Mad Money: When Markets Outgrow Governments

Strange argues that global financial markets have grown beyond the capacity of governments to control them. The world's financial system is 'crazier and even more out of control' than it was a decade earlier, driven by volatile markets rather than governments [citation:5][citation:7]. Building on Casino Capitalism, which exposed how finance escaped democratic control, Mad Money diagnoses the weak points—political, economic, and technical—of a system where markets have outgrown governments. The sequel is more urgent in tone, written after the Asian financial crisis confirmed Strange's warnings.

Strange uses 'mad money' to characterize the alternately rampant and depressed financial markets of the 1990s—capital flows that are erratic, unpredictable, and disconnected from productive economic activity [citation:5][citation:19]. The term captures both the volatility of markets and their seeming irrationality. Mad money is not simply money that is crazy; it is money that has escaped the moderating influence of political authority and operates according to its own volatile logic, producing crises that governments are powerless to prevent or contain.

Strange predicted that continued financial volatility, unregulated markets, and widening income gaps would lead to a long, inevitable financial crisis. She was proved right within a decade of the book's publication [citation:11]. The 2008 global financial crisis, triggered by banking failures and speculative excess, validated her diagnosis of a system where finance called the tune internationally and governments had been stripped of control. The book's reissue in 2015 with a new introduction by Benjamin Cohen contextualized its prescience for a modern audience.

Mad Money applies Strange's structural power framework to the financial structure specifically. In States and Markets, she identified finance as one of four primary structures through which power is exercised. Mad Money is the detailed case study of that pillar, showing how control over credit and money has shifted from states to markets and non-state actors. The book demonstrates that structural power in finance means the ability to shape the conditions under which all other actors—including states—must operate, a power that has escaped democratic accountability.

A common misconception is that financial crises are caused by external shocks or unexpected events that governments could not have foreseen. Strange argues the opposite: the system itself is structurally unstable because governments deliberately handed control to markets through deregulation and liberalization. The 'madness' is not an aberration but a feature of a financial order built on the assumption that markets self-regulate. Her point is that the crisis was predictable—and she predicted it—because the structural conditions for instability were visible to anyone willing to look.

Mad Money was published a fortnight before Strange's death in 1998, making it her last book [citation:16]. It carries a sense of urgency absent from her earlier theoretical works—she wrote it as the Asian financial crisis unfolded, watching her predictions materialize in real time. The book is simultaneously a diagnosis, a warning, and a call to action. Strange's tone is more direct and alarmed than in States and Markets or The Retreat of the State, reflecting her conviction that the window for reform was closing.