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Tag Archive: Michael Lewis


The Big Short

The book is a fabulous read because of its simplicity. It’s not just for finance geeks; rather the stuff narrated

by Michael lewis is easy to digest. Although I still believe Liar’s Poker was one of the best work by Michael, but the Big- short seems to me is one of the best journalism written on the subprime crisis.

The reason I recommend to read the book because the movie is out on December 23rd and I still doubt people will follow. It has more characters and the derivatives, CDS market is not easy to understand .

The book is more focused on the vulnerability of the subprime crisis,how the big guns shorted the subprime market making it worse as they  provided the fuel which kept the subprime mortgage furnace burning even when the US was running out of new junk mortgages to write. The book quotes an example of a Deutsche bank trader Greg Lippmann ended up making billions of dollars for his employer — not to mention a $50 million bonus for himself — by aggressively going out and finding fund managers to put on the short bets needed to keep the market ticking.

How the Govt agencies Fannie and Freddie started accepting increasing amounts of subprime paper. Then banks started selling private-label subprime CDOs directly to investors, bypassing the GSEs; a lot of the profits in that activity came from taking the unattractive lowest-yielding tranches and insuring them with AIG.

In the process AIG was over leveraged it was not selling Credit default swaps any more. But then it gave rise to the synthetic subprime CDOs which were bought by Greg Lippmann sold by the banks.

This was the market with almost no pricing transparency in the secondary market: because all securitization deals are unique, the only way to get a feel for the health of the market is by looking at where primary deals are pricing. Whenever anybody said that the marks being put on subprime assets by banks and hedge funds were delusional, it was easy to point to the booming market in synthetic subprime CDOs to prove them wrong. No one, of course, remarked on the irony that the synthetic subprime CDO market was only booming because John Paulson and others were providing a huge amount of demand for bearish bets.

 

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The favorite business books that are also fun reads? They can’t be boring, must be Business or Investing related. They also should blogbe informative and/or educational as well.

Here are 10 random business books that I think are especially readable:

Lords of Finance by Liaquat Ahamed: “It covers a 50-year period from before World War I and leading up to World War II. Even if you’re not interested in finance, it’s a great read”

 The Big Short by Michael Lewis: “Michael Lewis, to me, is the preeminent narrator [of the financial crisis]. He is the guy who constructs the story better than anybody else.” (Lewis also wrote the wonderful Moneyball, which covers the business of Sports — kinda) Continue reading

Gudi Padwa, Cheti Chand, , Ugadi – make it a Great day and a Great Year.Happy New year!  A very happy new Financial year Year Flash Boys Mech 3p_r3.REV.for cat.inddtoo . Well moving back to the topic : Flash Boys: A Wall Street Revolt is a new book by Michael Lewis to be released today. I have been following Mr Lewis when I first read his best work in “Liar’s Poker” .  I have read almost all his books published in the past and found every time fresh things to explore in this financial jungle.

He appeared for an interview day before yesterday before the release of Flash Boys,” is scheduled to be released on Monday, appeared on “60 Minutes”  to argue that high-speed trading has ripped off investors not in possession of lightning-fast computers and special cables.

Flash Boys is about a small group of Wall Street guys who figure out that the U.S. stock market has been rigged for the benefit of insiders and that, post–financial crisis, the markets have become not more free but less, and more controlled by the big Wall Street banks. Continue reading

Too many things said and being anticipated about the Indian Rupee, Indian Economy, Indian Politics that what does India Needs , the food Googlesecurity bill , the Current account deficit and the rising prices of the gold. It’s like the puzzle in India is that of finding the middle road, between Gotham City on one hand (a murky world of corruption and criminality) and Jurassic Park on the other (with socialist dinosaurs destroying the economy). Pessimists about India might say that if the goons won’t get you, the dinosaurs will.

Taking a break focusing on the favorite business books that are also fun reads? They can’t be boring, must be Business or Investing related. They also should be informative and/or educational as well.

Here are 10 random business books that I think are especially readable:

• Lords of Finance by Liaquat Ahamed: “It covers a 50-year period from before World War I and leading up to World War II. Even if you’re not interested in finance, it’s a great read”  Continue reading

Recently Michael Lewis was in news as he wrote a compelling piece on Serge Aleynikov, the former Goldman Sachs computer programmer imagesconvicted of stealing the bank’s secret algorithms, in the Vanity fair. Where he shared one of the famous line from his book Big short There’s a line in The Big Short; one of the characters, who was cynical about the subprime-mortgage market, says,

“When I hear Chinese Wall, I think you’re a f—ing liar.” I feel that way about liquidity. When I hear the word liquidity, I think you’re a f—ing liar. If this is liquidity, we don’t need it.

The book is a fabulous read because of its simplicity. It’s not just for finance geeks, rather the stuff narrated by Michael lewis is easy to digest. Although I still believe Liar’s Poker was one of the best work by Michael, but the Big- short seems to me is one of the best journalism written on the sub prime crisis.

Continue reading

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