July 19, 2011 2:36PM

What to Read on the Financial Crisis, Part I

I really couldn't find anything in John Tamny's fairly critical review of Reckless Endangerment by Gretchen Morgenson and Joshua Rosner to disagree with, but still I liked the book.  That may be because I spent most of the last decade as a staffer on the Senate Banking Committee, and I know that Josh was one of the few raising the early alarm bells about Fannie, Freddie (and FHA).

But I've also come to conclude that I liked the book because pretty much everything I've read on the financial crisis, regardless of who wrote it, has some pretty big flaws.  So now I have a pretty low bar for what's acceptable.  While Reckless Endangerment has lots of flaws too, it has fewer than the typical book on the crisis.

Anyway, in thinking about the many books out there, only one really strikes me as being anywhere near a full and perfect story.  Unfortunately said book has a low readership, and gotten almost no coverage.  So here it is: If you are only going read one book on the financial crisis, read Alchemists of Loss by Kevin Dowd* and Martin Hutchinson.  It isn't an easy read, but you won't find a better one -- at least not yet.

Now I hope you don't stop at reading just one, and so to assist in that endeavor, my Part II will be a longer list of fun summer reading on the financial crisis.

*Full disclosure, Kevin Dowd has had a long affiliation with Cato.