Falling Out of Love With Michael Lewis
The complicated demands of business writing
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Do you remember the first time your parents let you down?
I’m not talking about when you didn’t get what you wanted for Christmas or they didn’t make mac-n-cheese for dinner. No, what I’m talking about is the gut-wrenching sorrow that accompanies the realization that your progenitors are deeply flawed. It is an earth-shaking moment. For many folks it happens when they are teenagers, leading to a period of disillusionment where you are unable to look past your parents’ weaknesses. Eventually, hopefully, you recognize that your parents are imperfect, but they are trying their best, and love them anyway.
This is also a description of my feelings toward author Michael Lewis—except I’m not sure he is even trying his best.
The man has been a writing hero of mine for over a decade. The Big Short, Lewis's account of a group of hedge funds that predicted the 2008 housing crisis, made finance come alive in a way that I had never encountered before. He made me realize that business is the perfect vehicle by which to study human psychology and society. Companies weren’t all white-collar shirts and tedium—they were human and captivating and messy and fun. Reading Lewis’s work lit a fire in me that has never gone out. It is not an exaggeration to say that his writing led to this newsletter’s existence.
Which is why it is so hard to read his most recent work, Going Infinite: The Rise and Fall of a New Tycoon, about the FTX scandal. It is a feather duster of a book. It gently caresses Sam Bankman-Fried (SBF), whispering sweet nothings into his ear.
“Don’t worry, baby, you’re just absent-minded—you only misplaced $8B in customer funds.”
“It is just so cute how you play video games during meetings.”
“Hehe, you silly little goose, I love how you wear cargo shorts. It distracts me from the fact that you were sleeping with your direct reports, defrauding investors, and spending hundreds of millions trying to buy Senate votes *blushes*.”
Clearly, I’m a little heated about how Lewis chose to handle FTX. Lewis had a unique opportunity—he was embedded with SBF for months. He was able to, incredibly, convince the company psychologist to violate patient confidentiality and tell him about FTX employees’ mental health. He even spent time in the Bahamian villa with SBF in the final days before the latter’s arrest. There may never again be so storied a writer so perfectly placed for such a scandal.
And what does he decide to do with this opportunity? Write “his version” of the story, regardless of its relation to the truth.
The true story, the one that SBF is being prosecuted for, is this: FTX was a futures exchange that allowed people to do leveraged trades with cryptocurrency. SBF also owned a hedge fund called Alameda that was the biggest trader on this exchange. However, because crypto is kinda made up and there was a grand total of zero auditors at FTX, SBF did a little oopsie. No other trader would be allowed to trade if their positions went to zero; Alameda not only could maintain a negative balance, but it was able to continue trading using unlimited amounts of FTX customer funds. SBF lied and told everyone that Alameda had no special privileges. This is very bad and, like, illegal. SBF approved, oversaw, and monitored these illegal behaviors. Using the supposed (and totally false) quality of the FTX/Alameda businesses, he took out loans both from FTX funds and traditional banks to buy luxury beachfront real estate, lobby politicians, etc. He also built up a venture capital portfolio that included “a fertility clinic, a military drone maker, and a vertical farming company.” Classic finance supervillain behavior.
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The Lewis story goes something like this: SBF was a nerdy, absent-minded child who had a supernatural ability to forecast risk. He was so smart that he wasn’t good at school. He was so normal that he had to teach himself to smile. He was so good at finance that at his previous job at a hedge fund, he supervised its biggest day of losses in company history. He was so good at managing FTX that no one at his company knew their title, job description, or who they reported to. What a special little boy! He was also a practitioner of effective altruism, a philosophical code popular among Bay Area technologists that advocated earning lots of money so you could give it all away. Sure, followers of this movement have deployed capital devoted to keeping shrimp alive rather than malaria nets in Africa, but they totally care, man. While SBF was routinely cruel and callous to everyone around him, it was because he was so focused. He had to save everyone, so, obviously, he cared for no one. And, of course, FTX was a great business! Sure, it was built on a foundation of lies, but that isn’t important. Alameda wasn’t Sam’s fault! It was run by his jilted ex (never mind that SBF was the one who put her in that position). Sure, all of his closest friends have pleaded guilty to the U.S. government and are testifying against him. But, hey, listen, he really is special.
Lewis and everyone in SBF’s life bizarrely infantilizes him. Lewis describes him in the book as a “kid,” a “child,” a “teenager,” and a “baby.” Before he went to jail, his last remaining employees were panicking to make sure he had enough socks (seriously). When I finished the book, I expected to learn that he was 20 at the time of his arrest. He is actually my age—31—which makes the baby comparison particularly funny.
You may feel that I am being overly harsh to Lewis. After all, humanizing an individual through narrative is what he does! I would be willing to forgive that. I would even be willing to forgive a generous reading of SBF’s actions. However, Lewis seems to have made an explicit defense of this fraudster the goal of his book. In an interview with CBS News, he stated, “I realized I had an ambition for the book. I saw it as a kind of letter to the jury. I mean, there's gonna be this trial. And the lawyers are gonna tell two stories. And so there's a story war going on in the courtroom. And I think neither one of those stories is as good as the story I have.” When Lewis first met SBF, he described himself as being “totally sold” by the end of the first meeting. It seems like he was never able to escape that feeling.
Lewis was even offended that another author was hinting that he was too soft on SBF. From an interview with the New York Times: “‘Here you have a person who’s written a book, and he’s trying to torpedo a rival book before it comes out?’ he said. ‘That’s shocking. Talk about corrupt! So who do I think is more skeevy, Sam or him? I’d have to think about that.’”
Actually, Mr. Lewis, you do not have to think about that. The one who stole billions in customer funds is obviously the worst dude.
The things that make Lewis such a gifted writer are still present in Going Infinite. The book makes something as nerdy and stupid as crypto feel like a breezy beach read. His prose is a lazy river of anecdotes leading to wry observations, a gentle current of wit pushing you from destination to destination. And as I mentioned, his access is unparalleled. More than a few times I found myself asking, “How on earth did he get SBF to admit that to him?”
However, all of Lewis’s literary gifts cannot cover his bias. It is particularly obvious to anyone who has closely followed the saga. For example, SBF has admitted that his work in effective altruism—i.e., his "ethics stuff"—was "mostly a front." He also said that it was a "dumb game we woke westerners play where we say all the right shibboleths and so everyone likes us." Lewis never mentions this interview. Further, Lewis completely skips the important stuff (everyone around SBF pleading guilty, betraying him, and being wracked by inconsolable guilt).
Reality rarely makes for a good story. A nonfiction writer is faced with an impossible task—be right and entertaining. Analyzing tech companies and their underlying finances is a high art, an impossibly rigorous intellectual task, so perhaps asking Lewis to be perfect at both is too much. Lewis admitted that he struggled with the narrative of Going Infinite: “Feeling stuck, he solicited the advice of a film director friend who often helps him brainstorm. ‘He goes: ‘Man this is fantastic. But it’s not a movie, because there’s no ending. There’s no Act 3.’ Two days later, it all collapsed.”
Writing is an art form that never forgives. There are no gimme sentences, no words that just disappear into the ether. The author types once, maybe edits twice, and then publishes. Your mistakes and failures live on forever in referenceable and annotated form. You can spend years doing incredible work, but if you have one book go bad—say, you write an apology letter for a known fraudster—everything else comes under doubt. This is happening to Lewis—the portrayal of a similarly young, gifted protagonist in his book The Blind Side is being fiercely criticized. One of his more recent books about finance, Flash Boys, is so wrong that there have been book-length rebuttals published. Even with my more limited knowledge of the public markets, I could discern errors when I read it.
Reading Going Infinite meant confronting my flaws as a writer. That spark that was lit in me by The Big Short was driven not by rigor or analysis, but by Lewis's supernatural ability to spin a good yarn. As someone who’s primarily occupied with telling the story of business (and the people who make it), this is an ugly reality. I’ve been doing this for years now, and the truth is that being right has only a tenuous correlation with being successful as a nonfiction business writer. A compelling nonfiction writer who only has a loose association with the truth will always, always, always make more money than a boring analyst who consistently delivers rigorous work.
Somewhere in Lewis’s charmed career, he made that trade-off. He realized that he could spend a few years meeting interesting people, form a three-act narrative from the interviews, and ship a book to make millions of dollars. While this is a great gig, it is not necessarily a process that uncovers truth. Compare that to Robert Caro, whom I consider America’s greatest biographer and who has been working on a five-book series about President Lyndon B. Johnson since 1970. Caro is so committed to his craft that he moved to LBJ’s hometown (current population: 670) for three years so he could more fully understand his subject's state of mind. By contrast, Lewis vacationed in the Bahamas for a few months to hang out with SBF.
This realization hurts. Being taught this lesson by one of my favorite writers is that much harder.
There are systemic reasons for Lewis’s narrative-driven, light-research method winning out. The average book in America only sells about 500 copies, not enough to fund even a three-month research process, let alone a multi-year one. Newsletters are so popular because they generate more consistent revenue for writers so that research can be supported as the journey goes on. When I write my first book, it’ll only be possible because I have had years of thinking funded by paying subscribers.
Lewis’s method of deep observation of his subjects is only possible with their cooperation—naturally biasing the results. Access-driven reporting also tainted Walter Isaacson’s Elon Musk biography; it gave me a similar feeling of ick that the author of that work never really pressed his subject on his business failings. Lewis did the same thing. He saw a personal narrative, jotted down some entertaining anecdotes, and called it a day. A true finance writer would’ve broken down the numbers, step by step; explained the balance sheets; and performed a rigorous, quantitative analysis. Lewis instead chose to devote pages to SBF’s obsession with a video game.
That could’ve been fine if Lewis weren’t so explicitly focused on defending SBF. I would’ve thought that a book whose long-term success ultimately hinges on SBF’s guilt, would’ve actually tried to figure out if he was guilty.
Ultimately, Lewis has little incentive to be factually correct. He wants to write his books quickly, and for them to be entertaining so they make money. In that, this book delivered. The film rights have already been purchased by Apple for $5M. His previous success taught him that being mostly right is close enough. For my own writing, I think I’ll take being rigorous and not a millionaire. At least I wouldn’t be subject to criticism like this.
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