“why they studied economics, and they’d explain that it was the most practical course of study, even while they spent their time drawing funny little graphs.” ― Michael Lewis, Liar's Poker.
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Author | Michael Lewis |
---|---|
Country | United States |
Language | English |
Genre | Economics |
Publisher | W. W. Norton & Company |
Publication date | October 17, 1989 |
Media type | Hardcover |
Pages | 256 |
ISBN | 9780393027501 |
OCLC | 19321697 |
Followed by | The Money Culture |
Liar's Poker is a non-fiction, semi-autobiographical book by Michael Lewis describing the author's experiences as a bond salesman on Wall Street during the late 1980s.[1] First published in 1989, it is considered one of the books that defined Wall Street during the 1980s, along with Bryan Burrough and John Helyar's Barbarians at the Gate: The Fall of RJR Nabisco, and the fictional The Bonfire of the Vanities by Tom Wolfe. The book captures an important period in the history of Wall Street. Two important figures in that history feature prominently in the text, the head of Salomon Brothers' mortgage department Lewis Ranieri and the firm's CEO John Gutfreund.
The book's name is taken from liar's poker, a high-stakes gambling game popular with the bond traders in the book.
BREAKING DOWN 'Liar's Poker'. In Liar's Poker, if one player bids three 4s, he predicts that within all of the dollar serial numbers held by all players, there are at least three 4s. If the player's bluff is not called, the next player must either bid a higher frequency of any other digit (five 2s) or can bid a higher number at the same frequency level (three 6s). Nov 07, 2014 Poker is a game that was created by liars, played by liars and all the money is owned by liars. Never believe a word that comes out of the mouth of a poker player. They have become so good at fooling their opponent’s they can’t remember what parts of their lives are even real anymore. Apr 26, 2019 RELATED: The Perfectionists: Everything We Need To Know About The Pretty Little Liars Spin-Off. In the years since the show has ended, the cast members have been up to some really cool things. Where are the actors and actresses now? Let's take a look at their post-PLL credits and also the personal successes they have had. 10 Sasha Pieterse. Most of them had Ph.D.' S in math, economics, and/or physics. Once they got onto Meriwether's trading desk, however, they forgot they were supposed to be detached intellectuals. They became disciples. They became obsessed by the game of Liar's Poker. They regarded it as their game. And they took it to a new level of seriousness.
Overview[edit]
Liar's Poker follows two different story threads, though not necessarily in chronological order.
The first thread is autobiographical, and follows Lewis through his college education and his hiring by Salomon Brothers (now a subsidiary of Citigroup) in 1984. This part of the book gives a first-person account of how bond traders and salesmen truly work, their personalities, and their culture. The book captures well an important period in the history of Wall Street. Important figures in that history feature prominently in the text: John Meriwether, mortgage department head Lewis Ranieri, and firm CEO John Gutfreund.
The second thread is a history of Salomon Brothers and an overview of Wall Street in general, especially how the firm single-handedly created a market for mortgage bonds that made the firm wealthy, only to be outdone by Michael Milken and his junk bonds. This thread is less dependent on Lewis' personal experience and features quotes apparently drawn from interviews with various relevant figures.
Lewis jumps back and forth between these two threads in the book.
Biographical section[edit]
Lewis was an art history student at Princeton University, who wanted to break into Wall Street to make money. He describes his almost pathetic attempts to find a finance job, only to be roundly rejected by every firm to which he applied. For example, in 1982 Lehman Brothers had rejected his employment application. He then enrolled in the London School of Economics to gain a master's degree in economics.
While in England, Lewis was invited to a banquet hosted by the Queen Mother, where his cousin, Baroness Linda Monroe von Stauffenberg, one of the organizers of the banquet, purposefully seated him next to the wife of the London managing partner of Salomon Brothers. She hoped that his intelligence might impress her enough for her to suggest to her husband that Lewis, be given a job with Salomon Brothers. The strategy worked, and Lewis was granted an interview and subsequently received a job offer.
Lewis then moved to New York City for Salomon's training program. Here he was appalled at the sophomoric, obtuse and obnoxious behavior of some of his fellow trainees, and indoctrinated into the money culture of Salomon Brothers and the Wall Street culture as a whole.
From New York Lewis was shipped to the London office of Salomon Brothers as a bond salesman. Despite his lack of knowledge, he was soon handling millions of dollars in investment accounts. In 1987 he witnessed a near-hostile takeover of Salomon Brothers but survived with his job. However, growing disillusioned with his work, Lewis quit the firm at the beginning of 1988 to write this book and become a financial journalist. The first edition was published October 17, 1989.
Wall Street culture[edit]
The book is an unflattering portrayal of Wall Street traders and salesmen, their personalities, their beliefs, and their work practices.
During the training sessions, Lewis was struck by the infantilism of most of his fellow trainees. Examples included yelling at and insulting financial experts who talked to them, throwing spit balls at one another and at lecturers, calling phone sex lines and then broadcasting them over the company's intercom, gambling on behavioral traits (such as how long it took certain trainees to fall asleep during lectures), and the trainees' incredible lust for money and contempt for any position that did not earn much.
Lewis attributed the bond traders' and salesmen's behavior to the fact that the trading floor required neither finesse nor advanced financial knowledge, but, rather, the ability and desire to exploit others' weaknesses, to intimidate others into listening to traders and salesmen, and the ability to spend hours a day screaming orders under high pressure situations. He referred to their worldview as 'The Law of the Jungle.'
He also noted that, although most arrivals on Wall Street had studied economics, this knowledge was never used; in fact, any academic knowledge was frowned on by traders.
Lewis also attributed the savings and loan scandal of the 1980s and 1990s to the inability of inexperienced, provincial, small-town bank managers to compete with Wall Street. He described people on Wall Street as masters at taking advantage of an undiscerning public, which the savings and loan industry provided in abundance.
Catch phrases[edit]
- Big Swinging Dick — A big-time trader or salesman. ('If he could make millions of dollars come out of those phones, he became that most revered of all species: a Big Swinging Dick.' p. 56.) The opposite of this term is Geek, used to refer to a just-hired trainee.
- Equities in Dallas — A particularly undesirable job within a finance firm. ('Thus, Equities in Dallas became training program shorthand for 'Just bury that lowest form of human scum where it will never be seen again' p. 58.)
- Blowing up a customer — Successfully convincing a customer to purchase an investment product which ends up declining rapidly in value, forcing the client to end up withdrawing from the market.
- Feeding Frenzy — The Friday-morning meal shared by a certain clique of bond traders. At this meal, traders would order astounding quantities of take-out food, far more than they could eat (e.g., a five-gallon tubs of guacamole with an order of $400 worth of Mexican food). The traders would then compete with each other to see who could display the most gluttony.
- The Human Piranha — Nickname for an employee [2] at Salomon Brothers who constantly used the word 'fuck' and its variants in his speech. A reference to Tom Wolfe's character in The Bonfire of the Vanities.
- No Tears — Used to describe a preset alternate rule Michael Lewis describes in the book, John Gutfreund challenges John Meriweather to a game of Liars Poker, in which he states 'no tears' which means players of the game who lose can't complain about losing afterwards.
Reception[edit]
Despite the book's quite unflattering depiction of Wall Street firms and many of the people who worked there, many younger readers were fascinated by the life depicted. Many read it as a 'how-to manual' and asked the author for additional 'secrets' that he might care to share.[3]
See also[edit]
- Lewis, Michael, The End, Condé Nast Portfolio, December 2008. Written by Lewis, this cover story can be read as the epilogue or wrap-up of Liar's Poker.
- David, Greg, 'The Securities Industry and New York City'[permanent dead link], Financial History, Museum of American Finance, Spring/Summer 2009.
References[edit]
- ^Lewis, Michael, Liar's Poker, W.W. Norton & Company, 1989. ISBN0-393-02750-3. 'Archived copy'. Archived from the original on 2009-05-01. Retrieved 2009-05-25.CS1 maint: archived copy as title (link)
- ^'The Human Piranha' is said to be Tom Bernard[1] who ran trading businesses for Salomon Brothers, Kidder Peabody, and Lehman Brothers for twenty-eight years on Wall Street.
- ^ Simon Johnson and James Kwak, '13 Bankers: The Wall Street Takeover and the Next Financial Meltdown', (New York: Pantheon Books, 2010), p. 113-114 'citing' Michael Lewis, 'The End' 'Portfolio,' Dec. 2008
External links[edit]
- Liar's Poker (book details) - The Official Michael Lewis Website
Retrieved from 'https://en.wikipedia.org/w/index.php?title=Liar%27s_Poker&oldid=935813397'
Poker is a game that was created by liars, played by liars and all the money is owned by liars.
Never believe a word that comes out of the mouth of a poker player. They have become so good at fooling their opponent’s they can’t remember what parts of their lives are even real anymore.
This is what makes this game so beautiful. Nobody likes to tell the truth. We all wear a mask, and bluffing is the sexiest way to keep people from seeing who you really are.
With that in mind I reached out to as many of the games greats as I could to ask them to share their theories on the top 10 lies poker players like to tell.
1# The Good Old Bust Out Lie
It’s a rare thing indeed to find a poker player who gives you an honest appraisal of their bust-out hand. Inevitably, some amazing feat of mathematical outlandishness has resulted in the exit when in general things are generally a lot simpler than that.
“I just played the hand like an idiot.”
“One of the biggest lies I hear the most is the one when they bust out and make it seem as if they were the victim of a bad beat, when in fact they just played the hand terribly,” says Rupert Elder.
2# Good Luck
It’s the final hand of the biggest buy-in event in the world. It’s winner takes all, with $1m in prize money going one way and the insides of a balloon heading the over.
The two combatants have managed to duck and dive their way through a field of 10,000 people and they stole the $10,000 buy-in from their mothers purse, and need to get it back in their before she dips her hand in searching for the Silk Cut.
The player’s look at each other, liquid leaks from the sweaty palms as they embrace.
“Good luck.”
What a load of sweaty horrocks.
Good luck?
“Players saying good luck is the biggest lie in poker.” Says Nicolas Levi.
“I hope you die of a heart attack right now,” Is a more apt response.
3# I Never Tilt
When I first read the Mental Game of Poker by Jared Tendler I was blown away. It was as if the little man was inside my head. I got so excited I told everyone I knew to buy it and it was then that I feared for Tendler’s book sales.
“I don’t suffer from tilt.” Came the chorus of replies.
“I never tilt” is the biggest lie in poker. Everyone tilts, even if it’s in minor ways they may not even know about.” Says Max Silver
4# I Had You Beat
According to the French Pro, Benjamin Pollak, the most common lie that he hears reverberate around his earlobes is the ‘I had you beat’ line that inevitably comes after another super cool lay down from Pollak.
“When I ask a player what he had, and he tells me that he had me beat, I always know that I would have won the pot.” Says Pollak.
5# I Had to Fold or Move All-In
This little beauty is the personal favorite of Paul Jackson who has been around long enough to hear his fair shares of porky pies.
“I would say the biggest lie I hear is ‘I had to fold or move all-in,” says Jackson.
Not really mate.
You could have raised, looked interested in the hand, took less than two minutes to make your decision, or even smiled.
6# I Got it in Good
Kara Scott gets particularly irked with this one.
“The one lie that I hear a lot is ‘I totally got it in good,’ when they quite clearly didn’t.”
This lie is used quite commonly by people whispering their sordid tales away from the main action on the felt, and generally follows a hand that has led to complete and utter disaster.
I use it when trying to explain to the wife why I have just blown £1,000 on a tournament buy-in after telling her we can’t afford a vacation this year.
7# I Put You on That
If you think Derren Brown, Dynamo, David Blaine and Paul Daniels are the greatest mind twisters of all time, then you haven’t met a poker player.
It’s true that these guys can ask you to think of an animal and always know you are thinking of a cat or a chicken, but poker players can guess a complete hand with suits thrown in for good measure.
Absolute genius.
“I like the one where players always put you on a hand once showdown has been reached and they can see your holdings. It’s strange how their predictions are strangely similar to your actual holdings and yet their decisions in the hand tell a completely different story.” Says Rhys Jones.
8# The Classic Bluff Spot
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As I reiterated earlier: bluffing is black stockings and suspenders. It’s the sexiest thing about the game of poker, but it’s also the foundation of a lie that the Dane Morten Mortensen hears time and time again.
“The lie I hear a lot is when a player is talking through a hand and they tell you how good a bluff spot it was, and how they would have surely done it with any two cards, yet always seem to have the nuts.”
9# The Pants Down Scenario
There is nothing more cringe worthy that watching someone squirm in their seat after being caught with heir pants, or knick-knack-paddy whacks, well and truly warming the ankles.
Here is Leon Louis with the chapter and verse.
Player 1: “I had AK!”
Player 2: “If he didn’t call I was definitely going to call.”
Player 1: “I folded the ace of hearts.”
Player 2: “You couldn’t have. I folded the ace of hearts.”
Player 1: “Maybe it was a diamond?”
10# I Never Bluff
This is a line that comes from the old school way of thinking. More roaring 1920s than digital 2000s.
Liar's Poker Summary
“I always have a good laugh at the older men you find yourself up against from time to time,” says Anton Wigg. “They always find the opportunity to tell you that they never bluff and then always take the first opportunity to bluff.”
I also asked Mathew Frankland for his input in this article and he told me that he was too busy trying to find the soap in a Jacuzzi he was sharing with The Royal Flush Girls, but if I Facebooked him the question he would reply later.
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“Promise?” I asked.
Liar's Poker Rules
“I always tell the truth.” Said Frankland.
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