The big short
inside the doomsday machine
by Michael Lewis, Francisco José Ramos Mena · first published 2009
49% recommend50% neutral1% critical
Why HN recommends it
Engaging, story-driven account of the 2008 housing and CDO collapse, told through the few investors who saw it coming. Suits readers wanting an accessible look at how Wall Street's incentives and layered bets failed.
Common criticism: Some say it oversimplifies CDOs and the crisis
Summarised by Claude from recommending comments
The #1 New York Times bestseller: a brilliant account—character-rich and darkly humorous—of how the U.S. economy was driven over the cliff. When the crash of the U. S. stock market became public knowledge in the fall of 2008, it was already old news. The real crash, the silent crash, had taken place over the previous year, in bizarre feeder markets where the sun doesn’t shine, and the SEC doesn’t dare, or bother, to tread: the bond and real estate derivative markets where geeks invent impenetrable securities to profit from the misery of lower- and middle-class Americans who can’t pay thei
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What Hacker News says
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…there. If I want to avoid the $5 that's easy- I'll just switch to my credit card. But people who don't have enough credit to get a credit card now get punished twice. I read a fascinating passage in The Big Short (an excellent book on the financial crisis by Michael Lewis) that told the story of a top banking exec boasting about the amount of money they made on "Free Checking" accounts. Far more than they made…
on “Bank of America to charge monthly fee to debit card users” ↗…on year number four of telling us what a problem this will be? Surely if it was as bad as you say, it would have happened already/we wouldn't be making all this money." If you read Michael Lewis' The Big Short, you'll get a nice profile of five or six guys who not only saw this coming, but actually timed it perfectly and made fortunes. You can't solve problems like these by convincing one "important" person…
on “Blowing the Whistle on the Mortgage Bubble” ↗…consumer, HFT is not my competition it is my order facilitator. A huge share of equity trades get their price IMPROVED by the market makers in order to capture the trade flow. I love Michael Lewis. The Big Short was a very enjoyable read. I've read all of his stuff. I've run into the guy at the grocery store. But Flash Boys was just silly. Even if you believe it, the guy getting "disrupted" was not a retail trader…
on “Flash Boys a Year Later” ↗…It Works and for Whom Levitt, Arthur (2003) Take on the Street: How to Fight for Your Financial Future Lewis, Michael (1989) Liar's Poker: Rising Through the Wreckage on Wall Street _________ (2010) Big Short: Inside the Doomsday Machine STATISTICS Ayres, Ian (2007) Super Crunchers: Why Thinking by Numbers is the New Way to Be Smart Bernstein, Peter (1996) Against the Gods: Remarkable Story of Risk Kahneman,…
on “Ask HN: What are the must-read books about economics/finance?” ↗There are a number of people who foresaw the problems brewing in the CDO market. The book "The Big Short" by Michael Lewis provides a detailed portrait of a number of them. As usual, even when someone knows that the generally accepted wisdom is bunk, no one listens. Another comment that comes to mind is…
on “New Revealing paper on High Frequency Trading” ↗…the purchases and the ratings agencies. BUT - and this is pretty important - the ratings agencies were negligent in their rating methodology. Intelligent buyers could see the problems. The book The Big Short covers this in some detail.
on “Goldman Sachs Will Pay $5B to Settle Financial-Crisis Claims” ↗My father worked at one of the Hedge Funds referenced in The Big Short for about 15 years, and was there during the collapse. I've talked to him ad nauseam about these books and the only one he didn't like was Flash Boys, but calls The Big Short "sort of scary" in how accurate…
on “Michael Lewis: The Scourge of Wall Street” ↗…high-finance industry. MOLLY'S GAME BY MOLLY BLOOM -It was an entertaining, quick-paced read about the private, high-stakes poker industry with an assortment of participants. MONEYBALL, LIAR'S POKER & THE BIG SHORT BY MICHAEL LEWIS -I thought they were all entertaining reads, while also being insightful about their respective subjects. STEVE JOBS BY WALTER ISAACSON -It was an illuminating read to me. - - - Separately,…
on “Ask HN: What are your favorite books of all time, and why?” ↗…how those referees are changing, and in some cases, outright disappearing. Fascinating stuff from an author who really knows how to tell an engaging story about a potentially dry topic. (Moneyball, The Big Short, Liar's Poker, etc.) [1] https://atrpodcast.com/ [2] https://www.goodreads.com/author/show/776.Michael_Lewis
on “The Lonely Work of Moderating Hacker News” ↗If this article piqued your interest, please PLEASE read The Big Short by Michael Lewis, in which he tells the entire, fascinating story of Michael Burry, the one-eyed genius with Asburger's who fought against the entire Wall Street establishment. http://www.amazon.com/dp/0393072231
on “I Saw the Crisis Coming. Why Didn’t the Fed?” ↗Just finished Big Short and it's good - like anything by Michael Lewis. It's the only thing I've read that completely tied together the hedge funds, the investment banks and AIG for me.
on “Michael Lewis’s ‘The Big Short’? Read the Harvard Thesis Instead” ↗Reading The Big Short by Michael Lewis was illuminating. Essentially, the ratings agencies have done pretty well over the years on corporate and government bonds. There is a lot of quality historical data, and a relatively…
on “Credit Ratings Agencies - Who made them so powerful ?” ↗A toss between 'The Big Short' by Michael Lewis and 'Too Big To Fail' by Andrew Ross Sorkin. Both books are about the financial crisis on Wall Street. They provide excellent insight into how smart people made very bad decisions that…
on “Ask HN: Best book you read in 2010 and briefly why” ↗If anyone is interested in this, I highly recommend reading "The Big Short: Inside the Doomsday Machine"[1] by Michael Lewis. It talks about Greg Lippmann (mentioned in the article) and how he and others cashed out before the impending crash in 2008. [1] http://www.amazon.com/Big-Short-Inside-Doomsday-Machine/dp/0...
on “Ban email archives thrown open in devastating financial crash report” ↗I am reading "The Big Short" which is a great book by Michael Lewis about the subprime mortgage crash and those who bet against it. What are the best books on diagnosing the dotcom crash?
on “Best Books On The Dotcom Crash?” ↗