Product Description

Frank Partnoy, a former high-flying derivatives salesman, gives a vivid and shocking account of the vicious competition, raw machismo and dirty tricks at work in the riskiest sector of the stock market. Billions of dollars worth of securities are traded – and lost – in this amazing arena. Derivatives trading has also played a huge part in the global credit crunch that is the biggest story in the world today. This edition includes a sensational new chapter covering this, and all the other latest scandals.

Product Details

• Amazon Sales Rank: #167908 in Books
• Published on: 2009-02-19
• Original language: English
• Binding: Paperback
• 320 pages

Review
"'Take it from us that F.I.A.S.C.O. is absolute dynamite... Partnoy doesn't take prisoners.' - Euroweek 'Guns, booze and bloodlust: the truth about high finance.' - Sunday Times 'F.I.A.S.C.O. is a ringside seat on the nastiest and most important game being played on Wall Street today. Think of derivatives trading as a blood sport, with the unsuspecting consumer as prey. Read this book, or else...' - Michael Lewis, author of Liar's Poker."

About the Author
Frank Partnoy was an investment banker at CS First Boston and Morgan Stanley in New York, and as a lawyer in Washington D.C. He has been a law professor at the University of San Diego since 1997. He is the author of Infecting Greed and his next book, The Match King (ISBN: 978 1 86197 966 7), will be published, simultaneously with this new edition, by Profile in May 2009.

Customer Reviews

Wall Street bilks Main Street
In this cynical book (`traders ripping their client's face off') Frank Partnoy exposes the sharp practices of the herd of Wall Street brokers.
With such outlandish names as PERLS (Principal Exchange Rate Linked Security), PLUS (Peso-Linked U.S. Dollar Secured Notes), BIDS (Brazilian Indexed Dollar Securities), `quantoed constant maturity swap yield curve flattening trade' or `leveraged-indexed-inverse-floating-dual currency structured notes', brokers disguised the underlying risks of `emerging market" currencies or of wild interest rate swings for their `dumb' clients who bought their `miraculous' high coupon products.
By paying rating agencies top dollar fees, they even got triple A ratings for their high risk derivative products.

Other policies were, `sell your mother for a basis point' or if the customers were in trouble (called `distressed buyers') `try to convince them to `double-down' on their losses', in order to generate new juicy fees for the company.
At some point, one trader had a risk of 2 million UD$ per basis point change in the interest rate.

What were the results of these `strategies': monumental commissions for the brokerage houses, tremendous bonuses for the traders and billions of billions of losses for the customers (e.g., when National Banks didn't or couldn't continue to `manage' their local currencies).

What was the reaction of the US government in the face of those blatant rip-offs: less (!), not more regulation of the derivative markets. The political campaign contributions did their work.
One saw the ultimate result of these totally free market policies and their SIVs (Structured Investment Vehicles) a few years after the publishing of this book, when all banks all over the place nearly collapsed and when the `capital markets' system had to be saved by the public's tax money.

This astonishing book is a must read for all `investors' and for all those who want to understand the financial world we live in.

N.B. The Orange County story is better explained in P. Jorion's `Big Bets gone bad' and the story of Nick Leeson in his book `Rogue Trader'.