—Robert B. Reich, The New York Times Book Review

"Ms. Morgenson and Mr. Rosner have done what is uncommon: produce a book that is substantive but also readable, even entertaining. The result is a Washington ‘whodunit' story—the authors report not only what happened, but who did what . . . Books often are called ‘must-read.' But Reckless Endangerment really is a ‘must-read' for anyone who wants to understand the crash of 2008 and why more government-created economic crises are likely in the future."—Doug Bandow, The Washington Times

"[Morgenson and Rosner] provide the best account yet of how this system went off the rails . . . Reckless Endangerment may be the umpteenth book on the crisis, but it sheds new light on its causes."—The Economist

"Gretchen Morgenson, a New York Times business reporter and columnist, is never one to pull her punches—and certainly not in her new book, Reckless Endangerment . . . Throughout the financial crisis, Morgenson has persistently ferreted out instances of wrongdoing in the mortgage market . . . The authors' arguments are powerful."—William Cohan, Financial Times (UK)

"An engaging and insightful analysis of the subject . . . Morgenson and Rosner are great at filling in the details . . . One of the more readable and thought-provoking takes on the financial crisis from which the nation is still trying to extricate itself."—Claude R. Marx, The Boston Globe

"A worthy addition to the genre . . . Drawing on their deep expertise, the authors ably trace the legal and regulatory changes that stoked the unsustainable housing boom . . . Illuminates several small decisions that later had huge, unintended consequences . . . A particular strength of this book is the number of doubters the authors unearthed . . . The reader has a sickening sense of missed opportunity as these prophets are ignored or, worse, vilified, by those in a position to halt the mania."—Pam Luecke, The New York Times

"A great revisionist history . . . Reckless Endangerment utterly deflates the perceived history of the 2008 crash."—Mona Charen, National Review

"Gretchen Morgenson is a national treasure. Year after year, she has dragged Wall Street miscreants out of the shadows, exposing their dirty secrets to the public that they bamboozled with schemes and deceits. Now, working with Joshua Rosner, she has trained her expert eye on the mortgage mess that pushed the American economy to the brink. In stunning detail, Morgenson exposes the truth behind the worst financial calamity of modern times, weaving a tale that is as mesmerizing as it is horrifying. Reckless Endangerment names the names and reveals the secrets of the plutocrats and politicians whose greed and recklessness threatened the foundations of capitalism. It is essential reading for anyone struggling to understand how America entered the new era of financial chaos."—Kurt Eichenwald, New York Times bestselling author of Conspiracy of Fools and The Informant

"Even before Reckless Endangerment, Gretchen Morgenson was my nominee for Reporter of the Decade for her forensic and prophetic coverage of Wall Street. Now, she and the equally talented sleuth Joshua Rosner, like Holmes and Dr. Watson, have pieced together the clues to a seminal mystery of the financial debacle: how American taxpayers were suckered by the shenanigans, greed, egos, back scratching, and guile of financial and political elites who swarmed like vultures around Fannie Mae, picking it clean of oversight and accountability while its executives gorged themselves on the spoils. Naming names and taking no prisoners, they drill deep into one of the most disturbing scandals of our time, perpetrated in the name of helping "the little guy." Read it and weep. Read it and vow: Never Again!"—Bill Moyers, journalist, and President of the Schumann Media Center

"Morgenson and Rosner have written the long-awaited volume that gets to the heart of the mortgage crisis. The fearlessness and breadth of reporting make the book as compellingly readable as it is exhaustive. Reckless Endangerment is a remarkable achievement—and should be required reading for all Americans."—Bryan Burrough, Vanity Fair special correspondent and bestselling author of Barbarians at the Gate and The Big Rich

"Gretchen Morgenson and Josh Rosner show us how, over the last fifteen years, the mortgage lending industry used money and political influence to escape regulation, enrich itself, and create a catastrophe. Particularly in its dissection of Fannie Mae, Freddie Mac, and their enablers, this book is unmatched in its depth and invaluable to anyone interested in the causes and lessons of the financial crisis."—Charles Ferguson, Academy award-winning director of Inside Job

"A chilling account of the reckless disregard for ethical or civilized values at the heart of our financial system. If this compelling history does not completely turn your stomach, that's good—because by bailing out these individuals, their attitudes, and their way of life, we have set ourselves up for another nauseating turn of the Financial Wheel."—Simon Johnson, co-author of 13 Bankers: The Wall Street Takeover and The Next Financial Meltdown

Reviews from Goodreads



  • Gretchen Morgenson and Joshua Rosner

  • Gretchen Morgenson is a business reporter and columnist at The New York Times, where she also serves as assistant business and financial editor. She was awarded the Pulitzer Prize in 2002 for her "trenchant and incisive" coverage of Wall Street. Prior to joining the Times in 1998, she worked as a broker at Dean Witter in the 1980s, and as a reporter at Forbes, Worth, and Money magazines. She lives with her husband and son in New York City.

    Joshua Rosner is a managing director at the independent research consultancy Graham Fisher and Co. and was among the first analysts to identify accounting problems at the government-sponsored-enterprises and to warn of the coming credit crisis. He advises regulators and institutional investors on housing and mortgage-finance-related issues. He lives in New York City.

  • Gretchen Morgenson Fred R. Conrad, The New York Times
    Gretchen Morgenson
  • Joshua Rosner Dennis Drenner