A friend of mine mentioned Michael Lewis' article in Portfolio.com entitled "The End" the other day during an iChat, and I finished reading it last night. This is a fascinating behind-the-scenes look at the world of investment banking, drawing upon the author's account of his own experiences from the late 1980s in the business as presented in "Liar's Poker" and then updating with it with profiles of some of the players who developed a good understanding of what was really going on with the complex and opaque subprime investments on Wall Street.

One particular quote from the article, about investor Steve Eisman will give you an idea of the tone of the article:

But he couldnʼt figure out exactly how the rating agencies justified turning BBB loans into AAA-rated bonds.

“I didnʼt understand how they were turning all this garbage into gold,” he says. He brought some of the bond

people from Goldman Sachs, Lehman Brothers, and UBS over for a visit. “We always asked the same

question,” says Eisman. “Where are the rating agencies in all of this? And Iʼd always get the same reaction.

It was a smirk.” He called Standard & Poorʼs and asked what would happen to default rates if real estate

prices fell. The man at S&P couldnʼt say; its model for home prices had no ability to accept a negative

number. “They were just assuming home prices would keep going up,” Eisman says.

One caution--the language is a little strong in places (i.e., the 'f' word appears fairly frequently, and no, I am not referring to 'fiduciary').

Highly recommended reading!