The early the 1970s saw the breakdown of the system of the post-war system of fixed exchange rates established by the Bretton Woods in 1945, the final demise of the gold standard, the globalisation of banking as European, American and Japanese banks built up a substantial presence in all the main financial centres of the world, and the build up of huge amounts of rootless capital looking for a profitable home, e.g. the “petro-dollars” of the oil-rich Arab states after the OPEC price shocks. Developments in computing and telecommunications from the 70s onwards greatly facilitated the ease of transferring capital around the world.
The economic and political changes of the early 1970s also increased the opportunities for crime. Even the Vatican Bank was not immune. It and the Banco Ambrosiano was just two of a number of companies in Italy that were caught up in Italian banking scandals involving the Mafia, intelligence agencies, terrorists and arms dealers. Two of the principal figures were Michele Sindona and Roberto Calvi. Sindona was convicted in the U.S. on 65 counts of fraud and in 1984 was extradited to Italy where he was sentenced to life for murder. Two years later he was poisoned in his cell. Roberto Calvi also came to an untimely end. He was convicted by an Italian court in 1981 of illegal currency transactions. In 1982, a year after being convicted by an Italian court of illegal currency transactions, he was found hanging from a London bridge, possibly murdered. $400 million is still missing. These scandals were described inPower on Earth by Nick Tosches, St.Peter’s Banker by Luigi DiFonzo, God’s Banker by Rupert Cornwell, and The Calvi Affair by Larry Gurwin, and The Moneychangers : how the Vatican Bank enabled Roberto Calvi to steal $250 million for the Heads of the P2 Masonic lodge by Charles Raw.
Against such a background the first stirrings of a renaissance in financial fiction began.
In the early 1970s a young Canadian-born banker called Paul Erdman was being held in a Swiss jail as a result of an illegal scheme to corner the world cocoa market. While there he occupied himself profitably by writing The Billion Dollar Sure Thing which was first published in 1973, the start of a new career as the author of financial thrillers. His subsequent works in this genre include The Crash of ’79, the Silver Bears, the Swiss Account, Zero Coupon, and the Set Up. The Swiss Account has been unusually influential for a novel since it helped to stimulate efforts to recover Jewish assets deposited in Swiss banks before the Holocaust. Erdman has also published works of non-fiction, What’s Next?, written after the 1987 stockmarket crash, and in 1996Tug of War : Today’s Global Currency Crisis. Paul Erdman died in April 2007 after delivering his tenth and last novel, the Great Game, to the publishers.The Great Game is set in Uzbekistan and deals with politics and the oil industry.The title is taken from the phrase Rudyard Kipling used in his novel Kim to describe the rivalry between Great Britain and Russia in Central Asia in the late 19th century.
In the 1960s and 1970s Arthur Hailey, a British/Canadian writer, had a stream of enormously successful novels set in very different work places, as indicated by some of their titles; Hotel, Airport, Wheels, the Evening News. The Moneychangers, his foray into the world of banking and finance, tells the story of the seemingly respectable and sound First Mercantile American Bank which is ridden by corruption and incompetence. Hailey based the character Lewis Dorsey on his friend Harry Schultz who, according to the Guinness Book of Records, is the highest paid investment consultant in the world. The main theme is the power struggle between two of the vice-presidents of the bank, one ruthless and the other the institution’s conscience.
Other minor themes include the hidden dangers of credit cards and the lure of gold, both topical when the book came out in 1975 as credit cards were still a novelty then and the US had finally abandoned the gold standard just two years earlier. Hailey has maintained his interest in gold and from 1999 onwards has been an enthusiastic campaigner for GATA, the Gold Anti-Trust Action committee. In May 2002 he was a member of the GATA delegation that attended a mining industry analysts conference in London where they gave a presentation on what they allege is a plot by central banks to keep the price of gold down.
For a detailed portrait of Arthur Hailey’s career see the book by his wife Sheila Hailey, I married a best seller, 1978.
Michael M. Thomas
Michael Thomas was inspired to start writing in 1978, by which time he had spent 17 years on Wall Street when he read Little Dorrit and recognized in Dickens’s portrayal of the financier Merdle, exactly the sort of person he had regularly dealt with. The OPEC Oil crisis and its effect on Western capitalism provided the theme for his first novel, Green Monday. Two decades later Scott Burns, a financial journalist, writing in The Dallas Morning News, described the book as “stellar economic prediction.” In Black Money, published in 1994 a puzzling entry in the records of a failed Savings & Loan organisation leads to the unravelling of an enormously complicated scheme for laundering drug money. Baker’s Dozen (1996) involves a takeover of a failing manufacturer as a favour for a congressman a mystery unfolds as two key figures meet gruesome ends. Among his other novels on business themes are Someone Else’s Money, Hard Money and Hanover Place.
William Gaddis, who has been compared with James Joyce, Herman Melville, and Thomas Pynchon, was born in New York in 1922 and studied at Harvard where he edited the satirical Harvard Lampoon. After working as a fact checker with the New Yorker for a couple of years he gave up his job so that he could spend several years travelling in Central America, the Caribbean, North Africa and Europe. During that period he gathered material material and found inspiration for his first novel The Recognitions, about an aspiring artist, restorer and forger of Flemish masterpieces, which was published in 1955. Being a long, difficult novel it was not very successful at first but subsequently won critical acclaim. After a gap of twenty years, during which time he worked in public relations and as a speech writer, Gaddis produced his second novel, JR. Hailed by one critic as “the greatest satirical novel in American literature” its theme is money but its style is very unusual as the 726 pages are composed almost entirely of dialogue. The eponymous hero of the story is JR Vansant, an eleven year old schoolboy who deals in junk bonds and penny stocks from the public telephone booth in his school. Vansant builds up a financial empire with unintended, disastrous consequences. If Tom Wolf’s Bonfire of the Vanities is the definitive satire on the Wall Street of the 1980s, Gaddis’ JR was a prophetic depiction of what was to come.
Zachary Stone was the pseudonym used by Ken Follett in his early, rather unsuccessful novels. One of these, Paper Money, was written to show how crime, high finance, and journalism are corruptly interconnected. There is more about Follett in the section on the Rise of the Yuppie and the Social Commentators.
Peter van Greenaway
Peter van Greenaway was a British novelist who was born in 1929 and died in 1988. He originally worked as a lawyer before becoming a full-time writer. His novels cover a wide range of subjects but some of them deal with political subjects, e.g. The Man Who Held the Queen to Ransom and Sent Parliament Packing, published in 1968, is about a coup in Britain. Suffer! Little Children, published in 1976, deals with an attempt to end terrorism in Northern Ireland. A couple of years earlier Take the War to Washington was first published. That novel is about the actions of a group of disillusioned Vietnamese War veterans who attempt to bring that conflict to an end by unleashing a campaign of terror in the United States. Among their targets are the Pan Am and Empire State Buildings, with inevitable effects on Wall Street and the world money markets. They also crash a passenger airliner into the Pentagon. In the wake of the the attacks by terrorists on the World Trade Center and the Pentagon in September 2001 the plot seems chillingly eerie.
James Patterson studied English literature at Vanderbilt University and after graduating started a career in advertising with J. Walter Thompson, North America where he created award-winning campaigns for Kodak, Burger King and other well-known firms, rising to the position of chairman of the agency in 1990, a position he occupied until 1996. He is now a full-time writer. His first novel, The Thomas Berryman Number, was published in 1976. Eleven years later came the publication of his financial thriller, Black Market. The plot involves an unknown terrorist group which blows up several buildings in Wall Street, thus causing chaos in the world’s financial markets. With hindsight after the destruction, with a tragic loss of life, of the twin towers of the World Trade Center by terrorists in September 2001 the novel looks prophetic. Black Market has been reissued in Great Britain and a new version of the book has been published in the United States under the title Black Friday.