Michael Lewis Quotes

Here was a strange but true fact: The closer you were to the market, the harder it was to perceive its folly.

They traded in the market the way card counters in a casino played blackjack: They played only when they had an edge. That’s why they were able to trade for five years without losing money on a single day.

We live in a world where joy and empathy and pleasure are all around us, there for the noticing.

Yet another hedge fund manager explained Icelandic banking to me this way: you have a dog, and I have a cat. We agree that each is worth a billion dollars. You sell me the dog for a billion, and I sell you the cat for a billion. Now we are no longer pet owners but Icelandic banks, with a billion dollars in new assets.

The longer-term the option, the sillier the results generated by the Black-Scholes option pricing model, and the greater the opportunity for people who didn't use it.

The big Wall Street firms, seemingly so shrewd and self-interested, had somehow become the dumb money. The people who ran them did not understand their own businesses, and their regulators obviously knew even less.

The relationship of the big Wall Street banks to the high frequency traders, when you think about it, was a bit like the relationship of the entire society to the big Wall Street banks. When things went well, the HFT guys took most of the gains; when things went badly, the HFT guys vanished and the banks took the losses.

Incredibly, at this critical juncture in financial history, after which so much changed so quickly, the only constraint in the subprime mortgage market was a shortage of people willing to bet against it.

...these stories are a kind of beacon. By making stories full of empathy and amusement and the sheer pleasure of discovering the world, these writers reassert the fact that we live in a world where joy and empathy and pleasure are all around us, there for the noticing.

Force yourself through the work, force the skills to comes; that's the hardest phase; I feel like your problem is that you're trying to judge all things in abstract before you do them. That is your tragic mistake.

Looking into it a bit, Jamie found that the model used by Wall Street to price LEAPs, the Black-Scholes option pricing model, made some strange assumptions.

the more he studied Buffet, the less he thought he could be copied; indeed, the lesson of Buffet was: To succeed in a spectacular fashion you had to be spectacularly unusual.

perfectionism is the need to be right instead of being liked

A thought crossed his mind: How do you make poor people feel wealthy when wages are stagnant? You give them cheap loans.

The entire history of Wall Street was the story of scandals, it now seemed to him, linked together tail to trunk like circus elephants. Every systemic market injustice arose from some loophole in a regulation created to correct some prior injustice.