a lot of people are talking about michael lewis new book the big short about a handful of people, all odd balls, independent thinkers who saw the financial collapse happen before anyone else did. and most of them made spectacular profits from their foresight. but the book is about more than that. it poses a provocative thesis that wall street in its current form may just be a dinosaur. a dying empire. michael lewis is a best-selling writer of all kinds of books. but he has a special insight into wall street. back in the 1980s he worked at salomon brothers, the firm that pioneered the kind of bonds that eventually almost took down the american financial system. he wrote a book about that experience liars poker and even then was questioning the way wall street operates.
welcome, michael. thanks for having me back. the central promiemise of th book is that on the biggest financial trade in the history of capitalism, the vast majority of wall street was on the wrong side. absolutely. i mean this story is really the story of a single bet. the entire financial system organized itself around this bet. it s a bet on or against subprime mortgage bonds in the various derivatives thereon. the vast majority of the financial system, virtually all the big firms, were on the wrong side. they were longing it. this, to me, was one of the things that awakened my interest in wall street as a narrative subject. when i left, the last thing an investor would want to be is on the other side of a trade from goldman sachs or soloman brothers. if you were in a zero sum bet
in a way are heroes because they saw what was going on. and shouted about it. and profited from it. yeah, they made a fortune from it. they re complicated heroes. i do think the protagonist, the people oh i wanted to follow and the people i thought the readerer would want to follow were they were oddballs, people outside the system who realized they couldn t do the normal business of investing in the stock market side because this thing was happening in the subprime mortgage market to overwhelm everything. they crawfished their way toward this bet against subprime mortgage bonds. it is true that they are betting essentially on the collapse of the financial system. but the mere fact that they saw it coming and that they were shoulting about it and the perceptions were accurate, to me, innobles them a little bit. and the shocking thing to me