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The Big Short: Inside the Doomsday Machine
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The Big Short: Inside the Doomsday Machine

4.2 of 5 stars 4.20  ·  rating details  ·  47,903 ratings  ·  3,461 reviews
The real story of the crash began in bizarre feeder markets where the sun doesn't shine and the SEC doesn't dare, or bother, to tread: the bond and real estate derivative markets where geeks invent impenetrable securities to profit from the misery of lower- and middle-class Americans who can't pay their debts. The smart people who understood what was or might be happening...more
Hardcover, 264 pages
Published March 15th 2010 by W. W. Norton & Company (first published November 2009)
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The Big Short by Michael LewisToo Big to Fail by Andrew Ross SorkinLiar's Poker by Michael LewisBoomerang by Michael LewisLords of Finance by Liaquat Ahamed
Understanding the Financial Crisis 2008
1st out of 94 books — 149 voters
The Devil in the White City by Erik LarsonFreakonomics by Steven D. LevittIn Cold Blood by Truman CapoteA Short History of Nearly Everything by Bill BrysonGuns, Germs, and Steel by Jared Diamond
Best Non-Fiction (non biography)
130th out of 2,845 books — 4,854 voters

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Community Reviews

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The Subprime Mortgage’s too easy to just lay blame on a cabal of greed-constipated Wall Street sphincters who unzipped their consciences, yanked down their morals and dropped a huge deuce on the U.S. financial system.

In many ways it’s TRUE and it feels REALLY good to say...but it’s too easy.

There were clearly some major crooks, scumbags and swindlers involved in this monetary atrocity...a number of whom should have been taken out to the desert and shot, in my very pissed off opini...more
Lorin Kleinman
Remember that point, in recent years, when we all started to notice something strange? Houses were getting more and more expensive, interest rates were dropping more and more, and most of us knew someone who had no money, but was able to get a huge mortgage. And then there were all the stories of people buying houses with no money down and interest-only payments for three years. How exactly were these people expecting to make principal payments in three years? And why was anyone lending them mon...more
Rachel C.
This book made me want to vomit, then take a bath in a tub of bleach. Not because it's not well-written, but because the story is so repugnant and grotesque.

Lewis' last book "The Blind Side" told the stories of a lot of people who, when faced with impossible situations, chose to do the right thing and/or work harder. This book exclusively features people who were criminally stupid, those who were just flat-out criminals, and the scumbags who were smart enough to profit from it when the financial...more
Robert Intriago
It was a good book, but it disappointed. I will tell you what let me down:

1. One of the reasons for the credit crash was the lenght of the easy monetary policy pursued by the FED and Greenspan after 9/11. Mr. Lewis devotes about one paragraph towards the end of the book to it and Mr. Greenspan is only mentioned three times, even though his policies were the cause of the housing bubble, my opinion.

2. I found the book repetitious. He tells the same story from three different points of view, even t...more
Lawd. This book took my breath away. I remember what I was doing at several critical moments described in the book and to have been so unaware makes me breathless. I learned things and feel oddly vindicated and cheated at the same time. I knew dumb people were making money with my money: vindicated. I thought some people in the government might be smart enough to realize what happened and know what to do: cheated.

Michael Lewis played two roles in writing this book about the subprime loan debacle...more
I have to SHOUT during this review. Now I finally know the sleaziest, oily, untruthful, and arrogant class of people in the US--financial brokers at the big Wall Street investment banks. The Big Short is a rare look deep inside the machinery that broke the spine of our real estate industry. This is not the more common bottom-up look at the mortgage loan sweatshop industry; instead, this is a top-down view from the rarefied air above 20 stories at Goldman Sachs, Morgan Stanley, Merryl Lynch, JP M...more
Lewis has a talent for making his readers feel smart. Absorbing his best works, you’re granted kinship with the elite. Like a trader at Salomon Brothers, you might have laughed at the chumps in the bond market; or like the wage-constrained A’s boss, you could’ve cobbled together a line-up that draws lots of walks; or like a genius of modern day football, you would’ve recognized the importance of a great left tackle in protecting your quarterback’s back. Now, with The Big Short, you’d no doubt ha...more
Mike W
This book provides an interesting and enjoyable glimpse into the world of the Wall Street financiers who helped to create the recent financial crisis and the savvy few who recognized the bubble before it had burst.

As a piece of economic analysis Lewis's work has serious flaws. While he sees correctly that moral hazard was central to creating the crisis Lewis looks for the moral hazard in the wrong place: arguing, oddly, that the transformation of Wall Street firms from private partnerships into...more
Happy thought for the day:

At least I don't have to include a stint as an analyst for Moody's or Standard & Poor's to my list of professional shortcomings.
In The Big Short, Michael Lewis outlines the causes of the housing crisis (which led to the larger Financial Crisis of 2007-2010), and tells the story of three small investment companies (basically four different investors) who saw it coming, bet against it, and made millions of dollars in the process. I really enjoyed reading about these individuals who foresaw the coming doom. Great human interest stories.

I think one of the greatest take-away learnings for me is the explanation why nannies who...more
Otis Chandler
An extremely well-written account of the 2008 financial collapse. It explained complex ideas like subprime mortgage bonds and CDO's in a clear way, and almost read like a fast paced thriller.

Essentially it seems that a bad ratings system and human greed created an economy that fostered the creation of a lot of bad debts, that eventually went bad, and caused a lot of big companies to go under (Lehman brothers, Bear Sterns), or require a bailout (Goldman Sachs, AIG). This is the real crime. These...more
Frances Levy
Every intelligent person in America needs to read this book. Actually, it should be required reading.

By telling the story of the 2008 financial meltdown through the stories of a handful of people, Lewis manages to clarify and explain exactly what happened, how it happened, and why it happened (that would be unbridled greed of Wall Street banks and hedge funds. Duh.) The most enlightening revelation to me is Lewis's take on the rating agencies (Standard & Poor's and Moody's), which he charact...more
The Big Short: Inside the Doomsday Machine is more than 5 stars. It deserves the highest rank for the clear explanation of how to answer this question: “How do you explain to an innocent citizen of the free world the importance of a credit default swap on a double-A tranche of a subprime-backed collateralized debt obligation?” Not only will you be able to understand that arcane financial question, you will be riveted in the story Michael Lewis tells while you learn. Look, it is only 3 years to t...more
I think I might have a mini journalist's crush on Michael Lewis. First, that awesome article about Greek Monks pulverizing the financial system in Vanity Fair this month, now The Big Short. Lewis has an incredible ability to make unpalatable subjects such as credit default swaps fascinating. Anything related to economics is high on my "not interested" list. And I put the blame squarely on my high school economics teacher, a woman who insisted on pronouncing the world "equilibrium," "equileeeebri...more
Clif Hostetler
This is the best description so far of the inside story about the sub-prime mortgage crisis. Reading this book is like riding a time machine back a couple years, walking into the Wall Street offices and asking them, "What in the world were you thinking?" The story is told from the view point of several investors who were betting against the sub-prime mortgage industry. But there were so few other people who saw it their way that they kept second guessing their position because they couldn't unde...more
Steve Lowe
I never did really come to like anyone in this book. Why? Because every person written about here was in essense a dirtball. The Big Short tells the story of the financial collapse of 2007-08, specifically the spectacular implosion of the subprime mortgage lending market.

On one side, you have the completely repellent folks dealing in the packaging and selling of subprime mortgages in a number of various forms. Subprime mortgages are loans made to people with very little chance of paying them bac...more
Will Byrnes
Michael Lewis looks at a handful of people who saw what was happening in the US economy, tried to sound an alarm, but also used their knowledge to make barrels of cash.

If the tales told here, following the fiscal 9/11 that is Wall Street ethics, do not scare you away from investing with any Wall Street firm, I do not know what will. Lewis may singlehandedly revive stuffing cash in mattresses as a savings option.

What becomes clear is that there is no substitute for doing the hard work of gatheri...more
David Lentz
I have great respect for the clarity and diligence that Michael Lewis brings to shed new light on the second greatest financial disaster in modern American history. He knows where to go to find the bones buried by people both who profited immensely from and were destroyed on Wall Street by the unsurpassed greed of the sub-prime mortgage fiasco. I was intrigued by the creation of high-risk debt obligations consisting of packages of sub-prime mortages with teaser rates which blossomed so predictab...more
I am of two minds about this book. Either:

* Everyone in the world should read this book

... or ...

* No one should /ever/ read this book.

When The Big Short first came out, I heard about it on NPR, listened to a review on Planet Money, listened to an interview with Michael Lewis on Planet Money, heard several more people talk about this book, and then decided not to read it for 'rage management' reasons. Planet Money recently released their recommended books about the crash and the economy and, th...more
Four years ago, I would rant to anyone who would listen about the insanity of the real estate market: who was BUYING all these places, and WHERE were they getting the money? I knew from simple math and common sense that I couldn't afford a mortgage, but I didn't understand how my conviction could put me in such a distinct minority in the general population. The most frightening thing about Lewis's book is the revelation that my situation had an exact parallel on Wall Street, where the handful of...more
Michael Lewis has a knack for taking very complex subjects and weaving a highly readable story around them and filling them with an array of fascinating real-life characters. My only complaint is that I wish he wrote more books! For uninitiated Lewis wrote the excellent Money Ball and Blind Side, both 5 star books as far as I'm concerned. "The Big Short" is his telling of the sub-prime mortgage crisis through the eyes (mostly) of the select few that saw it coming. Keep a keen eye for what could...more
I know almost nothing about money. I know what it is (a physical representation of value that can be exchanged in place of true value), I know what a loan is, and what a bet is, but words like "bond" and "equity" set my head spinning, and "credit default swap" and "subprime mortgage bond-backed CDO" generally result in a horrible rash and near-asphixiation. So I guess I need to give this book credit for forcing me to learn a few things about money and finance, like what a mortgage is, how the de...more

Amazing. Scary. I recommend this book for anyone who thinks they have the stomach to get all the way through. Up until now I thought I had a clue about what provoked the financial meltdown of 2008 but I did not. What we hear in the media is sanitized for us, the masses. I am completely blown away by this book.
Michael Lewis writes very clearly so that even if I don't get all the nuances of the financial world, and I certainly don't, I still come away with a clearer picture of how this all happe...more
Like most people, I'd heard the terms credit default swap and collateralized debt obligation on the news. I followed the collapse of the subprime housing market with curiosity and figured that irresponsibility and greed was behind the collapse of the big Wall Street firms, but I didn't understand what had really precipitated the disaster until I read this book.

Michael Lewis can make pretty much anything interesting and, at times, funny. You may need to look up a few terms if you're not familiar...more
As Steve says in his review, there's a danger to beware of while reading this book. Namely, that danger is pretension; the feeling that you would have seen the collapse of the subprime mortgage bond market coming from a mile away, something most on Wall Street didn't see at the time. And believe me, I make no apologies for the people who caused the crisis (in fact, I think a great many of them ought to be thrown in jail), but I think it's easy to come away from this book with the sense that you...more
I've written before about the subprime mortgage crash and how it happened. We learned shortly after it happened that a major element was the Republicans' insistence on the Commodity Futures Modernization Act, which they snuck into the budget at the end of 2000. This act prohibits the federal and state governments from any regulation of derivatives, and this led to the creation of the credit default swaps that were the direct cause of the collapse of AIG and the other mortgage-backed bond funds....more
Laura (Kyahgirl)
4/5; 4 stars; A-

Michael Lewis does a good job explaining the sub prime mortgage debacle and points out some of the factors in the crumbling of many well known financial organizations in the last 10-15 years.

I had a variety of emotional reactions while listening to this book. I wasn't shocked....more saddened and disgusted. Books like A Short History of Financial Euphoria   by John Kenneth Galbraith, Juggling Dynamite  An Insider's Wisdom about Money Management, Markets, and Wealth That Lasts by Danielle Park, The Creature from Jekyll Island  A Second Look at the Federal Reserve by G. Edward Griffin, had already taken the edge off any admiration or awe I might have felt about the world of finance, banking, and global economics.

The thing that I liked t...more
This book will make you very, very angry, if you've got a live neuron left in your brain.

If I could, I would buy a copy of this for every American citizen, AND make them read it. Maybe, then, everyone would be angry enough to send mobs after the surprisingly few people who created our current economic crisis, and hang them in public - and you'll be convinced they well deserve this, after you read this book.

I did not think it was possible for me to feel more anger about the months of February th...more
Jon Spoelstra
Don't read this if you want to mellow out. This book will make you furious. It's about how the global financial world almost blew up.

It all started with a very altruistic notion: Let's let everybody own a home, whether they were credit worthy or not. This altruistic thing went crazy wild. In a few years, all the big Wall Street financial firms were packaging these sub-prime mortgages into bonds Moody's and Standard & Poors often rated them triple-A. However, in reality, the sub-prime mortgag...more
"The Big Short" by Michael Lewis chronicles the rise and fall of the U.S. subprime mortgage industry and the Wall Street firms which fired the engine that drove it. This book is very readable by people without much knowledge in the world of high finance as it often tells the tales of a group of investors and money managers at the heart of it all. Although "The Big Short" was published just a few years ago, it was more than enough time for the author to add an analysis of the situation, post-mort...more
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Michael Lewis, the best-selling author of Liar’s Poker, The Money Culture, The New New Thing, Moneyball, The Blind Side, Panic, Home Game, The Big Short, and Boomerang, among other works, lives in Berkeley, California, with his wife and three children.

His latest book, Flash Boys, was published on March 31, 2014.
More about Michael Lewis...
Moneyball: The Art of Winning an Unfair Game The Blind Side: Evolution of a Game Liar's Poker Boomerang: Travels in the New Third World Flash Boys: A Wall Street Revolt

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“What are the odds that people will make smart decisions about money if they don't need to make smart decisions--if they can get rich making dumb decisions? The incentives on Wall Street were all wrong; they're still all wrong.” 17 likes
“The CDO was, in effect, a credit laundering service for the residents of Lower Middle Class America. For Wall Street it was a machine that turned lead into gold.” 13 likes
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