This short, lucid book tells two stories—one familiar, the other less so. Many people will have a sense of the events leading up to the credit crunch of 2007-8 and of the financial catastrophe that ensued. Howard Davies, the former Chairman of the Financial Services Authority, sets out with great clarity how it all happened. But it is the book’s second movement that stands out. Here, Davies, in the most measured language, tears into the regulatory response to the banking crisis. Low interest rates sent investors on a search for decent returns, which ended with large-scale investments in ever more complex products. And as the banking and financial system became more complex, says Davies, regulation became more abstruse, as if to match it.