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rockshard PhDLiar's Poker

1 week ago

The salesmen blamed the traders, and the traders blamed the salesmen. Why couldn't we sell their bonds to stupid European investors? the traders wanted to know. Why couldn't they find bonds that weren't so embarrassingly awful? The salesmen wanted to know. I was told by one trader, who was trying to off-load an AT&T style rip-off onto one of my customers, that I needed to be more of a team player. I was tempted to ask, "What team?" I could probably have sold his bonds and saved him some money, but it would have come at the expense of a relationship. Telling traders to live with their mistakes, which I did on rare brave occasions, was not a moral but a business judgment. In my view, the solution to AT&T nightmares was not to dump them into the portfolios of my customers but to sack the traders who got us into the problems in the first place. The traders, of course, didn't agree.

The plain fact was that a combination of market forces and gross mismanagement had thrown Salomon Brothers into deep trouble. At times it was as if we had no management at all.

Liar's Poker

Liar's Poker is a non-fiction, semi-autobiographical book by Michael Lewis describing the author's experiences as a bond salesman on Wall Street during the late 1980s. First published in 1989, it is considered one of the books that defined Wall Street dur...

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rockshard PhDLiar's Poker

1 week ago

European lenders (my customers) didn't know how to roll over and play dead. You could sucker them once, but if you did, they'd never come back. Unlike their American counterparts, they didn't understand that they couldn't live without the services of Salomon Brothers. A Salomon trader in New York once told me, "The problem with the London office is that the customers aren't trained."

Liar's Poker

Liar's Poker is a non-fiction, semi-autobiographical book by Michael Lewis describing the author's experiences as a bond salesman on Wall Street during the late 1980s. First published in 1989, it is considered one of the books that defined Wall Street dur...

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rockshard PhDAladdin

1 week ago

I just had the idea to add a laughtrack. It would be like a British sitcom.

Aladdin

Aladdin is a game created by rockshardPhD/zeello using RPG Maker VX Ace. It features turn based battles with a card game theme.

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rockshard PhDLiar's Poker

1 week ago

None of my activities in the first couple of months made so much as a dent on the bottom line of Salomon Brothers, but all were highly entertaining. What was more important than immediate results, I figured, was my education. I was niggled during those first few months by the feeling of being a charlatan. I kept blowing people up. I didn't know anything. I had never managed money. I had never made any real money. I didn't even know anyone who had made any real money, only a few heirs. Yet I was holding myself out as a great expert on matters of finance. I was telling people what to do with millions of dollars when the largest financial complication I had ever encountered was a $325 overdraft in my account at the Chase Manhattan Bank. The only thing that saved me in meeting after meeting in the early days at Salomon was that the people I dealt with knew even less. London is, or was, a great refuge for hacks.

Liar's Poker

Liar's Poker is a non-fiction, semi-autobiographical book by Michael Lewis describing the author's experiences as a bond salesman on Wall Street during the late 1980s. First published in 1989, it is considered one of the books that defined Wall Street dur...

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Husky Wingrockshard PhD

1 week ago

did you ever watch 11.22.63

rockshard PhD no and I'm not going to. delete this.

1 week ago

Husky Wing wat how come why

1 week ago

nodley Green delete it or else

1 week ago

rockshard PhDLiar's Poker

2 weeks ago

Each day Alexander called and explained something new. After several months of struggling I began to catch on. When Alexander hung up, I would call three or four investors and simply parrot what Alexander had just said. They would think me, if not a genius, then at least astute. On the basis of what I told them, they put money on the line. They made handsome profits, just like the investors to whom Alexander spoke. Soon they were calling me. Before long they wouldn't speak to anyone else but me. That would do whatever I, meaning Alexander, told them to do. This would soon prove very valuable.

While Alexander taught me an attitude toward markets. Dash showed me style. Much of our time was spent on the telephone. By style, I mean phone technique. Dash had a lot of phone technique. He placed his social calls to clients in the upright seated position. He placed his sales calls hunkered over, head under his desk. He used the space beneath his desk as a kind of soundproof booth. His taste for privacy had been acquired as a geek, when he didn't want the seasoned salespeople to overhear the stupid things he was telling his customers.

Now it was habit. I could tell when Dash was about to sell a few hundred million dollars of government bonds because his torso would jackknife in his chair so that his chest was almost in his lap and his head went into the sound booth. Just before consummating the trade, he'd plug his empty ear with a finger on his free hand and speak rapidly in a low voice. (One of his customers nicknamed him the Whispering Dash.) Then suddenly, he'd pop up, hit the silencer button on his receiver, and shout into the hoot, "Hey, New York . . . New York . . . you're done on October ninety- two to September ninety-threes, one hundred by one hundred ten ... yeah, one hundred million by one hundred ten million." Whenever he emerged from the tuck position without having sold bonds, I knew he had been talking to his mother. It wasn't cool to talk to your mother on the trading floor.

Liar's Poker

Liar's Poker is a non-fiction, semi-autobiographical book by Michael Lewis describing the author's experiences as a bond salesman on Wall Street during the late 1980s. First published in 1989, it is considered one of the books that defined Wall Street dur...

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rockshard PhDLiar's Poker

2 weeks ago

Each time I jammed bonds into an investor's portfolio they came back to haunt me, usually in the form of a tenaciously pissed-off customer calling each morning with some variant on Herman the German's bitter refrain, "Michael, haf you any more great ideas up your sleef?" I did not sleep well at night or enjoy falling out of bed in the morning, imagining, as I did, investors across Europe sticking pins into miniatures of me. The question concerning the bonds of the Southland Corporation, then, was how to steer my customers around them. This was more easily said than done. Not selling bonds was a tricky affair, much trickier than selling bonds, more like playing squash with your boss, because you had to appear to want to win at the same time you intended to lose. Southland was especially tricky because it was Sutfreund's bid to show that Salomon Brothers was a force to be reckoned with in junk bonds. I received telephone calls from several New York managers, whose job it was to pester salesmen and who were galvanized by Gutfreund's interest in their project. They asked what luck I was having. I lied. I said that I was giving Southland my best shot when in fact I had not placed a single sales call. Still, they would not let me be.

It seemed that I, like a golfer, needed to improve my lie. Either it sounded unconvincing, or more likely, other salesmen were telling much better ones ("My customer is away for a week on vacation." "My customer is dead"). One of the junk bond specialists insisted on actually watching me place a sales call to my biggest client, my Frenchman. Mercifully he did not insist on listening in. He only wanted to be able to say that he saw me try. We sat at the comer of the trading desk, he beside me, while I did the dirty work.

"Oui," said my Frenchman.

"Hi, it's me," I said.

"But who else?"

"There is a deal you should have a look at," I began, measuring each word. "It's extremely popular with American investors." (My Frenchman was intensely suspicious of anything popular.)

"Then we shall let them buy it all," he said, having caught on.

"I'm sitting here with one of our high-yield bond specialists, who thinks Southland bonds are cheap," I continued.

"But you don't," he said, and laughed.

"Right," I said, and then launched into a long-winded sales pitch that greatly pleased both the junk bond man from Salomon and my customer, though for different reasons.

Liar's Poker

Liar's Poker is a non-fiction, semi-autobiographical book by Michael Lewis describing the author's experiences as a bond salesman on Wall Street during the late 1980s. First published in 1989, it is considered one of the books that defined Wall Street dur...

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rockshard PhDLiar's Poker

2 weeks ago

The process by which a take-over occurs is frighteningly simple-in view of its effects on community, workers. shareholders, and management. A paper manufacturer in Oregon appears cheap to the twenty-six-year-old playing with his computer late one night in New York or London. He writes his calculations on a telex, which he send to any party remotely interested in paper, in Oregon, or in buying cheap companies. Like the organizer of a debutante party, the twenty-six-year-old keeps a file on his desk of who is keen on whom. But he isn't particularly discriminating in issuing invitations. Anyone can buy because anyone can borrow using junk bonds. The papermaker in Oregon is now a target.

The next day the papermaker reads about himself in the "Heard on the Street" column of the Wall Street Journal. His stock price is convulsing like a hanged man because arbitrageurs like Ivan Boesky have begun to buy his company's shares in hopes of making a quick buck by selling out to the raider. The papermaker panics and hires an investment banker to defend him, perhaps even the same twenty-six-year-old responsible for his misery. Five other twenty-six-year-olds at five hitherto unoccupied investment banks read the rumors and begin to scourge the landscape for a buyer of the paper company. Once a buyer is found, the company is officially "in play." At the same time the army of young overachievers check their computers to see if other paper companies in America might not also be cheap. Before long the entire paper industry is up for grabs.

Liar's Poker

Liar's Poker is a non-fiction, semi-autobiographical book by Michael Lewis describing the author's experiences as a bond salesman on Wall Street during the late 1980s. First published in 1989, it is considered one of the books that defined Wall Street dur...

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rockshard PhDNintendo Switch

2 weeks ago

Question. Is it possible to buy a Switch screen on ebay and just buy an AC adapter and Joycons separately? That should be fine, right?

Nintendo Switch

Nintendo Switch (ニンテンドースイッチ, Nintendō Suitchi) is an upcoming video game console in development by Nintendo. Officially unveiled on October 20, 2016, it is currently scheduled for release worldwide in March 2017. Nintendo Switch is a hybrid device that ca...

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Husky Wing Wait wait wait save money and I'll pay the shipping cost to take the dock and HDMI off your hands

2 weeks ago

Husky Wing wait Husky don't say that

2 weeks ago

rockshard PhD dunno when I'll jump the gun and actually do it. I should probably wait until after I've played my 2DS a bit.

2 weeks ago

rockshard PhDLiar's Poker

2 weeks ago

There was an excellent reason my jungle guide-manager didn't let me lay my hands on the larger investors. He knew that soft-brained as I was, I was dangerous. His plan was for me to learn on the small clients so that if disaster struck, the effect on overall business of Salomon Brothers would be negligible. It was assumed that I might well put a customer or two out of business. That was part of being a geek. There was a quaint expression when a customer went under. He was said to have been "blown up." Once I'd learned to do my job, once I'd stopped blowing up customers, I would be permitted to advise the big investors.

A few days after I'd arrived, I was told by said jungle guide to start smiling and dialing. Cold calling, as I have pointed out, was not my idea of fun. I discovered immediately I was temperamentally unsuited to it; it made me feel like too much of a pest to do it well. And when he saw I was having no success, my jungle guide finally gave up the ghost and told me to phone a man named Herman at the London branch of an Austrian bank. This was convenient for everyone. Herman wanted to be sold to by Salomon Brothers. Because he had only a few million dollars to play with, no one else at Salomon Brothers wanted to sell to Herman. And in order to eat, I needed customers..

Poor Herman never knew what hit him. I proposed lunch, and he accepted. He was a tall, gruff German with an incredibly deep voice and the distinct impression that he was born to trade. He thought he was very, very smart. It was my job to encourage him in this view, since the smarter he felt, the more he traded, and the more he traded, the more business he could give me. His bank had given him authority to risk twenty million dollars.

In spite of his cunning, Herman didn't know a geek when he saw one. I explained to him how with this twenty million dollars the two of us could make a fortune. Salomon Brothers was full of shrewd, knowing people, I said, and we would draw from their reservoir of ideas. I allowed how I myself was known to have an idea or two. And my advice was greatly valued by certain large European investors. At the end of the lunch, during which we examined lots of Salomon's scientific graphs about bonds, talked a bit about head and shoulders patterns, and drank a bottle of wine, he decided he could do business with me. "But, Michael, remember," he said several times, "we need gut ideas."

A large corporate bond trader was waiting for me, like an unfed house pet, when I returned to the office. He was glad to hear the lunch had gone well. And as it happened, he had a great idea for me and my new customer. He had been watching the Eurobond market all day and had noticed that AT&T's thirty-year bonds had really become cheap, as measured against the benchmark thirty-year U.S. treasury bond. The $650 billion Eurobond market, it should be said, was one of the main reasons for Salomon Brothers' presence overseas. A Eurobond is a bond issued in Europe and bought mainly by Europeans. Many large American companies issued Eurobonds, usually because they could borrow money more cheaply from Europeans than from Americans, but occasionally to advertise their names abroad. Salomon, with its network of contacts in corporate America, was a leader in the market.

Anyway, the trader said the Street, meaning other Wall Street and London traders, was undervaluing AT&Ts. He knew where he could put his hands on a few AT&Ts. What I should tell my new client to do, he said, was to buy the AT&Ts and at the same time sell short thirty-year U.S. treasury bonds. The trick, he explained, was to avoid being long or short the bond market. Instead we would be making the esoteric bet that AT&T bonds would outperform U.S. treasury bonds. It sounded complicated. I wanted to be careful. I asked if the strategy was risky.

"Don't worry," he said, "your guy will make money."

"I haf nefer done dis ding before, but it sounds like a gut idea," said the still-tipsy Herman when I told him. "Do tree million."

My first order. I felt thrilled and immediately called the U.S. treasury trader in New York and sold him three million dollars' worth of treasury bonds. Then I shouted over to the London corporate bond trader, "You can do three million of the ATTs," trying, of course, to sound as if it really weren't that big a deal, just another trade, like going for a walk in the park.

There was in every office of Salomon a systemwide loudspeaker, called the hoot and holler or just the hoot. Apart from money, success at Salomon meant having your name shouted over the hoot. The AT&T trader's voice came loudly over the hoot; "Mike Lewis has just sold three million of our AT and Ts for us, a great trade for the desk, thank you very much, Mike."

I was flushed with pride. Flushed with pride, you understand. But something didn't quite fit. What did he mean, "Our AT and Ts"? I hadn't realized the AT&T bonds had been on Salomon's trading books. I had thought my trader friend had snapped them up from stupid dealers at other firms. If the bonds were ours to begin with . . .

Dash was staring at me, disbelieving. "You sold those bonds? Why?" he asked.

"Because the trader said it was a great trade," I said.

"Nooooooo." Dash put his head in his hands, as if in pain. I could see he was smiling. No, laughing. "What else is a trader going to say?" he said. "He's been sitting on that position for months. It's underwater. He's been dying to get rid of it. Don't tell him I told you this, but you're going to get fucked."

"How can I get fucked?" I said. "The trader made me a promise."

"You are going to get fucked," Dash said again. "That's all right because you're just a geek. Geeks were born to be fucked." He meant this in a nice way, to absolve me, as it were. He then replaced his pen in the corner of his mouth, gave it a thoughtfultwist or two, and began to work the phones like a jockey.

"What iss dee price of dee ATT bonds?" a familiar voice was shouting at me the next morning. No longer was he cool and self-assured. Herman had apparently been enlightened by some other trader in London. Everyone in London but Herman and I, it seemed, knew that Salomon Brothers owned AT&Ts and had been desperate to unload them. Herman was beginning to sense that he was going to get fucked.

I held out hope. Not much. But I did think that if I went and stood over the trader, told him how upset my new customer was, told him that this did not bode well for our new relationship, showed him how awful I felt that he might buy the AT&T bonds back from my customer at the same price he had sold them to him the previous day.

"They aren't doing real well," said the trader when I asked him the price. "But they'll come around."

"What's the price?" I asked again.

"I'll have to get back to you on that," he said.

"No way," I said. "I've got a boiling German on hold. I've got to know."

The trader pretended to shuffle through some complicated-looking sheets, to punch a few numbers into his Quotron machine. This, I learned, was standard practice when a customer was about to be sacrificed for the greater good of Salomon. The trader tried to transfer the blame to some impersonal, scientific force. (It's the numbers, don't you see? I can't do anything for you.) It was painfully apparent the AT&T trader was stalling. Something was very wrong.

"I could bid you ninety-five for them," he finally said.

"You can't do that," I said. "You sold the things to me at ninety-seven yesterday, and the market hasn't moved. The treasuries are the same price. I can't go tell my customer his AT and Ts have gone into a two-point free fall overnight. He's out of pocket sixty thousand bucks."

"I told you they weren't doing very well," he said.

"What do you mean? . . . You lied to me!" I started to shout.

"Look," he said, losing his patience, "who do you work for, this guy or Salomon Brothers?"

Who do you work for? That question haunted salesmen. Whenever a trader screwed a customer and the salesman became upset, the trader would ask the salesman, "Who do you work for anyway?" The message was clear: You work for Salomon Brothers. You work for me. I pay your bonus at the end of the year. So just shut up, you geek. All of which was true, as far as it went. But if you stood back and looked at our business, this was a ridiculous attitude. A policy of screwing investors could lead to ruin. If they ever caught on, we'd have no investors. Without investors, we'd have no business raising money.

The only justification-if you can call it that-I ever heard for our policy came unwittingly from our president, Tom Strauss, himself a former salesman of government bonds. At a lunch with one of my customers, apropos of nothing and everything, he offered this opinion; "Customers have very short memories." If that was the guiding principle of Salomon Brothers in the department of customer relations, then all was suddenly clear. Screw 'em, they'll eventually forget about it! Right.

However, you had to admire Strauss's frankness. It was one thing to screw a customer. It was another to tell him in advance you were going to. The difference in style between the AT&T trader and Strauss was the same as between a sucker punch and a duel. Still, neither was great for business. One thing my customer never forgot was that Salomon Brothers thought he had a short memory.

I had made the mistake of trusting a Salomon Brothers trader. He had drawn on the pooled ignorance of me and my first customer to unload one of his mistakes. He had saved himself, and our firm, sixty thousand dollars. I was at once furious and disillusioned. But that didn't solve the problem. Bellyaching to the trader wasn't going to get me anywhere. That much was clear. He'd just dock my bonus at the end of the year. Bellyaching would also make me look like a fool, as if I actually had thought the customer was going to make money on the AT&Ts. How could anyone be so stupid as to trust a trader? The best thing I could do was pretend to others at Salomon that I had meant to screw the customer. People would respect that. That was called jamming. I had just jammed bonds, albeit unknowingly, for the first time. I had lost my innocence.

But what did I tell Herman the German? "Don't let your sixty-thousand-dollar loss bother you too much, you have a short memory, and you'll soon forget? . . . Sorry, I'm new at this, and guess what, ha-ha, you've just been had!"

"Hi, sorry to take so long, it's really busy here," I said. Rifling through the range of tones I might adopt, I was unable to find anything exactly appropriate to the occasion and settled on sounding cheerful. I must have managed an expression halfway between a brave smile and the grin of an idiot. Dash was watching the charade and laughing. Now that was unnecessary. I flipped him the finger. I was more embarrassed for myself than I was concerned for Herman.

"I just spoke with the trader," I said to my new customer, "and he said that the AT and Ts didn't do very well overnight, but they'll definitely come around soon."

"What is dee price?" he asked again.

"Oh ... let me see . . . about . . . well . . . about . . . ninety-five," I said and felt my face wince.

"Aaaaaaaaahhhhhhhhhhhhhhhhh," he shouted, as if he had been stabbed with a knife. He had lost all ability to articulate his feelings. His primal Teutonic scream captured for all time the collective pain felt by the valued customers of Salomon Brothers. What I didn't know but soon learned was that he never imagined in his whole life losing sixty thousand dollars. His bank had given him twenty million dollars to trade but would not let him lose sixty thousand of it. If it knew he was down that much money, it'd fire him. Actually his story was more gruesome than that. He had a baby, a pregnant wife, and a new house in London with a large mortgage. This emerged only later, however. At the moment of impact all he could do was make noises. The agony. The horror.

"Uuuuuhhhhhhhhh," he continued, in a slightly different key. He began to hyperventilate into the phone.

And you want to know how I felt? I should have felt guilty, of course, but guilt was not the first identifiable sensation to emerge from my exploding brain. Relief was. I had told him the news. He was shouting and moaning. And that was it. That was all he could do. Shout and moan. That was the beauty of being a middleman, which I did not appreciate until that moment. The customer suffered. I didn't. He wasn't going to kill me. He wasn't even going to sue me. I wasn't going to lose my job. On the contrary, I was a minor hero at Salomon for dumping a sixty-thousand-dollar loss into someone else's pocket.

There was a convenient way of looking at this situation. My customer did not like hi s loss, but it was just as much his own fault as mine. The law of the bond market is; Caveat emptor. That's Latin for "buyer beware." (The bond markets lapse into Latin after a couple of drinks. Meum dictum pactum was another Latin phase I used to hear, but that was just a joke. It means "My word is my bond.") I mean, he didn't have to believe me when I told him AT&T bonds were a good idea.

Anyway, who was hurt besides my German? It is an important question, because it accounts for the detachment with which disasters were viewed at Salomon. The German's bank had lost sixty thousand dollars. The bank's shareholders, the Austrian government, were therefore the losers. To take it one step farther, the Austrian taxpayer was the loser. But compared with the assess of the nation as a whole, sixty thousand dollars was a ridiculously small sum. In other words, it was hard to generate sympathy for anyone but the man who had done the trade. And he was partly responsible.

He shouldn't blame me entirely, I might have thought had my capacity for rationalization been that of a man rather than a geek. But oh, how he did. For that is the customer's privilege and the bond salesman's burden. And he didn't just blame me once. He blamed me hundreds of times. For having made the first mistake of doing the trade, we promptly made the second of holding on to it. Each morning and each afternoon for the next few weeks I awaited his bitterly sarcastic phone calls in a frozen state of dread. A thick German voice on the other end of the line would say, "Dis bond iss a really great idea, Michael. Haf you any more great ideas up your sleef?" As a matter of fact . . . Herman gave up hoping he would survive intact; he gave up hope that Salomon would restore his losses; his sole reason for calling was to shower abuse upon me.

Till death did they part, my customer and his bonds. AT&T's bonds got cheaper and cheaper. Finally, about a month after the ordeal had begun, my customer's boss inquired into his activities. A loss of about $140,000 dutifully raised its hoary head, and my German was fired. Kaboom! He got another job, and as far as I know, his children are well provided for.

It was not an auspicious start to my career. Within a month I'd blown up my first and only customer. There were, thankfully, plenty more where he came from. All met the two requirements to speak with a geek- first, that they be small investors and, second, that they be so awed by Salomon Brothers as to assume anything they were told was good advice. I passed a period of a few months on the phone with dozens of the least desirable clients in Europe. Among them there was a cotton trader in Beirut ("You may think times are not good down here, but they are, they are"), an Irish insurance company with a taste for speculating in currency options, and an American pizza mogul living in Monte Carlo. I blew up the insurance company, this time in an act of stupidity unassisted by traders. I was told not to do business with the man from Beirut by the Salomon Brothers credit committee, for fear that he might blow us up before I blew him up. And I lost the Monte Carlo pizza mogul when he decided to give up bonds and return to pizza, but not before he delivered for posterity the memorable line "The casinos down here are dull compared to the shit we do." That was true.

Liar's Poker

Liar's Poker is a non-fiction, semi-autobiographical book by Michael Lewis describing the author's experiences as a bond salesman on Wall Street during the late 1980s. First published in 1989, it is considered one of the books that defined Wall Street dur...

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