And you thought a book on derivatives and option trading would be boring. WRONG! How can wiping out the global economy ever be boring? Oh sure, Option Trading is a wonky subject, and I’ve read many a dry book on the subject, but this one breaks the mold. It really does help you understand the mechanics of the derivative world as well as show you real world applications in a hilarious manner. Well, hilarious if you weren’t the one losing all your money in the deal. Or if somehow you weren’t part of the global economy within the last decade.

Let me step back at this point. Options. Basically, they’re for farmers. You plant a crop, spend all year tending to it, and need to be certain of a profit. Rather than relying on the weather and gods, you enter a contract. You limit your maximum profit, but put a floor on the downside. The baker does the same… he needs to ensure the price of flour stays low enough to keep his business going down the line. He enters into a buy contract for the farmer’s goods. Simple enough. And sure, why not scale that concept into new industries as well? Think fuel costs for a transportation company… now you’re getting the idea.

But here’s the thing. Why shouldn’t Wall Street take advantage of such a simple thing? I mean, little risk and profits from the sale of the contracts. How could these masters of the universe fuck that up? Just like everything else they touch, it’s gotta turn to gold for them. And that’s why this book shines.

When you seriously get to the causes behind all the messes caused by these guys, you’ll laugh so hard that you’ll cry. Mostly because a little part of you died on the inside and you were already crying to begin with. But you’ll laugh too! Now, I work on the ass end of this machine, but I’m still an insider. The book made me look around my office and laugh. Then cry.

You see, the formula is the same no matter where you go in this industry. A bunch of young know nothings running around selling crap that even their PhD financial quant engineers can’t understand. It’s perfect, the kids, most all who are in their 20s, peddle weapons of mass destruction to anyone dumb enough to buy their bomb. I see it every day at work. Kids ruining client’s people’s retirements because they’re just too stupid to…. Nah, wait, not stupid. They just don’t care. Either way, the stupid/not caring allows them rack in major paychecks. Wealth is not created by the financial industry, it is simply moved about.

Now you’re thinking, “Hey, great idea… let’s get smart people in there instead?” Wrong again, my friend. See, knowing ‘stuff’ in this industry is a bad thing. If you know stuff, you make the salesman feel bad about what they’re doing. This goes up the chain of command too. The author points out how management is based on hitting sales goals instead of skill or experience, because obviously this is a way to run the global economy. But it is. Sure, not everyone is horrid asshole when it comes to this industry, but we’ll never get far enough in this corporate climate to change things.

Given the fact that this book was written pre Great Recession, one could almost say it serves as a witty warning of things to come. Too bad that I’m writing this follow up in 2014… because I can tell you first hand that nothing has changed. And it’s not the industries fault. It’s yours. Yep, you know that boring guy you ignored when you tried to talk finance…? Remember how you brought all your money over to the 20 year old who kept blowing smoke up your ass instead?

A technical dive into the world of derivatives. Would be four stars but the writing style is a bit exhausting.

Learned a ton about derivatives and how they are bought and sold. Amazing how very little thought / due diligence goes into some very large transactions. Gets a little too geeky and esoteric at times.

A bit of a chaotic journey through the 80s/90s/00s financial world, book-ended by the author's involvement in a massive business failure due to misunderstood derivatives and risk.

There is a lot to learn here. The first few chapters were the most educational. The rest of the book tracked the progression of financial derivatives and the key players in the industry with a healthy dose of cynicism. The author was in insider in this world and comes across as very self-aware and jaded, which makes for a lot of entertaining anecdotes from his experiences.

Some of the financial details of the more complex derivatives were over my head. The irony of that mirrors one of the key themes of the book: derivatives are mostly unintelligible to the people using them. There are countless stories of misplaced trust, badly-calculated risk, and some straight up corruption in the financial world.

Hilarious. Never read a derivatives book that readable. I took several classes on Derivatives during my MBA, and after having worked through assignments, I didn't feel like I understand the products at all. The author has a straight forward way of analyzing derivatives to make key points very accessible.

A long walk for a medium sized drink that gets warm by the end. This is no Michael Lewis book, which is what I thing most readers desperately want it to be. The reader will be challenged which is good and bad. I have to admit this was one of the hardest books I've ever read as the material is pretty thick. The depth of the subject covered in this book not for a casual audience. I probably now know more than I'll ever want to about derivatives, and more than I probably should about the internal dealings of Wall Street. I agree with the Financial Times assessment from the cover that this is fascinating reading, but only for those who are deeply, deeply interested in the topic. I was pulled in by the title's inclusion of the word "guns" as I was hoping for a book similar to "Confessions of an Economic Hit Man" by John Perkins. I was looking for more adventure and explosions or something with at least hit of espionage, in fact I don't think a gun ever made an appearance, so I felt suckered by the title. This book really was closer to a text book study of derivatives or at least one man's life story of working in derivative markets on Wall Street, than anything having to do with guns. Though perhaps I just didn't go all in on the metaphor the author was trying to push on the reader. I prefer the analogy that derivatives are closer to WMD's, not guns.

The book is a bit more interesting reading in 2015, as it was published in 2006 before the big crash. The author makes many points that you cringe reading in hindsight about just how out of hand things had gotten during the era of his authorship. Many "shame on us" moments, but when has that ever stopped us (the American public) before, and doubtful it will stop us in the future.

If you are the right audience for this, dive right in, other wise pass on by as it's going to be a long journey.

The real deal.

Excellent book for filling in the background on our recent financial shenanigans. Very funny in parts too!

As heard on the NPR Books Podcast: apparently it describes the roots of current economic crisis.

This book gets very technical and it is obvious that the author adapted his style to be similar to Nassim Taleb. If you can put up with it, Das gets into several very good explanations about the many types of derivatives used to bend tax-laws, redirect risk, and confuse investors.

Very, very, readable. An excellent demonstration as to why the finance industry will always present the mystique of risk to investors, whilst seeking to quantite those same risks for its own benefit.

Very complex, textbook-type descriptions of derivatives in the financial world. I read this following the completion of "The Trillion Dollar Meltdown". It's far too complex for someone (like me) who is not involved in the financial industry. Interesting stuff, however.