Rating: 
Summary: A great read
Review: Considering the lack of access the author had to the key principals, he sure did write a good, clean, fast read. The book and financial lingo was simple and easy to understand. I know that all the investors losing money is not funny, in fact I am one of them, but the hubris that comes through from all the so called investing experts is amazing.
Rating: 
Summary: Fascinating insights into the world of high finance
Review: This book describes in detail the rise and fall of a company named "Long Term Capital Management" (LTCM). You may remember that in September 98 the world was stunned by reports that this until then largely unknown company had gotten into trouble. So much trouble in fact, that for a while financial chaos on a global scale threatend. What made this development all the more astonishing was the presence of two economics noble laureates amongst the partners of the firm. The author keeps the description of the financial transactions at a level that can be understood by virtually anyone. He paints a colorful picture of the characters that made up the firm. As the drama unfolds, the whole thing becomes "alive". The book is great fun to read. In fact, the author does such a good job that the book reads like a novel. Those with a strong background in finance must realise that there are no side bars or the like regarding the transaction details. This is not an economical analysis of the collapse of LTCM.
Rating: 
Summary: When economics fail
Review: Lowenstein does a good job in writing this account of Long Term. Compared to the classic "Liar's Poker" (another book where Meriwether appears, and important enough that Lowenstein quotes from it), the writing is much drier and the descriptions less atmospheric. However, since Lowenstein was stonewalled by Long Term, it's probably the most description anyone could manage. "When Genius Fails" paints Meriwether's economists as a bunch of learned yet socially inept eggheads who get dropped loose onto Wall Street. The results are funny to begin with, especially when some of them start spouting libertarian philosophy and other ivory tower drek. However, when they stick to their abstract theories as Russia defaults on its loans and the markets don't act how they "should," they nearly end up tanking the entire economy. This book should throw cold water on anyone studying econometrics and other high-level economics. The sad fact, as this book demonstrates, is that beyond a certain point, economics is not a science. Unfortunately, Lowenstein paints a dismal picture at the end, namely how economists like Merton have returned to the academy and are adding epicycles to their theories rather than admit that their fundamental assumptions are wrong to begin with. Investors may find this book useful as well. As Lowenstein warns, the next time another "economic genius" tries to pull another stunt like this, the best thing to do is run away and accept that the free market is not something that can be leashed.
Rating:
Summary: A Nearly Perfect Piece of Journalism
Review: This is truly an excellent book. The tale of LCTM is an important one for a number of reasons -- not least because the bailout orchestrated by the Federal Reserve was a major milestone in the Fed's ill-advised tendency to protect speculators from the consequences of their own actions. The details of what LCTM did are extraordinarily complex, but Lowenstein does an excellent job of giving the reader enough information to understand the tale without getting bogged down in trying to explain the details of swap spread derivatives. You don't need to be an Wall Street whiz to understand this book, although it would probably help if you at least read the financial pages now and then. Lowenstein also excels at telling the human tale -- he makes the arrogance and greed of the LCTM players on their way up very real, and conveys their bafflement and confusion on the way down. What remains astouding about the entire story, as Lowenstein points out, is that a group of people could be so intelligent and learned and yet make bonehead thinking errors that would be readily apparent to a C student in Econ 101. In that sense, LCTM is a universal human story about the dangers of self-delusion and hubris.
Rating:
Summary: Second best financial book ever
Review: After 'Reminiscences of a Stock Operator (Edwin Leferve)' this is the best financial market book there is. Well written, well researched, non-technical with a great ending. Regardless of the critisms of the biased telling of the tale (many of the traders involved refused to 'testify' so most of the information is reputed to have come from Scholes) it is still a great read!
Rating:
Summary: Engrossing read
Review: The author gives an engrossing read about the LTCM debacle in this book. His writing style, in my opinion, really captures my attention and almost turns the book into a Grisham-style page-turner. After reading the book, you will have a better idea of the reasons why the fund failed. Also, you will gain more qualitative knowledge about hedge funds, derivatives markets and investing in general. However, if you are looking for equations and quantitative stuff, then sorry man, you will be greatly disappointed. Don't expect to find the Black-Scholes equation here. Nor do I think it's necessary. As a finance student, I'm tired of having to know the complex equations and quantitative stuff inside-out, without the slightest idea of how they should be used and their limitations.
If you have the basic idea or training in quantitative finance, the this book is a must-read. It sheds light on the untold stories in derivatives trading. The downfall of LTCM should be a very somber and sobering reminder of the limitations of the derivatives markets. Too much credit is given to "risk management" and "quantitative finance". I think every portfolio manager and derivatives trader should keep this in mind.
Rating:
Summary: Complexity beautifully articulated for the lay person
Review: Lowenstein does a phenomenal job of articulating the complex nature of finance. The story is exciting and the book is a fast read. Great business lessons emerge in the power of your network, the power of your competitors and the need to keep your ego as well as your portfolio in check.
Rating:
Summary: Excellent! Reads like a novel.
Review: This is a superb telling of the crash of Long-Term Capital Management and the fallout that ensued. This book is very readable, and actually reads like a novel. If you did not know that this was non-fiction, you might actually think that it was the creation of a novelist. The book really details the stunning failure of the financial models that LTCM developed to trade the markets. If you are a staunch believer in the academically-inclined efficient market theory, don't read this book. However, if you want to read a story that details the fallibility of people and computers, pick up a copy of this book.
Rating:
Summary: Really good stuff
Review: Interesting book with lots of detail and insight into LTCM's rise and fall as well as a glimpse into the inner workings of the big Wall Street players. Gives one pause to see how things are really done there.
Rating:
Summary: Good analysis, but fails to address the real problem
Review: This book is about a defunct era, that of the 1990s, and it well-documents the rise and fall of Long-Term Capital Management. As Robert Shiller's related text, Irrational Exuberance, shows, the 1990s, like most American boom times, were characterized by a faith in a basket of propositions including technology and "rationality." Because of a faith in a rationality that was more a sign and less a fully-investigated phenomenon, banks and investors threw money at John Meriwether and his band of merry men. Their rationality consisted in a thoroughgoing application of Merton-Scholes trading models to finance, which replaced integer, discrete models with continuous models. Unfortunately, a hidden presumption was 100% faith in Say's Law: that markets always clear, and any buyer will find his seller. As Lowenstein shows this presumption failed in Aug 1998, and, if any further refutation was needed, it failed again after Sep 11 when the closing of the exchange was a refutation of Say's Law. Note that the "rationality" was a shaky edifice based on classical economics. Meriwether would have done well to read Barbara Ehrenreich's Sullivans' Travels like book, NICKEL AND DIMED: On (not) getting by in America, for a technical reason. This is because in the REAL world of the poor and middle class, Say's Law is a fantasy, and transaction costs, owing to the laws of small numbers, overwhelm an economic "rationality" which is based on a high and positive net worth. In the real world, people trained for jobs cannot get them (there is no buyer for the seller) and the ATM won't dispense under 20.00 even if you prefer it would (there is no seller for the buyer.) Banks were chasing after Meriwether because they had millions of dollars to lend, and not once did they think about directing these funds to real needs including microlending. As a result, boys are dying in Peshawar because the only work available to them is digging for scraps of metal. For this reason alone, the tax law needs to be revised to return to steeply progressive levels (90 cents on the last dollar earned by the wealthy), and to prevent overly elaborate arbitrage in the future. Unfortunately, Lowenstein instead recommends that we consider a mystified "human factor." In actuality, it is probable that Meriwether's software people could have predicted the anomalous developments of August 1999 and from Lowenstein's book it appears that they were neither asked, nor given information about the real prospects of the firm. This is not a human factor, it is the mathematical casting-in-concrete of the "laws" of people whom Keynes described as long-dead scribblers, resurrected by madmen in authority.
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