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The Money Culture

3.26 of 5 stars 3.26 · rating details · 327 ratings · 29 reviews

The author of the best-selling Liar's Poker offers a witty, trenchant analysis of the world of high finance in the 1980s and the cult of wealth that produced such moguls as Michael Milken and Donald Trump.

Paperback, 304 pages

Published October 1st 1992 by Penguin Books (first published 1991)

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Feb 09, 2012 Patrick rated it 2 of 5 stars

This review has been hidden because it contains spoilers. To view it, click here. I give this book a 2.5 stars as some of the essays were entertaining but as a whole the book was just average.

The money culture is a collection of essays by Lewis that highlights the downside to capitalism such as a con-artist bond salesmen despite being duplicitous works because he can sell. Wall-street is just legalized gambling for mathematicians. Is Wall Street really good for the economy? On the one hand, one can argue it has led to the Great Recession on the other hand the liberalization o...more I give this book a 2.5 stars as some of the essays were entertaining but as a whole the book was just average.

The money culture is a collection of essays by Lewis that highlights the downside to capitalism such as a con-artist bond salesmen despite being duplicitous works because he can sell. Wall-street is just legalized gambling for mathematicians. Is Wall Street really good for the economy? On the one hand, one can argue it has led to the Great Recession on the other hand the liberalization of Wall Street in the 80's led the globalization of 90's that has markedly produce a decline of wars between trading countries today because it is not in their economic interest to go to war.

I guess the main thesis of this book is any economic system is flawed from free-market capitalism that America favors to the centralized capitalism that East Asian countries favors. Lewis is surprisingly against regulation of Wall Street because it creates inefficiencies in which the professional would have to protect themselves from the risk of litigation at the expense of doing their job. After reading this book about heavy regulation in Japan, I am convinced that what ever regulation or taxes the government imposes on the rich, the rich will be able to get around them if they want.

Golden Parachutes are dangerous because a executive compensation is not directly tied to his performance. In the US greedy people get rich. In fact US tax policy encourages both companies and corporations to go into debt that they cannot easily repay. It is apparently better for companies to hold bonds than stocks because they do not have to pay taxes to the government. It behooves executives to undergo a LBO because if the company goes bankrupt due to being overleverage, it won't effect them because of their golden parachutes.

Supply-sider economist assume the markets are always rational thus tax policy should be geared toward having the government out of the way so rich people can invest money. The problem is that the market is not always rational. Then as now, Wall Street are against any sort of regulations. My issue with unregulated cowboy capitalism is if a sector in capitalism destroys the whole economy or if the government has to constantly bail out the gambling traders that is what I have a problem with. It is a given in capitalistic system that a certain amount destructive wealth creation has to occur but as long as the sector does not destroy the whole economy it is fine. A disconcerting thought is supply-siders economist borrowed the concept of going into debt in order to make government smaller from LBO firms that focused on debt as an excuse to make companies more efficient by cutting the fat. Did they not think of what would happen when the economy turned south and neither the country or companies would have cash flow to turn get rid of the debt?

Does LBO truly create efficiency as its proponents suggests or is it a negative in destroying American companies as what happen to some companies under Romney's Bain Capital private equity firm? Also, is using non-productive tax-deduction tricks such as starting a "small business" without productive product tax evasion or is it simply taking advantage of opportunities in an inefficient system?

Although it seems like common sense to main street Americans, it took Ben Bernake to warn Wall Street of LBO and the dangers of debt in sinking a company during a recession/depression. In an era of company loyalty, the LBO strategy of firing employees who are productive just seems shocking but now a days it is a given that everyone needs to work on their transferable skills in order to have horizontal movement between industries.

According to Lewis, no money guru can beat the stock market in the long run but those with information can beat in the short run this is where the traders who make millions of dollars a year make their money.

American capitalism and its relentless focus on money is able to break a society based on caste such as much of the Old World Societies where tradition rules. As I suspected the liberalization of Wall Street was a necessary precursor to globalization of today. Before multinationals can cross borders, money has to be able to cross borders first. In an interconnected world economic effects from one side of the world have real consequences for the other side of the world.

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Jul 20, 2010 Jarrod Jenkins rated it 3 of 5 stars · review of another edition

Shelves: nonfiction

Michael Lewis reminds me of the film producers/writers/directors the Coen brothers, and "The Money Culture" reminds me of "No Country for Old Men" in that both are more about style than substance. What, after all, was the point of "No Country?" Answer: America is a rough place filled with evil and all one can do is his best when faced with uncontrollable external forces, e.g. ride out into the dark and build a fire in the night for others to join you. The point of "The Money Culture" is simply t...more Michael Lewis reminds me of the film producers/writers/directors the Coen brothers, and "The Money Culture" reminds me of "No Country for Old Men" in that both are more about style than substance. What, after all, was the point of "No Country?" Answer: America is a rough place filled with evil and all one can do is his best when faced with uncontrollable external forces, e.g. ride out into the dark and build a fire in the night for others to join you. The point of "The Money Culture" is simply that people in America, England, Japan, France, and Australia strive to acquire money and the cultures differ in the process. That's it. No earth-shattering revelations or changes in world perceptions here.

The gift of Lewis is his ability to make such simple points in interesting ways through unique stories and humorous anecdotes. This book is not a coherent, unified story like "Liar's Poker." Rather, it is a series of discreet articles published between 1988-91 for various news organizations.

Lewis mostly speaks to the leveraged buyouts of the 1980's and appears to believe them, at best, a necessary evil and, at worst, an unjustified transfer of wealth from stockholders to managers or buyers. In the 1960's and 70's corporations sought to diversify their holdings by investing in many unrelated types of businesses, much like an individual investor. These diversified holdings would, in theory, smooth revenues over the years as cyclical businesses underwent booms and busts. Additionally, the diversity would make the conglomerate a cheaper borrower of capital and less susceptible to ultimate bankruptcy or failure. In practice, jamming unrelated businesses together offers no competitive advantages, imposes hidden costs on administration and capital allocation, and exposes slower conglomerates to more focused and nimble competitors. Thus, the 1980's saw an unwinding of these mistakes in the form of leveraged buyouts. Raiders would use the assets of companies as collateral for the very debt needed to purchase the companies. The raiders would then cut costs, sell off pieces of the conglomerate for more than the purchase price, and pocket the difference. The first and longest part of the book is about these leveraged buyouts in the United States with particular attention paid to the sale of RJR Nabisco. Lewis indicates that managers could and should have cut the costs anyway, without the need for a full blown LBO.

In the second part, Lewis briefly looks at how England and France eventually cut back on older, established methods of trading stocks and futures that benefited the privileged few at the expense of the small investors. These countries were compelled to open their financial markets to competition and slash transaction costs in order to remain competitive in the global economy and the global battle for capital. The pursuit of and respect for money has essentially replaced more traditional notions of aristocracy or good breeding in Europe. However, the transition is not always smooth; Lewis compares Australia to Texas in that people in both places sometimes have more money than taste or grace and spend lavishly on tacky parties or art.

Finally, in the third part, Lewis looks at Japan, whose people spend money on art in order to protect wealth from confiscatory tax policy. Lewis spends a significant portion of the Japanese section on a hypothetical involving a devastating earthquake hitting Tokyo around 1993. There was such an earthquake in 1923 and, evidently, one hits about every 70 years. So one is due. Japan is a net exporter, which means it runs a trade surplus and buys much of America's government debt. Lewis theorizes by way of a Japanese economist named Oda that a massive earthquake would have a worse impact on England and the United States than Japan. Japan's insurance for its real estate is provided by British and American companies. While Japan would rebuild and growth would be spurred by the destruction, there would be slack in demand for America's debt, which would slow business here at home. The massive liabilities for American insurance companies would pull the entire stock market down. It's an interesting, if somewhat overblown, hypothetical.

Lewis is a gifted, entertaining writer. I found myself laughing out loud at least twice, which is twice more than most other books. As with Lewis's other book I've read, "Liar's Poker," I found this to be quite the page-turner. It's a fun soirée into the world of Wall Street investment bankers (making $8,000 bets on whether or not a fatty can complete a mile-run in under 8 minutes), retired people on a cruise to find financial wisdom (from either a guru or hack depending on your perspective), and Japanese culture (emperor-worship, hierarchical rankings, etc.).

Memorable Quotes:

"[Ross Johnson, CEO of RJR Nabisco:] clowns around about the three rules of Wall Street: 'Never play by the rules, never pay in cash, and never tell the truth.'"

"Textbooks in economics, which explain the economic purpose of money (a unit of account, a store of value, and a means of exchange), usually neglect to mention the chief role of money in America: a source of entertainment." [i.e., investing is fun.:]

"It seems that even the most worldly students at Oxford and Cambridge were unable to resist the offer of such sudden glamor. And so the money culture spread."

"It is the single-minded pursuit of trade surpluses, coupled with the belief that to generate surpluses the levers of power must remain within the collective reach of bureaucrats, that has led to the crushing concentration of economic life in Tokyo. In practice this means that the Japanese government systematically rigs domestic prices to give Japanese companies the strength to wage price wars overseas. (It's no accident that Japanese goods are cheaper outside Japan than in.) To fix prices at home, however, the bureaucrats require the heads of the relevant companies, their shareholders, and their bankers to be close at hand. Ergo, Tokyo mushrooms. Risking Japanese lives for the sake of global economic domination is not high on the list of subjects that the bureaucrats who oversee the Japanese economy like to discuss with Western journalists."

"Now imagine the shock of Martin Saxon III when he hears he is a pimp. Say he is dining with a new Japanese client. How does he convey to a man he has only just met that he is widely known by those who count in America as a Big Swinging Dick? That in America he is the human equivalent of the Okura Hotel [the nicest hotel in Japan:]? He can, of course, open the meeting in the stylish and forceful manner of the Drexel trader visiting a large Japanese client who delivered the memorable line: 'You little shit, don't you ever talk that way to me again.' But I am told by an American who sells bonds to Japanese that there is a more effective way: brag and drop every name you can think of."(less)

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Mar 28, 2012 Doug rated it 2 of 5 stars

Shelves: nonfiction, business

In terms of big financial news, I guess there wasn't much that happened in the early 90s. This book was a good epilogue of the Barbarians at the Gate 80s and segway into the greed of the Dotcom boom and beyond. A point the struck me was Lewis's observation of the roots of the changing relationship between banks and corporations.

Changing the structure of the market for corporate shares has profound effects on corporate control for several reasons. First, when brokerage profits collapse, brokerag

...more

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Jan 10, 2013 Sam rated it 3 of 5 stars · review of another edition

Shelves: history

Like all good Michael Lewis, The Money Culture cultivates some of the best stories from a topsy-turvy age and unspools them delightfully for his readers. In The Money Culture, Lewis explores the scene of the late 80's and early nineties, after the Savings and Loans and before the deregulation and Internet bubble that defined the end of the 20th century on Wall Street. From vignettes like a Christmas Carol adaptation, circa 1990, to sardonic bulletins from a cruise up the Amazon for would-be stoc...more

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Mar 23, 2010 John and Kris rated it 4 of 5 stars

Michael Lewis is living the dream. He is the older brother or the boy that grew up down the street that is good at everything. He went to Princeton. He went to the London School of Economics. He took a job in the early eighties as a trader at Solomon Brothers and made a small fortune. He tried writing. Wrote Liar’s Poker, The New New Thing, Moneyball, Trail Fever, and The Blind Side. He’s written for The New Republic, New York Times Magazine, Bloomberg, Vanity Fair, Portfolio, and Slate. He curr...more Michael Lewis is living the dream. He is the older brother or the boy that grew up down the street that is good at everything. He went to Princeton. He went to the London School of Economics. He took a job in the early eighties as a trader at Solomon Brothers and made a small fortune. He tried writing. Wrote Liar’s Poker, The New New Thing, Moneyball, Trail Fever, and The Blind Side. He’s written for The New Republic, New York Times Magazine, Bloomberg, Vanity Fair, Portfolio, and Slate. He currently lives in Berkeley where he’s a visiting fellow at Cal, writes when he can, and collects royalty checks full-time. He’s married to former MTV News host Tabitha Soren and has a bunch of kids. He lives in an impressive home/compound.

My wife, Kris, saw him on 60 Minutes and told me he was a handsome young man. I saw him on 60 Minutes and noticed that he smiled a lot. He told the 60 Minutes audience that his modest home was paid for by The New New Thing. That was seven books ago. See, good at everything.

Money Culture is an anthology of early Lewis articles first published in the late eighties. He writes about leveraged buy outs, the savings and loans disaster, yuppies, Wall Street culture, the European nouveau riche, the Japanese pinnacle and crash, and, of course, greed. His early writings aren’t as polished and come across as a bit too brash, maybe even reckless, but I like them.

A couple of favorites:

Leveraged Rip-Off: The best article I’ve ever read describing the eighties LBO phenomenon that made a few people ridiculously rich and did next to nothing for everyone else. Come to think about it, what does Wall Street, what do stock brokers actually do to better our society? Do they really help to create capital which equates to jobs? Comrade, do I sound like Che?

Franky’s Longest Mile: Think the movie Wall Street. Envision the trading floor with Charlie Sheen in suspenders at his green-screened computer. Now envision that Sheen hears his co-worker, Franky, another young trader, claim that he could run a mile in under 7:30. Imagine that this trader looks as though he’s eaten a few too many steak dinners and enjoyed a few too many drinks as of late. Eventually a lot of money is placed on both sides of 7:30 and Franky is set to run, when the markets close, in a nearby park that is usually home to crack dealers and rarely sees Wall Street types with $20,000 watches and wads of cash. Franky makes it 7:27, collapses to cheers and jeers.

Taken For A Ride On the Customer’s Yacht: During the nineteen eighties while I was playing Nintendo, eating glue, and wearing Zubas, the get rich quick schemes began to reach millions via cable television sandwiched between episodes of Cheers and Lifestyles of the Rich and Famous. A great piece about how Lewis took a 10-day Amazon cruise from hell to witness one huckster up close. The huckster bailed after one day.

Kamikaze Capitalism and The Japanese Art Bubble: if you’re interested Japanese millionaires buying up valuable art by the yard and the eventual crash of the Japanese market than you’ll love these: Art as a tax shelter? 100-year mortgages to pass down to yet born grandchildren?

A list of books and articles can be found at the following link. Unfortunately, his stuff from the late eighties cannot be found online easily:
http://www.newnewjournalism.com/bio.p...
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Dec 13, 2010 Nick Black rated it 1 of 5 stars · review of another edition

Shelves: just-fucking-terrible

very disappointing. i'd thought we'd see more pieces like Lewis's 2008-vintage Vanity Fair epistles, witty pieces full of good analysis or at least reference to god analysis. this, especially the final chapter on Japan, more often just seems confused and juvenile. lewis forthrightly declaims in the preface that "I never intended to have these stuffed inside a hardback, but this is how I make my living now." indeed. Lewis's worst offering, one (like "Losers") that seems justifiably forgotten.

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Apr 19, 2010 Ellen rated it 3 of 5 stars

Shelves: non-fiction

This book is composed of a number of articles about the financial world that Michael Lewis wrote for various publications in the late 80's and early 90's. He describes the culture of greed and excess that ruled Wall Street during the 80s. At this point, of course, the book seems both dated and prescient. Many of the names he mentions are still around (Warren Buffet, Ben Bernanke), and many of the troublesome financial practices you hear about in connection with the current crash apparently have...more

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Sep 21, 2009 Matthew rated it 3 of 5 stars

Shelves: finances

An up and down book.
Its a collection of stories he wrote for different magazines, some of which, such as his story about what would happen to the financial world if Tokyo was hit by a large earthquake. Others were lacking, such as how he compared Australians to Texans, but then never got back to the analogy.

In the end, there are some very interesting vignettes mixed in, and its probably worth wading through the rest to find those gems.

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Aug 18, 2007 Sean rated it 1 of 5 stars

Shelves: business

I love me some Michael Lewis, and I have confessed here before a pleasure in the business tell all book. Michael Lewis wrote one of the genre, Liar’s Poker. This collection of pieces written right before and after Liar’s Poker is all right, but not his best work.

I have a high tolerance for bad writing if I am interested in the subject manner, but even I had a hard time getting through some of the early pieces in here about the excesses of Wall Street or the inherent stupidity of American Express...more

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Aug 18, 2012 mike rated it 2 of 5 stars

In this collection of magazine essays & newspaper opeds from the late 80s & early 90s, Michael Lewis displays the skills that rank him among the best modern-day cultural anthropologists.

I'd guess that one of the big influences upon Lewis' thinking is that other great longtime Wall Street observer, James Grant.

Here's one notably good essay reprinted in "The Money Culture"

http://www.nytimes.com/1990/11/21/opi...

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Sep 04, 2012 Yosh Han rated it 3 of 5 stars

"The same bittersweet scent that has driven American investors wild with desire for the past five years is now intoxicating the stock markets of Western Europe. Oe Brit in the City of London describes it as "the odor of the American financier-a blend of sweaty ambition, jet fuel, and overpriced cologne."

From the chapter entitled Slicing Up Europe for Fun and Profit

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Jan 04, 2012 Greg Stoll rated it 3 of 5 stars · review of another edition

The book is a collection of short (3-4 page) vignettes about the financial industry in the 1980's. The are three sections: about America, Europe, and Japan. The stories were occasionally interesting but I'm not familiar enough with the 1980's for most of them to really resonate (although I did learn about leveraged buyouts, I guess). Anyway, it was OK enough.

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Apr 24, 2011 Gil rated it 4 of 5 stars

I enjoy Michael Lewis. You might be interested to know that this book is a compilation of articles written in the 1980s, mostly about finance.

It was a great book, if you are into Wall Street culture in the 1980s. And really, it hasn't changed all that much.

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Apr 26, 2013 Emily rated it 4 of 5 stars · review of another edition

Shelves: audio-books, 2013

Neil kept encouraging me to read/listen to Michael Lewis, but I thought it sounded boring. But I was wrong! He's an engaging and interesting writer trying to explain the greed, corruption, and stupidy in the financial sector. Scary stuff - especially because most of the essays in this book were written in the late 1980's to mid 1990's and we seem to not have learned anything from those times.

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Mar 27, 2013 Darryl Stangry rated it 3 of 5 stars · review of another edition

Good for Lewis fans, may be a bit drab for other readers. Didn't capture the 80's as much as Liar's Poker. Would put it behind 4-5 other Lewis books, but those set a high bar.

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Feb 23, 2009 Brian rated it 4 of 5 stars

Shelves: business

Great writer, and an interesting topic. This is a compilation of articles he wrote over about a 4 year period. The period is the late 80's, though so it's a bit dated.

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Sep 23, 2012 Jerry Peace rated it 5 of 5 stars · review of another edition

Lewis' book reminds that one studies history not to avoid repeating but only to not be surprised by doing the same things again and again and again.

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Oct 26, 2012 Cameron rated it 5 of 5 stars

Michael Lewis is one of the best. He writes with such conviction and attacks the evils of Wall Street in the late 1980s-early 1990s in this book, which is a collection of his pieces published in that era.

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Sep 15, 2011 grundoon rated it 4 of 5 stars

3.5 Not in the same league as Liars Poker, but still a terrific and engaging, if uneven, collection of articles.

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Aug 09, 2011 Sarah Allen rated it 2 of 5 stars

There's a reason people don't mention Money Culture when discussing other works by The Big Short author.

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May 19, 2009 Shriram Narayanan rated it 2 of 5 stars

Not really a book, a collection of previously written articles, not bad but no coherent thoughts/binding.

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Aug 17, 2012 Andrew rated it 3 of 5 stars

Fairly scattered, somewhat dated batch of essays, but Lewis' writing shines throughout as always.

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May 26, 2011 Serge Boucher rated it 3 of 5 stars

Funny, written in 1991 and still very relevant today.

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May 07, 2012 Stephen Holiday rated it 2 of 5 stars

Nothing wrong. Nothing terribly useful.
Funny.

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Jun 16, 2011 Jeff rated it 2 of 5 stars

Collection of short stories, not his most interesting work, but a good idea of the financial system and snobbish behavior of the "elite" in the late 1980's and early 1990's.

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May 26, 2013 Heather rated it 4 of 5 stars

Shelves: 2013, non-fiction

Collection of Michael Lewis essays. Informative but with a dry witticism. Very entertaining.

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Dec 12, 2009 Tim rated it 3 of 5 stars

Interesting. A bunch of it flew over my head, but some tidbits that worth worth reading even to someone no well versed in the culture of money.

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Jun 28, 2011 Matt rated it 3 of 5 stars

Very well written book, I just was not as interested in the topic as I thought I would be. Michael Lewis is a fantastic author and uses stories to communicate an overlying context of the change the finance market took and what it looks like with examples that seem extreme but really are more common than those outside of this community may think.

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Oct 18, 2009 Matt rated it 3 of 5 stars

A collection of Lewis' articles and stories written during and about the 80s on Wall Street, this entire collection could have come from the pages of yesterday's paper.

A quick, fun read.

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Feb 06, 2008 Chris rated it 4 of 5 stars

A solid follow up to Liar's Poker.

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About Michael Lewis

Librarian Note: There is more than one author in the Goodreads' database with this name. See this thread for more information.

Michael Lewis attended Princeton University where he received a BA in art history in 1982. He also received a masters degree in economics from the London School of Economics in 1985.

He went on to work with New York art dealer Wildenstein, and then became a bond salesman at...more

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