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The Culture That Makes an MF Global Possible

Karen Ho, the author of Liquidated, an outstanding ethnography of contemporary Wall Street that explains how its internal culture spills out into the American economy, discusses the mindset that can bring down a huge financial firm run by terribly bright people.

I’ve said it over and over and over again: Karen Ho’s Liquidated, if not the best book about the financial crisis (and I think it might be), is at least the most slept-on. There are a lot of good ones to read: The Two Trillion Dollar Meltdown by Charles Morris, 13 Bankers by Simon Johnson and James Kwak, Too Big to Fail by Andrew Ross Sorkin, The Big Short by Michael Lewis, and so forth. The latter are excellent explanations of how it happened; Ho’s book is an excellent portrait of how it could have happened, which is to say—how did so many smart people break all their companies at once? How did MF Global manage to do it when you’d think everyone would realize how thin the ice has become?

It’s an ethnography, Dr. Ho’s doctoral dissertation, so don’t go in expecting Michael Lewis. If anything, it’s like the academic version of Lewis’s first book, Liar’s Poker, an exploration of the culture of Wall Street in crisis.

MF Global and Liquidated are two things that have captured my attention in the past couple years, so I was excited to see Ho, almost three years after her book came out, on Up With Chris talking about her work in the context of MF Global (along with Alexis Goldstein of Occupy the SEC). It’s a good introduction to her work.

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