Light, but she let me see absolutely everything economy, knew i would try to be fair, i think, and balanced. Im not going to make her saint clare, but im also not going to make her an ogre, and i didnt have that intention. I just think every human being has different facets. Were not all good, bad, and bad in all of us, and she knew that, and i think she wanted the truth told. She was courageous in that way. Very courageous. As difficult at is is to be a biographer, what will happen to biographers 30 years from now. The subjects of today dont write letters, let alone diaries. Wont be trunks of letters. Will they have to go through emails and twitters filled with nonsense . Well, as far as i know im not a twitter person myself, but i think those things are not saved, are they . Some people i know we print our business letters, but most people are not preserving their life in that way, unless theyre keeping diaries, which i also doubt. So, really, i think its going to be a dying art, if it is an art at all, biography. I think thats a great question actually. It is an art, biography is certainly an art. But not only with the i try very hard not be nostalgic but i am anyway, and we lived in a great period of biographies. But cant but, yeah, i think that the repository of documents and records that have always constituted the evidence we use in writing biography, will simply not exist in that form. Its true, letters, journals, manuscripts. Not only email but when you write your book or your article, you dont have the drafts anymore. Thats a huge loss. So, i guess what will happen, it will be different and people will be seen differently. And that we will watch them through video and record them in very different ways, and that will affect the way we think about personalities. What are the traits and qualities that show forth in the best light going forward. Does that mean you have to be visually adept and appealing . Theyre tricky. James is writing just finished a book on the art of biography. So he has probably addressed many of these subjects that youre interested in, and my husband today pointed out i havent read the times yet but he read something about the arts and he humanities are following not being studied in college anymore. The study of english and English Literature used to be the number one choice. Enough its not even in the top 70. Thats because it was easy. So if you dont have to the skills youre not learning these skills, how to write, write at all, let alone biographies or novels. It is going to be a dying art, isnt it . Were toast. If i just say, to make the last point, have the last word because its my prerogative as the interviewer, and that is why were still here writing long biographies, and actually will be, i suspect, the you have accomplish something very great, sylvia. You really have. You have captured a life, very complex life of a difficult person, and managed to do this with not only the skilled of the biographer, the narrative and the documentation and the research, but with the thing that the biographer needs above all and that is empathy. I read your book with great i felt great sympathy for her, and all her difficulties, and she was very difficult ins ways to love. But you have done that, and i congratulate you. Thank you all for being here. That means a lot coming from you. [applause] sylvia left out the best part. Rush upstairs and buy one of these books both books and find out what really happened. [inaudible conversations] interested in American History . Watch American History television on cspan3 every weekend. 48 hours of people and events that helped document the american story. Visit cspan. Org history for more information. Heres a look at upcoming book fairs and festival happening around the country. On september 6th the bookmark festival of books and authors hold their ten inch annual festival in winstonsalem. That is one thereof largest in north carolina. Then on september 21st, this years brooklyn book philosophy will bell of be held the Brooklyn Hall and plaza and host 100 authors, from september 26th to the 28th, the baltimore book festival will take place at the citys inner harbor. From october 10th to the 12th, the southern festival of books will hold their 26inch gathering in downtown nashville. The event hosts over 200 prominent authors and three performance stages for live readings and music. Let usow about book fairs and festival your area and well be happy to add them to our list, email us. Discussing her soon to be published book, without you there is no us. My time with the sons of north koreas elite miss kim talks to book tv of book expo america, the publishing industrys annual trade show held the Javits Convention center in new york city. Author suki kim, where are you from. Guest im from south korea originally. Born and raised there. And i came to america when i was 13. Host why did you dom the states . Guest long story. But as all immigrants do, there was a lot of turbulence, and then i ended up in queens originally, new york, without a word of english. Oo what do use do for a living today. Guest im a novelist and a journalist so i publish novels, literary novel, how i began writing, and then im coming out with a book actually, ive been a journalist for since the first time i went into north korea in 2002, and thats when i first went into north korea and thats what i have been covering more or less. Host thats why we invited you on booktv to preview your book coming out in the fall of 2014. Without you there is no us. My time with the sons of north koreas elite. How did you get a job in north korea . How did that come about . Guest it took a long time. I first time i went in 2002 was by doing english pronorth koreas groups and then i went to kim jongils Birthday Celebration in 2002. Host what was the process like of getting into north korea guest im south korean and im on an american, but having a south korean background is not exactly a blessing because korea is, as we know, a kind of technically still at war. So, but theyre just the north korea is very organizational place so groups get in, so the first time i went in with this group, which was fascinating. I got to see the wasnt going in there as a tourist. I went there as a youth delegate. I guess posing as a youth delegate there to honor the great leader, and then i ended up writing a long feature for the review of books after that. I also covered when the new york fill harmonic went in 2008 to pyongyang, and i had been looking for a chance to actually really see north korea abuse its impossible to see. I have covered the factor crazy you can cover from china or south korea, people fled and thats one part of the story. What about the people that are living there . So finally i found out about this school that was being set up by christian missionaries in the suburb of pyongyang, and i applied for a job there, and i actually got this job for in 2011, which happened to be the last six months of kim jung ills life. Host you got a job doing what . Guest teaching english. Host how controlled was your life on a daily basis. Guest oh, my god. Well, north korea is just the most controlled state. The recent u. N. Report says the i guess the gravity of the violations is unparalleled to any state in a contemporary world. From the minute you go in you will be followed every second. Give up your phone and parts and all that. Host ha to give up your phone. Guest you have absolutely nothing on your basically that can connect you to anyone. And then a minder will be with you all the time. You are not going to leave, like a package tour in a way, and think of it as a package tour. Even a package tour you can go off but there is we are you just basically go from site to site to site. This who is its impossible to cover north korea in any meaningful way that would reveal that place. And the people. So were always getting sound bites about what is going on there, its probably why everyone is fascinated by north korea in some sense. Host go ahead. Guest so, 24 7 im watched. Tape recorded. A minder is living in the same building, even in the room, you know, host did you presume it was bugged . Guest yes. I mean, always its so hyper controlled that you are just never left alone in a sense. Even when youre on your own, which is an odd way to be, kind of impossible to emergency to imagine when youre sit hearing in Jacob Javits Center in new york. Host who were you teaching. Guest in 2011 was an extremely important year in north korean history because this is when kim jung ill died, and the 100th year in north korea they count the day from the first day of the original great leader, so that year all the universities were shut down, all the College Students who were sent to construction fields, the entire country, except 270 young men, age 19 and 20, and they were i think they were sent to suddenly transferred to this school. Host suddenly. Guest some of them already there but my students got there three months before i got there. Detroit in july of 2011, and these were the most creme dela cream. Obviously everyone else is in the construction field, build what the call a prosperous nation, and these young men were selected to sort of i think almost the storm is coming because the regime was going to change, and by the end of that year, december 17th of 2011, kim jung ill kim jongil died, and the announcement happened in north korea on dem 19, 2011, and that was my last day in north korea. Host what was that like . Did you know guest the final chapter. Host did you know it would be your last day and. Guest yes. Was a sort of coincidence, and i couldnt believe it when i was told he died. And because i was there i just the school was set up by christian missionary. When i was told by a colleague that he died, it was christmastime, actually thought we were talking about god, but in that country its also another god. Kim jongil. Host were your lesson plans controlled . Guest yes. Host you were given scripts. Guest not scripts but we were given certain guidelines and you had to get permission for everything two days before. So, there was a certain freedom you could practice within that. Which not certain i mean, really tried to find that in order to get to know them, really, and i wasnt it wasnt it doesnt sound as i really actually love them. I fell in love with all of them and i really wanted to teach them, but it was always conflicting feeling because if i told them more than they dont really know about the world, a lot of them, and i do, because im from the outside, and theyre never allowed out of anywhere. Never allowed out of this locked compound the whole time. Ever. So, they have no communication with the outside world. So, i was always trying to in a way reveal the glimpses of the outside world to them, but it worried me because i thought if they learned more, what would happen to them . Because north korea just will not was a closed nation. Host what was the goal of the christian missionaries in setting up the school. Guest what is the goal of missionaries anywhere . Theres only one goal. Which is to bring god or so i think that they had their own purpose of getting in, to set up the school, which in some way it has a positive and negative aspect but they were determined to bring god. Part of the missionary pump im not a missionary, clearly. I sort of went in as one, in order to teach at that school, and get to know my kids. I think of them as my kids. Host would they ask you questions about the u. S. . Were they allowed to. Guest they werent allowed to. But what i found there, is first of all i was born in south korea, fluent in korean, and i come from separated family, meaning families on my side have been separated into north korea, although were from south korea, during the war so really the horrific heartbreak was division of korea, has always been in my family. So i have a personal, i guess its not interest its more my mothers brother was lost during the war, same thing happened to my father. So when i think about north korea, south korea this happened to a million families. I think for us its a heartbreak. North korea is a really big wound and a heartbreak, and i think i want you to tell that story. Its very personal story. Which i i think why its been investigated an account but also in some sense, a memoir because i wanted to relate that sense of what it means to have 70 Million People and one are a third is over here and twothirds of the south and they have families for 5,000 years and theyre separated forever because of the the war ended in 1973 and here we are in 2014, they never saw each other again. So i think that when i wanted to relate to my kids, i wanted some sort of, i guess, bond or understanding or some way of connecting, i think. Host were you allowed to wear western clothing . Guest no jeans allowed in north korea because kim jongil doesnt like them. I guess kim jongun. He might because he likes dennis rodman, but generally jeans because its symbol of america. But it was a very sort of conservative environment. Also was a locked compound. None of us were allowed out. Host you never got to see the countryside. Guest we were taken on organized group outingsment the teachers only. Students never left. And they were always at a certain time in and all of news one bus with a minder and you go out in a group and come back as a group. So thats the way you see the rest of the country. I think the way that this is a story, this book is, a narrative story of what happens in some sense in a prison. The whole country is a prison. This locked compound i was living in was a prison. And i think that this and in a daily life that we were living i lad to east all my meals with them. I played basketball with them. I talked to them about girls which they never at first it was all great leader, great leader, but then various i do think that if youre locked in a place with somebody, slowly understand what happens and some sort of adoration happens and this real bond happens. So, they would ask questions about america, but very hesitantly. And i always i didnt want to get them in trouble because somebody is always watching and reporting. Even the conversation, the stunts are watched also. Host did you get the sense that any of the students wanted to leave . Guest the country . Guest definitely senses that i got the sense some were questioning a little, because you can only question. I think that the reason that this experience was so unique was also their age. 19 and 20. Theyd been growing up in this system of the great leader. A very cultlike, onetrackminded system. They wake up at 6 30 and do the whole great leader ritual, great leader studies and do english but their entire day is about the great leader. So do they want to leave . I think its kind of like, if you can think of a really, really fundamental religion environment, even if they did, in that place where youre constantly reporting on each other, you cant reveal that thought because that the consequence of that is a gulag. So, even if i saw that questioning, i think i stopped it or they stopped it. Theres always this host now that you have written this book, could you go back . Guest no. Absolutely not. Absolutely not in some way i think that i have in one sense i said everything i want to say but i have, all my understanding, heartbreak of the division, personal stories, and this beautiful, beautiful young men who are in a way trapped in their horrible system. I think my ultimate goal with the book is to humanize north korea in some way because i think that when you look at human suffering, hear a word like 400,000 people suffering in gulag. Three Million People the numbers dont register because they dont seem like us. The portrait of this is not seen as a political sense, its add really a daily life and think of them as this innocent, fun, 19yearold, and then they switch to the great leader, and the world they live in, very jarring feeling. The more and more you follow in love with them, my hope is that leaders would begin to actually care, that its not just labels defector or the comic relief of the great leader which is really, really, in a way wrong of in the media to focus on that because its not that funny, really, north korea. It is the most violent and sad, tragic, horrific place. Host where did you get the title without you there is no us. Guest any students. My kid always sang three times a day coming into the cafeteria. They sang all the time in groups. And its marching like soldiers, and one of the songs they would sing is, without you there is no us. Without you there is no motherland. Of course you is obviously the great leader. So, that always stuck with me and i would hear that song, sometimes i would hum it because it got so familiar. They sang it all the time. Three times a day, and then they marched, and i walked to the cafeteria and they marched in groups like soldiers and we set down, and then i kind of even here in new york, sometimes ill be humming and, oh, thats the song, the kim jongil song, so it became almost like a daily ritual. Without you there is no us. Host suki kim is the author of wow pouting without you there is no us. It comes out in october of 2014. This is booktv on cspan2, television for serious readers. Booktv is on facebook. Like us to get publishing news, setted alling updates, behind the scenes pictures and videos, author information and to talk directly with authors during the live programs. Facebook. Com booktv. Some of your language that you have used has certainly you talk about this, the politically correct police you call them, the pc police a little bit on this, but word does matter and it did offend both. So, why not curtail some of your language . Well, what offends people that ive said . I think it depends on their point of view. Maybe your political positions. All sorts of ways people get offended. When i talk about political correctness, im talking about not being able to express how you actually feel. Host so, in saving our children, some africanamericans would say, slavery was this to compare the National Debt to slavery is doing a disservice to slavery. Guest its the whole hyper sensitivity thing. A lot of things dont bother people and then somebody comes, did you hear what somebody said, you should be offended oh, my god oh, yeah, 0 yeah. 140 characters. Guest saying stuff that used to go on, on the thirdgrade playground, the guy whoa say, you hear what he said about your mama . Comp on. We dont have to deal with that. We have real major problems that we have to deal with. The reason i talk about enslaving our young people is because this level of debt i dont think most people can even comprehend, 17. 5 trillion, going on to 18 trilon. If you tried to pay back 18 trillion at 10 million a day, it would take you five thousand years. Its an absurd amount of money. The only reason we can sustain that us base the u. S. Dollar is a reserve currency of the world. What if it were not . The designation that goes with the number one economy in the world which we have been since the 1870s. Were going to lose it soon because host china . China is a mess, though. Guest theyre a mess but growing at six to seven percent. How much are we growing . Host two to three. Right. Guest so, they are going to pass us up. However, dont believe theyre going to become the same kind of force. Look at their banking system. Host theres a lot of problems theyll face. Guest however, heres the issue. They are already talking about it. Russia is starting to talk about it. Other nations, about creating a basket currency, so that instead of the u. S. Dollar being the basis it would be a hodgepodge. What will that do to us . It will rob us or deplete us from the ability to print money. What happens when you cant print money and you have the kind of debt that we have some stop and think about that for a moment. You can watch this and other programs online at booktv. Org. Youre watching booktv on cspan2 2. Now joining us live is the author of flash boys. Michael lewis, what is a flash boy . The heroes of the book of the flash buys and theyre people who discover the stock market has something funny going on and seek to find out what it is and then build a mechanism to prevent predators in the stock market getting to prey and eight called the flash boys, one is the solution the main characters come up with require them to be faster than the highspeed traders who are the predators in the stock market so they have to be i wanted speed the title. Also wanted super hero in the title because they were these these characters at the center of the story i felt. Not doing anything unnatural but haveward powers in the Financial Markets and the powers are powers explain complicated things to people. The power to kind of engender trust in others. But the last reason its called flash boys is i knew i wanted flash in the title because the markets have taken this term and, flash crashes and flash orders and flash trading. And i had a title that was kind of an inert title the flash trap. I was driving with my kids and they said whats the name of the book, i said, flash trap. They said thats dull. And i said come up with a better name. Its about guys on wall street who figure out rich people on wall street are stealing from his rich people, middle class people. And they get upset about it and try to do something about it. They go my kid goes rich people are stealing from us . Thats awful. And yeah, butted thats what happening. Theyre going to fix it . I said its like robin hood. They say one children said, qualify it flash boys eye and i thought, thats my title. Any told the publisher where it came from. Host how are people stealing from from others on wall street . This happened pretty rapidly over the last six or seven years where the 13 public stock exchanges are all scattered through new jersey. So they know that and there is only a narrow second advantage. They know that we have be analogy is a bit like something that would result in a horserace before its been run walking onto the track and other people were betting on a horserace. So its for some fairness in the system. So thats the problem and that problem is nobody knows quite how big a problem is in terms of sums of money they are being essentially taxed out of investors by wall street intermediaries but i mean its billions of dollars a year. Host because of these milliseconds . Guest because of these milliseconds. Host this is something you write in your book flash boys over the past decade of Financial Markets have changed rapidly poorer mental picture of them to remain true to life. The picture of that most people have of the markets is still a picture of a human being that a human being might have taken. In edit tickertape runs across the bottom of a cable tv screen with alpha males and colorcoded jacket standing in treaty bans hollering at each other. That picture is dated. The world it depicts a stated. Guest yeah. In fact thats the picture i had in my head when i got into the story. I didnt have a great sense of what happened in the market. It was only three or four years ago he started hearing this phrase High Frequency trading and its really all in the last decade they have become fully automated meaning that all trades go into, are essentially matched inside of computers rather than by human beings on the stock exchange. Its funny but its a problem and its also an opportunity. To describe what this new world as you can see how hard it is for people to get their minds around not just the stock market but all of Financial Markets because they cling to the old picture. It used to be you would watch tv and there were reports about what was going on the start market in people on the stock exchange. The old picture is still sort of being used because the new picture has not been drawn. One of the things i had hoped to do that was almost by the buyer but i thought it would be leaving the reader with a sense of a different sort of picture and the problem is in order to generate that mental picture you almost have to imagine time the way a computer does. The computer can make a thousand trades in the time it takes a human being to make one. Its like geological time like the time it takes to form mountains and valleys and rivers. Its hard to get your mind around what can be done in a millisecond. Host if you were to draw that picture today Michael Lewis would you draw it at the New York Stock Exchange on wall street or would you drive in mahwah new jersey . Guest i would drive in mahwah new jersey. The exchanges are all housed in data centers very heavily guarded data centers in weehawken, secaucus, and mahwah new jersey and you go in them and what you see is there are boxes, black boxes. There are rows and rows of black boxes but one set of black boxes is the exchange itself. Its when buyers and sellers are connected so its what the price of the stock should be because the buyer and seller agree to meet at that price. Then you have the boxes the highfrequency traders who paid 50,000 a month, 100,000 a month whatever it is to connect a line directly into the box to get information on exchange before everybody else. Host what is front running that you talk about in flash boys . Guest front running is the idea almost like a ticket scalper. Someone who figures out the sheriff is going to be soldout runs out and buys tickets at the box office and sells them double the price to people who walked up to see the show. In the stock market what is happening often is that traders with faster machines are able to anticipate orders to buy and sell stock from investors in every kind of investment. Big investment to little investment and by the stock before them and sell it back to them at a slightly higher price. Host you are talking about 1 millionth of a second. Guest a millisecond is a thousand. Im talking microseconds. Highfrequency traders now are making decisions to improve speeds by a nanosecond so a millisecond is 1000th of a second and a microsecond is a problem of a microsecond. You are talking the increment of speed on my numbingly small, its very hard but my point is the ability to divine the intentions and act faster creates this opportunity. Doesnt happen to every trade in the stock market i think it happens quite a lot am always interesting to me about this story about this young man, this young canadian who figures out for himself whats going on, hes a trader on wall street but he finds himself being front running he can figure out how people are doing this. Once he figures it out and he wanders around even the most sophisticated investors in america to Hedge Fund Managers for example, he finds it everybody senses theres this front running going on but nobody knows the nature of it. No one understands why. So a Big Hedge Fund manager in new york who often buys and sells big chunks of companies told me that he said before the main character in the story came into his office he thought he had an Insider Trading and he was thinking of buying some stock. He was going out wanting to buy some stock in the stock wouldnt move. It would go up before he could buy it as if someone knew he wanted to buy it and selling it back to them at a higher price. That captures the flavor from it. Its people learning what you want to do before you do it and doing it to your disadvantage. Host Michael Lewis is our guest. His most recent book is called flash boys and hes the author of moneyball, the blind side and several other books. You might have seen them on 60 minutes last week trade we have him live here on booktv to take your calls. We will put the numbers on the screen 202 5853880 in the eastern and central timezones 585. It won for the city in the mountain Pacific Times and if you cant get her on the phone lines you get there on twitter. Send the tweet at booktv is our twitter handle any to make a comment on our facebook page. Com booktv and finally you can send an email to booktv at cspan. Org. What is your history in the Financial Markets . Guest my personal history . I was brief. It was brief but lucrative. I stumbled into a job at the now defunct Salomon Brothers. I was 24 years old in 1985. And i was trained by Salomon Brothers for six months and i spent two years. Nobody called at the time and i was essentially a derivatives expert is what im supposed to be. I would and bond salesman. This is one of Financial Markets were starting to get very complicated and Financial Options and futures were starting to become the rage. My job was to explain them to investors. I was taught a crash course in what the stuff was and would go out and proselytize. I quit in 1988. I wrote a book called liars poker about the experience im working on wall street. Since then i have been an interloper meaning that ive written about a lot of other things, sports, my family, my High School Baseball coach, politics but since the financial crisis i found myself drawn back into wall street to write big narratives on the big three, a book called the big short which was about the credit crisis and a book called boomerang which was about the way it should do something about the cultures and in flash boys about how the stock market has evolved since the credit crisis and my interests, my interest is different than when i was working on it in these books are a little different than liars poker but what seems to have happened is because of my history writing about wall street i have had some access to fabulous narrative stories that happen to have emerged from wall street in this time. Wall street at this moment it is a rich material for a storyteller. Host in flash boys one of the themes throughout years of federal regulation called the Regulation National market system. What is that and where did it come from . Guest rag ms was implemented in late 2007 and it was a response to the fear of unfairness in the market. The possibility of unfairness caused by the fragmentation. It wasnt that long ago when the stock market was basically on the New York Stock Exchange and there was this thing called nasdaq in which Tech Companies traded and you could trade in one place or the other. That is changed. The stock market is now 13 public exchanges and 40 something private exchanges called dark pools run by Goldman Sachs or Morgan Stanley in which you cant really see the trading. Host you could participate. Guess we could participate in the sense if you are a big investor you to give the order to Goldman Sachs and they may execute it for you but you cant see in real time how your trade fits into the larger trade in the marketplace. Theres a lot of opacity and complexity. The market is fragmented and he cant can see whats going on so to protect it the fcc came up with rag mnsa and reg mns says its against the rules for a broker handles the stock market to trade outside whatever the national so let me explain that. Lets say you the investor want to buy shares in microsoft at microsoft in the 60 sixtysomething or fiftysomething markets there are and you add it all up offers to buy and sell the market microsoft is 29. 99 and some people are willing to buy a 29. 99 and some are willing to sell it at 30. If you come into by the broker is not allowed to execute your order at a price higher than 30 because there is an offer somewhere in the market. It was to protect investors from being cheated by the complexity and opacity of the system. The problem is with reg mns is how the best are calculated. It takes a long time or all this information together. Host what you mean by slowly . Are you talking a day or talking a weak . Guest its funny we are talking milliseconds differences but the technology is slow. Nobody has an interest, nobody on wall street as an interest in making it faster so that official market is a stale market. The people who have faster access to information whats going on inside all of these exchanges know that maggie maybe microsoft is active from the time its gone in and it gets executed. Microsoft collapsed the next millisecond and im sorry it grows a lot. Is that right . No its collapse. The highfrequency trader can now buy it cheaply and sell it back to you at the sale price of 30. That is what happens. The meaning, the intent of the regulation is very good. It was like to stop investors from being screwed by the complexity of the market. The problem is the market gained regulation by creating two markets, the small market that investors see and a fast market that insiders pay to see. The further problem was once that happened that gap opened between this old stale official price and the insiders knowledge the sums of money that were made from us were fast. No one knows. The closest i have seen to something i believe is what can be calculated from the predatory strategies but its many things. Once those billions of dollars are made by those traders who are paying the exchanges for the faster and faster information and who are paying the brokers for the right to trade against those orders in the sense that all they know is the slow market everybody is than none. The banks of the brokers get paid a lot of money by highfrequency traders. Highfrequency traders obviously get very rich. The system is basically opaque and investors have a hard time picking out what on earth is going on with the stock market. They dont really feel the pain, collectively the pain is fast. And echo system rises and no one on wall street has any interest whatsoever in exposing or talking about it. This is why to finish the soliloquy, sorry to market style has really become incredibly secretive. Why it takes detectives to figure out what on earth is the stock market. How on earth does it operate . Because people on the inside, everybody in the inside doesnt want to talk about much. Host Michael Lewis one more question before we go to calls deleted emails. You quote one of your main characters run as saying its a whole industry of. Guest and hes a wall street person. Host i notice it was white male and f word is thrown around a lot. Guest every time i come on cspan im called out on that. I admire your willingness to attack those that use bad language and defend the langua language, the purity of the language but its true. Its a lot of males. It isnt some weird way more of a mens world than even when i was there. In some ways thats not true but this world of trading is ridiculously male. I said many times and i thought if you wanted to reform wall street just get rid of the guys and put in women for a few years in the decisionmaking jobs and everything would be cleaned up. Everything would be fine. The women would not do with them and are doing. Theres something about test off strong competition that when it connects to the Financial Markets its toxic. But anyway ryan is his name come hes irish so a lot of characters in this book, the people who are the radicals trying to fix wall street are immigrants. Road and is an irish guy in his whole life from the age of 18 or 16 when he moves to the greenwich connecticut from ireland he discovers investment and financial people and he wants nothing more than to be a wall street person. He spends 12 or 13 years trying to get a job on wall street and he cant. All he can get our jobs helping guys who call themselves highspeed traders get faster by knowing the technology. He works in telecamp and he knows where fiberoptic lines or maybe knows what boxes you buy to make your trades go faster. Hes a highfrequency trader in a box. He says i will start trading stuff on wall street and he finally gets hired and he is paid a Million Dollars a year to be kind of a big figure on a wall street trading floor. After about a year he says why do they even want to be here . He cant believe the mystique was so different from the reality that he becomes almost instantly disillusioned. Host Michael Lewis is our guest and burning from howard beach new york you are the first caller. Hi bernie. Caller yeah thanks mr. Lewis for writing the book. And i wanted to point out and you probably know about it already but its been bothering me. My feeling is i used to be able to look at data make a decision as to the depth of the market but it changes, the sizes change so quickly. In other words its my contention that these highspeed computers are corrupting the information. Guest can i ask him . When you say used to be able to look and make a decision where are you trading from and what are you looking at when you look at your screen . Caller im looking at leavitt whether two quotes. Im seeing a size. Guest who is providing information . Host burning what you do for living . Caller i am retired. Host you are an investor or trader . Caller i used to be, not anymore. Host what is a level to quote . Caller are you asking me . A level to is on an investment screen you will see a list, you will take a stock, and a stock and it will show a list of the orders at Different Levels often in pennies, 100 plus 10 cents and on the other side 110. 11 and it will tell you how many shares are offered on each side. I used to be able to see that on a steady basis and i could digest the information but now these numbers change so quickly, the size changes so quickly that the information is useless. So i have stopped. Guest thats interesting. Its a big discussion on what you really want is the subject of my book here to explain what hes talking about better than i that the exchanges enable the highfrequency traders to use quotes tactically so to submit offers to buy or sell stock not because they want to buy it but to make the market seems something it isnt. So he would be talking about a think highfrequency traders will spoof the market. They will make it look like they want to buy. There are a lot of demands out there for the shares in Proctor Gamble but they move so fast in an out that the minute any person like him is trying to act on it its gone. So the information is meaningless. Bad in itself is a problem between predators and some ways. Its an act of shortterm traders trying to deceive each other about what the market really is but the bigger problem is that the exchanges enabled out activity have to make the exchange itself the software incredibly complicated to satisfy the needs of highfrequency traders and all the tactics they want to deploy and fooling people into thinking the market is one thing rather than another. They create instability in the system and this is why and i dont mean to expand on this too much that one of the things that was interesting about the story was one bit wall street bank Goldman Sachs when presented with the main character the story has to tell and a choice, and exchange that is simple and fair and assigned with the sole purpose of making great equality among all investors. One trader on the Exchange Advantage or another. Goldman sachs basically said you know this is a moment of choice for us. Its a gut check moment for us because we actually think that what has been done in the u. S. Stock market to accommodate highfrequency trades is creating conditions for catastrophe and if we dont make the right choice for fair exchanges this catastrophe is going to happen at some point and we will get blamed for it. Its all the result of changes in the plumbing of the market. That is just to accommodate highfrequency traders. Host Michael Lewis and email it front running is illegal wise and writing the software for illegal . Guest great question. One of the questions i ask myself in the story was you i was asked this question. Why is the story available to be written . Why hasnt there have been more outrage about the subject and it wasnt that, it wasnt that nobody hadnt noticed the Something Weird was happening. A lot of people noticed and the insiders really noticed and its not that someone had not cried out about it. There were gadflies in the industry and critics in the industry but it was bad people were numbed. The public generally was numbed and people inside the markets were numbed by two things. One, in the course of the story the stock market had been booming so whatever skin there is isnt really noticeable in the grand context of the market the triples. Everybody is making money so they arent thinking very much about this. The second thing is his point which is whats in between the lines is that when its done by a Computer People have, its not just deniability. They have a sense that there is and will fill human action behind it. Its just that the computer is doing it and what they also have is a level of complexity that actually understands the front running. To prove it you will need to parse the algorithms written by highfrequency traders so it creates a smoke screen and it creates i think and eternal moral defense and a funny way. If you were directing the computer to do something i think a human being will direct the computer to do something that they would never do themselves if they had to physically do it. Host land emails from georgia what do you think of the idea of collecting a small fee one or 2 cents on each stock trade and apply the fees generated to our federal and state needs even the National Debt and these would be turned into billions of dollars by virtue of the volume of transactions. Guest so the issue of taxing. To levy taxes, naturally its distorted in the market and maybe this is a good way to distort the market. But as a solution to this particular problem, any sort of tax is going to have all kinds of unintended consequences. It may actually you now get the bad guys kind of thing. You may get some satisfaction there but its going to have all sorts of unintended consequences. There is a solution. This is whats so great about this story. Its a choice of societies being presented with an its a small part of our society. Their stock market but its actually all of our Financial Markets and that market is so important and so are effective of who we are in the choice is between fairness and unfairness. This exchange has been built. Its the solution to the problem is transparency, people understanding how the stock market is being handled in people being given a choice of which way to direct their stock market orders and spite of the wishes and needs of their brokers. If they choose whatever market is fair you will gut the system. You will reform the system and away occupy wall street never would have. Host rc tweets in two u. Do we really need hedge fund center of it its and leveraging . Guest do we need them . No we need love, right . We need food and water. But do we need hedge funds and derivatives and what was the other one . Host leveraging. Guest leveraging. Host ie complexity. Guest this is i think a very good point. A useful discussion. In the broader discussion is if you look back on the innovation that has occurred in the Financial System since the early 80s you can see that things were created credit default swaps collateralized debt obligation specialized access for highfrequency traders that look like innovation that were masquerading as efficiencies and that works up that works out that as such because one of her very complicated and people who are doing them or making more money than anybody else and three we have this metaphor. Every other aspect of our economy always seems like kind of a good thing. It is really true that in the Financial Sector can be maligned. It can seem like its progress and its not progress. I would not say, i would not list as a malign influence the structure of the hedge fund. Its a structure for a money manager to use. Leveraging depending on where it is, be useful actually but the problem is we have developed too much of a taste for it and we dont recognize the social cost of it so thats a problem. And derivatives, some of the directives should never have been allowed to be created i think. I think it is there could be a tchdog. The problem is once you introduce it you introduce a whole set of problems but if you waive a wand over wall street and never had created credit default swaps they would all be better off. Host Michael Lewis from the cbs news sites on the story from 60 minutes i dont know if he had a chance to look at some of the comments that people made on the story but heres one from star flyer. I like 60 minutes but this piece is a crock. Maybe if it was true it affects large buyers, affects large fires, one per centers in mutual funds however i can limit any by act put in by price and if i dont get it thats fine with me. From what i got from the show we are talking a few pennies a share. Guest we are talking a few pennies a share so lets talk about this. Lets talk about his question is, his point is if there are any damages at all and the person who says that rightly no doubt is thinking there have been incredible improvements in my ability to trade the stock market, totally true. We are much better off because of computers in the stock market and trading on the stock market than before was automated. Its much less expensive to trade. The problem is that instead of the benefits of technology flowing to investors hedged it should have, the customers the Way Technology would flow to people who make telephone calls incredibly cheap now compared to the way it used to be. Wall street has captures wall street has captured some of benefits for itself totally unnecessary by introducing this inefficiency in the market. The other question is what is the cost of back . What is the cost of letting wall street insert itself unnecessarily in the loss of transactions between buyers and sellers of stocks and take out a few pennies each time . You could say its not that big of a deal and hes very happy that the computer works better than the people used to work and whatever he is losing its trivial to him. Over the market a few pennies, and not even that probably adds up to many billions of dollars a year so whats back . Would say its 10 or 20 billion or whatever it is. Thats a tax on investment, just a pure tax levied by attacks on the economy levied by the richest people in the economy. So thats offensive. Even if its 20 billion, 20 billion who cares . Im marty starting to get a little worked up. Then i think well what they have done in order to secure this . What are they done to structure the markets in order to make the 20 billiondollar rift possible thanks they have compromised the structure of the market and this is a collaboration of banks exchanges and highfrequency traders. They have made it less stable than it could and should be. It made it highly unstable. We have things like ipos going poof. We have outages on the exchanges. What does that cost . It causes a blind trust in the markets. That gets right at the core of capitalism. The whole thing runs on