Streams

The Big Short

Tuesday, March 16, 2010

Michael Lewis gives an account of how the U.S. economy was driven over the cliff. His latest book The Big Short: Inside the Doomsday Machine, is an insider’s view of the people behind the financial collapse—the villains, a few heroes, and those who look very foolish: high government officials, the watchdogs, and heads of major investment banks.

Guests:

Michael Lewis
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Comments [13]

Steven Rudin from Nassau County, Long Island, NY.

I inherited a relatively small amount of money in 2006, compared to what these wall street types earned anyway. I have no financial training at all, yet somehow I could see that all this was all a house of cards, just by following the financial news reports everyday. I used to ask myself what ever happened to the "good old days" when semi-retired folks like me would invest in utility stocks, the phone company,and US Treasury Bonds in order to preserve our money, so as to have it in our old age and not become a burden to our families. Anyone remember those days?

Mar. 17 2010 09:42 AM
Andy B. from Queens, NY

Also in answer to the question about why Moody's and S+P are still doing business - they are the monster players in the ratings industry.

Generally the top two players in ANY industry are extremely well connected in Washington - the government will do whatever it takes to cement their dominance.

Just like Goldman Sachs in investment banking or GE, etc, etc.

Mar. 16 2010 12:40 PM
superf88

Enjoyed and benefited greatly from your Bloomberg segments during the Enron, accounting and dot com "bubble" at the end of the Clinton era/beginning of Bush.

How did you decide to write this sort of book at this point rather than that one?

Mar. 16 2010 12:37 PM
Andy B. from Queens, NY

Disappointing. More of the same "the big boys just went crazy with risk and I don't understand why".

I thought we went way beyond this stage with Matt Taibbi's series of articles in Rolling Stone - have we not many months ago established the Wall Street/government conspiracy that explains all of this quite well?

Mar. 16 2010 12:37 PM
jade

What about Ned Gramlich?
He was on the Board of Gov of the Fed, and tried to warn Alan Greenspan, and Greenspan just poo pooed him.

His "Subprime Mortgages: America's Latest Boom and Bust" was published in June of 2007. He was criticizing this market for 10 years before his death. CHeck the NYTs.

(Actually, its Edward Gramlich)

Mar. 16 2010 12:32 PM
sp from CNJ

why Moody and S&P still doing ratings ?

Mar. 16 2010 12:32 PM
A. Listener

How do "mortgage service" companies make money?

Also, your guest looks genuinely happy in the photo on your home page. Is that professional satisfaction, personal, both?

Lastly, I LOVED Moneyball and recommended it to all my friends.

Mar. 16 2010 12:32 PM
anonyme

This is so much better than 60 minutes was sunday!

Mar. 16 2010 12:26 PM
Jennifer Hickey from Flushing, Queens

Despite the high profile interogations of the rating agency heads way back when, it seems that they have escaped any of the "reforms" proposed by the administration. Why is that? Since they were the biggest promotors of these MBS?

Mar. 16 2010 12:25 PM
Robert F, from NY NY

There's a really good book on this topic called:

The Greatest Trade Ever: The Behind-the-Scenes Story of How John Paulson Defied Wall Street and Made Financial History

~ Gregory Zuckerman (Author)

http://www.amazon.com/Greatest-Trade-Ever-Behind-Scenes/dp/0385529910

I think he already was on WNYC - great book

Mar. 16 2010 12:15 PM
anonyme

I have suspected for awhile that brokers have to put aside their own brains, judgment, training and do as told by house policy - and they get paid for lying, basically - am I right?

Mar. 16 2010 12:13 PM
superf88

Hmm. I was actually relieved when this so called crash finally came. The disaster were the years 95-07.

any worldly investor over 35 knows too well that this crash is nothing -- so far.

Mar. 16 2010 12:13 PM
Douglas Andersen from Lexington, KY

The repeal of "Mark To Market" has boosted Wall Street profits and bonuses, but is it a lingering time bomb? Are big financial institutions pretending that they are healthier just because they do not have to record losses on assets that are worth less than the market value of those assets?

Mar. 16 2010 07:06 AM

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