She shows the premium that young hotshots there placed on “innovation” and “creativity,”

Ms. Tett describes how banks invented increasingly complex derivatives, “all based upon the fundamental premise that the default risk of bundles of mortgages had been virtually erased by the process of bundling and then slicing them” into so-called “tranches,” which were supposed to give investors a choice of different levels of risk and return.

Her book starkly illustrates the folly of using mathematical models to predict human behavior and the Las Vegas-like bet-making embraced by many bankers.