On the throes of an
impending resignation, when I’d rather engross myself in a book than
mull over the various potential directions of my life, Michael Lewis’
Liar’s Poker came at an opportune time in my life. Wasn’t
expecting a memoir of a bond trader in the 1980’s to be my escape route
though.
Liar’s Poker is the story
of the unlikely transition of an art graduate from the Princeton, to the
loud, ugly world of bond trading at Salomon Brothers. The moments of
self-doubt, the author’s easy admission that
he lacks pure talent or the trader’s instinct and has risen within the
ranks to become a ‘big swinging dick’ piggybacking on others makes this a
highly endearing account. Perhaps, this very humbleness from the very
beginning is what had me rooting for the
author from the start. However you realize quite early on, that the
author is blessed with an astute sense of how the world works. As a
trainee in Salomon Brothers, the various managers pick and choose the
trainees they want in their departments, on the basis
of their likeability and potential they see at the end of the training
program. Mike, fearful of being unwanted and packed off in some obscure
department, spreads a rumor about how X manager has been asking for him.
The other bosses toe the line, not for
any other reason, but simply because other bosses wanted him, and he
gets the department of his choice.
Nevertheless, the author
is in a constant state of learning from others, lacking any genuine
insights on the market himself. His mentor in fact rightly describes him
as ‘bearing the stamp of the last person he spoke
to’. The author is soon made to break out of the naïve notion that his
customers’ interests were aligned with the interests of the firm, and is
forced to make unprofitable deals for his gullible customers for the
greater good of Salomon Brothers.
There are some unforgettable characters in the book (made unforgettable by the author’s quirky character description) the
Human Piranha (Piranha is an exceedingly nasty fish) who can’t speak without spewing profanities or as the book puts ‘His is a world filled with copulating inanimate objects’
or Alexander, Mike’s mentor who would advise him to take a long
position
on potatoes in US after Ukraine’s Chernobyl nuclear plant explosion,
and there is the Lewis Ranieri, the brain behind the creation of
mortgage bonds.
As some one with little or
no knowledge of finance, the author got me interested in a book of
mortgage bonds and CMOs and junk bonds and leveraged buyouts and such,
and for that I am thankful. Without quite meaning
to, the book actually ended up teaching quite a lot! Though I was more
interested in his ‘outsider’ perspective on the company and his personal
story than the company’s history and progress, it is undobtedly an
interesting read.
Impatiently waiting for Flipkart to deliver Moneyball now.
