Going Infinite and Beyond Our Big Short Journey with Michael Lewis
Mar 5, 2025
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Michael Lewis, bestselling author of 'Liar's Poker' and 'The Big Short', engages in a fascinating dialogue about his experiences during the financial crisis and the impact of high-frequency trading. He shares insights from writing 'Flash Boys' and examines the predatory nature of modern sports gambling, particularly its effects on youths. Lewis also critiques government inefficiencies and offers a glimpse into his upcoming works on civil servants. The conversation touches on the biography challenges of figures like Elon Musk and Sam Bankman-Fried, highlighting complex narratives in finance.
Michael Lewis recounts his pivotal meeting with Danny Moses during the financial crisis, which led to his exploration of 'The Big Short.'
The discussion emphasizes the predatory nature of sports gambling and its parallels to ethical dilemmas in high-frequency trading and finance.
Deep dives
The Origins of a Friendship
Michael Lewis shares the story of how he met Danny Moses, which began with a connection through Meredith Whitney during the financial crisis. Their initial meeting at FrontPoint Capital introduced Michael to key figures in the finance world, including Steve Eisman, who ultimately became a central character in Lewis's book, 'The Big Short.' Throughout the following year, while Michael worked on the book, he gained insights from Danny and his team about the financial dynamics that were unfolding. This collaboration became a pivotal moment that not only established their friendship but also inspired Lewis's exploration of the financial crisis in literature.
Transitioning from The Big Short to Flash Boys
After the success of 'The Big Short,' Michael Lewis delved into the world of high-frequency trading (HFT) with the potential for his next book, 'Flash Boys.' The idea emerged when he learned about the experiences of Brad Katsuyama, who exposed how automated trading systems were manipulating the markets. Conversations with Danny about the intricacies of stock trading and HFT revealed new complexities, leading Lewis to realize he had stumbled upon another compelling narrative with significant implications. His investigation illuminated the predatory practices present in modern-day trading, highlighting both the technological advancements and the ethical dilemmas they entail.
The Predatory Nature of Sports Gambling
Discussion on sports gambling underscores its growing prevalence and potential dangers, particularly among young individuals. Research indicates that a significant percentage of college males are engaged in gambling activities, prompting concerns about addiction and its consequences. The conversation also touched upon the aggressive marketing tactics employed by sports gambling platforms, which are designed to exploit behavioral vulnerabilities. This predatory landscape parallels issues witnessed in financial markets, where consumers often struggle to recognize the hidden risks associated with gambling behavior.
Reflections on Government Accountability
Michael Lewis discusses his book, 'The Fifth Risk,' which critiques the dysfunction within government agencies following leadership changes. He highlights how the Trump administration's approach led to the firing of key oversight personnel, exacerbating risks of mismanagement and disaster within essential government functions. The conversation emphasizes the importance of accountability and transparency in protecting public interests while revealing the broader implications of neglecting government responsibilities. Through this lens, Lewis warns of the potential catastrophic consequences that could stem from undermining governmental integrity, drawing parallels with the private sector's ethical lapses.
Danny Moses is joined by bestselling author Michael Lewis for a wide-ranging discussion touching on their initial meeting during the financial crisis, Lewis's journey with 'The Big Short' and its subsequent transformation into a movie. They delve into the real-time writing of Lewis' book 'Flash Boys', prompted by the flash crash of 2010. The conversation also covers Lewis's podcast journey on sports gambling, exploring its predatory nature and impact on youth, and concludes with insights into Lewis's forthcoming books addressing government inefficiencies and profiles of civil servants. The duo also discuss the relationships between author and subject as it relates to Elon Musk and Sam Bankman-Fried.
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ABOUT THE SHOW
For decades, Danny has seen it all on Wall Street and has built his reputation on integrity, curiosity and skepticism that he will bring with him each week. Having traded through the Great Financial Crisis and being featured in "The Big Short" is only part of the experiences Danny wants to share with the listener. This weekly podcast cuts through market noise, offering entertaining and informative discussions with expert guests giving their views of the financial world and the human side of it. Whether you're a seasoned investor or just getting started, On The Tape provides something for all listeners.
The financial opinions expressed are for information purposes only. The opinions expressed by the hosts and participants are not an attempt to influence specific trading behavior, investments, or strategies. Past performance does not necessarily predict future outcomes. No specific results or profits are assured when relying on this content.
Before making any investment or trade, evaluate its suitability for your circumstances and consider consulting your own financial or investment advisor. The financial products discussed in 'On The Tape' carry a high level of risk and may not be appropriate for many investors. If you have uncertainties, it's advisable to seek professional advice. Remember that trading involves a risk to your capital, so only invest money that you can afford to lose.
Derivatives are not suitable for all investors and involve the risk of losing more than the amount originally deposited and any profit you might have made. This communication is not a recommendation or offer to buy, sell or retain any specific investment or service.
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