★★★★★ Doing the improbable...

The Big Short: Inside the Doomsday Machine

Michael Lewis

In the book The Big Short: Inside the Doomsday Machine, and even more in the movie made from it, Michael Lewis does something that, if not literally impossible, at least on the face of it looks highly improbable -- he writes a nonfiction book about financial markets leading up to the 2007-2008 Financial Crisis that is as gripping and exciting as the best of fictional thrillers. Even more astounding, he doesn't avoid discussion of the financial derivatives that destroyed financial markets -- instead, he focuses on them.

In the early 2000s, the price of housing in the USA rose because it rose -- investors saw that the price was rising and bought buildings for more than they were worth confident that the price would continue to rise and they would be able to sell for much more than they paid. This sort of thing has happened many times in history and is generically called a "financial bubble". We were reassured by almost every finance professional that the housing market was sound -- that the price of housing had never fallen and that it was, therefore, a sound investment. (I was there and paying attention -- I remember the voices of "There is nothing to worry about." well.) The housing market was not sound.

The Big Short is the story of a small number of investors who realized that a crash was inevitable. They looked for a way to bet that the price of housing would fall. In finance, betting that the price of something is going to fall is known as short-selling. Thus, these investors were looking for a way to short the housing market. That's where the title "The Big Short" comes from. By focusing on this small group of investors and what they learned as they investigated the housing markets, Lewis makes the story personal.

And it really happened! Although the stakes of this thriller are lower than one in which nuclear armageddon is on the line, the world-wide financial crash really happened, and the result was the biggest financial crisis since the Great Depression. It was a devastating event that ruined many people's lives, and ended some. People died. In the movie, but not the book, there is an extraordinary scene in which one of the investors tells two others that for every 1% increase in unemployment, 40,000 people die, and that they are betting for this to happen. It is true.

Should you read the book, or just see the movie? Well, you know who you are -- if you're the sort of person who prefers the book to the movie, then do what comes naturally. Or do both! I did, and I enjoyed both.

Amazon review

Goodreads review

Comments

★★★☆☆ The Great Geometer

The Impossible Man: Roger Penrose and the Cost of Genius Patchen Barss If I were asked to name the greatest physicists of the second half of the twentieth century, I would probably choose three: Richard Feynman , Steven Weinberg , and Roger Penrose . (I am a neuroscientist and a mathematician with a long interest in physics. I'm not the best person to choose great physicists, but I'm not the worst.) Thus when my local Theoretical Physics Institute (every town should have one!), the Perimeter Institute , announced a public presentation by Patchen Barss , a science journalist who has written this biography of Penrose , I immediately snagged a ticket. Barss wounded my confidence by emitting that cliché of the science popularizer: that you make science interesting by telling the "human story." Oh, please! I don't read a biography of Penrose for the sake of the human story. Why do science popularizers find it so hard to believe that there...

★★★★☆ What are these people?

Red Side Story Jasper Fforde When I reviewed Shades of Grey , the first novel in Jasper Fforde 's Shades of Grey series, I asked Although I referred to Eddie as a young man, it is not clear to me what the people of the Collective are. I think they are more-or-less human. ... However, in some ways they behave like automata. These are puzzles that I hope Jasper Fforde will clear up in subsequent novels in the Shades of Grey series. Now I'm patting myself on the back, because that is indeed what Red Side Story is about. Or so say I. You might think it is about other things -- a love story, a fight to survive, a battle for justice, a cycle race -- and you would not be wrong. Red Side Story contains multitudes. Shades of Grey ended in a flurry of revelations about the Collective. Eddie, Jane and Courtland Gamboge visited the abandoned town of High Saffron, where Jane revealed that all the people supposedly sent to Reboot were in fact sen...

★★★★☆ The Duchess, the Prince, and the Preacher

The Apocalypse Codex Charles Stross Bob Howard, we have been told several times in the previous three Laundry Files novels, is being groomed for rapid advancement in the Laundry. In this episode he is given a "training wheels" assignment by Gerald Lockhart, a senior manager in the Department of External Assets, a division of the Laundry of which Bob understands little, and most of that wrong. He is asked to supervise two of the external assets Gerry's division manages: the sorceress Persephone Hazard (codename BASHFUL INCIENDARY) and her muscle Johnny McTavish (codename JOHNNY PRINCE) as they investigate Raymond Schiller, the pastor of an American megachurch called the Golden Promise Ministries, which has begun fishing for converts in the Prime Minister's cabinet, making him a person of interest to UK intelligence agencies. Bob is to tag along and supervise (in the lightest possible way, since they know what they're doing and he does not) the operation. Well, as...

★★★★☆ Enola is looking for a friend

The Case of the Peculiar Pink Fan Nancy Springer I just finished three weighty novels. If you care, and there is no reason I know that you should, they were City of Miracles , The Running Grave , and Starling House , good novels all, but no light fare. Therefore, I told myself wisely, "Self! What you want now is something light and sweet and crunchy! You want an Enola Holmes novel!" Thus I gobbled down Book 4, The Case of the Peculiar Pink Fan . It was just the thing! Pink Fan is the best Enola Holmes book so far, in my opinion. Enola is not OK. Despite her mother's frequently repeated mantra, "You will do very well on your own", Enola is not doing great on her own. Abandoned at the age of fourteen by her mother, hunted by her formidable brothers Sherlock and Mycroft, who want to take her freedom away, and without friends, Enola longs for affection. To be sure, plenty remains of the funds her mother embezzled from Mycroft and l...

★★★★★ A Cyberspace Cowboy

Count Zero William Gibson Count Zero was the first book in William Gibson 's Cyberspace trilogy I read. I picked it up in an airport bookstore, where it was on display, so it was probably pretty newly published -- let's say 1984. The Internet existed -- I had been using it to send email, although that was still pretty difficult and took some figgerin. It would be another ten years before Tim Berners-Lee 's World-Wide Web got off the ground as a thing that any academic could use, and thus a version of Gibson 's cyberspace became real. There were no eBooks back them (not really), which meant that a person like me, who must ALWAYS have a book to read, had to carry a backpack full of heavy paper books when I traveled. A quick glance in the bookstore made it clear that Count Zero was my kind of book. And it was. As it happens, the series works almost equally well in the order Count Zero , Neuromancer , Mona Lisa Overdrive ...

★★★☆☆ Commentary disguised as a novel

The Handmaid's Tale Margaret Atwood I think I read The Handmaid’s Tale around 1986, when it first came out and became famous. I found it tedious. I have since looked at one or two other works by Margaret Atwood , and honestly, I have never enjoyed one. You have probably spotted my problem. It is that verb "enjoy". I read books for enjoyment. Not only enjoyment, but also enlightenment and information, and to broaden my mind. But I also enjoy those things, so the verb "enjoy" should not be taken to imply that I will only read a book that is a ball of fun fluff. (Indeed, if you care to peruse the list of books I have recently reviewed, you'll see a five-star review for Nonlinear Dynamics and Chaos: With Applications to Physics, Biology, Chemistry, and Engineering . Let me just state, for the record, that The Handmaid’s Tale is less entertaining than Nonlinear Dynamics and Chaos . To me! Of course I speak only for myself.) But The Handmaid’s T...

★★★★★ Tactical Assault Clown

Class Clown: The Memoirs of a Professional Wiseass—How I Went 77 Years Without Growing Up Dave Barry There is one living human who can write prose that makes me laugh so hard I can't breathe. That person is Tactical Assault Clown Dave Barry . Class Clown: The Memoirs of a Professional Wiseass—How I Went 77 Years Without Growing Up had that effect on me at least twice -- an automatic five-star rating. ("Tactical Assault Clown" is right up there with "Combat Epistemologist" ( The Jennifer Morgue ) on my list of creative military specializations. And if you're one of those people who get their knickers all in a twist when someone uses parens inside of parens, you know what you can do about it.) (Yes, I know I'm not funny.) It's not all ROFL funny. In fact, he tells about his father's alcoholism ( that story has a happy ending ) and his mother's suicide ( that one obviously does not ). Later in the book he tries to convince us that his real li...

★★★★☆ Ultimately, I found I didn't believe it

The Wire David Simon Yesterday I watched the last episode of Season 5 of The Wire . Well, it was good. Obviously, it was good. It has won all kinds of awards, and everyone on Earth will tell you how great it is. What I mean specifically is that it's good entertainment . The plots are intricate and engaging, and the characters are charismatic and well drawn. But I find myself reluctant to confer on it the mantle of greatness that almost everyone else does. Here's how I felt after watching the last episode. Many threads were brought to satisfying ends. We end up with a lot of vivid characters: the corrupt politician, the pushers, the international drug traffickers, the dope fiend, and murder police, murder police, murder police. And you know what? I didn't believe in any of them. They were all obviously fictional constructs. Well, I hear you saying, what did you expect? They are fiction. You knew that going in. But the best fiction transcends itself. You don't strain t...

★★★★☆ Making heroes of Rednecks and Hillbillies

Demon Copperhead Barbara Kingsolver You already know that Demon Copperhead by Barbara Kingsolver is a retelling of David Copperfield by Charles Dickens . Indeed, it is so faithful a retelling that, if the publisher had not already spilled the beans, I would feel compelled to mark this review a spoiler because of mentioning David Copperfield . If you have read David Copperfield at all recently, then you will recognize the characters and the major plot points as you read Demon Copperhead . (I last read David Copperfield when I was a kid in the late 1960s, so I was blessedly free from this detailed anticipation as I read Demon Copperhead . I did, however, check out the Wikipedia plot summary of David Copperfield on finishing Demon Copperhead , so I'm up to speed on both plot outlines.) And this, I say, is absolutely fine! If you're going to steal, by all means, steal from the best! I am co...

★★★☆☆ Lacking the common touch

100 Selected Poems: John Keats John Keats Well, that was disappointing. I am ready to admit that this is an "It's not you -- it's me," case. Since I suspect that some other readers, even readers who love poetry, may likewise find Keats disappointing, I will try to explain why he disappointed me. Thus you can judge whether you, too, might suffer the same fate. First thing to say is that the young John Keats was not really that great a poet. (By "young", I mean up to and including Endymion .) That, of course, is a judgment many readers will disagree with, but don't discount it! It was Keats 's own judgment. In his preface to Endymion , he says "I apologize for the lousy work, but I just had to get this out of my system." (Obviously I'm paraphrasing.) You may dismiss that as false modesty, but I am more inclined to accept it as the judgment of a man who knew what he was talking about, especially because the quality of his poetry abr...

Search This Blog