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Straight to Hell by John LeFevre

A strange book: think of the movie The Wolf of Wall Street, but instead of retail brokers on Long Island, it's the institutional bond syndicate desk at a major bank. But the pranks, the drugs and the ludicrous behavior are all the same. 

Straight to Hell is crass, outlandish, instructive at certain points[*] and genuinely comedic at others--but I wish I hadn't read it. It's hard to tell what the author is trying to do exactly (moralize? satirize? shock? warn?), but ultimately the book leaves you with a gross feeling: for the author, for all the people in the story, and for yourself as the reader.

For readers interested in this genre: stick to Michael Lewis' classic Liar's Poker. 

[*] Instructive, that is, if you're curious how an institutional sell-side bond house works; how bond issuance deals are won and lost; how major sell-side firms both compete and cooperate as they fight over deals; how these deals, once won, are then doled out to institutional investor clients. I can't imagine many readers would share this curiosity, however--and you have to fight through a lot of unsavory stories to satisfy it.

Notes: 
1) Now that I've read my fair share of works about Buddhism (see in particular Thich Nhat Hanh's The Heart of the Buddha's Teaching) I'd consider this book an example of "bad intellectual nutriments."

2) Early on you can tell this book is unlikely to interest somebody from outside the business.

3) The author starts at an intern, then does the company training program (note the ruthlessness the company uses to weed out underperformers), he survives his first few years, then moves up to join the fixed income syndicate desk, a big job.  

4) "Statistically speaking, you shouldn't worry about what your first wife's mother looks like." I had to think about this one for a while before I got it.

5) On winning the right to offer a deal on behalf of a bond issuer (getting the client "pregnant") and then "we'll moonwalk them back once we win the deal" to agree to more realistic deal terms (on interest rates for example, or deal size). Also you control the client by suggesting it would signal weakness or be embarrassing to cancel a deal after a long roadshow, the client might lose "access" to capital markets, etc.

6) The deal process--everything from bakeoff to roadshow to deal allocation--is all well explained, but will likely be over the head of most readers outside the industry.

7) The mechanics of a bond deal that goes badly: just the same as a bad IPO. When clients get a "full allocation" they instantly know the deal is bad.

8) Note also the game theory aspect of bond issuers who frequently need to access capital markets: See the Thai telecom company with debt maturities that need to be "rolled" in each of the next few years; we thus have a game theory situation with repeated iterations, so the parties involved can only screw each other over to a certain point! They know they have to play the game again soon. Equity deals are less like this. 

9) See also certain interesting agency problems here: say you work for a sell-side bond shop and your client (a company that wants to issue bonds) comes to you, thinking of doing a bond issue between October and December. Well, how does your P&L look? Is your bonus already set for this year? Then encourage the client to wait for January so that deal would show up in next year's bonus numbers--plus you start the year with a great-looking deal pipeline.

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