Fiasco: The Inside Story of a Wall Street Trader

Enjoyed. Very eye-opening and educational!

I just couldn't stop reading this book, it's eye opening on how bad incentives can ruin fortunes. It might be a sure way to give you some financial paranoia, even more so then watching the movie The Big Short. It started me thinking on how I was getting duped. Somehow thinking about index tracker where I'm invested in for over 9 years, that performs substantially less than the index it is tracking, although it is promoted as a physical ETF. These should trail the index only by the associated costs, but that's not the case, it's worse. I have also seen some physical ETF's that get higher returns than the index, although it should always lag the index by the costs of the ETF. So reading this book I came to the conclusion that I should do a search for derivatives in the prospectus, and low and behold, these products can contain derivatives. So some small derivatives risk is being inserted in these products that supposed to (assumed by most buyers) only to track the index using physical replication. That explains the losses against the index that are higher than the cost, and also explains some of the ETF that are giving higher returns, even though there are these costs... (at the cost of additional risk that you are not aware of). You are getting duped by unrequested/unsuspected risks of these derivatives that are inserted. So the lesson is, read the prospectus carefully, understand the risk of derivatives and probably stay away from these EFT that also contain derivatives instead of only following the index.

Frank Patron revelation about how Morgan Stanley Derivatives group do business is just mind blowing. Its a true story where Frank Patron shares his journey within Morgan Stanley from getting in to the couple of years he spent with the Derivatives Public Group, How big business and individual who wanted to make quick money or show their balance sheets clear lost money and how they were sold Derivatives which were complex in nature and impossible to understand, The Money made by Morgan Stanley in selling these complex products the incentives and bonuses which Agents and Salesman from Latin America to Tokyo how these big Investment Firms can just blow your money off.It was informative as well as enjoyable to read this story with some solid learnings as captured belowDo not invest in Derivatives or try to Understand it as you won't understand its all FraudInvestment Bankers are there to make money for themselves not for youIts all Nexus from Corporate to Politician to Financial system there is little or no chance for someone to fight against these behemoth

book is v good. print is absolutely shocking bad

I am a big fan of business books and I recommend this memoir of life in the Wall Street derivatives business in the late 1990's.I enjoyed Fiasco both as a personal story and as an interesting walk through of how some of the more interesting and profitable Wall Street deals of the past decade have been done. I think Liar's Poker, The Smartest Guys in the Room, When Genius Failed and Barbarians at the Gate are the best of this genre, and this one sits comfortably in their company. The basic summary is that the author gets a job at Morgan Stanley Derivative Products Group on the cutting edge of the derivatives trend sweeping wall Street at the time and he learns all about the business, including its characters, opportunities and ethical challenges. The subject is particularly interesting now that the derivative chickens have come home to roost.The only reason I didn't give it five stars is that compared to the characters discussed in the books above (Guttfreund, Michael Steinhardt, Kravis, Milken, et al.), Partnoy didn't have quite the same material to work with. Nevertheless, Fiasco was fun, informative and timely.