A Demon of Our Own Design is written by Richard Bookstaber who knows markets inside-out. He held various roles in finance which put him in the thick of the action, such as Director of Risk at a major global hedge fund, and a trader and risk manager at a large investment bank.
He talks about what went wrong in the market crash of 1987 as many people bought portfolio insurance and as an unintended consequence the hedging of these products may have destabilised markets. He asks whether markets are doomed to crash by design. Although written a while back in 2007 it offers insight into the causes of market crashes with some nice explanations of things such as statistical arbitrage.