Crashed audiobook cover - How a Decade of Financial Crises Changed the World

Crashed

How a Decade of Financial Crises Changed the World

Adam Tooze

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Economics

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Crashed
Origins in the US+
European Banking Contagion+
Divergent Crisis Responses+
Geopolitical Fallout+
London's Decline & Brexit+
US Political Upheaval+

Quiz — Test Your Understanding

Question 1 of 9
What practice allowed lenders to justify offering high-risk 'subprime' mortgages prior to the 2008 crash?
  • A. Relying on federal government insurance programs to cover any potential borrower defaults.
  • B. Bundling massive numbers of mortgages together and selling shares in them to spread out investor risk.
  • C. Requiring borrowers to put down unusually large collateral deposits to secure the loans.
  • D. Strictly limiting the number of subprime mortgages to less than 5 percent of their total lending portfolio.
Question 2 of 9
Why were European banks particularly vulnerable when the US housing market collapsed?
  • A. They had much higher leverage ratios than US banks, leaving them without enough cash to cover their debts in an emergency.
  • B. European Union laws strictly prohibited them from receiving any form of government bailout.
  • C. They had abandoned traditional banking in Europe to exclusively trade in the US real estate market.
  • D. They relied entirely on the Euro, which rapidly lost its value against the US dollar during the crisis.
Question 3 of 9
How did the Eurozone's initial response to the financial crisis differ from that of the United States?
  • A. The Eurozone immediately printed more Euros to buy up securities, while the US relied on strict austerity measures.
  • B. The Eurozone implemented a unified, cross-border bailout, while the US left economic recovery up to individual states.
  • C. The US injected massive liquidity through quantitative easing, while the Eurozone failed to coordinate a joint approach due to political resistance.
  • D. The US immediately called in the International Monetary Fund, while the Eurozone relied solely on the European Central Bank.
Question 4 of 9
What was the primary condition imposed on struggling Eurozone countries, like Greece, by the 'troika' in exchange for bailout payments?
  • A. The implementation of extreme austerity measures, such as slashing public sector jobs and raising the retirement age.
  • B. The requirement to abandon the Euro currency and return to their original national currencies.
  • C. The immediate privatization of all national banks and the elimination of the national minimum wage.
  • D. The obligation to drastically increase government spending to stimulate local economic demand.
Question 5 of 9
According to the book, how did the 2008 financial crisis indirectly contribute to the 2014 conflict in Ukraine?
  • A. It forced Ukraine to default on its debts to Russia, prompting Vladimir Putin to seize Ukrainian assets as compensation.
  • B. It crippled Ukraine's steel industry, leading the desperate government to reject a small Western aid package in favor of a larger Russian one, which sparked mass protests.
  • C. It caused the European Union to aggressively expand its military presence in Eastern Europe to protect its financial investments.
  • D. It led to a total collapse of the Russian economy, causing Russia to invade Ukraine to secure essential agricultural resources.
Question 6 of 9
What historical factor originally allowed London to become the world's number one financial hub prior to the 2008 crash?
  • A. A light-touch regulatory environment that allowed bankers to take big gambles with offshore dollars.
  • B. Strict adherence to the Bretton Woods Agreement, which made the British Pound the global reserve currency.
  • C. A ban on foreign banks operating in the UK, creating a highly protected and profitable domestic monopoly.
  • D. Heavy government subsidies funded by revenues from North Sea oil exports.
Question 7 of 9
Which of the following was a significant domestic factor that drove the British public toward voting for Brexit?
  • A. A widespread desire to adopt the Euro currency to stabilize the British economy after the crash.
  • B. Public anger over government austerity cuts, which led to the scapegoating of EU migrants from Eastern Europe.
  • C. A direct mandate from the International Monetary Fund requiring the UK to leave the EU to receive bailout funds.
  • D. Prime Minister David Cameron's strong ideological opposition to the European Union and his aggressive 'Leave' campaign.
Question 8 of 9
What was a major source of bipartisan political anger in the United States following the 2008 financial crash?
  • A. The refusal of the US government to bail out any major banks, leading to a total collapse of the financial sector.
  • B. The implementation of a 35 percent wealth tax on the highest earners, which angered conservative voters.
  • C. The perception that Wall Street executives received massive bonuses while ordinary Americans lost their homes.
  • D. The decision to prosecute and imprison hundreds of low-level bank employees while ignoring senior executives.
Question 9 of 9
Why did candidates like Bernie Sanders and Donald Trump resonate so strongly with voters during the 2016 US presidential election?
  • A. They both promised to return to the moderate, centrist economic policies of the Obama and Clinton administrations.
  • B. They successfully channeled the public's lingering rage against the political establishment and Wall Street's influence.
  • C. They proposed expanding the 2008 bailout programs to protect international financial institutions.
  • D. They focused their campaigns entirely on foreign policy and the containment of Russian expansionism in Eastern Europe.

Crashed — Full Chapter Overview

Crashed Summary & Overview

Crashed (2018) unpacks the metaphorical seismograph to take the measure of an economic earthquake whose tremors can still be felt today – the 2008 financial crisis. Written with an eye to the global effects of what’s now known as the “Great Recession,” Adam Tooze traces the crash’s shockwaves from their epicenter in the American financial markets to their conclusions in Crimea, London, Athens and other geopolitical hotspots.

Who Should Listen to Crashed?

  • Economists, policymakers and anyone in financial trading
  • History buffs fascinated by the links between economics and politics
  • Disgruntled citizens wondering how politicians and bankers landed us in such a mess

About the Author: Adam Tooze

British historian Adam Tooze is a professor and the director of the European Institute at Columbia University, New York. His previous books include the Wolfson History Prize-winning The Wages of Destruction (2006), a study of Nazi Germany’s economic policies, and The Great Deluge (2014), an analysis of the Great War and the creation of a new international order.

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