Why am I languishing here, making approximately $0 dollars as a librarian? Why was I not a Wall Street investment banker?! These guys were having all the fun. In his introduction to the Big Short, Lewis writes that he was dismayed people took Liar's Poker not as a cautionary tale, but as a how-to manual for their careers. But I can totally understand why! He makes the trading floor sound like the place to be, the absolute center of the universe.

He's also got a real knack for explaining something in one or two sentences, and then providing a brief anecdote or lively quote to illustrate the thing described. It's literally never boring. I've heard people say that his writing is successful because it makes readers feel smart, and I get that. Although sometimes, when you have failed to understand something so colorfully and breezily explained, it can actually make you feel...less smart. I read one particular page about the rise of junk bonds three times, and then just gave up.

Liar's Poker is a book about the days that Michael Lewis spent at Solomon Brothers as a Bond broker during the bond boom that took place starting in the 80's. The book is really entertaining and at the same time very informative. The book can be grouped into a few sections, that have very distinct focuses. The first is about the rise to prominence of Louie Ranieri to the head of the mortgage bond trading desk and his subsequent fall. The second is about Lewis' own experience in the London office of Solomon Brothers as a trader in the corporate bond department. The third section talks about Michael Milken , the junk bond czar, and his rise to power. I was amazed by the extent to which this whole industry is driven by Ego, cunning, opportunism, speculation, deceit, and street smarts. It is clear that the customer is a victim to be exploited by this industry.It is amazing to realize that institutional investors like pension funds and trusts make multi-billion dollar investments in some of these bonds which turn out to be little more than a speculative gambles of varying levels of risk. Some people become very rich some loose their shirts, and all the while the investment banks make huge profits. It is also thought provoking how laws enacted by the government can drive a whole industry. An example of this is home mortgages as a bond instrument.There is one characteristic of mortgages that make them uninteresting to the bond industry and that is the fact that they can be repaid at any time. Bonds are generally held to a maturity date. Who wants to hold a bond that can be repaid at any time ? The financial lobby tried like crazy to get congress to enact legislation to force a holder of a mortgage to hold it for full term or pay a penalty. This would make it more interesting as a debt instrument, to the detriment of the mortgage holder. This lead to a whole industry which is the CMO industry. Abuses in this industry ultimately lead to the housing bubble and the finanacial crisis 0f 2008. You can read Lewis' other book, The Big Short, for more details about this. In any case, if you want to read a first hand account of the inner workings of the wall street bond industry from an insider, this is a very good read.

pp 83 is a discussion of S&L's failure in the US.
pp 136 is the best explanation of CMO's I've ever read.

Great read. Initially loaned to me by a coworker. I went out and bought it shortly thereafter.

A former art student winds up becoming a bond salesman for Salomon Brothers in the mid 1980's. He sees a lot, and describes it vividly. Chernobyl. The October Crash of 1987. Gutfreund and Meriwether quibbling over how much to bet in one hand of the title game.

He introduces some terms to the lexicon that persist to this day: BSD- as used in the movie Boiler Room. Good deal of relevant information for both the average investor as well as the seasoned professional. When the news about Chernobyl breaks Mike's good friend has some advice for him, "Buy potatoes." This is a powerful illustration of how traders, not investors, think.

A spread, any spread...

This is great book for someone who wants to get a taste of financial markets in the 70s/80s. The book glorifies the greediness of the traders. It gives great insight on the rise and the fall of Solomon Brothers, and Michael Lewis writes many behind the scenes incidents which helps adding some humor to the history!

Student perspective:

I am very new to investment banking, and I found this book really great. It tells many things about what happens inside of investment banks. Of course, a little bit background of finance is required (khanacademy.org is enough) to understand things. The best things I liked about this book is that the author shares all the actual trading incidents that happened and how they made money by exploiting each situation. This book also explains some things about corporate structure (I have never worked in an actual company so this was new to me), all the office politics and power games. This book gives a perfect picture about how a typical trader/salesman's thinking when he/she is at work.

I would highly recommend this book to students who are looking out for internships/jobs in the investment banking sector.

A plot is set up, then things happen, and then finally there's a conclusion. That's what makes a story. Right? Wrong.

Michael Lewis is a brilliant writer. He catches the reader's fancy from the get go. But Liar's Poker doesn't really have a plot. It's not based on a singular event -- a market crash, a scam, or whatever. Instead, it's part memoir, part deep look inside the world of investment banking. Or maybe just one investment bank Salomon Brothers, where Lewis worked for ~2 years.

Liar's Poker is a primer into investment banking. He tells it like it is, there's no glorification, and no undue vilification of either the profession or any individual character. He knows how to tell a story, even if there's no plot, and there was not a single page in the book that dragged or felt like it didn't fit.

Most investment bankers, turns out, are just glorified salesmen. Bonds' salesmen, in this particular instance. They call up fund managers and try to feed them shit so that they buy whatever they want to sell. I mean, at least some salesmen do that. Or did that, this book was published decades ago.

Now why would a fund manager buy a bond or some other complex financial instrument out of nowhere 'cause some guy called him to sell it to whom? I really don't know. It's mostly greed. But fund managers do do that (or did that). And the investment banks where these salesmen work are darn fucking rich, so they have darn fucking good images (dapper suits and fancy restaurants help for sure). But the investment banks aren't the fund manager's friends. They're just middlemen with conflicts of interest at every point and you can never be sure of which interest they're furthering at which point in time.

Essentially, unless you're a big, big fish, dealing with investment banks is a massive gamble. They're not out there looking for your interests. As with any agent/broker/middleman.

Lewis intersperses his writing on how investment banks operate with his own moral dilemmas. Bankers love to think that they "deserve" all the money they end up making (hundreds of thousands of dollars, sometimes millions, back in the '80s!). Lewis is unambiguous in his thoughts that he didn't deserve it. He gives us a brief insight into his dilemma in the epilogue and I love the measured, reflective individual I see there.

Undoubtedly a classic for the ages. If you know nothing about finance, read this book, google a little, and you'll come out with both knowledge and emotions (and dazzled by the humour).

The author talks about his experiences on Wall street since he joined there straight out of college and quit once he got enough of it. He describes the investment banking in general and briefly goes over the landscape and main events of investment banking around the 70s until the 1987 crash.

Overall it's a good and interesting read but personally i feel that i have picked the book a little early in my learning curve of finance and economics. As long as you are comfortable with the basic concepts like different types of bonds - junk bonds, mortgage bonds etc., thrifts and thrift managers etc., Even though the author makes an effort to explain them up, it still wasn't a very smooth read for me without apriori knowledge.

Great fun and probably benefits from a read 20 years after the crazy time in the financial markets, particularly as 2008 seems to represent a reaping of the financial markets sowed in the late 80s.

Don't know much about the financial markets and you really don't need to to find this book entertaining. Lewis manages to give you both the feeling of a insider (he lived the time) but also acts as an external commentator on the excesses of the period as well as the key personalities.

Thank Jeebus and Gutfreund this early book was successful because it is hard to imagine experiencing this last bear market without the funny, clear narrative genius that is Michael Lewis.

Love a book that reinforces my existing views

There are some books about finance and economics that are so well written and fundamental in their arguments that they withstand the weight of time, becoming atemporal sources of market wisdom. Michael Lewis’ Liars Poker, unfortunately, is not one of those books.

Reading it almost 4 decades later makes it hard to buy into the importance of the events being portrayed. The descriptions of traders and salesmen moving millions through phone lines or the mentions of old Wall Street heroes long forgotten are so removed to the point of being useless for any modern student of capital markets.

As a depiction of the Wall Street toxic money-chasing macho culture the book is excellent. But years later several books and movies - some by Michael Lewis himself - would come out as much better portraits of that culture.

The book does contain, to my pleasant surprise, one of the best primers on the creation of the mortgage bond market. It describes with good detail the events and financial rationale that led Lewi Ranieri and his team at Salomon to create a market for mortgage bonds. Said market would eventually grow and mutate into the cacophony of fraud and greed that underpinned the 2008 financial crisis. But, in many ways, the first symptoms of what would later become a systemic problem can be seen in the book (the poor risk-rating process, the financial shenanigans to cater to many investors, etc).

The book is mildly funny, but often Lewis’ personal dialogue and self evaluation during his salesman days become a little annoying. The social dynamics of his training class at Salomon is also a little overplayed. Lewis’ writing style gets much lighter and funnier in some of his later books such a as The Big Short or Flashboys.

The book was a great success after its publication in 89. It was one of the first books tailored to the general public that portrayed with great detail the culture of Wall Street, the market evolution of the 80s, and the shenanigans of some of the biggest names in finance at the time. But today it feels like a relic; made of names long gone, their interactions on a finance stage that now looks very different, and a culture that, in many ways, remains, but is better portrayed in other mediums.

Liar's Poker tells the story of Michael Lewis and his career on Wall Street during the eighties. In those days, it was almost like the wild west with people throwing money around. Then, the loss of massive sums of money (one hundred million and over) was something that was laughable and easily disregarded. Now, losing that amount of money would yield either a huge embarassment or an instantaeneous firing. Througout the book, Michael Lewis describes to macho-nature of the financial world by using slang terms, such as a human pirahana (someone who curses in every single sentence) and a big swinging dick (the head honcho in the room).
I liked this book a lot because Lewis blends his unique brand of deadpan humor with actual facts about his time on Wall Street. I find that is something that is really hard to do in a book because finding that perfect balance between truth and humor is near impossible. I also like it because the book had a lot of ramifications in the financial world. The book practically ended a few careers as it exposed many brokers for being loose with their money and becuase many people had just been pulled right out of high school. I just found that so interesting because it is very, very rare that you find a book that can do that.
I would reccomend this to anyone that enjoys book based on the financial world and anyone who enjoys books that mesh humor with real facts.