The Big Short: Inside the Doomsday Machine by Michael Lewis

The Big Short: Inside the Doomsday Machine is a non-fictional account of the financial bubble in terms of credit and housing mortgage. The book was released in 2010 and has been written by Michael Lewis, who is a bestselling author of Liar’s Poker and The New Thing. He mostly concentrates on financial and economic aspects of things, and his books are basically about one or the other economic and financial troubles. In short, he tries to aware everyday people of the tricks and games played at businesses, so as to earn the maximum profit. Likewise, he is equally interested in dramatic successes of individuals, who reach the top by their virtue. This book is also all about the people, who created the credit default swap that challenged the financial bubble.

In the book, Lewis takes a look at several people, including Meredith Whitney, Steve Eisman, Greg Lippman and Dr. Michael Burry, who profited from the economic bubble. They decided on going against the rule by allowing investment in mortgage and credit payment, so as to help to the people. Not only did they ease the problems of the general public, but they also earned enough profit for themselves or the company. Whitney is a financial analyst, who predicted that the two of the top banks were not going to make it during the financial crisis. This did prove to be true, as they had to be bailed out by the government. Likewise, Steve Eisman and Greg Lippman started a hedge fund, which is a not heavily controlled, earned great profit during the time of financial crisis. Similarly, Dr. Burry, who despite his physical challenges, established a hedge fund by the name of Scion Capital.

The Big Short: Inside the Doomsday Machine by Michael Lewis, however does not only concentrate on the top earners, but also on the big losers of the crisis. After all, not everyone was smart enough, or could not foresee the crisis coming. For example, the book discusses the loss of Howie Hubbler, who lost $9 billion in a single trade. His loss is the highest of the individual loss in history. Likewise, it also mentions AIG Financial Products loss of $ 99 billion. Therefore, people who like to read about economics and financial situations will enjoy this book. The book has been made interesting by Lewis’s writing style, but it may not appeal to everybody.

Many reviewers have pointed out that it would have been better, if Lewis had elaborated about John Paulson in the profit makers list, whose company earned a profit of $ 15 billion in a year. All in all, the book gives an insight into the nature of market and investments, and what works and what does not in certain situations.