The Mind of Wall Street: A Legendary Financier on the Perils of Greed and the Mysteries of the Market [Hardcover]

Leon Levy (Author), Eugene Linden (Author)

Book Description

Publication Date: November 5, 2002

Most of us are in the stock market, but few of us understand how it really works. This book explains the hidden dynamics of Wall Street, and its message is urgent and disturbing. . As stock prices and investor confidence have collapsed in the wake of Enron, WorldCom, and the dot-com crash, people want to know how this happened and how to make sense of the uncertain times to come. Into the breach comes one of Wall Street's legendary investors, Leon Levy, to explain why the market so often confounds us, and why those who ought to understand it tend to get chewed up and spat out. Levy, who pioneered many of the innovations and investment instruments that we now take for granted, has prospered in every market for the past fifty years, particularly in today's bear market. In The Mind of Wall Street he recounts stories of his successes and failures to illustrate how investor psychology and willful self-deception so often play critical roles in the process. Like his peers George Soros and Warren Buffett, Levy takes a long and broad view of the rhythms of the markets and the economy. He also offers a provocative analysis of the spectacular Internet bubble, showing that the market has not yet completely recovered from its bout of "irrational exuberance. "The Mind of Wall Street is essential reading for all of us, whether we are active traders or simply modest contributors to our 401(k) plans, as volatile and unnerving markets come to define so much of our net worth.

Editorial Reviews

From Publishers Weekly

This well-written investment book delivers both adventure and financial insight, offering an intriguing theory that blends economic fundamentals with a keen understanding of the stock market's many moods. Levy, a legendary Wall Street investor with more than 50 years of experience and the founder of Oppenheimer Funds, certainly has a firm intellectual grasp on the inner workings of the stock market, but also sees its psychological dynamic. He fleshes out this analysis of the markets and the economy from the 1950s to today with amusing and exciting financial stories. Early in his career, Levy piggybacked on corporate raids run by J. Paul Getty and Sy Scheuer. After helping to found Oppenheimer and later, Odyssey Partners, he had the capital to lead the way. He explains each investment story step-by-step, from initial research to acquiring positions and influence, fighting through defenses and counterattacks, and finally cashing out years later, usually-but not always-at a handsome profit. Interwoven throughout the financial dramas are character vignettes, autobiographical sketches, anecdotes and thoughtful digressions on Levy's philanthropy, social theories and market theories.
Copyright 2002 Reed Business Information, Inc.

Review

"Levy blends in anecdotes from the Street to produce a short, well-written, and well-organized work." -- Library Journal, January 2003.

"The beauty of [Levy's book] is that you can hear how...Levy's mind works...the reader-investor gets more than his money's worth." -- Forbes, November 5, 2002.

"illuminating...combines tales of flamboyant promoters...with wry observations about the nature of man and markets." -- New York Times, October 6, 2002

"well-written...delivers both adventure and financial insight, offering an intriguing theory...[and] a keen understanding of the market's many moods..." -- Publishers Weekly, October 28, 2002

See all Editorial Reviews

Product Details

• Hardcover: 240 pages
• Publisher: PublicAffairs; 1st edition (November 5, 2002)
• Language: English
• ISBN-10: 1586481037
• ISBN-13: 978-1586481032
• Product Dimensions: 9.6 x 6.4 x 0.9 inches
• Shipping Weight: 1.1 pounds
• Average Customer Review: 3.5 out of 5 stars  See all reviews (19 customer reviews)
• Amazon Best Sellers Rank: #1,273,118 in Books (See Top 100 in Books)

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Customer Reviews

Most Helpful Customer Reviews

38 of 40 people found the following review helpful:

5.0 out of 5 stars A Wall Street prophet, March 9, 2003

By 

M. Swanson (Virginia) - See all my reviews
(REAL NAME)   

Amazon Verified Purchase

This review is from: The Mind of Wall Street: A Legendary Financier on the Perils of Greed and the Mysteries of the Market (Hardcover)

This is a book that every investor should read. People who are looking for a trading system or some cookie-cutter program that will make you rich will be dissapointed. Although he made hundreds of millions of dollars, I doubt Levy himself had an exacting system that he used. He knew how to manage risk and look for low-risk opportunities. He also knew how to take advtange of new investment markets - which are almost impossible for average investors. Leveraged buyouts for example.

Nonetheless, if they take the effort this is one of the most important investment books that someone can read in this moment in time. Levy's book is one that will make you think. As he recounts the past 50's years on Wall Street you'll see how the stock market changed and how the psychology around it did too. Going into the 1950's, people, remembering the 1930's, were extremely bearish about the market. Levy wouldn't hire anyone under 30 - not because he wanted youth, but because he feared that those older would be too cautious, because of their life experiences of the depression.

Contrast that bearish sentiment, with today where every down day is heralded as a bottom and a one week rally is called a new bull market, and you'll see how different the eras are. You'll also realize how different the risk to reward ratio for stock investors is.

I have come to the same conclusions that Levy has concerning our market and our economy and where the coming investment opportunities are in the world. I was already in agreement with him before I read his book. That is why I strongly recommend that people read it. This is one of the few mainstream investment books that you can find that will give you a good picture of what has happened to our markets in the past decade and where it is likely to go in the next 10 years - and where true investment opportunities lie in the world. This is all done in a crisp, engaging style, that makes for a quick read. If you want to understand what is going on read this!

Even if you have an investment/trading style where you don't think this is important you need to read this book. I personally trade mostly on charts and technical indicators. However, if you are trading a trend in the market it is helpful to have a knowledge about what is moving the market. That makes it easier to have believe that what the charts are telling you is real. You need to believe in your convictions. That is why it is important for investors and traders to keep up with the news and take the time to read books such as this one. I spend a lot of my time involved in the financial markets and usually read books as a way to get away from them. When I take the time to read a financial book it has to be a good one and this one didn't disappoint.

This book is never going to be one of the trading classics, like Jesse Livermore's Remicenses of a Stock Operator. However, 10 years from now it will be known as one of the few books that warned of what was to come.

22 of 23 people found the following review helpful:

1.0 out of 5 stars Total Waste of TIME, April 22, 2004

By 

P. Hamidi (Orange County, California) - See all my reviews
(REAL NAME)   

This review is from: The Mind of Wall Street: A Legendary Financier on the Perils of Greed and the Mysteries of the Market (Hardcover)

This book is an example of how someone with a decent track record in investing thinks they can be as successful in writing, but then fail miserably at creating anything meaningful. I was able to finish this book in less than 9 hours!

The author actually makes an attempt at explaining the market based on the theories and doctrines of Behavioral Finance, or so he says. Unfortunately, the book is nothing more than a ramble about the "excess of the late 90's", as if we need more literature on that subject. In reality, the book would be thrown out of Behavioral Finance class rooms as a miserable failure.

In one instance, the author refers to Amazon.Com as "nothing more than a mail order house". He also suggests that Amazon's model of selling books is not going to be sufficient to bring this company to profitability. Hmm...Maybe an update is required but this book was published in 2002!!

Throughout the book, the author constantly refers to his and his firm's success, suggesting this to be nothing more than a $15 advertisement. There is no resemblance to work such as "Reminiscence of a Stock Operator", which is the classic book on speculator psychology. Unless you have never ever invested in the market and have nothing more than a basic understanding of what an investment is, don't buy this book. Instead, consider work by Schwager, LeFevre, Bernard Baruch and even classic Technical Analysis work such as "TA of Stock Trends", which goes more into the psychology behind successful investing than this author. I also highly recommend the two books written by Victor Neiderhoffer.

In instances where the author actually begins to discuss anything remotely close to behavioral finance, he immediately drops off into another subject. He continually refers to the subjects of Greed and Fear. However, greed and fear are merely symptoms of the herd mentality. Nothing new there!

On the plus side, Ch. 12 covers EuroDollar Call Options and the benefits of trading these instruments when playing the interest rate curve. Unfortunately, in the middle of this discussion which was no more than a page, he changes the subject abruptly and begins talking about the benefits of archeological digs in present day Syria and why one should make philanthropic donations based on trust. This is literally the next paragraph after EuroDollars!!!

If you have an advanced grasp of markets, read "Alchemy of Finance". This is in fact the greatest work on the subject and quite honestly, the recent implementation of Behavioral Finance as a course of study amongst many universities is based on the work of George Soros, the greatest speculator of all time, and his "Theory of Reflexivity", which was first introduced in Alchemy of Finance.

13 of 15 people found the following review helpful:

1.0 out of 5 stars Memoir, not methods, April 22, 2003

By A Customer

This review is from: The Mind of Wall Street: A Legendary Financier on the Perils of Greed and the Mysteries of the Market (Hardcover)

If you are looking for a memoir, then this one is well written and a worthwhile read. But unfortunately, if you are looking to glean some insights and wisdom from his years in the trenches, you will be disappointed. Except for a few references to interest rates and value investing he never really spells out his theories on economics and investing. He repeatedly makes mention of his brother who continued his father's work (economic theory) but never really explains it. He probably has much he could teach us, but fails to do so. What a shame.