Busting Up A Game Of Liar’s Poker

And The Investment Lessons Learned Along The Way

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Table of Contents

• And The Investment Lessons Learned Along The Way

• Three Things To Know Before We Go…

• And one more thing… A Healthy 18% Jump

• Poll Results… Fed Rate Hike

Showing the guys who think they know it all that, in fact, they actually don’t… is a great feeling.

And that’s especially the case when the know-it-all guys are BSDs (that is… they think their manhoods are bigger than anyone else’s) on a 1980s bond trading floor.

As context… in the October 23, 2024, Daily Journal (“Bonds And Liar’s Poker At Salomon Brothers”), Distressed Investing senior analyst Martin Fridson recounted his experiences with the colorful Salomon Brothers bond traders portrayed in Michael Lewis’s 1989 best seller, Liar’s Poker.

Marty shared stories about then-CEO John Gutfreund, who personified the scrappy, my belt-is-longer-than-yours culture of high-stakes bond trading of the time. Making it – or just surviving – in that world required nerves of steel, gallons of gumption, a take-no-prisoners attitude, and strong convictions about value that you’re prepared to back up with the capital entrusted to you.

The title of Michael Lewis’ book recounting these days comes from an often-high-stakes poker-like betting game played on the trading floor by the highly competitive characters in Salomon’s trading group.

Just a few years before Lewis was at Salomon, flogging bonds (and collecting material for what became his first of many best-selling books), Marty Fridson had been at Salomon, identifying profitable investment opportunities in the debt market.

Marty takes over from here, describing investment lessons to be learned from how the game of liar’s poker was played at Salomon and many other Wall Street firms.