Michael Lewis (Author) succinctly narrates how he landed up a job at Salomon Brothers, the most profitable investment bank of the 1980's. He joins Salomon Brothers at a time when Investment banking is in vogue and is considered to be the only worthwhile occupation.
The author gives vivid pictures of the trading floor at an Investment bank with all the associated pandemonium. Salomon Brothers was a pioneer in bond trading and had a near monopoly in the bond market (except Junk Bonds).
Lewis is flabbergasted by the fact that the customers were treated such short handedly by the traders. The traders didn’t loose a single opportunity to seal a bad deal with the consumer. It is no surprise that this industry rests on the premise that "Buyer's Beware". Nonetheless he himself seals a one or two raw deals with the investors, which continues to haunt him during his tenure at Salomon Brothers.
Lewis is appalled to notice that there is no lucid management direction at Salomon Brothers which ultimately leads to its demise. The bonuses dispersed to traders at the year end are disproportionate to the amount of business he gets for the firm. This leads to a widespread discontent and unsurprisingly attrition of premier traders from Salomon. This not only leads to a loss of a prized asset but also to the loss of accounts associated with the concerned employee.
There are a lot of important concepts in this book like Junk and Mortgage bonds. Lewis gives a detailed description that how star traders smell an opportunity and develops a whole new business around it. The case in point is the mortgage trading which was invented by a Salomon Trader. Mortgage trading rose from nowhere to become a multi million dollar business. Of course there is no dearth of imitation at Wall Street. Salomon's success in Mortgage Trading was quickly replicated by other banks like Goldman Sachs.
Lewis also reflects on Milken, the guru of Junk Bonds. Milken revolutionsed the whole debt market and made it available even to the sub par investment grade firms. He was the pioneer in junk bonds and targeted new startups or older firms on brink of bankruptcy. Cheap and easy availability of credit lead to a wave of mergers and acquisitions which is the most profitable business these days.
Finally I would like to say that this book is indispensable for anyone who has dreams of making it big at Wall Street. This will give us a macroscopic view of the life at an investment bank and various positions available apart from being a trader. It takes you through the strenuous ordeal a trainee faces on his path to a star trader or salesman and raking in millions for firm as well as himselfJ.