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Speaker 1: Pushkin.

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Speaker 2: I'm Leady agen Kott, I'm Michael Lewis, and we're here

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Speaker 2: with a special kind of bonus episode of The Big

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Speaker 2: Short Companion podcast.

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Speaker 1: Yes, which you've heard because you were there for it live.

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Speaker 1: I was interviewed by Nicole Wallace at Symphony Space and

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Speaker 1: you were in the audience. And there were a few

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Speaker 1: wrinkles to this interview that made it really fun. One

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Speaker 1: it was Nicole Wallace, and she's a fabulous interviewer, and

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Speaker 1: I've been on her show on MSNBC and she has

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Speaker 1: a devoted and large.

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Speaker 3: Following, and there's a reason for it.

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Speaker 1: Two was, as we'll hear, an actor came out at

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Speaker 1: the beginning of the show and performed one of the

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Speaker 1: passages from the book and he was so much better

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Speaker 1: at reading my book than I was, and I was mesmerized.

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Speaker 1: It was like I was listening to the thing for

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Speaker 1: the first time. And the third was that characters from

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Speaker 1: The Big Short were actually in the audience, and that

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Speaker 1: was a rare treat for me to be able to

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Speaker 1: talk about them in front of them.

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Speaker 2: Could you see them? They were like kind of in

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Speaker 2: the front row. I was kind of trying to watch

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Speaker 2: them out of the corner of my eye.

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Speaker 1: It was Danny Moses, Vincent Daniel, and Porter Collins. And

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Speaker 1: they're so loud. I could not see them because of

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Speaker 1: the stage lights, but I could hear them. I could

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Speaker 1: hear them laughing, you know, So that was a good sign.

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Speaker 1: So that made it kind of fun. And it was

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Speaker 1: just fun to like recap this whole thing. And it's

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Speaker 1: a great I feel like it's a great way to

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Speaker 1: end our little season.

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Speaker 2: And there are even stories that you told Nicole Wallace

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Speaker 2: that I had never heard before.

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Speaker 1: This I find hard to believe.

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Speaker 3: But it's nice that there's.

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Speaker 1: Still a few coming up.

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Speaker 2: Michael Lewis and Nicole Wallace recorded live at Symphony Space

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Speaker 2: in New York.

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Speaker 4: This is sort of celebrating an anniversary of the Big

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Speaker 4: Short and and you've just released a new audio book

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Speaker 4: in your Own Boys, in your Own Telling. What is

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Speaker 4: it like to relive this story?

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Speaker 1: First? You really should give me credit for having the

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Speaker 1: balls to come out for two days of media for

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Speaker 1: a book that's fifteen years old.

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Speaker 5: Well, I'm taking notes. I want to know how it's done.

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Speaker 1: I do feel like I do feel this is the

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Speaker 1: last thing I'm doing, and I do feel I need

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Speaker 1: to come clean to someone about why we're doing this.

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Speaker 1: We happy? Can I be this? Can we just do it?

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Speaker 5: Here?

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Speaker 1: Are we safe space? Yes? Safe space? Safe space?

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Speaker 5: You guys in.

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Speaker 1: Sas safe space and nobody's going to talk about it.

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Speaker 6: No it well this is classified.

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Speaker 1: Okay. So what happened was a few years ago the rights,

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Speaker 1: the audio rights to Liar's Poker came back to me.

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Speaker 1: And the audiobook market is what's changed. It's the biggest

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Speaker 1: change in the way books are consumed in my career

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Speaker 1: and in the old days, in olden times, even big

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Speaker 1: short times, there wasn't a whole lot of effort that

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Speaker 1: went into making the audiobooks. And in the case of

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Speaker 1: like Liar's Poker, the audiobook was cassettes on you know,

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Speaker 1: really you got a box. You got this giant cardboard

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Speaker 1: box full of cassettes if you ordered it. So we thought.

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Speaker 1: I thought with Pushkin my podcast company, and I'm a

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Speaker 1: kind of an itinerant podcast right now, I'm not on

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Speaker 1: all the time, but I do this. See I'll do

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Speaker 1: seasons from time to time that it would be it

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Speaker 1: would be fun to just try to redo the Liar's

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Speaker 1: Poker and see if see if anybody would be interested.

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Speaker 1: And we did a podcast season alongside of it, and

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Speaker 1: the thing just took off, I mean, and so we thought, hmmm,

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Speaker 1: like these things are coming back, Big Shorts coming back,

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Speaker 1: Moneyball's coming back, the blind Side's coming back, all these

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Speaker 1: books that are coming back, and this chance to uh

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Speaker 1: make free money. It's really great. But also it's kind

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Speaker 1: of fun to revisit the stories. Like I never reread

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Speaker 1: my books. I don't think about them. They really just

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Speaker 1: kind of they're in the back past. And this one,

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Speaker 1: this had Moneyball in particular, we're still living in a

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Speaker 1: world that it was sort of just and it seemed relevant.

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Speaker 1: So we did recorded the book a couple of months

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Speaker 1: ago when we have a new fancy audio book, but

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Speaker 1: we have a seven episode podcast with going back and

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Speaker 1: looking at the consequences of the financial crisis, talking to

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Speaker 1: some of the characters in the book. Some of them

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Speaker 1: were here. I think they got in Danny Moses, Vincent,

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Speaker 1: Daniel Poor Collins. Did they hear, Yeah, there we go

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Speaker 1: and I think that's all. I think that's all that's here,

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Speaker 1: and there's an and it was. It was It's just interesting,

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Speaker 1: still interesting, still in the air.

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Speaker 4: It's riveting. I mean I and I'm so glad that

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Speaker 4: you brought it back to the people because your gift

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Speaker 4: to the story we're telling every day in the news

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Speaker 4: is that it is very easy to shorthand everything. But

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Speaker 4: there's nothing that you experience on a more human level

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Speaker 4: than the human stories. And so I want to spend

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Speaker 4: tonight talking about these humans.

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Speaker 1: Do you want me to start now I start talking,

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Speaker 1: I kind of don't say.

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Speaker 4: Give me one Give me one note on the humans

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Speaker 4: and then we'll listen.

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Speaker 1: To this elevated the human There was a logic to

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Speaker 1: the book. There was there was The book got cast

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Speaker 1: in a way no book I have ever written has

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Speaker 1: gotten cast, but in the way the book I'm writing

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Speaker 1: now is getting cast. And and I will explain that

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Speaker 1: logic after we hear the reading.

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Speaker 4: So without further ado, this this is I mean, you

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Speaker 4: are always a highlight. This is really going to be They're.

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Speaker 1: Here for you.

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Speaker 4: No, no, no, Now, Zach Renier is going to do

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Speaker 4: reading from from the book.

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Speaker 6: It had been four days since Lehman Brothers had been

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Speaker 6: allowed to fail. But the most powerful effects of the

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Speaker 6: collapse we're being felt right now. The stop of Morgan

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Speaker 6: Stanley and Goldman Sachs were tanking, and it was clear

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Speaker 6: that nothing short of the US government could save them.

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Speaker 6: It was the equivalent of the earthquake going off, Danny said,

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Speaker 6: And then much later the tsunami arrives. Danny's trading life

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Speaker 6: was man versus man, but this felt more like man

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Speaker 6: versus nature. The synthetic cdo had become a synthetic natural disaster. Usually,

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Speaker 6: you feel you have the ability to control your environment,

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Speaker 6: said Danny. You're good because you know what's going on now.

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Speaker 6: It didn't matter what I knew. Peel went out the window.

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Speaker 6: Front Point had maybe seventy different bets in various stock

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Speaker 6: markets around the world. All of them were on financial institutions.

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Speaker 6: He scrambled to keep a handle on them all, but couldn't.

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Speaker 6: They owned shares in Key Bank and were short the

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Speaker 6: shares of Bank of America, both of which were doing

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Speaker 6: things they had never done done before. There were no

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Speaker 6: bids in the market for anything, said Danny. There was

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Speaker 6: no market. Was really only then I realized there was

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Speaker 6: a bigger issue than just our portfolio.

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Speaker 5: For fundamentals didn't matter.

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Speaker 6: Stocks were going to move up and down on pure

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Speaker 6: emotion and speculation of what the government would do.

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Speaker 5: The most unsettling loose.

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Speaker 6: Thought rattling around in his mind was that Morgan Stanley

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Speaker 6: was about to go under. Their fund was owned by

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Speaker 6: Morgan Stanley. They had almost nothing to do with Morgan

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Speaker 6: Stanley and felt little kinship with the place. They did

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Speaker 6: not act or feel like Morgan Stanley employees. Heisman often

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Speaker 6: said how much he wished he was allowed to short

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Speaker 6: Morgan Stanley's stock. They acted and felt like the managers

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Speaker 6: of their own fund. If Morgan Stanley failed, however, its

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Speaker 6: shared and their fun wound up as an asset in

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Speaker 6: a bankruptcy proceeding. I'm thinking we got the world by

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Speaker 6: the fucking balls, and the company we work for is

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Speaker 6: going bankrupt. Then Danny sends something seriously wrong with himself.

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Speaker 6: Just before eleven in the morning, wavy black lines appeared

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Speaker 6: in the space between his eyes and his computer screen.

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Speaker 5: The screen appeared to be fading in and out.

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Speaker 6: I felt this shooting pain in my head, he said,

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Speaker 6: I don't get headaches. I thought I was having an aneurysm.

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Speaker 6: Now he became aware of his heart. He looked down

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Speaker 6: and he could actually see it banging against his chest.

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Speaker 6: I spent my morning trying to control all this energy

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Speaker 6: and all this information, he said, and I lost control.

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Speaker 6: He rose up from his desk and looked for someone

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Speaker 6: eyes been normally sat across from him, but Ivesan was

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Speaker 6: out at some conference trying to raise money, which showed

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Speaker 6: you how unprepared they all were at the arrival of

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Speaker 6: the moment for which then they thought themselves perfectly prepared.

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Speaker 6: Danny turned to the colleague beside him, Porter, I think

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Speaker 6: I'm having a heart attack, he said. Porter Collins laughed

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Speaker 6: and said, no, you're not. An Olympic rowing career had

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Speaker 6: left Porter Collins a bit inerd to the pain of

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Speaker 6: others as he assumed that they didn't know what pain was. No,

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Speaker 6: Danny said, I need to go to the hospital. His

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Speaker 6: face had gone pale, but he was still able to

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Speaker 6: stand on his own two feet.

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Speaker 5: How bad could it be?

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Speaker 6: Danny was always a little jumpy, That's why he's good

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Speaker 6: at his job, said Porter. I kept saying, you're not

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Speaker 6: having a heart attack, and then he stopped talking and

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Speaker 6: he said, all right, maybe you are.

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Speaker 5: This actually wasn't all that helpful.

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Speaker 6: Unsteadily, Danny turned to Vinnie, who had been watching everything

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Speaker 6: from the far end of the long trading desks and

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Speaker 6: was thinking about calling an ambulance. I got to get

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Speaker 6: out of here now, he said. By the time Heisman

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Speaker 6: got the call from Danny Moses saying that he might

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Speaker 6: be having a heart attack, and that he and Vinnie

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Speaker 6: and Porter were sitting on the steps of Saint Patrick's Cathedral,

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Speaker 6: he was in the midst of a slow, almost menopausal change.

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Speaker 6: He had been unprepared for his first hot flash in

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Speaker 6: the late fall of two thousand and seven. By then,

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Speaker 6: it was clear to many that he had been right

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Speaker 6: and they had been wrong, and that he had gotten

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Speaker 6: rich to boot. He gone to a conference put on

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Speaker 6: by Merrill Lynch right after they had fired their CEO,

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Speaker 6: Stan O'Neill and disclosed twenty billion dollars or so of

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Speaker 6: their fifty two billion in subprime related losses. There he

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Speaker 6: had settled up to Merrill's chief financial officer, Jeff Edwards,

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Speaker 6: the same Jeff Edwards Heisman had taunted some months earlier

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Speaker 6: about Merrill Lynch's risk models. You remember what I said

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Speaker 6: about those risk models of yours, Eisman now said, I

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Speaker 6: guess I was right.

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Speaker 5: Huh.

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Speaker 6: Instantly, and amazingly, he regretted having said it. I felt

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Speaker 6: bad about it, said Eisman. He was obnoxious. He was

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Speaker 6: a lovely guy. He was just wrong. I was no

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Speaker 6: longer the underdog, and I had.

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Speaker 5: To conduct myself in a different way.

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Speaker 6: Valerie Fagan watched in near bewilderment as her husband acquired

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Speaker 6: haltingly in fits and starts, a trait resembling tact. There

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Speaker 6: was a void after everything happened, she said.

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Speaker 5: Once he was.

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Speaker 6: Proved right, all this anxiety and anger and energy went away,

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Speaker 6: and that left this big void. He wanted on an

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Speaker 6: ego thing for a while. He was really kind of

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Speaker 6: full of himself. Eisman had been so vocal about the

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Speaker 6: inevitable doom that all sorts of unlikely people wanted to

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Speaker 6: hear what he now had to say. After the conference

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Speaker 6: in Las Vegas, he had come down with a parasite.

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Speaker 6: He told the doctor who treated him that the financial

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Speaker 6: world as we knew it was about to end. A

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Speaker 6: year later, he went back to the same doctor for

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Speaker 6: a colonoscopy. Stretched out on the table, here's the doctor say,

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Speaker 6: here's the guy who predicted the crisis.

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Speaker 5: Come in and listen to this.

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Speaker 6: And in the middle of Iman's colonoscopy, a room full

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Speaker 6: of doctors and nurses.

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Speaker 5: We told the story of heisman genius.

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Speaker 6: The story of Iceman's genius quickly grew old to his wife.

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Speaker 6: Long ago, she had established a sort of Iceman's social

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Speaker 6: emergency task force with her husband's therapists. We beat him

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Speaker 6: up and said, you really just have to knock the

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Speaker 6: shit off. And he got it, and he started to

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Speaker 6: be nice, and he liked being nice.

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Speaker 5: It was a new.

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Speaker 1: Experience for him.

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Speaker 5: All around.

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Speaker 6: She and others found circumstantial evidence of a changed man

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Speaker 6: at the Christmas party at the building se door, for example.

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Speaker 6: She wasn't planning to even let Eisman know about it,

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Speaker 6: as she never knew what he might do or say.

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Speaker 6: I was just trying to kind of sneak out of

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Speaker 6: our apartment, she said, and he stops me and said,

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Speaker 6: how will it look if I don't go. The sincerity

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Speaker 6: of his concern shocked her into giving him a chance.

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Speaker 6: You can go, but you have to behave, she said,

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Speaker 6: to which Eisman replied, well, I know how to behave now,

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Speaker 6: And so she took him to the Christmas party and

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Speaker 6: he was as.

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Speaker 1: Sweet as he could be.

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Speaker 6: He's become a pleasure, said Valerie.

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Speaker 1: Go figure.

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Speaker 6: That afternoon of September eighteenth, two thousand and eight. The

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Speaker 6: new and possibly improving eyes been ambled toward his partners

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Speaker 6: on the steps of Saint Patrick's Cathedral. Getting to places

255
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Speaker 6: on foot always took him too long. Steve such a

256
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Speaker 6: fucking slow walker, said Danny. He walks like an elephant

257
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Speaker 6: would walk, if an elephant could only take human size steps.

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Speaker 5: The weather was.

259
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Speaker 6: Gorgeous, one of those rare days where the blue sky

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Speaker 6: reaches down through the forest of tall buildings and warms

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Speaker 6: the soul. We just sat there, says Danny, watching the

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Speaker 6: people pass. They sat together on the cathedral steps for

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Speaker 6: an hour or so. As we sat there, we were

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Speaker 6: weirdly calm, said Danny. We felt insulated from the whole

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Speaker 6: market reality. It was an out of body experience. We

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Speaker 6: just sat and watched the people pass and talked about

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Speaker 6: what might happen next. How many of these people were

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Speaker 6: going to lose their jobs. Who was going to rent

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Speaker 6: these buildings after all the Wall Street firms had collapsed.

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Speaker 6: Peter Collins thought that, well, it was like the world stopped.

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Speaker 6: We were looking at all these people and saying, these

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Speaker 6: people are either ruined or about to be ruined, and

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Speaker 6: apart from that, there wasn't a whole lot of hangaring

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Speaker 6: inside Front Point. This is what they had been waiting for,

275
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Speaker 6: total collapse. The investment banking industry is fucked, Heisman had

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Speaker 6: said six weeks earlier. These guys are only beginning to

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Speaker 6: understand how fucked they are.

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Speaker 5: It's like being a scholastic prior to Newton.

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Speaker 6: Newton comes along and one morning you wake up, holy shit,

280
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Speaker 6: I'm wrong. Layman Brothers had vanished, Merrill had surrendered, and Goldman,

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Speaker 6: Sachs and Morgan Stanley were just a week away from.

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Speaker 1: Ceasing to be investment banks.

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Speaker 6: Investment bankers were not just fucked, they were extinct. That

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Speaker 6: Wall Street has gone down because of this is justice,

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Speaker 6: Heisman said. The only one of them who wrestled a

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00:16:03,516 --> 00:16:06,116
Speaker 6: bit with their role as the guys who made a

287
00:16:06,116 --> 00:16:11,476
Speaker 6: fortune betty against their own society was Vincent Daniel Well

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Speaker 6: Vinnie's being from Queen's needs to see the dark side

289
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Speaker 6: of everything, Heisman said, to which Vinnie replied, well, the

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Speaker 6: way we thought about it, which we didn't like, was

291
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Speaker 6: by shortening this market, we're creating the liquidity to keep

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Speaker 6: the market going. It was like feeding the monster, Heisman said,

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Speaker 6: We fed the monster until it blew up. The monster

294
00:16:36,396 --> 00:16:41,036
Speaker 6: was exploding, yet on the streets of Manhattan, there was

295
00:16:41,116 --> 00:16:42,836
Speaker 6: no sign anything important.

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Speaker 1: It just happened.

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Speaker 6: The force that would affect all their lives was hidden

298
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Speaker 6: from their view. That was the problem with money. What

299
00:16:50,516 --> 00:16:53,316
Speaker 6: people did with it had consequences, but they were so

300
00:16:53,516 --> 00:16:57,556
Speaker 6: remote from the original action that the mind never connected

301
00:16:58,076 --> 00:17:01,516
Speaker 6: the one with the other. The teaser rate loans you

302
00:17:01,636 --> 00:17:04,156
Speaker 6: make to people who will never be able to repay

303
00:17:04,196 --> 00:17:07,716
Speaker 6: them will go bad. Not immediately, but in two years,

304
00:17:07,756 --> 00:17:11,476
Speaker 6: when their interest rates rise. The various bonds you make

305
00:17:11,516 --> 00:17:13,716
Speaker 6: from those loans will go bad.

306
00:17:13,836 --> 00:17:15,476
Speaker 5: Not as the loans go bad, but.

307
00:17:15,676 --> 00:17:19,356
Speaker 6: Months later, after a lot of teds, foreclosures and bankruptcies

308
00:17:19,356 --> 00:17:23,516
Speaker 6: and for sales. The various CDOs you make from the

309
00:17:23,556 --> 00:17:26,956
Speaker 6: bonds will not go bad right then, but after some

310
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Speaker 6: trustees sort out whether there will ever be enough cash

311
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Speaker 6: to pay them off, whereupon the end owner of the

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Speaker 6: cdo receives a little note, Dear sir, we regret to

313
00:17:39,036 --> 00:17:43,876
Speaker 6: inform you that your bond no longer exists. But the

314
00:17:43,876 --> 00:17:47,356
Speaker 6: biggest lag of all was right here in the streets.

315
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Speaker 6: How long would it take before the people walking back

316
00:17:52,276 --> 00:17:57,276
Speaker 6: and forth in front of Saint Patrick's Cathedral, figure out

317
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Speaker 6: what had just happened to them?

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Speaker 5: Who thank you for.

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Speaker 2: That?

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Speaker 4: Gren proving that the book is always better than the movie.

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Speaker 1: Oh no, I made such a mistake reading this book myself.

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Speaker 4: That was incredible.

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Speaker 1: I should have hired him. Incredible. That was incredible.

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Speaker 4: That was, of course Zachrenier from The Good Wife, The

325
00:18:18,196 --> 00:18:21,436
Speaker 4: Good Fight, Ray Donovan, Fame and Tony nominated for thirty

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Speaker 4: three variations. While we're round, thank you.

327
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Speaker 7: How did the Volkswagen Beatle go from being Hitler's dream

328
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Speaker 7: car to a hippie icon? How did a disgruntled center

329
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Speaker 7: fielder change the business of sports? I'm Jacob Goldstein and

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Speaker 7: on Business History, my co host Robert Smith and I

331
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Speaker 7: dig into the people and companies who created the modern world.

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Speaker 7: Business history is full of innovations and failures and insights

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Speaker 7: into how business works today. At the end of today's

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Speaker 7: episode of Against the Rules, we're going to play a

335
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Speaker 7: clip from our episode about Jim Simon's decades ago. Simon's

336
00:19:02,796 --> 00:19:07,316
Speaker 7: basically invented modern algorithmic trading, and after a few early hiccups,

337
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Speaker 7: including buying up all the titles in Maine, Simon's built

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Speaker 7: a machine that generated incredible returns for decades. The show

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Speaker 7: is called Business History and the previous coming up at

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Speaker 7: the end of today's episode of Against the Rules.

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Speaker 4: I just want to start with the human stories are

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Speaker 4: sometimes hardest to tell because they involve such meticulous reporting.

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Speaker 4: You can't just you can't get it wrong. They're real people,

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Speaker 4: and it strikes me that the Big Short is a

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Speaker 4: story about what happens when the reporting doesn't happen, when

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Speaker 4: people don't pursue the facts and they look the other way.

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Speaker 4: And so I want to know what it is in

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00:19:47,836 --> 00:19:50,996
Speaker 4: you that inspires you to report out stories like this.

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Speaker 1: I'll try to end with that. And I want to

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Speaker 1: end the whole night by telling my own colonoscopy story.

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Speaker 4: I mean, that's t we call that a d I've.

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00:20:02,796 --> 00:20:03,876
Speaker 1: Got it, So you go.

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Speaker 4: I'll bring you back to my question very end.

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Speaker 1: You do, okay, because I MS kolonoscopy story was pretty great.

355
00:20:11,156 --> 00:20:15,676
Speaker 1: I have one. So so the logic of the book,

356
00:20:15,676 --> 00:20:20,996
Speaker 1: how the it was so it was an incredibly complicated story,

357
00:20:21,076 --> 00:20:22,156
Speaker 1: right It's a hairball of a story.

358
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Speaker 3: It's like a story in Washington.

359
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Speaker 1: Right now that it's very hard to tell. It in

360
00:20:29,196 --> 00:20:32,916
Speaker 1: from eighty thousand feet in a way that's interesting. It's

361
00:20:32,956 --> 00:20:36,996
Speaker 1: too it's just too complicated. And however, there was a

362
00:20:36,996 --> 00:20:40,036
Speaker 1: simple there's a beautiful simplicity to the story, and the

363
00:20:40,036 --> 00:20:42,476
Speaker 1: beautiful and this is the penny dropped for me pretty

364
00:20:42,476 --> 00:20:45,316
Speaker 1: early on that the simplicity was you could think of

365
00:20:45,316 --> 00:20:48,876
Speaker 1: the financial world as a simple bet, a giant bet,

366
00:20:49,116 --> 00:20:51,796
Speaker 1: and the financial will had organize itself around the bet.

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00:20:51,996 --> 00:20:53,956
Speaker 1: And on one side of the bet was virtually all

368
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Speaker 1: the big firms on Wall Street and the international banks

369
00:20:56,196 --> 00:20:58,356
Speaker 1: and so on, and it was a bet on the

370
00:20:58,356 --> 00:21:00,956
Speaker 1: subprime mortgage market, and on the on the on the

371
00:21:00,956 --> 00:21:02,876
Speaker 1: other side of the bed, where all these people.

372
00:21:02,676 --> 00:21:03,516
Speaker 3: Know what I'd ever heard of.

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00:21:04,356 --> 00:21:09,316
Speaker 1: And and the question was, how had the people on

374
00:21:09,316 --> 00:21:11,156
Speaker 1: the wrong side of the bet, the center of the

375
00:21:11,156 --> 00:21:13,996
Speaker 1: financial system, become the dumb money? How did they end

376
00:21:14,076 --> 00:21:17,276
Speaker 1: up on the dumb side of the bet? So I

377
00:21:17,316 --> 00:21:18,196
Speaker 1: go out to answer that question.

378
00:21:18,236 --> 00:21:20,396
Speaker 4: When you figure out that structural frame.

379
00:21:20,276 --> 00:21:22,796
Speaker 1: I figured that's the first thing I figure out. I

380
00:21:22,836 --> 00:21:25,316
Speaker 1: figure out that, Oh I could tell this story. I

381
00:21:25,356 --> 00:21:27,636
Speaker 1: can make it simple for a reader by just it's

382
00:21:27,716 --> 00:21:29,436
Speaker 1: just a bet. It's a single and you're are on

383
00:21:29,436 --> 00:21:33,356
Speaker 1: one side or the other. And then so what I

384
00:21:33,396 --> 00:21:37,076
Speaker 1: do then, is I go out and get a list

385
00:21:37,396 --> 00:21:39,516
Speaker 1: of everyone who was on the right side of the bet.

386
00:21:39,596 --> 00:21:42,956
Speaker 1: Now there were probably thousands, but people who were really

387
00:21:42,996 --> 00:21:44,356
Speaker 1: on the right side of the bed, who kind of

388
00:21:44,436 --> 00:21:46,916
Speaker 1: laid it all on the line, and they were maybe

389
00:21:46,996 --> 00:21:52,556
Speaker 1: twenty five twenty and I went and met I think

390
00:21:52,596 --> 00:21:55,156
Speaker 1: all of them. Not all of them would talk to

391
00:21:55,196 --> 00:21:57,756
Speaker 1: me on the record, but I got to know all

392
00:21:57,796 --> 00:22:00,076
Speaker 1: of them, and all of them agreed to kind of

393
00:22:00,116 --> 00:22:05,116
Speaker 1: inform my understanding. But that was that because the beginning

394
00:22:05,196 --> 00:22:07,796
Speaker 1: what was essentially a casting search. Because what happened is

395
00:22:07,836 --> 00:22:10,916
Speaker 1: I talked to them. I realized that there was another

396
00:22:10,956 --> 00:22:14,676
Speaker 1: way to think about this. There were different ways to

397
00:22:14,716 --> 00:22:16,356
Speaker 1: get to the right answer, to get to the right

398
00:22:16,356 --> 00:22:18,236
Speaker 1: side of the bet. They weren't all doing the same thing,

399
00:22:19,756 --> 00:22:22,956
Speaker 1: but they were categories. They were kind of three ways

400
00:22:22,996 --> 00:22:24,916
Speaker 1: that people got to the right side the way these

401
00:22:24,916 --> 00:22:27,596
Speaker 1: guys did, the guys that you just heard about it started.

402
00:22:27,636 --> 00:22:29,756
Speaker 1: They had just a deep history in the subprime argue.

403
00:22:29,796 --> 00:22:33,236
Speaker 1: It went back to the nineties. Eisman and Vinnie both

404
00:22:33,356 --> 00:22:37,196
Speaker 1: knew that it was a predatory market that was squirreling,

405
00:22:37,476 --> 00:22:41,356
Speaker 1: and they smelled trouble because they had had this history

406
00:22:41,716 --> 00:22:45,316
Speaker 1: but they were kind of I realized that broadly three

407
00:22:45,356 --> 00:22:48,796
Speaker 1: ways people had got to the right answer. And then

408
00:22:49,396 --> 00:22:51,676
Speaker 1: they all those twenty characters who were on.

409
00:22:51,636 --> 00:22:52,836
Speaker 3: The right side in a big way.

410
00:22:53,476 --> 00:22:56,476
Speaker 1: I could classify them into those buckets, and then thought

411
00:22:56,836 --> 00:22:58,436
Speaker 1: I got to know them well enough to figure out

412
00:22:58,476 --> 00:23:01,276
Speaker 1: who would be essentially the most fun and the most

413
00:23:01,316 --> 00:23:04,236
Speaker 1: interesting to the reader and the best teacher with the

414
00:23:04,316 --> 00:23:07,796
Speaker 1: least overlap in kind of how the characters sounded almost

415
00:23:07,956 --> 00:23:11,916
Speaker 1: like a singing group, so that I picked the three

416
00:23:11,996 --> 00:23:15,316
Speaker 1: characters that way, and then that's when I really get

417
00:23:15,316 --> 00:23:17,436
Speaker 1: to know them. So that's when I'm in their lives

418
00:23:17,436 --> 00:23:18,836
Speaker 1: a lot. And these guys would tell you I'm in

419
00:23:18,836 --> 00:23:20,476
Speaker 1: their office. So I was in their office all the time.

420
00:23:20,716 --> 00:23:23,356
Speaker 1: I walked around the neighborhoods they grew up in. I

421
00:23:23,396 --> 00:23:25,996
Speaker 1: got to know in some cases their families, and you know,

422
00:23:26,236 --> 00:23:29,196
Speaker 1: it was it was immersive that way, and it has

423
00:23:29,236 --> 00:23:31,916
Speaker 1: to be immersive that way, because in the beginning when

424
00:23:31,956 --> 00:23:35,076
Speaker 1: I walk in, they're all self conscious. They're all as

425
00:23:35,116 --> 00:23:37,436
Speaker 1: you would be, like he's coming to write about us,

426
00:23:37,836 --> 00:23:40,436
Speaker 1: and I need to be around so much that it

427
00:23:40,436 --> 00:23:43,076
Speaker 1: gets they get weary of being self conscious that they

428
00:23:43,116 --> 00:23:44,876
Speaker 1: just and they just drop it and I could just

429
00:23:44,916 --> 00:23:46,636
Speaker 1: see who they are. They get to the point where

430
00:23:46,636 --> 00:23:48,476
Speaker 1: they surrender, I give up, You're going to know who

431
00:23:48,516 --> 00:23:51,076
Speaker 1: I am. Here I am. And these guys are actually

432
00:23:51,076 --> 00:23:54,116
Speaker 1: pretty quick to that, as they were less afraid of

433
00:23:54,156 --> 00:23:58,636
Speaker 1: themselves than some of the other characters. But so that

434
00:23:59,556 --> 00:24:01,836
Speaker 1: so that's the That was the logic.

435
00:24:01,556 --> 00:24:02,116
Speaker 3: To the book.

436
00:24:03,356 --> 00:24:06,156
Speaker 1: And it was once I figured out the logic to

437
00:24:06,196 --> 00:24:09,076
Speaker 1: the book, it was so easy to write it, like

438
00:24:09,156 --> 00:24:11,636
Speaker 1: you were dealt the best handed bridge ever, and how

439
00:24:11,796 --> 00:24:14,356
Speaker 1: just how you're going to play the cards and uh,

440
00:24:14,556 --> 00:24:17,156
Speaker 1: and it was just so much fun. It wrote itself,

441
00:24:18,396 --> 00:24:21,316
Speaker 1: and it was a very easy book to write.

442
00:24:21,516 --> 00:24:24,716
Speaker 4: It's interesting to look at it now though you couldn't,

443
00:24:25,156 --> 00:24:27,756
Speaker 4: not that you forget, but the time in which you're

444
00:24:27,796 --> 00:24:29,836
Speaker 4: reporting it out and telling their stories, the country is

445
00:24:29,836 --> 00:24:33,276
Speaker 4: still very much traumatized. And even the even the rescue

446
00:24:33,316 --> 00:24:36,836
Speaker 4: has his political reverberations. I mean, just take us back

447
00:24:36,876 --> 00:24:38,516
Speaker 4: in time a little bit too well.

448
00:24:38,836 --> 00:24:39,476
Speaker 1: Would you just heard?

449
00:24:39,556 --> 00:24:40,476
Speaker 3: Was the end of the book?

450
00:24:40,836 --> 00:24:43,716
Speaker 1: So I wrote it. It had not. It had not.

451
00:24:44,036 --> 00:24:47,596
Speaker 1: The rubble had not been sifted, the pieces had not

452
00:24:47,636 --> 00:24:48,116
Speaker 1: been put.

453
00:24:47,996 --> 00:24:48,676
Speaker 3: To get back together.

454
00:24:48,716 --> 00:24:52,196
Speaker 1: I wrote it before we knew exactly how all this

455
00:24:52,316 --> 00:24:54,436
Speaker 1: was going to shake out. I certainly wrote it before

456
00:24:54,476 --> 00:24:57,316
Speaker 1: we knew that it was going to generate the political

457
00:24:57,356 --> 00:25:00,436
Speaker 1: anger that I mean, endless political anger. I mean one

458
00:25:00,476 --> 00:25:02,876
Speaker 1: of the one of the consequences of that event is Trump.

459
00:25:03,516 --> 00:25:05,476
Speaker 1: Of course, you can draw a line from that to Trump.

460
00:25:05,636 --> 00:25:10,596
Speaker 1: Sure mistrust of the one it is focused on the

461
00:25:11,076 --> 00:25:14,316
Speaker 1: Wall Street people, and the other side is focused focuses

462
00:25:14,356 --> 00:25:17,516
Speaker 1: at anger on the government having done this, having bailed

463
00:25:18,156 --> 00:25:21,476
Speaker 1: bailed out the banks, that what the government did was

464
00:25:21,516 --> 00:25:24,756
Speaker 1: far more defensible. I mean like they they're playing a

465
00:25:24,836 --> 00:25:27,476
Speaker 1: very difficult hand and what they stopped was a depression

466
00:25:27,796 --> 00:25:31,236
Speaker 1: and the federal the institutions worked. It's a bit like

467
00:25:31,716 --> 00:25:33,796
Speaker 1: it's a bit like our inability to understand what happened

468
00:25:33,796 --> 00:25:38,516
Speaker 1: with COVID. That is, it is incredible that we were

469
00:25:38,916 --> 00:25:40,356
Speaker 1: our paint was saved by.

470
00:25:40,276 --> 00:25:41,796
Speaker 3: The mrn A vaccines.

471
00:25:42,476 --> 00:25:45,636
Speaker 1: That was one of the most a miracle of modern science.

472
00:25:46,036 --> 00:25:48,036
Speaker 1: We are so much better off because of it, and

473
00:25:48,076 --> 00:25:49,516
Speaker 1: now we're not allowed to get a vaccine.

474
00:25:49,596 --> 00:25:53,476
Speaker 8: Well, I meantulated, and what I would say is with

475
00:25:54,236 --> 00:25:56,436
Speaker 8: look at what you should have learned from the financial

476
00:25:56,436 --> 00:25:58,796
Speaker 8: crisis is thank god we have an independent federal Reserve

477
00:25:59,196 --> 00:26:03,276
Speaker 8: and a treasury that people trust, trust enough.

478
00:26:03,116 --> 00:26:06,916
Speaker 1: That they can walk into a room and calm everything down,

479
00:26:07,116 --> 00:26:09,116
Speaker 1: be that that we can take the risk and every

480
00:26:09,116 --> 00:26:13,596
Speaker 1: everybody believes it. We're moving towards a world where we

481
00:26:13,636 --> 00:26:16,636
Speaker 1: don't have that, where we have a federal reserve, this

482
00:26:16,956 --> 00:26:21,196
Speaker 1: hostage to a president, and and we have finances that

483
00:26:21,236 --> 00:26:24,316
Speaker 1: have spun out of control, and nobody trusts trust us.

484
00:26:25,516 --> 00:26:30,516
Speaker 1: So we've squandered the thing. We've attacked the thing that

485
00:26:30,676 --> 00:26:33,276
Speaker 1: saved us. And what I wonder about I don't wonder

486
00:26:33,316 --> 00:26:35,756
Speaker 1: like when the next financial crisis is going to happen,

487
00:26:35,756 --> 00:26:37,996
Speaker 1: because God knows. You know, anybody who tells you they

488
00:26:37,996 --> 00:26:39,756
Speaker 1: know when it's going to happen, don't listen to them

489
00:26:39,756 --> 00:26:42,596
Speaker 1: about anything, because you can't predict these and they're unpredictable.

490
00:26:42,916 --> 00:26:44,556
Speaker 1: But you just it's like and you don't even and

491
00:26:44,556 --> 00:26:45,996
Speaker 1: you know. All you know is that when it comes,

492
00:26:46,036 --> 00:26:48,356
Speaker 1: you're gonna be surprised by how it happened. It's probably

493
00:26:48,396 --> 00:26:50,316
Speaker 1: not going to be AI, it's probably not gonna be

494
00:26:50,356 --> 00:26:52,796
Speaker 1: what people are talking about, be something else, something that

495
00:26:52,836 --> 00:26:54,916
Speaker 1: people know I'm not paying attention to, but whatever as

496
00:26:54,956 --> 00:26:58,316
Speaker 1: a trigger. But when it comes, we are in a

497
00:26:58,396 --> 00:27:01,316
Speaker 1: far weaker position to deal with it. That's the big thing,

498
00:27:01,436 --> 00:27:04,156
Speaker 1: and it's because we didn't actually internalize the lesson of it.

499
00:27:04,516 --> 00:27:08,676
Speaker 4: You are going to land on the answer to the

500
00:27:09,236 --> 00:27:14,196
Speaker 4: humans as your Oh they're not vehicles, they are the story.

501
00:27:14,316 --> 00:27:21,156
Speaker 1: Sorry, here's so I loved about this story. It's true.

502
00:27:21,436 --> 00:27:22,796
Speaker 1: We don't to write a book unless I love the

503
00:27:22,796 --> 00:27:27,716
Speaker 1: story and the people because loving the characters you can

504
00:27:27,796 --> 00:27:31,196
Speaker 1: I can understand in all the books that you can

505
00:27:31,276 --> 00:27:34,476
Speaker 1: disapprove of the characters, but you But what I what

506
00:27:34,516 --> 00:27:37,236
Speaker 1: I don't understand is when you can't like them as charcter, like, wow,

507
00:27:37,276 --> 00:27:40,276
Speaker 1: these are interesting people, and I mean you could I

508
00:27:40,356 --> 00:27:43,796
Speaker 1: left these guys. I left them exposed because I left

509
00:27:44,156 --> 00:27:46,996
Speaker 1: I left it for the reader to decide how you

510
00:27:47,036 --> 00:27:49,476
Speaker 1: feel about someone getting rich betting on the collapse of

511
00:27:49,516 --> 00:27:52,076
Speaker 1: the society. Didn't actually bother me all that much, but

512
00:27:52,116 --> 00:27:53,796
Speaker 1: it bothered a lot of other people. And I let that.

513
00:27:53,956 --> 00:27:56,236
Speaker 1: I didn't cover for them. I didn't make a defense

514
00:27:57,356 --> 00:28:00,076
Speaker 1: or or and I didn't make an assault. I left it.

515
00:28:00,756 --> 00:28:02,476
Speaker 1: The best story is leave a hole for a reader

516
00:28:02,516 --> 00:28:05,396
Speaker 1: to walk into and exercise their own discretion about what

517
00:28:05,476 --> 00:28:07,276
Speaker 1: it means. And that was one of the.

518
00:28:07,196 --> 00:28:09,076
Speaker 3: Holes I left for the reader in this.

519
00:28:09,356 --> 00:28:13,716
Speaker 1: But the people, it isn't just gratuitous drawing of character.

520
00:28:14,636 --> 00:28:17,396
Speaker 1: They get to the right answer because of who they are.

521
00:28:19,276 --> 00:28:22,116
Speaker 1: That so you can't understand how they get to the

522
00:28:22,156 --> 00:28:25,476
Speaker 1: right answer unless you understand who they are. So their

523
00:28:25,596 --> 00:28:29,116
Speaker 1: character is organic to the story. It isn't just decoration,

524
00:28:29,436 --> 00:28:34,196
Speaker 1: It isn't just entertainment. The characters become important and and

525
00:28:34,236 --> 00:28:36,036
Speaker 1: so that's why you need to know them. That's why

526
00:28:36,076 --> 00:28:37,636
Speaker 1: I need to know them. I need to know why

527
00:28:37,716 --> 00:28:41,036
Speaker 1: they were able to do what they did. And that

528
00:28:41,116 --> 00:28:43,396
Speaker 1: makes it that's that's all of a sudden, when you're

529
00:28:43,436 --> 00:28:48,036
Speaker 1: there with the reader, you're you're opening up that world,

530
00:28:48,196 --> 00:28:50,996
Speaker 1: you're making it accessible. I learned this with I learned

531
00:28:50,996 --> 00:28:53,116
Speaker 1: this with Liar's Poker, that if you can attach a

532
00:28:53,196 --> 00:28:57,636
Speaker 1: reader to a character, you can take them anywhere. They

533
00:28:57,676 --> 00:29:00,556
Speaker 1: will forgive you anything. You can take them even to

534
00:29:00,636 --> 00:29:04,316
Speaker 1: an explanation of a collateralized dead obligation, which no reader,

535
00:29:04,636 --> 00:29:08,276
Speaker 1: no reader, if that's worse than a colonoscopy, no reader,

536
00:29:08,596 --> 00:29:12,396
Speaker 1: no reader wants to be explained a collateralized They just don't.

537
00:29:12,476 --> 00:29:14,636
Speaker 4: Well, what's amazing is they take that to the movie

538
00:29:14,716 --> 00:29:17,596
Speaker 4: version as well. You know, they they take.

539
00:29:17,396 --> 00:29:20,436
Speaker 1: This too, so I save Adam McKay. So the first

540
00:29:20,516 --> 00:29:22,996
Speaker 1: episode of this podcast season that we've just dropping was

541
00:29:22,996 --> 00:29:27,876
Speaker 1: Adam McKay, who the filmmaker, the co writer and director.

542
00:29:27,556 --> 00:29:30,236
Speaker 3: Of the movie. He's a genius, he is.

543
00:29:30,196 --> 00:29:34,676
Speaker 1: A special, special talent. So I thought, I thought that

544
00:29:35,636 --> 00:29:37,676
Speaker 1: what you just heard, I didn't know what passages they

545
00:29:37,676 --> 00:29:39,436
Speaker 1: were gonna pick. It was interesting for me to hear that,

546
00:29:39,876 --> 00:29:42,476
Speaker 1: but I didn't And they didn't know that Danny and

547
00:29:42,516 --> 00:29:43,636
Speaker 1: the and Porter were gonna be here.

548
00:29:43,676 --> 00:29:44,276
Speaker 3: So it's funny.

549
00:29:44,516 --> 00:29:47,156
Speaker 1: But I thought that was the end of the movie.

550
00:29:47,196 --> 00:29:48,716
Speaker 1: I thought it was the end of the book. Those

551
00:29:48,716 --> 00:29:50,396
Speaker 1: guys standing on the steps of us, sitting on the

552
00:29:50,436 --> 00:29:55,036
Speaker 1: steps of Saint Patrick's cathedral, so seeing that people were good,

553
00:29:55,076 --> 00:29:58,716
Speaker 1: they didn't know what happened to them McKay. And it

554
00:29:58,796 --> 00:30:02,156
Speaker 1: is a very it's it's a cinematic moment, McKay. The

555
00:30:02,236 --> 00:30:04,076
Speaker 1: end of the movie for Adam McKay was an editorial.

556
00:30:04,276 --> 00:30:06,996
Speaker 1: It was like him telling the audience.

557
00:30:07,236 --> 00:30:09,596
Speaker 4: So it's him telling the audience what you just said

558
00:30:09,636 --> 00:30:13,996
Speaker 4: about the political reverberations. It's him on the phone saying

559
00:30:14,076 --> 00:30:15,996
Speaker 4: it was all it was all set up. They were

560
00:30:16,036 --> 00:30:17,036
Speaker 4: always gonna bail them out.

561
00:30:17,036 --> 00:30:18,476
Speaker 1: They're alway gonna bail them out, and who were gonna

562
00:30:18,476 --> 00:30:20,796
Speaker 1: do We're gonna blame the immigrants. We're gonna blame Yes,

563
00:30:20,876 --> 00:30:25,996
Speaker 1: that it was incredibly prescient. That he was right in

564
00:30:26,116 --> 00:30:28,516
Speaker 1: the movie. So the movie is five years after the book,

565
00:30:29,156 --> 00:30:33,516
Speaker 1: so we've seen some things happen, right. That's only That's

566
00:30:33,556 --> 00:30:36,316
Speaker 1: only the part of the reason why the movie is

567
00:30:36,396 --> 00:30:38,916
Speaker 1: angrier than the book. The movie is angrier than the

568
00:30:38,916 --> 00:30:42,196
Speaker 1: book also because Adam McKay's angrier just naturally more capable

569
00:30:42,196 --> 00:30:44,596
Speaker 1: of anger than I am. I just look at the

570
00:30:44,636 --> 00:30:48,036
Speaker 1: world as a comedy. I just basically, which is funny,

571
00:30:48,036 --> 00:30:50,916
Speaker 1: because I'm not that funny, you know it's but I'm

572
00:30:50,956 --> 00:30:54,476
Speaker 1: watching it, and he is funny. He looks at the

573
00:30:54,516 --> 00:31:00,356
Speaker 1: world in a darker way, and he is. He's just

574
00:31:00,836 --> 00:31:05,116
Speaker 1: he's just more capable of the emotion. And I detach.

575
00:31:05,436 --> 00:31:09,876
Speaker 1: I I it was the human folly that interested in me.

576
00:31:10,676 --> 00:31:13,916
Speaker 1: I didn't get all worked up. I thought this is

577
00:31:14,036 --> 00:31:16,956
Speaker 1: really interesting, but I'm not. I'm not going to like

578
00:31:17,676 --> 00:31:21,236
Speaker 1: inflict the reader my anger or my even when I

579
00:31:21,276 --> 00:31:23,036
Speaker 1: really think about it, upon the reader. I'm just gonna

580
00:31:23,036 --> 00:31:23,396
Speaker 1: tell a story.

581
00:31:23,436 --> 00:31:24,396
Speaker 4: What do you really think about it.

582
00:31:24,996 --> 00:31:26,196
Speaker 1: When I really think about.

583
00:31:25,956 --> 00:31:31,396
Speaker 3: It, this is a long conversation.

584
00:31:32,756 --> 00:31:35,276
Speaker 1: So I kind of I feel like I need a

585
00:31:35,316 --> 00:31:37,156
Speaker 1: couch right now because to get what I really need.

586
00:31:37,676 --> 00:31:42,076
Speaker 1: So I am really bothered by the by the way

587
00:31:42,276 --> 00:31:46,836
Speaker 1: our society spun up a financial sector that is only

588
00:31:46,956 --> 00:31:50,516
Speaker 1: partly useful, and it has got all this status and

589
00:31:50,596 --> 00:31:55,396
Speaker 1: money and that I can understand ordinary people looking at

590
00:31:55,436 --> 00:31:59,796
Speaker 1: it and thinking why, like, what are those what are

591
00:31:59,796 --> 00:32:02,196
Speaker 1: those people doing that? Why don't I get some of that.

592
00:32:02,716 --> 00:32:04,596
Speaker 1: I feel like a lot of our politics comes out

593
00:32:04,636 --> 00:32:07,236
Speaker 1: of what happened on Wall Street. And and it isn't

594
00:32:07,276 --> 00:32:11,316
Speaker 1: just a crist crisis. It is the unfairness. And it

595
00:32:11,396 --> 00:32:14,756
Speaker 1: bothers the hell out of me that half the class

596
00:32:14,796 --> 00:32:17,876
Speaker 1: at Harvard, Princeton and Yale and so on think that

597
00:32:17,876 --> 00:32:20,916
Speaker 1: they should go to work in finance. Like it's just half.

598
00:32:20,996 --> 00:32:22,116
Speaker 6: Do you think it's more than that?

599
00:32:22,756 --> 00:32:25,116
Speaker 1: It's kind of usually about it. Probably three quarters think

600
00:32:25,156 --> 00:32:27,476
Speaker 1: they should, but half get jobs. I don't know it's

601
00:32:27,516 --> 00:32:30,676
Speaker 1: that kind of thing, but it's uh, and are distracted

602
00:32:30,716 --> 00:32:33,996
Speaker 1: from other purposes. It isn't that I think working on

603
00:32:34,036 --> 00:32:36,676
Speaker 1: Wall Street is evil, That's not it. There are people

604
00:32:36,716 --> 00:32:40,236
Speaker 1: who my characters, they belong on Wall Street. If they're

605
00:32:40,276 --> 00:32:43,116
Speaker 1: really good at it, they should be there. The making garage,

606
00:32:43,116 --> 00:32:45,436
Speaker 1: in my book, should all be in finance. Uh, And

607
00:32:45,476 --> 00:32:47,756
Speaker 1: they love it. It's a it's a kind of calling

608
00:32:47,796 --> 00:32:51,836
Speaker 1: for them. It's the it's the casual young person who's

609
00:32:51,876 --> 00:32:54,876
Speaker 1: not found a direction in life, but it might have

610
00:32:54,916 --> 00:32:58,076
Speaker 1: some great other purpose, who uses an excuse not to

611
00:32:58,396 --> 00:32:59,796
Speaker 1: not to ask the hard question WHI should I do

612
00:32:59,876 --> 00:33:02,196
Speaker 1: with my life? That bothers the hell out of me?

613
00:33:02,436 --> 00:33:04,876
Speaker 1: And so I think we have a kind of a

614
00:33:04,956 --> 00:33:08,636
Speaker 1: cancer in our midst and and so it does bother

615
00:33:08,756 --> 00:33:15,236
Speaker 1: me in but in a complicated way. My response to

616
00:33:15,276 --> 00:33:18,396
Speaker 1: being bothered by it is not to scream to people

617
00:33:18,956 --> 00:33:21,156
Speaker 1: or tell them where they did think. My response is

618
00:33:21,196 --> 00:33:24,276
Speaker 1: to find fun stories to tell. I mean, the amazing

619
00:33:24,116 --> 00:33:26,916
Speaker 1: thing to me was this story that was available to me.

620
00:33:27,756 --> 00:33:30,476
Speaker 1: Liar's Poker made me non grata on Wall Street. I

621
00:33:30,476 --> 00:33:32,956
Speaker 1: couldn't like walk into office buildings on Wall Street. People

622
00:33:33,156 --> 00:33:36,476
Speaker 1: were really angry when Liar's Poker came out. I was toxic.

623
00:33:37,916 --> 00:33:43,196
Speaker 1: And so when I first see these banks starting to

624
00:33:43,476 --> 00:33:46,156
Speaker 1: do dumb things, and I started to ask the question

625
00:33:46,636 --> 00:33:48,676
Speaker 1: which I mentioned earlier, like how did they become the

626
00:33:48,756 --> 00:33:51,116
Speaker 1: dumb money, because that wasn't the bank I left. The

627
00:33:51,156 --> 00:33:53,636
Speaker 1: bank guy left. If they were making a secret bet

628
00:33:53,876 --> 00:33:55,676
Speaker 1: and asking you to take the other side of the bet,

629
00:33:56,276 --> 00:33:58,116
Speaker 1: you are to run as fast as possible, the other

630
00:33:58,156 --> 00:34:02,596
Speaker 1: direction that they and my job was actually sell those bets.

631
00:34:02,636 --> 00:34:04,996
Speaker 1: So I knew, like the people who I was selling to,

632
00:34:05,076 --> 00:34:08,116
Speaker 1: it was not going to work out well. And so

633
00:34:08,196 --> 00:34:10,836
Speaker 1: something had happened between the time I left in this

634
00:34:11,356 --> 00:34:13,876
Speaker 1: and it was I was intensely curious about that, and

635
00:34:13,916 --> 00:34:15,956
Speaker 1: I thought, what a pity that I won't be able

636
00:34:15,996 --> 00:34:17,516
Speaker 1: to go find out, because no one on Wall Street

637
00:34:17,516 --> 00:34:20,036
Speaker 1: will ever talk to me again. But I did think

638
00:34:20,236 --> 00:34:23,316
Speaker 1: we'll give it a shot, and I started by calling.

639
00:34:23,596 --> 00:34:25,076
Speaker 1: You know, I knew people who knew people who knew

640
00:34:25,076 --> 00:34:31,676
Speaker 1: people traders Morgan, Stanley, Merrill, Lynch City Bank, Goldman and

641
00:34:31,756 --> 00:34:35,396
Speaker 1: like who were who were in the who were either

642
00:34:35,476 --> 00:34:38,236
Speaker 1: had done the horrible trades or were very near them.

643
00:34:38,676 --> 00:34:42,756
Speaker 1: And to mysh astonishment, the response I get on the

644
00:34:42,756 --> 00:34:44,676
Speaker 1: other line is I'll go have a beer with you.

645
00:34:45,396 --> 00:34:47,516
Speaker 1: And it's off. It's off the record, and in the

646
00:34:47,516 --> 00:34:49,876
Speaker 1: sense that you can know what I tell you, but

647
00:34:49,956 --> 00:34:53,876
Speaker 1: don't ever say we ever met. And and this happened

648
00:34:53,876 --> 00:34:55,596
Speaker 1: to like half a dozen times. I thought, oh my god,

649
00:34:55,716 --> 00:34:57,116
Speaker 1: someone's going to go have a beer with me. I

650
00:34:57,196 --> 00:35:01,236
Speaker 1: was brought. I was kind of tickled, and I swear

651
00:35:01,316 --> 00:35:03,836
Speaker 1: to you that each of these people were like six

652
00:35:03,876 --> 00:35:06,916
Speaker 1: of them who had been responsible for making these bets

653
00:35:07,796 --> 00:35:10,356
Speaker 1: said to me, the the reason I'm having this beer

654
00:35:10,396 --> 00:35:13,356
Speaker 1: with you is you're the reason I'm in the business.

655
00:35:13,396 --> 00:35:15,196
Speaker 1: I read Liar's Poker and I wanted to be It

656
00:35:15,236 --> 00:35:17,076
Speaker 1: made me want to be a trader. And about the

657
00:35:17,116 --> 00:35:20,196
Speaker 1: third time, I thought, Jesus Christ, I created this crisis.

658
00:35:20,516 --> 00:35:24,876
Speaker 1: That that that that I wrote this book. I wrote

659
00:35:24,876 --> 00:35:27,436
Speaker 1: this book and all these people, I thinking that it

660
00:35:27,476 --> 00:35:29,316
Speaker 1: was going to say, like, show people what Wall Street

661
00:35:29,356 --> 00:35:31,156
Speaker 1: was so they could go, you know, do other things,

662
00:35:31,676 --> 00:35:35,956
Speaker 1: and instead attracted all the wrong people under the trading floor.

663
00:35:36,436 --> 00:35:39,556
Speaker 1: And this is the result. But it also told me that,

664
00:35:39,716 --> 00:35:42,556
Speaker 1: oh my god, because of Liar's Poker, now enough time

665
00:35:42,596 --> 00:35:46,036
Speaker 1: has passed, I have access to the story like I

666
00:35:46,076 --> 00:35:48,476
Speaker 1: can get to this. So that's that was the That

667
00:35:48,596 --> 00:35:50,076
Speaker 1: was the very beginning of it for me.

668
00:35:58,236 --> 00:36:03,316
Speaker 4: Is part of it that at their core people want

669
00:36:03,556 --> 00:36:06,196
Speaker 4: to be heard like people talk to you, because at

670
00:36:06,196 --> 00:36:08,676
Speaker 4: their core, people want someone to listen to.

671
00:36:08,636 --> 00:36:12,316
Speaker 1: Their Why why do people talk to you?

672
00:36:12,436 --> 00:36:12,716
Speaker 3: I could?

673
00:36:12,836 --> 00:36:15,076
Speaker 1: I mean, look, you are a great interviewer. I was

674
00:36:15,076 --> 00:36:17,756
Speaker 1: on your show and you were you were the streets

675
00:36:17,796 --> 00:36:20,716
Speaker 1: above most people on TV. You're a great interviewer. Why

676
00:36:21,076 --> 00:36:24,076
Speaker 1: why are you a great interviewer? I had a theory.

677
00:36:24,356 --> 00:36:26,356
Speaker 1: I walked I walked off, and I had I had,

678
00:36:26,396 --> 00:36:28,996
Speaker 1: and you have an audience that loves you. So so

679
00:36:29,076 --> 00:36:32,516
Speaker 1: I walked on. I thought, oh my god, she listens.

680
00:36:33,116 --> 00:36:34,876
Speaker 1: She's actually listening to what I'm saying stead of thinking

681
00:36:34,916 --> 00:36:37,596
Speaker 1: of the next question. She seems to have read the book,

682
00:36:37,596 --> 00:36:41,076
Speaker 1: which is freakish on television, like like it doesn't happen,

683
00:36:41,516 --> 00:36:45,156
Speaker 1: And so you're engaged. You're actually you're there for a reason.

684
00:36:45,356 --> 00:36:47,396
Speaker 1: I don't know. I didn't ask you why you were there,

685
00:36:47,436 --> 00:36:49,316
Speaker 1: but there was some reason you were there, and I

686
00:36:49,356 --> 00:36:53,396
Speaker 1: felt it. The people I write about feel the same thing.

687
00:36:53,676 --> 00:36:56,196
Speaker 1: There's a real I'm not my time is valuable. I'm

688
00:36:56,196 --> 00:36:58,476
Speaker 1: here for a reason. I'm not here just I'm not

689
00:36:58,516 --> 00:37:00,476
Speaker 1: here to stitch you up. I'm not here to do

690
00:37:00,556 --> 00:37:03,436
Speaker 1: something trivial. I want to write a great book, and

691
00:37:03,516 --> 00:37:05,236
Speaker 1: I won't do it if it's not a great book.

692
00:37:05,556 --> 00:37:08,156
Speaker 1: And I'm going to really try to understand you and

693
00:37:08,196 --> 00:37:13,036
Speaker 1: your world, and that after a while becomes intoxicating. It's

694
00:37:13,076 --> 00:37:16,996
Speaker 1: really because people don't get you know, people don't get

695
00:37:16,996 --> 00:37:20,356
Speaker 1: asked questions about themselves. They go home to their spouses

696
00:37:20,396 --> 00:37:22,636
Speaker 1: and their spouses that don't want to hear about it right,

697
00:37:23,076 --> 00:37:30,076
Speaker 1: like really, And it's so I find the most the

698
00:37:30,156 --> 00:37:34,596
Speaker 1: strangest moment, the most unnatural moment in my relationship with

699
00:37:34,636 --> 00:37:36,476
Speaker 1: the people I write about when I move into their

700
00:37:36,516 --> 00:37:39,996
Speaker 1: lives is not the I'm moving into your life and

701
00:37:40,116 --> 00:37:42,716
Speaker 1: tell me everything, because that happens very gradually, and we

702
00:37:42,876 --> 00:37:45,316
Speaker 1: build a relationship and they come to sort of understand

703
00:37:45,316 --> 00:37:47,156
Speaker 1: what I'm trying to do, and they let me just

704
00:37:47,196 --> 00:37:48,036
Speaker 1: be a fly on the wall.

705
00:37:48,596 --> 00:37:48,756
Speaker 2: Uh.

706
00:37:49,036 --> 00:37:53,396
Speaker 1: It's when I'm finished and I leave and it's like, hey,

707
00:37:53,716 --> 00:37:57,916
Speaker 1: where are you. You're not coming in today, You're not

708
00:37:57,956 --> 00:38:02,396
Speaker 1: coming in today, and it's like the book's done. It's like, oh, oh,

709
00:38:02,556 --> 00:38:04,916
Speaker 1: that's right, you're writing a book, you know. It's that

710
00:38:05,036 --> 00:38:07,916
Speaker 1: kind of thing. They kind of forget that. It just

711
00:38:07,916 --> 00:38:10,836
Speaker 1: becomes a relationship for a while and then I move

712
00:38:10,916 --> 00:38:13,116
Speaker 1: on and then there's this hard moment where sorry, I

713
00:38:13,756 --> 00:38:15,716
Speaker 1: can't fly to New York to see you. You know,

714
00:38:16,076 --> 00:38:19,476
Speaker 1: I got to do something else. So so I'm not

715
00:38:19,476 --> 00:38:21,356
Speaker 1: going to talk about the next book. But then the

716
00:38:21,396 --> 00:38:24,076
Speaker 1: next book is about the collision between the Trump administration

717
00:38:24,116 --> 00:38:25,596
Speaker 1: and the civil Service. And it's a real book, kind

718
00:38:25,596 --> 00:38:27,516
Speaker 1: of like the fifth risk in the Who Is Government?

719
00:38:27,596 --> 00:38:29,836
Speaker 1: It's a it's a it's a it's a big short

720
00:38:29,956 --> 00:38:30,676
Speaker 1: like enterprise.

721
00:38:31,436 --> 00:38:33,636
Speaker 4: So you owe us.

722
00:38:33,996 --> 00:38:35,556
Speaker 1: Yeah, I think we kind of ran through time. I

723
00:38:35,596 --> 00:38:36,996
Speaker 1: was just looking at that I do do I do?

724
00:38:37,116 --> 00:38:44,036
Speaker 1: Go on? Uh So, so I got a calloscopy and

725
00:38:44,476 --> 00:38:46,636
Speaker 1: you know, when you're in that, they give you a

726
00:38:46,716 --> 00:38:50,356
Speaker 1: drug that you're there and you're not there, and thank god,

727
00:38:50,476 --> 00:38:52,636
Speaker 1: you're kind of awaken. You're awake and you're not awake.

728
00:38:52,796 --> 00:38:57,916
Speaker 1: And afterwards it was in Oakland. And afterwards the nurse

729
00:38:57,956 --> 00:39:01,276
Speaker 1: comes in and I said, like, she said, you can

730
00:39:01,356 --> 00:39:02,516
Speaker 1: kind of go, and I said, I'd love to say

731
00:39:02,676 --> 00:39:04,676
Speaker 1: like goodbye to the doctor. And she said, I don't

732
00:39:04,676 --> 00:39:06,156
Speaker 1: think he wants to. He doesn't want to talk to you,

733
00:39:06,716 --> 00:39:09,876
Speaker 1: and and and I said, like why he says he's

734
00:39:09,956 --> 00:39:12,196
Speaker 1: kind of he's up. She said, he's like upset, like

735
00:39:12,276 --> 00:39:15,236
Speaker 1: what you said. And I said, I don't remember what

736
00:39:15,396 --> 00:39:18,156
Speaker 1: I said, like you know, and she said, what did

737
00:39:18,196 --> 00:39:21,716
Speaker 1: I say? She said, she said, while you were while

738
00:39:21,756 --> 00:39:23,836
Speaker 1: you were in the procedure, you look up at him

739
00:39:23,876 --> 00:39:26,236
Speaker 1: and said, when you were a little boy, did you

740
00:39:26,356 --> 00:39:28,076
Speaker 1: dream that this was what you would be doing in

741
00:39:28,196 --> 00:39:33,836
Speaker 1: real life? Or did you want to or did you

742
00:39:33,876 --> 00:39:39,556
Speaker 1: want to be an astronaut? And I had to go

743
00:39:39,596 --> 00:39:40,636
Speaker 1: apologize to him.

744
00:39:40,956 --> 00:39:44,076
Speaker 4: I mean, I, do you have a new gust eventrologist?

745
00:39:45,996 --> 00:39:47,596
Speaker 1: Well, this is true. I've now had too. If I had

746
00:39:47,596 --> 00:39:50,636
Speaker 1: a second one very recently and I had to arrange.

747
00:39:50,436 --> 00:39:53,276
Speaker 4: Different to go to a different place, I'm not surprised.

748
00:39:53,356 --> 00:39:54,196
Speaker 4: I'm not surprised.

749
00:39:54,676 --> 00:39:57,276
Speaker 5: All right, this was fun, This is amazing.

750
00:39:58,556 --> 00:40:02,036
Speaker 4: Keep writing forever. And I just want to wave to

751
00:40:02,076 --> 00:40:05,076
Speaker 4: your real humans because I feel like, thanks for coming,

752
00:40:06,276 --> 00:40:08,716
Speaker 4: thank you, thank you for letting him tell Tell the

753
00:40:08,836 --> 00:40:13,196
Speaker 4: girl Thanky, thanks you for thanks thanks giving me, Thank

754
00:40:13,236 --> 00:40:14,076
Speaker 4: you guys for coming.

755
00:40:23,276 --> 00:40:25,676
Speaker 1: I want to thank Nicole Wallace for interviewing me in

756
00:40:25,716 --> 00:40:28,076
Speaker 1: Symphony Space, for hosting us, and you ought to go

757
00:40:28,156 --> 00:40:30,996
Speaker 1: check out Nicole's new podcast. It's called The Best People

758
00:40:31,036 --> 00:40:34,756
Speaker 1: and It's Great. Against the Rules is hosted by me

759
00:40:34,996 --> 00:40:39,236
Speaker 1: Michael Lewis and produced by Lydia jen Kott and Catherine Gerardou.

760
00:40:39,636 --> 00:40:42,956
Speaker 1: Our editor is Julia Barton. Our theme was composed by

761
00:40:43,036 --> 00:40:47,236
Speaker 1: Nick Prittel, and our engineer is Hans Dale. She special

762
00:40:47,276 --> 00:40:52,956
Speaker 1: thanks to Nicole Optenbosch, Jasmine Fustino, Pamela Lawrence, and the

763
00:40:52,996 --> 00:40:55,956
Speaker 1: rest of the Pushkin Audio Books team. To find more

764
00:40:55,956 --> 00:41:00,396
Speaker 1: Pushkin podcasts, listen on the iHeartRadio app, Apple Podcasts or

765
00:41:00,436 --> 00:41:03,116
Speaker 1: wherever you listen to podcasts, And if you like to

766
00:41:03,196 --> 00:41:07,036
Speaker 1: listen ad free and learn about other exclusive offerings, don't

767
00:41:07,076 --> 00:41:09,876
Speaker 1: forget to sign up for a Pushkin Plus subscript at

768
00:41:09,916 --> 00:41:13,636
Speaker 1: pushkin dot fm, Slash Plus or on our new Apple

769
00:41:13,676 --> 00:41:16,596
Speaker 1: show page. And you can get the Big Short audiobook

770
00:41:16,636 --> 00:41:21,276
Speaker 1: now at pushkin dot fm, slash Audiobooks, or wherever audiobooks

771
00:41:21,316 --> 00:41:24,636
Speaker 1: are sold.

772
00:41:26,116 --> 00:41:28,236
Speaker 7: It's Jacob Goldstein. I'm the co host of a new

773
00:41:28,236 --> 00:41:31,156
Speaker 7: show called Business History, and we're bringing you a clip

774
00:41:31,236 --> 00:41:34,156
Speaker 7: right now from an episode we did about a mathematician

775
00:41:34,236 --> 00:41:38,316
Speaker 7: named Jim Simon's. Simons wanted to take human emotions out

776
00:41:38,316 --> 00:41:42,276
Speaker 7: of investing, and after a few early hiccups, including buying

777
00:41:42,356 --> 00:41:45,196
Speaker 7: up all the potatoes in Maine, he created one of

778
00:41:45,236 --> 00:41:48,436
Speaker 7: the greatest money machines in history. I really hope you

779
00:41:48,516 --> 00:41:50,356
Speaker 7: like the clip. And if you want to hear more,

780
00:41:50,476 --> 00:41:53,636
Speaker 7: please check out the show. It's called Business History and

781
00:41:53,676 --> 00:41:55,556
Speaker 7: it's available wherever you're listening.

782
00:41:55,876 --> 00:41:59,276
Speaker 9: Right now, they were doing what we would call today

783
00:41:59,836 --> 00:42:00,716
Speaker 9: machine learning.

784
00:42:00,796 --> 00:42:05,116
Speaker 10: A machine learning is like, essentially, you build a system

785
00:42:05,116 --> 00:42:07,076
Speaker 10: in a computer. You feeded a bunch of data, and

786
00:42:07,116 --> 00:42:10,076
Speaker 10: the system sort of builds a map of the relationships

787
00:42:10,076 --> 00:42:12,316
Speaker 10: in that data, and then with new data it can

788
00:42:12,356 --> 00:42:15,796
Speaker 10: kind of interpolate or extrapolate and make guesses about what

789
00:42:15,836 --> 00:42:16,636
Speaker 10: should come next.

790
00:42:16,956 --> 00:42:18,476
Speaker 1: And of course today we have.

791
00:42:18,316 --> 00:42:22,596
Speaker 10: An exciting, maybe misleading, confounding term for machine learning.

792
00:42:23,076 --> 00:42:23,916
Speaker 1: We call it AI.

793
00:42:24,196 --> 00:42:27,556
Speaker 9: Exactly right, right, this is still very basic machine learning,

794
00:42:27,756 --> 00:42:31,556
Speaker 9: and the computer at the time keeps making mistakes that

795
00:42:31,596 --> 00:42:35,676
Speaker 9: they didn't really understand. So, for instance, once the computer

796
00:42:36,356 --> 00:42:42,636
Speaker 9: developed a taste for potatoes, main potatoes, the system kept

797
00:42:42,676 --> 00:42:48,636
Speaker 9: buying main potato futures in the state of Maine, potato.

798
00:42:48,196 --> 00:42:50,756
Speaker 1: Potatoes, big harvest year, next year or whatever.

799
00:42:50,996 --> 00:42:55,076
Speaker 9: Yes, okay, until two thirds of the company's money was

800
00:42:55,116 --> 00:42:57,956
Speaker 9: in potatoes. They were all in potatoes. And they got

801
00:42:57,956 --> 00:42:59,236
Speaker 9: a call from the regulators, the.

802
00:42:59,196 --> 00:43:03,756
Speaker 10: CFTB a CFPP Commodity Futures Trading Commission.

803
00:43:03,316 --> 00:43:07,036
Speaker 9: Right, yeah, saying whoa who are you guys, Like, what

804
00:43:07,076 --> 00:43:09,476
Speaker 9: are you doing over there? You have almost corner the

805
00:43:09,516 --> 00:43:13,396
Speaker 9: market on potatoes. You have to sell And they ended

806
00:43:13,476 --> 00:43:18,476
Speaker 9: up losing money on the trade because blown out on potatoes,

807
00:43:18,596 --> 00:43:22,276
Speaker 9: they had stopped the computer. Whatever the computer's plan was,

808
00:43:22,916 --> 00:43:25,676
Speaker 9: but you know, this was just one small weird thing.

809
00:43:26,076 --> 00:43:29,796
Speaker 9: Simon and Baum were really kind of nervous about this

810
00:43:29,876 --> 00:43:32,756
Speaker 9: whole thing. They had taken investors money, they didn't really

811
00:43:32,756 --> 00:43:36,996
Speaker 9: know if their system worked. And as the story gets told,

812
00:43:37,036 --> 00:43:40,196
Speaker 9: they start to like second guess the computer and themselves,

813
00:43:40,236 --> 00:43:42,516
Speaker 9: and they start to think, well, I have this intuition

814
00:43:42,636 --> 00:43:46,356
Speaker 9: that gold's gonna go up because of the geopolitical situation,

815
00:43:46,556 --> 00:43:48,316
Speaker 9: and they'd make some money on that, and then they'd

816
00:43:48,356 --> 00:43:51,556
Speaker 9: lose some money on that, and so by doubting their

817
00:43:51,596 --> 00:43:55,036
Speaker 9: own system, it just wasn't really working. And at that

818
00:43:55,116 --> 00:43:57,476
Speaker 9: point they're just Wall Street investors, right when the big

819
00:43:57,476 --> 00:44:00,916
Speaker 9: computer trying to buy more potatoes and the man won't

820
00:44:00,956 --> 00:44:01,996
Speaker 9: let them buy potatoes