Hostname: page-component-cd9895bd7-lnqnp Total loading time: 0 Render date: 2024-12-23T23:09:07.718Z Has data issue: false hasContentIssue false
  • English
  • Français

The Un-real Deal: Financial Fiction, Fictional Finance, and the Financial Crisis

Published online by Cambridge University Press:  20 October 2015

LAURA FINCH Open the ORCID record for LAURA FINCH [Opens in a new window]
LAURA FINCH*
Affiliation:
Program in Comparative Literature and Literary Theory, University of Pennsylvania. Email: [email protected].
Get access Rights & Permissions [Opens in a new window]

Abstract

The credit crisis of 2007–8 prompted a Manichean discourse that labeled finance the flighty and unreal other of the solidity of the real economy. Almost overnight the “speculative finance” shifted from a descriptive term to an evaluative one, with freewheeling finance singled out as the main cause of the crisis. The fictionality of finance is, of course, a fiction itself. Not only is finance a part of the real economy but since the 1970s it has played an increasingly significant part in it. This essay aligns with recent work in critical finance studies that puts pressure on the idea that finance can be separated from the real economy. Supplementing the world-historical scale at which this work often remains, this essay theorizes the real abstraction of finance through its lived social experience. The year 1973 was replete with financial events: the end of the Bretton Woods agreement and the gold standard, the Middle East oil crisis, the creation of the Chicago options exchange, and the invention of the Black–Scholes equation governing derivatives. It also saw the birth of the financial thriller with Paul Erdman’s The Billion Dollar Sure Thing. Seizing upon a formulaic genre and opening it up to a flood of real events from the trading floor, the financial thriller acts as a dynamic interface and sensitive seismograph for theorizing the fictionality of finance. This essay opens with a reading of Bret Easton Ellis’s American Psycho (1991) as an example of a work that renders real abstraction in an explicitly social way. Rather than viewing the novel as a hyperbolically postmodern reflection of abstract financial maneuvers, I argue that it is thickly embedded within the historically specific financial cityscape of 1980s Manhattan. I then turn to a comparative reading of recent financial thrillers written in response to the twenty-first-century credit collapse. Unlike Ellis’s novel, these thrillers strive to keep the unreality of finance segregated from the real economy at the level of plot, while also making use of generic strategies to do so at the level of form, pushing financial data into footnotes, descriptive asides, and a different tonal register of narrative. By reading these thrillers alongside American Psycho, a book written before the shock of terminal economic crisis, I offer a more historically nuanced reading of their attempts to salvage a workable economy out of the mess of the twenty-first-century American economy.

Type
Articles
Information
Journal of American Studies , Volume 49 , Special Issue 4: Fictions of Speculation , November 2015 , pp. 731 - 753
Check for updates
Copyright
Copyright © Cambridge University Press and British Association for American Studies 2015 

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

1 Andrew Leonard, “Panic on Wall Street,” salon.com, 17 Aug. 2007.

2 Chris Giles and Gillian Tett, “Analysis: Parallel Worlds? As Markets Suffer, Belief Persists in the Real Economy,” Financial Times, London edn, 17 Aug. 2007.

3 Glenn Milne, “Reality Is It's All a Bit Unreal,” Sunday Herald Sun, 14 June 2009.

4 John Authers, “Compare the Markets,” Financial Times, London edn, 22 May 2010, FT magazine section.

5 Lord Lipsey quoted in Adam Jones, “Details of Secret Bank Talks Revealed,” Financial Times, London edn, 21 Dec. 2010, national news section.

6 This debate created a huge range of wickedly satirical cartoons. The German-born American caricaturist and cartoonist Thomas Nast's “Milk Tickets for Babies” (1876) makes use of Humpty Dumpty to conflate the inflationary power of art with the feared inflation of paper money. See Marc Shell, “The Issue of Representation,” in Martha Woodmansee and Mark Osteen, eds., The New Economic Criticism: Studies at the Intersection of Literature and Economics (London and New York: Routledge, 1999), 44–64.

7 Greta R. Krippner, Capitalizing on Crisis: The Political Origins of the Rise of Finance (Cambridge, MA: Harvard University Press, 2011); David Harvey, The Enigma of Capital: And the Crises of Capitalism (Oxford and New York: Oxford University Press, 2010); Giovanni Arrighi, The Long Twentieth Century: Money, Power, and the Origins of Our Times (London and New York: Verso, 2010).

8 Krippner, 4.

9 Randy Martin, Financialization of Daily Life (Philadelphia: Temple University Press, 2002); Louis Hyman, Debtor Nation: The History of America in Red Ink (Princeton, NJ: Princeton University Press, 2011); Maurice Lazzarato and Joshua David Jordan, The Making of the Indebted Man: An Essay on the Neoliberal Condition (Los Angeles, Cambridge, MA and London: Semiotext(e) and MIT Press, 2012); Robert Reich, Supercapitalism: The Transformation of Business, Democracy, and Everyday Life (New York: Knopf, 2007).

10 Avsar, Rojhat B., “‘Financialization’ of Public Discourse: The Case of AIG,” On the Horizon, 22, 4 (2014), 239–44, 240CrossRefGoogle Scholar. An intermediate scale of analysis focusses on financialization as the drive to maximize shareholder value, leading to changes in the governance of corporations, turning to the behaviour of corporate actors (managers, shareholders, and employees). See William Lazonick, “How Shareholder Value Ideology Is Destroying the U. S. Economy,” in Gerald Epstein and Martin Wolfson, eds., The Oxford Handbook on the Political Economy of Financial Crises (Oxford: Oxford University Press, 2013), 491–511. This has been less appealing to literary and cultural studies, offering neither the powerful large-scale analysis of the Arrighian style nor the concrete minutiae of lived experience.

11 Buck-Morss, Susan, “Envisioning Capital: Political Economy on Display,” Critical Inquiry, 21 (1995), 434–67, 439–40CrossRefGoogle Scholar. For more on the discourse of the market see also Samuels, Warren J., “‘Truth’ and ‘Discourse’ in the Social Reconstruction of Economic Reality: An Essay on the Relation of Knowledge to Socioeconomic Policy,” Journal of Post Keynesian Economics, 13, 4 (1991), 509–24CrossRefGoogle Scholar. For the spread of financial terms into political discourse since the 1970s see Avsar.

12 Michael Lewis, Flash Boys: A Wall Street Revolt (New York: W. W. Norton & Company, 2014), 3.

13 For this terminology see Arrighi, 167. For the early 1970s as a periodizing marker see Clover, Joshua, “Value|Theory|Crisis,” PMLA, 127, 1 (2012), 107–14CrossRefGoogle Scholar; Rosenberg, Jordana and Rusert, Britt, “Framing Finance: Rebellion, Dispossession, and the Geopolitics of Enclosure in Samuel Delany's Nevèrÿon Series,” Radical History Review, 118 (2014), 64–91CrossRefGoogle Scholar; and Blanton, C. D., Lye, Colleen, and Puckett, Kent, “Introduction: Financialization and the Culture Industry,” Representations, 126, 1 (2014), 1–8CrossRefGoogle Scholar.

14 Lauren Berlant, “Thinking about Feeling Historical,” in Janet Staiger, Ann Cvetkovich, and Ann Morris Reynolds, eds., Political Emotions: New Agendas in Communication (Milton Park, Abingdon, and New York: Routledge, 2010), 229–45, 229.

15 In her excellent article “The Rules of Abstraction: Methods and Discourses of Finance,” Radical History Review 118 (2014), 93–112Google Scholar, 95, Leigh Claire La Berge writes, “in humanities-oriented academic discourse, ‘abstraction’ is perhaps the most commonly employed category used to describe finance.” It is worth noting that her article takes the dichotomy of complex/simple as the mainstream vocabulary for crisis, rather than my interest in the unreal/real.

16 Karl Marx and Ernest Mandel, Capital: A Critique of Political Economy, Volume III (Harmondsworth: Penguin in association with New Left Review, 1981), 516, italics added.

17 Ibid., 517, added emphasis.

18 Ibid., 518.

19 Jameson, Fredric, “Culture and Finance Capital,” Critical Inquiry, 24, 1 (1997), 246–65, 250–51CrossRefGoogle Scholar, italics added.

20 Haiven, Max, “Finance as Capital's Imagination? Reimagining Value and Culture in an Age of Fictitious Capital and Crisis,” Social Text, 29, 3 (2011), 93–124CrossRefGoogle Scholar; Edward LiPuma and Benjamin Lee, Financial Derivatives and the Globalization of Risk (Durham, NC: Duke University Press, 2004).

21 Karl Marx, Friedrich Engels, Ernest Mandel, Ben Fowkes, and David Fernbach, Capital: A Critique of Political Economy, Volume I (London and New York: Penguin Books in association with New Left Review, 1990), 183, added emphasis.

22 Ibid., 176.

23 Marx and Mandel, Capital, Volume III, 520.

24 Where he writes, “not only the study of the economy but the economy itself is constituted by a real abstraction from the comprehensive reality of valuations.” Georg Simmel, The Philosophy of Money (London: Routledge & Kegan Paul, 1978), 78.

25 Alfred Sohn-Rethel, Intellectual and Manual Labour: A Critique of Epistemology (Atlantic Highlands, NJ: Humanities Press, 1978), 96.

26 Bewes, Timothy, “To Think without Abstraction: On the Problem of Standpoint in Cultural Criticism,” Textual Practice, 28, 7 (2014), 1199–1220CrossRefGoogle Scholar, 1205.

27 Lütticken, Sven, “Attending to Abstract Things,” New Left Review, 2, 54 (2008)Google Scholar, n.p.

28 Toscano, Alberto, “The Open Secret of Real Abstraction,” Rethinkng Marxism, 20, 2 (2008), 273–87CrossRefGoogle Scholar.

29 Louis Althusser, “Cremonini, Painter of the Abstract,” in Althusser, Lenin and Philosophy, and Other Essays (New York: Monthly Press, 1972), 236–37.

30 Arrighi, The Long Twentieth Century, 375, added emphasis.

31 Clover, Joshua, “Autumn of the System: Poetry and Financial Capital,” Journal of Narrative Theory, 41, 1 (2011), 34–52CrossRefGoogle Scholar, 46, original emphasis.

32 Ian Baucom, Specters of the Atlantic: Finance Capital, Slavery, and the Philosophy of History (Durham, NC: Duke University Press, 2005), 26, 24.

33 Hensley, Nathan K., “Allegories of the Contemporary,” Novel, 45, 2 (20 June 2012), 276–300CrossRefGoogle Scholar, 297.

34 Avery F. Gordon, Ghostly Matters: Haunting and the Sociological Imagination (Minneapolis: University of Minnesota Press, 2008), 197–98.

35 In his essay on Marx's style, Keston Sutherland chides translations of Gallerte as “congealed labour,” arguing that Marx used this specific term for emphasis. Gallerte, an actual product, consists of “the undifferentiated mess of glue-yielding … animal substances industrially boiled down into condiments.” Of this gelatinous product, Sutherland writes, “all that is meat melts into bone, and vice versa; and no mere act of scrutiny, however analytic or moral, is capable of reversing the industrial process of that deliquescence.” Sutherland, Keston, “Marx in Jargon,” World Picture Journal, 1 (2008), 1–25, 7–8Google Scholar. This account emphasizes the irreversible bodily cost of Marx's analysis, and the impossibility of separating out terms by means of theoretical cenrtifuge.

36 Karen Zouwen Ho, Liquidated: An Ethnography of Wall Street (Durham, NC: Duke University Press, 2009), 35.

37 Theodor W. Adorno, Christoph Gödde, and E. F. N Jephcott, Introduction to Sociology (Stanford, CA: Stanford University Press, 2000), 31–32.

38 Theodor W. Adorno, “Late Capitalism or Industrial Society” (1968), at www.marxists.org/reference/archive/adorno/1968/late-capitalism.htm, n.p.

39 For Bateman as hyperbolic consumer see Weinreich, Martin “‘Into the Void’: The Hyperrealism of Simulation in Bret Easton Ellis's American Psycho,” American Studies, 49, 1, (2004), 65–78Google Scholar. As the sign of postmodernism see Brandt, Stefan L., “The City as Liminal Space: Urban Visuality and Aesthetic Experience in Postmodern U. S. Literature and Cinema,” American Studies, 54, 4 (2009), 553–81Google Scholar; and Cojocaru, Daniel, “Confessions of an American Psycho: James Hogg's and Bret Easton Ellis's Anti-Heroes’ Journey from Vulnerability to Violence,” Contagion: Journal of Violence, Mimesis, and Culture, 15–16 (2008–9), 185–200CrossRefGoogle Scholar. As a symbol of high finance see Zaller, Robert, “American Psycho, American Censorship, and the Dahmer Case,” Revue Française d’études américaines, 57 (1993), 317–25CrossRefGoogle Scholar; and Heise, Thomas, “American Psycho: Neoliberal Fantasies and the Death of Downtown,” Arizona Quarterly: A Journal of American Literature, Culture, and Theory, 67, 1 (2011), 135–60CrossRefGoogle Scholar.

40 Heise 154, 135, my italics.

41 Walter, Patrick F., “Cyberkill: Melancholia, Globalization and Media Terrorism in American Psycho and Glamorama,” Arizona Quarterly: A Journal of American Literature, Culture, and Theory, 68, 4 (2012), 131–54, 131CrossRefGoogle Scholar, added emphasis.

42 Weinreich, Martin, “‘Into the Void’: The Hyperrealism of Simulation in Bret Easton Ellis's American Psycho,” Amerikastudien/American Studies, 49, 1 (2004), 65–78Google Scholar, 75, added emphasis.

43 Zaller, 320, added emphasis.

44 Godden, Richard, “Fictions of Fictitious Capital: American Psycho and the Poetics of Deregulation,” Textual Practice, 25, 5 (2011), 853–66CrossRefGoogle Scholar, 853, added emphasis.

45 Bret Easton Ellis, American Psycho: A Novel (New York: Vintage Books, 1991), 36.

46 Ibid., 23.

47 Ibid., 8.

48 Ibid., 9.

49 Bateman's colleague, Anderson, has his speech cut off by the book: “Vacationers who can't take a full week away will find the Caribbean an ideal spot for the alternative weekend escape. Eastern Airlines has created its Weekender Club which includes many Caribbean destinations and enables members to visit many places at sharply reduced prices which I know doesn't matter but I still think people are going”. The sentence ends without punctuation and the next chapter begins on an unrelated topic. Ibid., 141.

50 Ibid., 132.

51 Ibid., 132.

52 Ibid., n.p.

53 Whiting, Frederick, “Playing against Type: Statistical Personhood, Depth Narrative, and the Business of Genre in James M. Cain's Double Indemnity,” Journal of Narrative Theory, 36, 2 (Summer 2006), 190–227CrossRefGoogle Scholar, 201, original emphasis.

54 McClanahan, Annie, “Bad Credit: The Character of Credit Scoring,” Representations, 126, 1 (2014), 31–57CrossRefGoogle Scholar, 45.

55 Mark Seltzer, Serial Killers: Death and Life in America's Wound Culture (New York: Routledge, 1998), 31.

56 Ibid., 34.

57 Ibid., 70–1.

58 Sassen, Saskia, “Cities in Today's Global Age,” SAIS Review of International Affairs, 29, 1 (2009), 3–34Google Scholar, 4. See also Lee, Roger, Clark, Gordon L., Pollard, Jane, and Leyshon, Andrew, “The Remit of Financial Geography: Before and after the Crisis,” Journal of Economic Geography, 9, 5 (1 Sept. 2009), 723–47CrossRefGoogle Scholar, 731.

59 David Harvey, Class, Monopoly Rent, Finance Capital and the Urban Revolution (Toronto: Department of Urban and Regional Planning, University of Toronto, 1974), 254.

60 David Harvey, The Limits to Capital (Chicago: The University of Chicago Press, 1982), 397. See also Christina B. Hanhardt, Safe Space: Gay Neighborhood History and the Politics of Violence (Durham, NC: Duke University Press, 2013); and Neil Smith, The New Urban Frontier: Gentrification and the Revanchist City (London and New York: Routledge, 1996).

61 Harvey, David, “Neoliberalism as Creative Destruction,” GEOB Geografiska Annaler: Series B, Human Geography, 88, 2 (2006), 145–58CrossRefGoogle Scholar, 149. Forced to raise capital quickly in order not to default on its debts, and left to perish by Gerald Ford, who famously pronounced “Ford to New York: Drop Dead” (New York Daily News, 29 Oct. 1975), the city turned its finances over to the Municipal Assistance Corporation, or “Big MAC,” in June of 1975, which promptly set about implementing swingeing austerity measures. By September of the same year additional measures were necessary, and the less jauntily monikered Emergency Financial Control Board (EFCB) was formed, a group with seven members, three of whom were from the corporate world. By 1978, the books were balanced. It is, however, telling that the EFCB dropped “Emergency” from its name, and continued to act as the Financial Control Board, the quiet settling in of the goals of finance in the elected seat of power. The effects of these emergency measures may have balanced the books, but the price was a woefully unbalanced city. The number of people living below the poverty line increased from 1.1 million to 1.7 million between 1975 and 1984, and the number of residents living with incomes under 75% of the poverty line rose from 560,000 to 1.1 million. In 1980 more than 20 cents in every dollar of tax revenues were still put towards paying off debts, compared to 13 cents towards social spending. Furthermore, New Yorkers had been effectively disenfranchised, as the Financial Control Board reigned over quotidian decisions such as admission fees for CUNY, the frequency of garbage collections, the repair of public transportation, and the funding of hospitals. For the data on poverty see Brash, Julian, “Invoking Fiscal Crisis: Moral Discourse and Politics in New York City,” Social Text, 21, 3 (2003), 59–83CrossRefGoogle Scholar. For a larger account of the crisis see William K. Tabb's majestic The Long Default: New York City and the Urban Fiscal Crisis (New York: Monthly Review Press, 1982).

62 Ellis, American Psycho, 81.

63 Ibid., 84, emphasis added.

64 Ibid., 86.

65 Naomi Wolf, “The Animals Speak,” New Statesman and Society, 12 April 1991, 33–34, 33.

66 Roger Rosenblatt, “Snuff This Book! Will Bret Easton Ellis Get Away with Murder?” New York Times, 16 Dec. 1990, 3.

67 Tammy Bruce, cited in Edwin McDowell, “NOW Chapter Seeks Boycott of ‘Psycho’ Novel,” New York Times, 6 Dec. 1990, C17.

68 Ellis, 377.

69 Ibid., 1.

70 Ibid., 399.

71 Bret Easton Ellis, Lunar Park (New York: Knopf, distributed by Random House, 2005), 41.

72 As Serpell, C. Namwali, “Repetition and the Ethics of Suspended Reading in American Psycho,” Critique: Studies in Contemporary Fiction, 51, 1 (2010), 47–73, 48Google Scholar, writes, “the uncertainty about the reality of Patrick's violence has become the chief critical debate on American Psycho.”

73 Paul Cobley, The American Thriller: Generic Innovation and Social Change in the 1970s (New York: Palgrave, 2000), 163; Ernest Mandel, Delightful Murder: A Social History of the Crime Story (Minneapolis: University of Minnesota Press, 1986); Jerry Palmer, Thrillers: Genesis and Structure of a Popular Genre (New York: St. Martin's Press, 1979).

74 Franco Moretti, Signs Taken for Wonders: On the Sociology of Literary Forms (London and New York: Verso, 2005), 148.

75 Derrida, Jacques, “The Law of Genre,” trans. Ronell, Avital, Critical Inquiry, 7, 1 (1980), 55–81, 81CrossRefGoogle Scholar.

76 There remains still a sense that the sprawling 19th-century novel managed to navigate the abstractions of the economy most successfully: both The Economist and The Observer include Anthony Trollope's The Way We Live Now (1875) as the only fictional book in their 2010 lists of “post-crisis reading.” “Post-Crisis Reading,” The Economist, 29 April 2010; “The 10 Best Credit Crunch Books,” The Observer, 26 June 2010. There have been plenty of realist novels written in response to the recent financial crisis, for example Cristina Alger's The Darlings (2012), Justin Cartwright's Other People's Money (2011), Jonathan Dee's The Privileges (2010), Sebastian Faulks's A Week in December (2009), Adam Haslett's Union Atlantic (2009), Sam Lipsyte's The Ask (2010), Martha McPhee's Dear Money (2010), Eric Puchner's Model Home (2010), and Jess Walters's Financial Lives of the Poets (2009). However, as McClanahan, Annie, “Bad Credit: The Character of Credit Scoring,” Representations 126, no. 1 (2014), 31–57CrossRefGoogle Scholar, notes, they have tended to be in the genre of “domestic realism,” focussing on the small scale of the family in financial peril. work between the general and particular by domesticating the world of finance through its effect on the individual or family.

77 See www.amazon.com/The-Economics-Ego-Surplus-Economy/dp/0982903804/ref=sr_1_1?ie=UTF8&qid=1407090190&sr=8-1&keywords=economics+of+ego+surplus.

78 J. D. Phillips, The Firewall Sedition: A Novel about a Dangerous Idea (n.l.: CreateSpace Independent Publishing Platform, 2011); Paul McDonnold, The Economics of Ego Surplus: A Thriller about the Global Economy (Dallas: Starving Analyst Press, 2010).

79 Teddy Wayne, Kapitoil: A Novel (New York: Harper Perennial, 2010), 19.

80 McDonnold, 78, 34.

81 Peter Cosgrove, “Undermining the Text: Edward Gibbon, Alexander Pope, and the Anti-authenticating Footnote,” in Stephen A. Barney, ed., Annotation and Its Texts (New York: Oxford University Press, 1991), 130–51, 133.

82 McDonnold, 61, 74, 94, 144,

83 Ibid., 153.

84 Nicky Marsh, Money, Speculation and Finance in Contemporary British Fiction (London and New York: Bloomsbury Academic, 2008). For the 1970s see chapter 2; for the 1990s see chapter 4.

85 Ibid., 34.

86 Ibid., 107.

87 It is striking that the post-crisis thriller that is most elastic with its genre, Robert Harris's 2012 The Fear Index (a Gothic thriller that places the control of the global economy within the Artificial Intelligence that the market has been given), is from a British author and set in Switzerland; a setting that the novel describes as a neutral space, the perfect home for an economy with its own agential force unmoored from an affective investment in the fortune of a nation.

88 Theodor W. Adorno, “Parataxis,” in Notes to Literature, Volume II, Theodor W. Adorno, ed. Rolf Tiedemann, trans. Shierry W. Nicholsen (New York: Columbia University Press, 1992), 109–52, 128.