“The CDO was, in effect, a credit laundering service for the residents of Lower Middle Class America. For Wall Street it was a machine that turned lead into gold.”

I took my time with this one, reading it slowly and carefully for over a week, trying to understand all of the really complex concepts outlined by Lewis. At least, complex to me — I dropped economics in junior college because it was going to ruin my otherwise perfect GPA. By a lot. I’m not sure that I understood everything (okay, I know I didn’t), but I did grasp enough to absolutely freaking terrify me.

“What are the odds that rich people will make smart decisions about money if they don’t need to make smart decisions — if they can get rich making dumb decisions?”

So The Big Short (recently turned into an Oscar award-winning movie, like two of Lewis’s other books — Moneyball and The Blindside) is Lewis’s attempt to dissect the financial crash of 2007. Basically (very, very basically), several different guys figured out alone or together that a bunch of home loans given to people who couldn’t afford to pay them back (because the banks kept lowering their standards of who they’d lend to) were going to default around the same time. These guys also figure out a way to exploit that, by betting that they would default, and making a buttload of money as the financial system came crashing down.

I’ll let Lewis explain the rest. The book was really interesting, and very well-written. He does a great job of explaining various financial concepts using metaphors, which this history major really appreciated. I’ve never read anything else by him, but I’m definitely going to now.