The Fictions of Finance

The Fictions of Finance

As the divide between finance and everyday life yawns ever wider, fiction has stepped into the gap.

Street money exchange, Kabul, 2011 (Asian Development Bank via Flickr)

This stuff is so esoteric that the only people who understand it are in the business. . . . Can you imagine the people on a march against finance? The guy on a megaphone shouting: What do we want? And everyone answering: Specific curbs on short selling in certain circumstances!
                                                                                                                                                                                                —In the Light of What We Know

What happens to culture in the age of finance capital? What happens to the fictions we create in an era when money—harnessed by a range of new, sophisticated, and increasingly abstruse financial instruments—begets money on a scale that Marx could scarcely have imagined? As the production of wealth is further and further removed from the production of things, billions of people’s lives are tied up in financial markets shrouded in a haze of mystery. It is no surprise, then, that culture in the age of finance capital is wrestling precisely with what we know but cannot always see.

Fiction has become accustomed to the question of money—to the everyday dealings of credits and debts, trinkets bought and sold, the price of milk. In Edith Wharton’s The House of Mirth, the drama circles around $9,000 (the beautiful Lily Bart’s gambling debts); in John Updike’s “A&P,” it is 49 cents (the cost of fancy herring in a can); in Saadat Hasan Manto’s aptly named story, it is “Ten Rupees” (the price of a young girl). Beyond dollars and cents, the novel, historically, has been in turn dazzled by, and critical of, the crush of capitalism, the rapid accumulation of wealth, and the exploitation of labor, all documented and turned over by writers ranging from Balzac and Zola to Dos Passos and Dreiser. But the scale now seems vaster—not dollars and cents but hidden millions, the millions that underwrote the sugar plantations (as Edward Said writes of Jane Austen’s Mansfield Park) and that now circulate farther and faster than ever but are even more difficult to see.

Zia Haider Rahman’s recent novel In the Light of What We Know absorbs the most contemporary iteration of this dilemma, the problem of the invisible economy, by constructing a range of characters whose livelihoods depend on high finance: Meena, the investment banker; Zafar, the trader; and Zafar’s former roommate at Oxford, our listener, to whom Zafar’s tangled story is told. The unnamed friend here traded in mortgage-backed securities at a firm in London—the infamous credit default swaps—and has been summarily dismissed. It is clear that some kind of charge is forthcoming. There is collusion and casual venality; those higher up are quick to sacrifice those below.

In a story that moves us, circuitously, from childhood in rural Bangladesh to the Kensington homes of the London elite to the war zone that is post-9/11 Afghanistan, we continually come back to the moral tangle of financialization. At one point, our narrator thinks out loud about the mess he is in:

I feel no guilt for what I did in finance. There’s little doubt that the financial crisis will translate into an economic one and that recession will likely follow. People will lose their homes, their jobs. But tell me how I can feel guilt for doing something that was not only legal but actively encouraged by governments everywhere. I never sold mortgages to house buyers; I bought large bundles of them from commercial banks and apportioned the packages into parcels that were sold on to investment firms, all of it done aboveboard and without so much as a quizzical look from regulators. . . . [H]ow can I be responsible for all the consequences?

Not unlike the statement of “apology” by Rajat Gupta, the director of the consulting firm McKinsey & Company who was convicted for securities fraud in 2012, the narrator’s statement is just one of many examples of the kind of bad faith that pervades the banking sector.

The financier and his questionable morals have been an object of interest in the novel since at least the late nineteenth century: Mr. Merdle and the circumlocutions office in Dickens’s Little Dorrit, Aristide Saccard in Emile Zola’s Money, Frank Cowperwood in Theodore Dreiser’s The Financier. John Dos Passos’s The Big Money reimagines John Pierpont Morgan himself. In all of these, the investor is treacherous, lascivious, scheming. He prevaricates, he lies, he bribes and blackmails. Saccard strips his wife bare and corrupts his mistress; Cowperwood abandons his marriage and seduces his benefactor’s daughter. Sexual depravity flourishes alongside the scintillation of the profit motive. Sherman McCoy, the bond trader in Bonfire of the Vanities, Gordon Gekko in Wall Street, and of course the American Psycho Patrick Bateman push this trope further, where the white male “master of the universe” demonstrates a pathological hunger and greed—one underwritten, financially and morally, by the profession. Dreiser leaves us with the crass but still inspiring American mantra, “I satisfy myself”; Patrick Bateman, the murderer, laughs maniacally and touches his chest, “expecting a heart, but there is nothing there, not even a beat.”


Today’s fiction shifts from the register of the megalomaniacal to that of the mundane. No one is deluded by the rhetoric of meritocracy, and the stockbroker need not be insane. The crash is the subject of dinner parties and discussions over drinks (“What of bankers’ pay?”), the object of bewilderment, cynicism, even boredom. In Joseph O’Neill’s Netherland, the protagonist, Hans, spends most of his time chauffeuring around a New York City West Indian immigrant in charge of an illegal betting operation and pondering the tragedy that is his life after 9/11. By trade, Hans, who began his career at Shell Oil, is an analyst at Deutsche Bank, the global financial services company. At Deutsche Bank he focuses on “large cap oil and gas stocks” and is considered a seer, a prophet of his industry, one on whose predictions large numbers of shares will move. And yet, as he admits, “I could take a guess at the oil production capacity of an American-occupied Iraq . . . but I found myself unable to contribute to conversations about the value of international law or the feasibility of producing a dirty bomb. . . . Did Iraq have weapons of mass destruction that posed a real threat? I had no idea; and to be truthful, and this touched on my real difficulty, I had little interest. I didn’t really care.” The world of finance now appears less morally bankrupt than morally indifferent.

Rahman’s response to this state of affairs is to immerse the reader into the bankers’ universe—not into the mind of one trader and his abject psychology, à la Bonfire of the Vanities or American Psycho, but into a realm much more banal. Over the course of its 500 pages, In the Light of What We Know submerges the reader in the highly specialized language of financialization. There is the UK’s Financial Services Authority, its “principles-based” regulation, the poaching of its employees by private equity firms, and the fiction that is compliance. There is an elaborate, 478-word long footnote explaining synthetic securities—that class of derivatives that is by nature least tied to the actual asset, and is therefore most risky—a paratext that is pedagogical, even pedantic, an explanation clear enough to allow me to hand over my money and reasonably assess the risk in doing so. There are debates on compliance and regulation, detailed differentiation between fixed-income derivatives (“options on bonds, swaps, caps, floors”) and equity derivatives (“to do with stocks and shares”), epigraphs not just from Rainer Maria Rilke and Tayeb Salih but from the private emails of S&P analysts (emojis included), conversations regarding the problem of rating new products like collateralized debt obligations (CDOs). There is also casual mention of SMEs (small- and medium-sized enterprises), the small business sector, credit derivatives, tranches, i-banking, and of course the infamous mortgage-backed securities (MBS).

Some of these long digressions and related footnotes could well have come from John Lanchester’s guide How to Speak Money, released just a few months after Rahman’s novel in 2014. Somewhere between self-help book and cultural glossary—a “lexicon,” as the author describes it—Lanchester’s book walks us through terms like high-frequency trading and amortization, as well as commodity and Bitcoin, in a series of clear yet charming definitions. Even more interesting are terms like “confidence interval,” which Lanchester brilliantly glosses as “the attachment of probability to a fact.” Embedded in the introduction of How to Speak Money is a philosophy of language, where language can be obfuscating and trippy, but also, in the case of financial jargon, startlingly amoral. Behind “vanilla mezzanine synthetic RMBSs” there seems to be no ethical palette, says the author, only denotation. As economist Christian Marazzi and others have argued, specialized language is a currency, with new forms of communication undergirding new modes of production and consumption.

Rahman’s novel traffics avidly in this currency. In one sense, this is nothing new: highly specialized information—whether about whaling in Moby Dick, mining in Zola’s Germinal, or genetic botany in Zadie Smith’s White Teeth—has long circulated in the genre of the novel. The contemporary novel, in particular, is data-driven; it incorporates the specific languages of sailing or linguistics or immunology. What distinguishes a novel like In the Light of What We Know from a textbook is the way it translates the language of finance—sound markets, allocation of resources, security—into a larger world. “Compliance,” for example, comes to describe not just corporate conformity to rules set by the SEC, but Zafar’s slow and regular bending toward his love, Emily. Moreover, Rahman’s novel sets its financier protagonists, their relationships, and their jargon-laden, ethically compromised industry into a specific political context—our post-9/11, post-recession, post-Occupy universe.

That is to say that the elaborate paratext—on bank regulation, or the subjective nature of Moody’s credit ratings—is, in the end, a bit of a red herring. Despite all evidence to the contrary, high finance isn’t the finance novel’s primary interest. In the Light of What We Know is also the story of how 1971 transformed West Pakistan and East Pakistan into Pakistan and Bangladesh. It is the story of two roommates at Oxford—one, an elite Pakistani raised in the home of Princeton scientists, the other from rural Bangladesh, raised in the home of East London shopkeepers—shaken from that upheaval. And most importantly, it is the story of the heavy American footprint in Afghanistan, the crass opportunism of “development and reconstruction” conducted both through governmental and non-governmental operations, the blatant amorality of the free zone that is expatriate life in a time of war.

Why, then, spend a novelistic lifetime educating the reader on Alan Greenspan and interest rates, or home equity, or securitization—all of which John Lanchester’s witty nonfiction self-help guide (itself another sign of the desperation of the times) does in equal measure—only to direct our fickle attention elsewhere? In the Light of What We Know, for example, takes pages, literally, to debate what post–2008 reparations might look like, only to embroil us in a conspiracy born from the three players on the Afghan border: Pakistan, the Taliban, and the U.S. government.

Rahman’s novel might be understood as a book about how finance—indeed, even the high abstraction of “synthetic securities”—cannot be altogether divorced from the mud and concrete and goods and, yes, corpses upon which economies have always rested. Zafar sees the homes in Kabul “belonging to Talibs but that had been acquired by Westerners for their rocketing market value, including diplomatic missions and their staff, whose real estate purchases had boosted Taliban funding. Property in 2002, even in Kabul, was booming, as it was the world over.” He watches the new development economy distort the old, and inflation soar. As they drive in their Land Cruiser through Wazir Akbar Khan, the neighborhood bought up by NGOs and expats, Zafar tells his guide, “There is a saying on Wall Street. . . . When there’s blood on the streets, buy property.”

Indeed, the most damning critique in this unequivocally damning novel is reserved for the property and patronage regimes spawned by intervention, whether in the form of home buying, newly minted servant classes (from office aides and local advisors to jeep drivers and custodians), or the poaching of the entire professional, educated classes—faculty members, school teachers, engineers, and doctors—in the service of this new NGO-designed and -demarcated build-and-break city. Afghanistan becomes the latest casualty of both the war and the war economy, a new market to conquer and to privatize. This is accompanied by a relentless neoliberal discourse of remaking, rebuilding, and exchange. Local talent, local rugs, local girls—finally, all reveal their true value in the custody of the marketplace.

Over the course of the novel, an irony emerges between the abstraction of the securities market and the richly material economy of the war zone. When they’re not speculating on real estate, the expatriates are indulging their fetish for local craft (at one point Zafar mentions how the prices of Afghan rugs shot up when expats began buying them to floor their New York and London homes). Rahman even points the reader to this irony explicitly: as one character says admiringly of our narrator’s Pakistani grandfather, “That man was born for business. And I mean real business, manufacturing, oil refining, shipping, not finance, like mine—you know what I mean. No, he actually made things.”

Synthetic securities—concocted by brilliant minds in mathematics, the heirs of thinkers like Princeton’s Kurt Gödel, a fixation of Rahman’s—appear to be light-years from the brick-and-mortar homes upon which they rest. Yet the entire nexus of social relations on which the novel depends suggests that they are not so distant after all. Forrester, for example, is a senator but also a former member of the Armed Services Committee, who then built a fortune starting a ratings agency, one that gradually “diversifies into other sectors of finance,” one whose task it is to evaluate CDOs. Forrester’s son has joined the Marines, which takes him to Afghanistan, where, working as a private military contractor, he becomes embroiled in a plot involving a Pakistani general, the American government, and an Afghan insurgent. What are the reverberations that beat around the world in response to the American economic model? There is a hint of this question in Netherland as well, as Hans muses, “It is an English summer’s evening of the best sort, in which the day cloudlessly slips past nine o’clock and the price of a barrel of oil, scandalously ticking over in the seventies, seems to have not the slightest bearing on the world.” But of course, there is no such day, not in England, nor anywhere else, and not of course in the place thrown in singular occasional relief in O’Neill’s novel: Iraq.

Both Netherland and In the Light of What We Know, in this sense, hint at “the specific relation of the new phase of monopoly-finance capital to imperialism” posited by John Bellamy Foster in his 2006 essay on the era of financialization. Neither Rahman nor O’Neill articulate this connection bluntly; neither leaves the reader inspired to march down Wall Street with placards inscribed “Wall St. is War St.,” as New York anarchists did long before the birth of Occupy. But Rahman’s novel, at least, bears traces of Foster’s conclusion—“that monopoly-finance capital requires enhanced intrusion into the economic and social life of the poor countries for the purpose of extracting ever greater surplus from the periphery.” This is a question that the novel now wants to ask, strains to ask, even at the risk of didacticism, even at the expense of its art.

As much as they are “finance novels,” then, Netherland and In the Light of What We Know are post-9/11 novels, both of which attempt to take stock of a new geopolitical terrain—one for which even keen knowledge of colonial empires leaves them unprepared. But more specifically they address a Western complacency born precisely from that ill preparation. As Rahman’s novel progresses, we are reminded again and again of what we do not know. “Nobody outside the business—and not everyone inside—could get their heads around the new products.” And credit default swaps are the least of it. “I did not know,” says Hans, “because I had no information about the future purposes and capacities of terrorists or, for that matter, American administrations.”

These novels are symptoms, like John Lanchester’s London novel Capital or Mohsin Hamid’s How to Get Filthy Rich in Rising Asia, of a kind of collective difficulty with which culture is wrestling. We might name this the intractability of the global financial network, whose increasing specialization makes it resistant to forms of translation—translation that would render its mechanisms more intelligible to the rest of us. As the epistemological divide between finance and everyday life yawns ever wider, fiction has stepped into the gap. New genres have emerged to do the work of translation between that thing called financialization and the daily grind of the global economy, or, if not, to at least ironize our ability to do so.

This is in part the basis of Tom McCarthy’s new Satin Island, which tries to capture the dazzling present, full of screens and networks and “things that creep under the radar by being boring. And complex.” The last few years have shown us the glossary and the primer, the self-help book and its ironic double (Hamid’s Filthy Rich, for example, is reminiscent of Shiv Khera’s You Can Win and other financial spirituals sold on Indian streets everywhere), and, of course, the lyrical novel and its ironic doubles. There are novels in the realist tradition filled to the brim with paratext and epigraphs, and those like McCarthy’s, novels consisting almost entirely of theoretically savvy footnotes and nothing more.

In this sense, the finance novel carries a second pervading irony: for all the information it provides, its ultimate achievement is to draw a circle around our ignorance. Yes, it makes much of the raw data of experience, but only in order to direct our attention to the full range of our illiteracy. Hans is dazzled by his Caribbean friend’s argot, a card game called wapi, the all-fours club, roti and doubles, the language of the street. The narrator of Rahman’s novel reminds us that bankers have their own names for these new money-making equations, but only to preserve the “mystique of the priesthood.” Lanchester calls this reversification, the process by which language evolves over time to indicate its very opposite, in the way that a hedge is a border or boundary, but hedge funds are often unregulated investment opportunities that are literally “unhedged.” The first obstacle, says Lanchester, is “the words themselves.” Language is the mystical foil that preserves the aura of the expert, the native, he who is in the know. It is a form of denial, too, that shields the trader from his own guilt: as Lanchester reminds us, quoting Martin Amis, “Denial was the best thing. Denial was even better than smoking.”

To whom do we distribute the tedious work of tearing away the veil? In the face of the “boring” and the “complex,” where is the intellectual vanguard? Novelists like Dreiser and Zola were committed socialists, and naturalism was a political project as much as an aesthetic one. Who are their counterparts today?

In the interim, there are projects like Occupy Finance, an e-book put out by the Alternative Banking Group and available for free download, on the principle that “you do not need a PhD in economics to understand what is happening.” The labor of reconfiguring the imagination, that imagination so strained by the abstractions of financial crisis, and of drawing other worlds, has been left to projects like them. The finance novel, participating as it does in what has been called capitalist realism—an ideological inability to imagine any kind of rupture to the political and economic systems of the present—is just catching up. But little by little, it punctures the aura of the specialist, for the long age ahead.

Toral Gajarawala teaches literature in New York.