Author Michael Lewis discusses The Big Short and the future of finance

Author Michael Lewis discusses his book The Big Short: Inside the Doomsday Machine, the future of finance as he sees it, and his thoughts on whether today's business students have a chance at changing it. Part of the Dean's Speaker Series, co-sponsored by the Center for Responsible Business as part of its Peterson Series on Sustainable Finance. (September 13, 2010)
The University of California Berkeley Haas School of Business is one of the world's leading producers of new ideas and knowledge in all areas of business - which includes the distinction of having two of its faculty members receive the Nobel Prize in Economics over the past 15 years. The school offers six degree-granting programs. Its mission is to develop innovative business leaders - individuals who redefine how we do business by putting new ideas into action, and who do so responsibly. The school's distinctive culture is defined by four key principles - question the status quo; confidence without attitude; students always; and, beyond yourself.
Visit our website at haas.berkeley.edu

[@jamesroach8841]

Even if you don't care that much about finance, you can learn a lot about life from this guy, who's a real sage, if a bit strained in his optimism.

[@lc9245]

@Alden Buyer In the opening of The Big Short, it mentions that those who benefited benefits by just look. I think it's not exactly that Lewis makes difficult things easy to understand, he just looks at the things that we are too lazy to look into or entrenched to think about it in a set way that we didn't bother to look. Lewis gathers what needs to be known to understand together into a narrative. That's his magic.

[@kentheengineer592]

3:11 to skip introductions

[@RTC1655]

Michael Lewis comes across as a great guy. Very insightful and unpretentious.

[@hereigoagain5050]

I love the advice at the end: pick heart over money (assuming heart pays the bills).

[@darlene8130]

I love that he got so excited when he was asked on his future plans. Some just doesn't want to share.

[@Btn1136]

She opened the interview with a story about herself... I think she answered the question she raised.

[@rezonthe]

Oh my god, this is so great! So many good stories. Crash insurance. ;-)

[@Tina-di4lx]

Loved money ball and the big short. Both outstanding stories. watched these two movies at least 4 or 5 times.

[@detectiveofmoneypolitics]

Economic investigator Frank G Melbourne Australia is following this very informative content cheers Frank 😊

[@nbme-answers]

51:01 "[In a weird way,] the more willing someone is to answer your question, the less willing you should be to take their advice." I don't find that weird at all; cf., "Where are all the customers' yachts?"

[@AnshMittal007]

starts at 3:12

[@RONMAYS71]

Michael Lewis , Awesome Insight !

[@roblegit]

WOW .... very intriguing! Going to buy the book today!

[@michaeldavis6807]

This is great. I got a couple books to read.

[@Cryo837]

Synopsis...so the in the 1980's the "Greed is Good" culture rooted itself as the new paradigm, and the financial industry has never looked back. Just as a historical footnote the old paradigm was...are you ready for this....company reputation based on helping clients and building trust. Imagine that....what WERE they thinking?

[@willmpet]

There was a repeal of the Glass-Stegall act!

[@wesleysaams448]

Greed has been around as long as there has been life on the planet. The desire to get more and have more is a primordial survival instinct, so don't blame it on the 1980's People have always been just as g"greedy". .What has accellerated it is technology which made it easier for people to evade retraints put in place by rules and regulations tht haven't kept up. The lack of oversite and restraint caused the housing disaster in 2000-2007 just like it did in 1929 and 1987.

[@dagweedo17]

Love how he completely clowns her at the end.

[@jsmn5059]

11:16 for people who don't give a shit about introductions or lewis's personal life

[@blah5325]

Blackstone Group is now doing something similar with renting. We will have another crash and I worry about those people in homes. So not only did wall street cause the financial crisis, they have now found a new way to exploit people who suffered from that very crash they caused.

[@1life857]

Exactly, it's by design.

[@jazvock1366]

We will have a sovereign debt bond bubble about to pop thanks to the Covid19 pin, and it will wipe out everything including Wall Street

[@AviPars]

Great advice! I hate using a broker

[@berkeleyhaas]

@rooleybbq She is Kellie McElhaney, Director of Center for Social Responsibility

[@chantellegiardina5098]

Best quote "carrier of the virus of irony"

[@inthevault9603]

Chantelle Giardina 2020: That has never been more ironic than now and perhaps for years to come. 😂

[@hansvetter8653]

Great talk! Thanks for the upload! Amazing ... Michael Lewis has difficulties to answer this common question: "Where to put my money?" ... I think that there is only one safe answer ... invest into yourself! ... health (better nutrition, fitness & mental greatness, higher value neighborhood) and USEFUL skills & probably most important RELEVANT (!) knowledge ... That is for my belief the ONLY doable path of preparation for the next upcoming crisis of society ... ! ... so you see now that there is no easy way ... ! ... there are no shortcuts in life! ... and money is always only the result of success and never its cause! ... so ... DO THE WORK! Become an alpha ... ! ... That way even economic wealth is simply unavoidable!

[@ShivangBhatnagarlasb]

Beautiful and fantastic.!!!

[@kenconsultify]

Very insightful. Kian lang teh

[@Tina-di4lx]

I find Underdogs interesting people because they are usually more committed to what they are doing than naturals. They usually fight for personal reasons, they have an axe to grind. Like the current Ukrainian issue. They’re not usually Mercenaries. They fight for very powerful personal reasons. Of course, everyone counts the Underdog out. They’re to small They too big. They’re not naturals. They usually don’t look like they are going to make it at their chosen field. They fight harder. They keep getting up after a knock.

[@hipchickfitness]

Could it be really possible to change those discussion in the book by the new finance students today?

[@dancasey9660]

Read Liar's Poker when it first came out. Thought it was a good look at how screwed up Wall Street could be. It didn't make me want to be one of them.

[@NwoDispatcher]

Obama would say that derivatives are necessary to keep the dollar from imploding. The petrodollar is failing, and that scheme is putting downward pressure on the dollar world system. Derivatives are a way to make the financial sector look better than it is.

[@MiauZi69]

extremly interesting point, thx

[@quantum7401]

Derivatives are inherently overvalued.

[@Ann-sf6od]

Leverage, including in the form of residential mortgages, and trading risk is an essential building block of a functioning society -- it is the excesses of these things which is deleterious. It is a classic case of regulation attempting to catch up with technological change that unleashed the computer power to trade mortgages in this way.

[@Fredrika25m]

Miligoree - I think she is brilliant. You are offensive. Michael Lewis is also brilliant-very grateful for the information.

[@justinchung7998]

I constantly see Mark Cuban in him

[@bobirkeland5980]

Michael Lewis reminds me of Mark Cuban for some reason

[@williamgarrard195]

He kinda looks like him too! I was thinking the same

[@geoffcole6009]

Skip to 3:18!

[@nedenstation]

you are awesome, thanks.

[@anntalbot1071]

GOOD INTERVIEWER. OBVIOUSLY A LONG TIME FRIEND AND THAT BRINGS OUT THE MORE PERSONAL SIDE OF HIS SENSE OF HUMOR AND PERSONALITY. THANKS TO THE FORUM.

[@lanceaugust]

What Michael is communicating is that he has learned that a writer cannot change human nature.

[@nancydellinger7600]

interesting observations An interesting observation was when ML was invited to speak at a republican book group and then later dems 23:36 Bias turned around through observation perhaps? 58:33 people who have some perspective: Obama-wise, shrewd, interesting man put in a horrible position learning about this world, he has a perspective on how this country works, you would learn a lot (my aside, yes you would learn a lot, I know I have about media, corruption on both sides and I would be interested in what ML thinks about the direction of race relations etc. since this interview in 2010. My observation is also that I have a different interpretation of wisdom and where that came from in his example- I see puppet with a key word being put in this situation).

[@heyhey89674]

Iv said it before and Il´l say it again: The big short should become a movie. =)

[@AbcAbc-qb8lj]

Auraruth8 And they did.

[@AviPars]

Wow. A lot has changed. United states are allowed to visit cuba now!

[@pbowes5]

I'm not denying derivatives were involved. However, they were not the cause - the reason people were selling and buying the credit default swaps and MBS securities was because government stepped into the market, completely changed the rules and gave people an illusion of safety (which they ultimately backed up by the bail outs). Yes, traders made a lot of money selling various financial products, but people only bought because they thought those products had a magical mix of yield and safety.

[@alexroge6495]

“Kind of like your mission statement” LOL

[@davidbautista9]

She is one attractive interviewer host wow it is rare to have them in academia

[@pbowes5]

But who would be doing the regulating? Who do you think would be lining up to lobby the government for more "fair" treatment? I agree with you that WS has certainly had its share of shady characters, but what industry hasn't? Common denominator is government intervention. Regulation always sounds nice, but it has extremely negative consequences as it chokes growth through taxation and compliance cost and installs barriers to entry - insulating existing firms from competition.

[@pbowes5]

Corrupt politicians and lobbyists is exactly the problem. My point is you shouldn't give the politicians the power to pick winners and losers in society. Before the 1930's there wasn't one company with a DC presence, now everybody has a presence there. I don't like it, but businesses - if they are to stay in business need to compete - and if their competition is getting advantages from government then they need to lobby as well. The solution is to strictly limit the scope of government.

[@zacharycat]

Could have edited out the long intro.

[@jimflagg4009]

Now Wall Street is in trouble from trading companies like RobinHood which allows everyone to buy stocks. Look at what happen with the Short Sellers (which I think should be a crime) and the Game Stop stock.

[@matin1011]

teach them definition of susses to not become deaf. susses = more of kindness,generosity and Justice and not a occasion for more greed.

[@HermitSinghdoctus]

How to inspire the wrong people, in the wrong place, at the wrong time. ... ...For an ideal Liars Poker epitaph, perhaps add ML's own subtitle "how to get rich" for the few (by screwing the sleeping majority. .) ?? I am Trying to understand the greedy mess in reverse (which is usually easy , but so many obscenely cunning vested interests make it like trying to explain God to a fish ) , and having watched the movie at an almost empty Arclight Hollywood , I would recommend the roundtable discussion by The Hollywood Reporter as insightful by the key actors, writer, and director

[@willmpet]

While there was a bit of stupidity involved in the creation of The Great Recession, there was nothing but criminality in the usage of High Frequency Trading.

[@davidwilkie9551]

What should we invest in?, is the natural WYSIWYG expectation of survival, that determines our approach to the culture, plus and minus. Money is the medium of exchange, so unless you know what you expect to return on your investment, on its own, money is an illusion/delusion of what you think and believe. Actual vs Artificial intelligence. Everybody sells themselves to the market and culture, provide services and skills towards a mutual support of the surrounding culture, of course men and women are doing the same thing differently, but is the end return on investment as different, considering the natural partnership required, and responsibility for teaching OUR children.

[@SquirrelFromGradLife]

When managers at Fan. and Fr. could get financial insurance via derivatives the strategy became sell sell sell. The sellers of CDS were also making money because a marginal portion of people were defaulting. It all worked brilliantly until reality set in. So lending was directly driven by the derivatives and the CDS came with the CFMA of 2000. Reality was that NOTHING was backing CDS and when they acted like financial insurance we had the perfect financial disaster. THE END! Deal with it..

[@edwincajayon7934]

GAMESTOP !!!!! #GME

[@pbowes5]

Ok, you need to educate yourself about what you are talking about. CDS is nothing more than insurance. You mean securitization. Regardless, I acknowledge that derivatives had an effect on the speed of the bubble inflating and then deflating - that is definitely true. The underlying issue, however, is government meddling in the market - coercing participants to make, what otherwise would be, unwise economic decisions. In short, screwing things up for political reasons.

[@scottab140]

Red suspenders with dollar signs? lolz

[@maddierosemusic]

Read Liar's Poker, his first book.

[@jimflagg4009]

When your company starts getting rid of the odd characters then it is time to go. Look at what happened to Atari.

[@sjindal453]

@durdenlye Look at Gold's return over 30 years and may be you will appreciate the people in the room.

[@mmoly-cj4bd]

The host is so rude to Mr. Lewis with her cuts and barbs it's unbelievable. You never discuss pre-interview private conversations publicly. She tries to dis him at every chance. I can't help but wonder why? Certainly lacks in etiquette. Lewis is absolutely gracious to her and keeps moving along. I'm sure after the interview when he left he must have just shook his head. But, he has a thick skin, he gets it, and knows that unfortunately there are a lot people like this host who are plain stupid.

[@agirlisnoone5953]

Agree. She's what you think of when you think of the kind of woman woman-haters hate.... Clearly a modern feminist- anything men can do I can do better, out to prove herself smart and shove it in everyone's face, bitter, holds a grudge, not genuine at all. She seems absolutely miserable

[@wilhelmina8843]

I don't get that at ALL! Are we listening to the same conversation? They have such a great rapport. She talks about how intimidatingly smart he is, etc. How skewed is your view - or is this some sort of trolling comment and I fell for it?

[@Daniel-yi1le]

@@wilhelmina8843 Feel the exact same way about that comment.

[@thwwoodcraft1449]

She was rude because she felt at liberty because he is a white male who has earned wealth. Something you get an absolute hall pass on at Berkeley. Now much more so than 3 years ago when you posted this comment.

[@gorgorybmus]

@milligoree Your comment doesn't make any sense...

[@SquirrelFromGradLife]

When Bear Sterns had some 15 trillion in outstanding liabilities in derivatives gambling they had NOTHING backing those bets! NOTHING! 15 trillion is the annual US GDP! If all bets went south, which is highly unlikely, their losses would be in the trillions and the cascade effect would knock just about everyone else over. The cause for all of this was derivatives and the complete deregulation of the derivatives market in 2000 was the ultimate reason for all of this! THE END.

[@kenconsultify]

Shocking. Usd15t in liabilities backed by nothing.

[@kenconsultify]

Hilarious fella Teh kian lang

[@holaCarolina]

I fines ir really annoying when people ask questions during the Q&A session that have already been answered during the conference. To me it's disrespectful because either you were distracted or late but definitely not listening. And, yeah, I'm saying this because of the shaved head guy.

[@SquirrelFromGradLife]

You're right that politicians and lobbyists are a huge part problem but you completely fucking fail to realize that lobbyists work on the behalf of another entity than themselves and politicians are most often bought and paid for by people making contributions i.e. Wall Street. If I pay a politician directly to have legislation changed that's corruption. If I pay a lobbyist to have them change exact same legislation through the same politician the exact same way it's perfectly fine.

[@SquirrelFromGradLife]

If I sell you financial insurance I go to jail instantly! If I sell derivatives in the form of credit default swaps I can sell you financial insurance and the sky is the limit with absolutely no financial backstop required. That's the law and it came with the CFMA of 2000. Why do you think the derivatives market exploded after 2000? Do you think deregulation had anything to do with that? It's the Wild West of finance, it's total anarchy, it's giving matches and gasoline to pyromaniacs!

[@SquirrelFromGradLife]

I'm also for removing financial reform from the grasp of politicians and voters like you and have educated, knowledgeable, moral and common sense people like myself dictate that when anyone is within arms reach of other peoples money i.e. Wall Street banks they should be so tightly regulated asking permission just to go to the bathroom was mandatory! You can gamble all you like with your own money I have no problem with that but they're gambling with OUR money and OUR financial freedom!

[@1czechit1]

1. I find it ironic that leftists (who generally get the "gist") think people on the right (who generally look for the "details") don't read. 2. now I understand a couple of...uhm.. prejudicial lines he wrote in "the Big Short." and 3. a comment he made about the finance industry were happy about Trump when in fact they helped Hillary (2016) and Biden (2020.)

[@winstonchurchill9377]

First interesting progressive person I got to know in this year.

[@SquirrelFromGradLife]

You simply fail to understand that Fannie and Freddy couldn't lend just about anyone anything without credit default swap backing! Their lending policies were directly dictated by derivatives. No derivatives - no lending. Credit default swaps on tap - anyone could get approved. Don't you realize that? Fan. & Fr. made money making insecure loans based purely on financial insurance with absolutely no backstop. Companies like Bear Stearns, Lehman and AIG had gambled trillions with NO backing!

[@SquirrelFromGradLife]

Actually there is a guarantee for success in finance. It's called corruption. Some chose to call it lobbyism but I think we should call it by its real name which is corruption. If I pay a politician to have legislation changed it's corruption. If on the other hand pay a lobbyist to contact a politician on my behalf and have the same legislation changed it's perfectly fine. In fact we hail it as the greatest democracy in the world. Right? When WS asks for deregulation it's a guaranteed success!

[@Miguel-pd3no]

Jesus... pragmatism... thank you.

[@SquirrelFromGradLife]

Taxation without representation was one of the reasons behind the American revolution. Today we have a similar situation with Wall Street, the politicians and the bailouts. Effectively Wall Street have managed to create a perfect political vacuum surrounding themselves and they have even manged to have people like you routing for them making HUGE contradiction and completely failing to deal with reality. You even manages to believe my point of view is wrong and I have to educate myself! LOL

[@agirlisnoone5953]

Have we not learned a thing. We'll have another crash soon guaranteed. People are just too greedy

[@draft1643]

Get a room!

[@ethanniedorowski116]

I think she is missing the point that she shouldn't keep saying her school. He was talking about these people as dopes. Let them be c students from yale..Yale... not my school.

[@agirlisnoone5953]

Boy is she bitter and does she hold a grudge. She isn't an open honest genuine person. I'm a wahman. I see right thru that shit and help me please god not ever have friends or family like this woman.

[@MrAdrianjherman]

worst intro ever!!!

[@krystle579]

omg yes! wow

[@artsmith103]

Yes terrible, and it ends at 3:10.

[@jpenneymrcoin6851]

Corporate responsibility - what a joke.

[@pretorious700]

The "financial reform bill"is a joke.

[@fredoman1323]

FF to five minutes in to avoid the overwrought intros and get to THE FUCKING point. KKthanks.

[@pbowes5]

Traitor of the American people? Seriously? Try reading the constitution and tell me what it says about what the government should and should not be doing. I do appreciate the discussion though. I'll put something on my blog in the next day or two more fully explaining my position - feel free to drop by and comment at boweseditorial.blogspot.com

[@lesterdiamond6190]

this whole presentation is RACE-IS...... ( finger snaps )

[@durdenlye]

Funny how all these supposedly smart people laugh out loud when he mentions gold bullion. Investing in gold would have yielded a 50% return in the last year since this lecture (even after the recent setback), and a 600+% return if you bought it right after Lehman imploded. No one laughs when he mentions indexed funds. S&P index is negative over the past year in real terms.

[@SquirrelFromGradLife]

I'm NOT making your point!I'm completely fucking OPPOSED to your point! Your point is there should not be any financial regulation.My point - there should be unbelievable tight financial regulation the moment you're within arms reach of other peoples money i.e. the entire financial industry! Your claim it's the governments fault! My opinion is that it's Wall Streets fault. Your claim the government is manipulating Wall Street, and I say Wall Street is manipulating everything!

[@davewheelock3435]

Tragic example of the many (most) bright minds siloed into the dead end of capitalism. Could it have anything to do with their incomes?

[@boonedockjourneyman7979]

Did you ever think about asking questions about the grotesque breach of rules then in existence? Not “theoretically important ideas.” These guys just paid you frauds off.

[@NibsNiven]

@59:32 saying Obama is very wise about how America works. Could he be more wrong?

[@northwindl]

+NibsNiven perhaps his only disingenuous view in this entire session, imo.

[@SquirrelFromGradLife]

Using your logic we should let pedophiles in charge of laws regarding child pornography, pyromaniacs in charge of laws regarding arson, let Bernie Madoff be in charge of anything concerning fraud etc. My point is the exact opposite! I want as tough financial regulations as they come! I want all access to politicians limited and monitored. Talk to a politician and all journalists, all media have to listen in and everything has to be public record.No secret meetings, no closed doors or you're OUT!

[@hrustygmail]

At the one hour mark..................Obama???? With or without teleprompter?

[@thelastshallbefirst6531]

10yrs later, and I must say Government and the Banking Ariel are in collusion. They both need each other to maintain power.

[@SquirrelFromGradLife]

Imagine a world where you would have an editorial...LOL... Do you actually believe you're speaking on the behalf of we the American people or Wall Street? What side are you really on? I know you're NOT on my side when you claim deregulation is such a brilliant thing and we should have more of that. You're certainly NOT on the side of the American tax payers because we the people have to pay every time they fuck up. Finally you're NOT on the side of the American democracy because they OWN us!

[@SquirrelFromGradLife]

How can you be the smug and arrogant about being this WRONG? You do realize that the Constitution is made in an effort to try to protect our rights whereas Wall Street is doing everything in their power to circumvent this fact. Wall Street is NOT mentioned in the Constitution as a legislative power yet they seem able to dictate pretty much whatever legislation they want including DEREGULATION i.e. removing whatever little rules and regulation that concerns them. You simply couldn't be more WRONG

[@cybercab]

I love his books but as a person, he’s arrogant and unlikeable. Sad.

[@roblegit]

WOW .... very intriguing! Going to buy the book today!