BORROWED TIME

A relentless exposé of the 200-year-old banking enterprise.

During the early decades of the United States, after the colonies broke away from the British, the Founding Fathers engaged in lengthy, heated debates about the wisdom of creating a central bank under the aegis of the government. One of the entities that eventually emerged from these debates was what we call Citibank or Citigroup. Freeman, assistant editor of the Wall Street Journal’s editorial page, who used to be investor advocate at the Securities and Exchange Commission, and McKinley, a consultant and attorney, maintain that despite its facade of solidity for two centuries, the bank has experienced repeated massive failures only to be rescued each time by wealthy private investors and/or the federal government. Before the phrase “too big to fail” became all-too-familiar in the 2000s, it described a widespread perception within the circles of the wealthy during the 19th and 20th centuries. Moving the story along, the authors salt the narrative with colorful characters who have controlled the institution from top to bottom—e.g., Moses Taylor during the Civil War era, Frank Vanderlip before and during World War I, Charles Mitchell during the Great Depression, Walter Wriston (1967-1984), and a cast of miscreants who contributed to the 2008 financial crash. Throughout the book, the authors also profile members of Congress, Federal Reserve Bank governors, and others outside Citi. Unfortunately for millions of investors, even the smart, well-intentioned regulators turned out to be ineffectual at ameliorating the widespread chaos caused by Citi and similar financial institutions. The boom-and-bust cycles chronicled by Freeman and McKinley accumulate in chapter after chapter until it seems that Citi executives and government regulators were little more than a procession of villains. Readers may feel hard-pressed to identify even one hero in the book.

An exposé that might lead readers to stash their savings under a mattress.