All the Devils Are Here: The Hidden History of The Financial Crisis.

• Author: Marshall, Jeffrey
• Position: Book review

By Bethany McLean and Joe Nocera. Portfolio, 398 pages. $32.95

What a subject. Many books have tackled it, in various ways, from the theoretical to the anecdotal. The theoretical looks at the impact of credit-default swaps and other exotic securities and the ways in which they were misunderstood and misused, fashioning a worldwide house of cards that triggered the demise of Lehman Brothers and then a panic that almost brought the global economy to its knees.

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McLean and Nocera have chosen the alternate route, the anecdotal one. They are wonderful storytellers, and have produced a well-researched sampling of firms--and individuals--who contributed to the meltdown. At bottom, they write, the blame is shared by a host of devils, not just a few. Ultimately, they write, it wasn't a crisis about mortgages or derivatives--it was about human nature.

Perhaps that's a bit disingenuous: the mortgages and derivatives became the manifestation of the financial nightmare. They were the Frankenstein monster patched together by their human creators, and there were many hands at work.

No area is spared from the author's critical gaze: mortgage firms, investment bankers, rating agencies, traders and insurers and even regulators. They single out former Federal Reserve Chairman Alan Greenspan--virtually a deity in the financial markets for two decades--for turning a blind eye to unsound lending practices that helped trigger the granddaddy of all housing bubbles.

Human nature was a clear villain at Countrywide Financial, the massive mortgage firm that was a powerful contributor to the subprime debacle. The firm was led for decades by Angelo Mozillo, who refused to accept his firm losing market share to lesser firms more...