Friday, April 1, 2011

The Big Short, A Unique Look at the Most Recent Financial Crisis

Michael Lewis. The Big Short: Inside the Doomsday Machine. NY: W.W. Norton, 2010.

Submitted by Grinnell College Circulation Supervisor Nathan Clubb ’10

The massive scale of the latest financial crisis and my deep interest of both economics and finance sparked a desire to learn more about how the world’s financial markets fell so far, so quickly.  The Big Short, by Michael Lewis, examines some of the key contributors to the recent financial crisis.  Lewis dives into the lives of several individuals who saw the impending mortgage and housing crisis and were able to bet against it.  He explains how several financial giants created complex mortgage bonds, turning low grade mortgage bonds into AAA rate bonds.  He looks into the greed of those who put the entire financial system at risk in order to push their profits ever higher.  He examines several important questions.  Who actually understood the risks associated with creating “artificial securities,” which  depended on housing prices always increasing to succeed?  Why did so many in the financial industry scoff at those who saw the risks associated with these mortgage bonds and credit default swaps without looking into their own holdings?  This is a story about a major underlying cause of the recent financial crisis, the small investors who saw it coming, and their persistence and eventual perseverance despite the rejection of their findings by most of the financial industry prior to the crisis.

The Big Short: Inside the Doomsday Machine. New York: W.W. Norton, 2010.
Burling 2nd Floor  HC 106.83  .L5  2010

Grinnell College Libraries possesses other works by Michael Lewis including:

Moneyball:  The Art of Winning an Unfair Game. New York : W. W. Norton, c2003
Burling 2nd Floor  GV 880 .L49 2003

Panic: The Story of Modern Financial Insanity. New York : W. W. Norton & Company, 2009
Burling  2nd Floor  HB 3722 .P36 2009

Trail Fever: Spin Doctors, Rented Strangers, Thumb Wrestlers, Toe Suckers, Grizzly Bears, and Other Creatures on the Road to the White HouseNew York : Knopf, 1997
Burling 2nd Floor  E 888 .L49 1997.

1 comment:

France said...

I'm sure there are other books out there which cover other contributing factors to the current financial crisis, but I'm not sure how many would be as enjoyable to read. Overall, this is a very interesting and entertaining account of how several individuals were able to see what almost nobody else could or wanted to, and ultimately profit from it.