Average Reviews:
(More customer reviews)This is an incredible book about John Paulson, and in general, the trade against the housing market. This is a great read for anyone who is interested in how an investment thesis is constructed and executed.
There were two pleasant surprises of the book:
1. Cast of Characters - How different investors, besides John Paulson, also saw the similar trade opportunity and went for it. As the crisis unfolded John Paulson, George Soros and a host of other investors were revealed to have been shorting the housing market. The surprise was learning about the host of other, "unknown" investors from a medical school dropout to a cocky Deutsche Bank trader to wealthy real-estate mogul to a recently graduated MBA, each of whom recognized the crisis before most others and were able to trade against the rest of the investment community.
2. The transformation of John Paulson - He was initially described someone who was smart, but not as someone who always "had to be the best" or a natural leader; in other words he was not the classic alpha male.John Paulson was portrayed as a random i-banker with awkward communication skills, a weak handshake and an affinity for the NYC club scene. Many actually saw his career as stalled and unexceptional. The book is very good at showing how he transformed himself from a run of the mill finance professional to someone whose ambition grew and grew....and once he saw the opportunity he calmly executed his trade and transformed his life.
(A small side note...this is also the one of the best books describing the technical terms of the housing crisis (e.g. CDS, MBS).)
Finally, even though the ending is essentially known (the collapse of the housing market), the description and narrative of the sequence of events is riveting.
A great read for anyone interested in finance, the markets, and the real estate crash.
Click Here to see more reviews about: The Greatest Trade Ever: The Behind-the-Scenes Story of How John Paulson Defied Wall Street and Made Financial History
In 2006, hedge fund manager John Paulson realized something few others suspected--that the housing market and the value of subprime mortgages were grossly inflated and headed for a major fall. Paulson's background was in mergers and acquisitions, however, and he knew little about real estate or how to wager against housing. He had spent a career as an also-ran on Wall Street. But Paulson was convinced this was his chance to make his mark. He just wasn't sure how to do it. Colleagues at investment banks scoffed at him and investors dismissed him. Even pros skeptical about housing shied away from the complicated derivative investments that Paulson was just learning about. But Paulson and a handful of renegade investors such as Jeffrey Greene and Michael Burry began to bet heavily against risky mortgages and precarious financial companies. Timing is everything, though. Initially, Paulson and the others lost tens of millions of dollars as real estate and stocks continued to soar. Rather than back down, however, Paulson redoubled his bets, putting his hedge fund and his reputation on the line. In the summer of 2007, the markets began to implode, bringing Paulson early profits, but also sparking efforts to rescue real estate and derail him. By year's end, though, John Paulson had pulled off the greatest trade in financial history, earning more than $15 billion for his firm--a figure that dwarfed George Soros's billion-dollar currency trade in 1992. Paulson made billions more in 2008 by transforming his gutsy move. Some of the underdog investors who attempted the daring trade also reaped fortunes. But others who got the timing wrong met devastating failure, discovering that being early and right wasn't nearly enough. Written by the prizewinning reporter who broke the story in The Wall Street Journal, The Greatest Trade Ever is a superbly written, fast-paced, behind-the-scenes narrative of how a contrarian foresaw an escalating financial crisis--that outwitted Chuck Prince, Stanley O'Neal, Richard Fuld, and Wall Street's titans--to make financial history.From the Hardcover edition.
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