Traders, Guns & Money: Knowns and Unknowns in the Dazzling World of Derivatives

Great book. I learned a ton, but it jumps around a little and could use another review by the editor to clean up some typos.

Definitely not one of the better books on the subject. There are two major faults with this one: First, the writing is all over the place, with the author jumping hither and thither every other paragraph, with almost no cohesion. Second, there are a great deal of technical bits that are not explained well at all, and some times they don't even need to be that technical. Some interesting anecdotes and case studies, all marred by these downsides.

I take back what I said earlier, which is that Traders, Guns and Money is rather disappointing for such a critically acclaimed book. I still stand by what I said about the book's tone -- from the punchy three-word title you could recognise it for the way it reads, sort of a stand up comic routine on the derivative markets. The first half wasn't especially compelling, as the castigation of financial professionals is so generalised. You have to be offensive to be funny, I guess. Once you get past that, the second half rocks -- perhaps because I don't take any personal offense, not being involved in derivatives. It's a great insider's view of how and why derivatives evolved, with great and simple (and cynical) explanations of why various structures were created (generally, to evade taxes, get around trading regulations, and other ways to give investors more yield and earn banks more fees). The anecdotes and narrative read like a late-night drink confessional -- probably exaggerated but sounding true enough in essence, and deeply educational. As mentioned previously, it doesn't claim to be a rigorous, comprehensive risk management textbook (which Das has written) so it won't be that sort of educational if that's what you're looking for. But through anecdotes it gives a sharp sense of the culture of the people involved, something you could never find even in very good textbooks.

Grandioso libro en el que un trader de volatilidad de tipos cuenta un monton de historias interesantes sobre el negocio, mezcladas con divertidas opiniones y en general repartiendo estopa a todo lo que se menea. Un companero a quien se lo preste me dijo que era "demasiado real". Un grandisimo libro.

An accesible and wryly funny book on derivatives and their historical uses such as hedging risk, making bets, avoiding regulations of forbidding investors from certain types of investments, avoiding taxes, hiding losses / creating paper profits,etc.

educational read of finance doublespeak

Lemmed...to boringly technical. I will stick to his interviews which are much better.

A high finance memoir, written in the format of a highly-irreverant and idiosyncratic textbook, bracketed with a David-and-Goliath lawsuit worthy of John Grisham.

Required reading to understand the financial industry. *****

And you thought a book on derivatives and option trading would be boring. WRONG! How can wiping out the global economy ever be boring? Oh sure, Option Trading is a wonky subject, and I've read many a dry book on the subject, but this one breaks the mold. It really does help you understand the mechanics of the derivative world as well as show you real world applications in a hilarious manner. Well, hilarious if you weren't the one losing all your money in the deal. Or if somehow you weren't part of the global economy within the last decade. Let me step back at this point. Options. Basically, they're for farmers. You plant a crop, spend all year tending to it, and need to be certain of a profit. Rather than relying on the weather and gods, you enter a contract. You limit your maximum profit, but put a floor on the downside. The baker does the same... he needs to ensure the price of flour stays low enough to keep his business going down the line. He enters into a buy contract for the farmer's goods. Simple enough. And sure, why not scale that concept into new industries as well? Think fuel costs for a transportation company... now you're getting the idea. But here's the thing. Why shouldn't Wall Street take advantage of such a simple thing? I mean, little risk and profits from the sale of the contracts. How could these masters of the universe fuck that up? Just like everything else they touch, it's gotta turn to gold for them. And that's why this book shines. When you seriously get to the causes behind all the messes caused by these guys, you'll laugh so hard that you'll cry. Mostly because a little part of you died on the inside and you were already crying to begin with. But you'll laugh too! Now, I work on the ass end of this machine, but I'm still an insider. The book made me look around my office and laugh. Then cry. You see, the formula is the same no matter where you go in this industry. A bunch of young know nothings running around selling crap that even their PhD financial quant engineers can't understand. It's perfect, the kids, most all who are in their 20s, peddle weapons of mass destruction to anyone dumb enough to buy their bomb. I see it every day at work. Kids ruining client's people's retirements because they're just too stupid to.... Nah, wait, not stupid. They just don't care. Either way, the stupid/not caring allows them rack in major paychecks. Wealth is not created by the financial industry, it is simply moved about. Now you're thinking, "Hey, great idea... let's get smart people in there instead?" Wrong again, my friend. See, knowing 'stuff' in this industry is a bad thing. If you know stuff, you make the salesman feel bad about what they're doing. This goes up the chain of command too. The author points out how management is based on hitting sales goals instead of skill or experience, because obviously this is a way to run the global economy. But it is. Sure, not everyone is horrid asshole when it comes to this industry, but we'll never get far enough in this corporate climate to change things. Given the fact that this book was written pre Great Recession, one could almost say it serves as a witty warning of things to come. Too bad that I'm writing this follow up in 2014... because I can tell you first hand that nothing has changed. And it's not the industries fault. It's yours. Yep, you know that boring guy you ignored when you tried to talk finance...? Remember how you brought all your money over to the 20 year old who kept blowing smoke up your ass instead?