Liquidated

An Ethnography of Wall Street

Karen Zouwen Ho

Honorable Mention, 2010 Gregory Bateson Book Prize, Society for Cultural Anthropology

Narrated by Cynthia Wallace

Available from Audible

Book published by Duke University Press

Financial collapses—whether of the junk bond market, the Internet bubble, or the highly leveraged housing market—are often explained as the inevitable result of market cycles: What goes up must come down. In Liquidated, Karen Ho punctures the aura of the abstract, all-powerful market to show how financial markets, and particularly booms and busts, are constructed. Through an in-depth investigation into the everyday experiences and ideologies of Wall Street investment bankers, Ho describes how a financially dominant but highly unstable market system is understood, justified, and produced through the restructuring of corporations and the larger economy.

Ho, who worked at an investment bank herself, argues that bankers’ approaches to financial markets and corporate America are inseparable from the structures and strategies of their workplaces. Her ethnographic analysis of those workplaces is filled with the voices of stressed first-year associates, overworked and alienated analysts, undergraduates eager to be hired, and seasoned managing directors. Recruited from elite universities as “the best and the brightest,” investment bankers are socialized into a world of high risk and high reward. They are paid handsomely, with the understanding that they may be let go at any time. Their workplace culture and networks of privilege create the perception that job insecurity builds character, and employee liquidity results in smart, efficient business. Based on this culture of liquidity and compensation practices tied to profligate deal-making, Wall Street investment bankers reshape corporate America in their own image. Their mission is the creation of shareholder value, but Ho demonstrates that their practices and assumptions often produce crises instead. By connecting the values and actions of investment bankers to the construction of markets and the restructuring of U.S. corporations, Liquidated reveals the particular culture of Wall Street often obscured by triumphalist readings of capitalist globalization.

Karen Zouwen Ho is Associate Professor of Anthropology, University of Minnesota.

REVIEWS:

“Liquidated: An Ethnography of Wall Street asks many questions that those who work in the investment field should ask themselves. Is constant change at investment banks wrong? Or is it an intelligent way of operating in a competitive, rapidly changing global business? Wall Street firms that succeed over the long run are adept at quickly shutting down business units that prove to be nonstrategic and starting new ones. As for job insecurity, it leads investment bankers to morph instantly into successful job hunters and mobile survivors. Although many in the financial industry will not agree with Ho’s hypotheses and conclusions, they will be challenged by the questions she raises and enthralled by the body of fieldwork she presents.”

—Janet J. Mangano and Martin S. Fridson , CFA Institute

“Liquidated is a must-read book for anyone interested in how legions of recruits from Ivy League colleges come to espouse and enact the twisted bundle of class interests and market ideology that constitutes neoliberal capitalism.”

—Kathryn Dudley, American Studies

“Liquidated is an interesting description of many of the practices and orientations that exist in large investment banks, one that confirms what the reader may suspect: that these institutions are forcing-grounds for the sort of hubris and invulnerability that goes with the phrase ‘Masters of the Universe’, the incomprehensible money that sales staff receive, and the idea that they are ‘doing God’s work’. It also, however, indicates the reverse of the strength of the social studies of finance. Liquidated may help explain why those in investment banks think and operate in the ways that they do.”

—James G. Carrier, Journal of the Royal Anthropological Institute

“Karen Ho is my hero.... Her ethnography of investment bankers in the late 1990s, Liquidated, depicts the bravado, callousness, and contradictions that are the hallmarks of investment banking culture.”

—Mitchel Y. Abolafia, American Journal of Sociology

“Karen Ho has picked an excellent time to publish her fascinating new study ... of Wall Street banks.... As field-sites go, Wall Street is not classic anthropological territory: ethnographers typically work in remote, third-world societies.... Ho nevertheless embarked on her study in classic anthropological manner: by blending into the background, listening intently, in a non-judgmental way – and then trying to join up the dots to get a ‘holistic’ picture of how the culture works. That patient ethnographic analysis has produced a fascinating portrait that will be refreshingly novel to most bankers.”

—Gillian Tett, Financial Times

“A unique portrait of the industry that asks pertinent questions about constant change, job insecurity, and the banker’s identity.... Liquidated: An Ethnography of Wall Street asks many questions that those who work in the investment field should ask themselves.... Although many in the financial industry will not agree with Ho’s hypotheses and conclusions, they will be challenged by the questions she raises and enthralled by the body of fieldwork she presents.”

—Janet J. Mangano, Financial Analysts Journal

“For an alternative perspective on last year’s events, I recommend Liquidated: An Ethnography of Wall Street... The insights are highly pertinent to the events of 2008, since this ethnography provides a wider cultural context and analysis than most journalistic books.”

—Gillian Tett, Management Today

“Ho’s refreshing ethnography of the daily lives of Wall Street investment bankers ... outlines a web of practices, beliefs and structures that may be vital to understanding what keeps the market system in place despite built-in instabilities.”

—Publishers Weekly

“Ho's study shows the intense competitiveness that is instilled in these primarily Ivy League recruits even before they are finished with their Bachelor's degrees. And she examines the myth that stockowners and companies are best served by maximizing shareholder profits. If anything, this book gives faces to the people who work in that abstract entity called Wall Street that seems to affect our world so much of late. I highly recommend it, especially if you have no idea how the world of high finance operates.”

—James Franco, The Huffington Post

“The book’s great strength lies in Ho’s careful observation of the means by which people succeed or fail on Wall Street, as she punctures many of the assumptions about how markets work.”

—Keir Martin, Times Literary Supplement