Err – Michael Lewis is Brilliant.

September 6, 2007 at 9:12 am (Uncategorized)

Check out the Bloomberg piece excerpted below.

“So right after the Bear Stearns funds blew up, I had a thought: This is what happens when you lend money to poor people.

Don’t get me wrong: I have nothing personally against the poor. To my knowledge, I have nothing personally to do with the poor at all. It’s not personal when a guy cuts your grass: that’s business. He does what you say, you pay him. But you don’t pay him in advance: That would be finance. And finance is one thing you should never engage in with the poor. (By poor, I mean anyone who the SEC wouldn’t allow to invest in my hedge fund.)”

Read the whole piece. Clearly, there’s an element of satire involved, but Lewis is always at his best when writing about finance (forget Moneyball – revolutionary ideas, at least to those who weren’t as informed about baseball, but not a great piece of writing per se) – Liar’s Poker should be on the required reading list of every finance or business curriculum – heck, I learnt more from that book than I did from many of my other courses. The sub-prime clusterfuck is a direct product of human ingenuity running into human greed (both of which are good things – fyi) – the consequences can be enormous. Its hard for to feel sympathy for people who insist on spending above their means, and then expect those who did not to bail them out. If anything, I don’t think this is a liberal-conservative issue – The guy making $40,000 a year shouldn’t have his tax dollars go to bail out the $70,000 a year guy who bought a house he could not afford, and the reverse holds true.

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