Michael Lewis

Quotes

1. He now suspected that every human being who knew how high-frequency traders made money was making too much money doing it to stop and explain what was going on.

   p. 55

2. 

   Thus the only Goldman Sachs employee arrested by the FBI in the aftermath of a financial crisis Goldman had done so much to fuel was the employee Goldman asked the FBI to arrest.

   p. 148

3. 

   "Liquidity" was one of those words Wall Street people threw around when they wanted the conversation to end, and for brains to go dead, and for all questioning to cease.

   p. 108

4. 

   The relationship of the big Wall Street banks to the high frequency traders, when you think about it, was a bit like the relationship of the entire society to the big Wall Street banks. When things went well, the HFT guys took most of the gains; when things went badly, the HFT guys vanished and the banks took the losses.

   p. 264

5. 

   People who had lived without government were more likely to find meaning in it. On the other hand, people who had never experienced a collapsed state were slow to appreciate a state that had not yet collapsed.

   p. 24

6. 

   The orders resting on BATS were typically just the 100-share minimum required for an order to be at the front of any price queue, as their only purpose was to tease information out of investors. The HFT firms posted these tiny orders on BATS—orders to buy or sell 100 shares of basically every stock traded in the U.S. market—not because they actually wanted to buy and sell the stocks but because they wanted to find out what investors wanted to buy and sell before they did it. BATS, unsurprisingly, had been created by high-frequency traders.

   p. 73

7. 

   If your ambition is to maximize short-term gain without regard to the long-term cost, you are better off not knowing the cost. If you want to preserve your personal immunity to the hard problems, it's better never to really understand those problems. There is an upside to ignorance, and a downside to knowledge. Knowledge makes life messier. It makes it a bit more difficult for a person who wishes to shrink the world to a worldview.

   p. 77

8. 

   The role had been spawned by the widespread belief that traders didn’t know how to talk to computer geeks and that computer geeks did not respond rationally to big, hairy traders hollering at them.

   p. 93

9. 

   It was neither healthy nor good when public stock exchanges introduced order types and speed advantages that high-frequency traders could use to exploit everyone else. This sort of inefficiency didn't vanish the moment it was spotted and acted upon. It was like a broken slot machine in the casino that pays off every time. It would keep paying off until someone said something about it; but no one who played the slot machine had any interest in pointing out that it was broken.

   p. 233

10. 

    "For geniuses, they are really dumb,” she said. “Some of them are really pampered: They can’t even put together a cardboard box. They don’t think you do something. They think you call somebody."

    p. 188

11. 

    The entire history of Wall Street was the story of scandals, it now seemed to him, linked together tail to trunk like circus elephants. Every systemic market injustice arose from some loophole in a regulation created to correct some prior injustice.

    p. 101

12. 

    The deep problem with the system was a kind of moral inertia. So long as it served the narrow self-interests of everyone inside it, no one on the inside would ever seek to change it, no matter how corrupt or sinister it became

    p. 88