Author: Michael Lewis
Genre: Non-fiction, Autobiography, Economics, Financial Markets
Published: 1989
BookMarks
Liar’s Poker is the story of Michael Lewis and his employer, the Wall Street firm Salomon Brothers. The story switches from how Lewis joins the firm, followed by a history of the firm and finally Lewis’s own work till he quits. The book is set in the 1980’s which are some of the most turbulent times in the financial markets.
The book is one of the more recommended reads in management colleges mostly for its insider account of the goings on at investment banks. The title itself refers to a game played by the traders at the firms. (Investopedia)
Overall, quite an interesting and fun read with its insider account of the goings on in the global big money market and investment banks. The picture it presents isn't the rosiest and it also foreshadows the Global Financial Crisis.
Some lines and messages which stood out from the book
- Wall Street is a street with a river at one end and a graveyard at the other.
- In every market there is a fool. And any player unaware of the fool in the market is probably the fool.
- Good traders tend to do the unexpected. Their best work tends to go against conventional wisdom.
- Market rule of thumb - Those who say, don't know and those who know, don't say. [Or as the saying goes – empty vessels make most noise].
- Communications system sufficiently advanced and human relations sufficiently primitive. [This book was set in the 1980s, we have moved much further ahead/behind in the two in the past four decades].
- In the stock market, the higher the math, take it as warning signal that the operator was trying to substitute theory for experience.
- The 3-6-3 club - borrow at 3% lend at 6% and be at the golf course by 3 PM [for people who want to keep life simple]
- I'm now convinced that the worst thing a man can do with a telephone, without breaking the law, is to call someone he doesn't know and try to sell that person something he doesn't want. [How precisely the author has predicted the spammers of today – who are mostly trying to sell financial products]
- The reason why people believe in Charts - because everyone else does
- God gave you eyes…Plagiarise.
- On bonuses/raises - people react with relief, joy, anger or a mixture of three.
- You don't get rich. You attain new levels of relative poverty.
- Two ways of running a firm - as a business or as an empire?
- The money game rewards disloyalty. People who hopped from firm to firm secured large pays and performed better financially than the people who stayed on one place.
Previously on BookMarks: Predictably Irrational
