The Greatest Trade Ever: The Behind-the-Scenes Story of How John Paulson Defied Wall Street and Made Financial History

In 2006, hedge fund manager John Paulson realized something few others suspected-that the housing market and the value of subprime mortgages were grossly inflated and headed for a major fall. Paulson's background was in mergers and acquisitions, however, and he knew little about real estate or how to bet against housing. He had spent a career as an also-ran on Wall Street. But Paulson was convinced this was his chance to make his mark. Colleagues at investment banks scoffed at him and investors dismissed him. Even investors skeptical about housing shied away from the complicated derivative investments that Paulson was warming to. But Paulson and a handful of renegade investors such as Jeffrey Greene and Michael Berry began to bet heavily against risky mortgages and precarious financial companies. Timing is everything, though. Initially, Paulson and the others lost tens of millions of dollars as real estate and stocks continued to soar. Rather than back down, however, Paulson redoubled his bets, putting his hedge fund and his reputation on the line.
In the summer of 2007, the markets began to implode. By year's end, John Paulson had pulled off the greatest trade in Wall Street history, earning more than $15 billion for his firm-a figure that dwarfed George Soros's billion-dollar currency trade in 1992. He made billions more in 2008. Some of the underdog investors who attempted the daring trade also reaped fortune; others who got the timing wrong met devastating failure.
Written by the prize-winning reporter who broke the story in the Wall Street Journal, The Greatest Trade Ever is a superbly written, fast-paced, behind-the-scenes narrative of how a contrarian who foresaw the escalating financial crisis that outwitted Chuck Prince, Stanley O'Neal, Richard Fuld, and Wall Street's titans, amid the personal hubris and carnage of economic collapse, made financial history.