The Big Short–Book Comments

More appropriately stated, it’s Michael Lewis’s The Big Short, which was a kind of super-late, yet awesome sequel to Liar’s Poker.  I cannot do any justice to the book, based on the zillions of reviews that have already been done, but here’s a bit of blathering anyway:  Liar’s Poker and The Big Short both contain valuable education that America as a whole could use regarding Wall Street’s effect on the mortgage industry.  They’re both good reading as well, as Lewis may have been a scumbag bond salesman for a dead Wall Street firm, but he is really a writer…

Essentially, what the first book points out is the fact that the mortgage crap from recent years was nothing new; Wall Street has been trading bonds full of people’s mortgages for years, and making far better returns than anyone owning a wooden house in Moreno Valley or Stockton, CA.  The early version (Liar’s Poker) represented the crash of the savings and loan industry, and spawned geniuses like Michael Milken, who’s still rich, I’m pretty sure.  We all know about what’s happened to the housing/mortgage market over the past few years.  The key point here is this:  Wall Street intends to screw the mortgage holder as many times as it can, and banks shall not get in the way (although they may participate, like idiots).  It happened in the 1980s (people just forgot, as financial memory is not long), and it happened recently, although on a far worse scale.  You were bet against, people, and you need to learn, in an entertaining way, to stay away from adjustable rate mortgages.

Here’s the useful link:  http://www.amazon.com/Big-Short-Inside-Doomsday-Machine/dp/0393072231.

 

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