Plain English with Derek Thompson
Episode: Michael Lewis on How the Global Financial Crisis Explains Trump, Crypto, and Everything Else
Date: October 28, 2025
Guest: Michael Lewis
Host: Derek Thompson
Overview
In this episode, Derek Thompson sits down with legendary nonfiction author Michael Lewis (Liars Poker, The Big Short, Moneyball) for a wide-ranging conversation about economic bubbles, the lessons and lasting impact of the global financial crisis, how those events relate to the rise of Trump and crypto, and the craft of storytelling. Together, they explore how the reverberations of the 2008 financial crisis still shape society, politics, and even pop culture today. The episode is rich with insider anecdotes about Lewis’s reporting process, the art of character selection, as well as thought-provoking discussions on artificial intelligence, COVID, and the power (and risks) of analytics in sports and entertainment.
Key Discussion Points and Insights
The Anatomy of Financial Crises and Bubbles
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Common Traits of Bubbles
- 01:00 Michael Lewis explains that while each financial crisis is unique ("each is its own specimen"), there are underlying similarities:
- Risks are misunderstood or hidden—often deliberately—which is ironic considering finance is "put on earth to expose it and price it accurately."
- "Before every financial crisis, incentives get screwed up. People are paid to do really dumb things, paid in the short term to ignore longer term risks." (Lewis, 08:15)
- Prediction is a fool’s errand: "Anybody who tells you that they know when the crisis is coming, you should just not listen to them about anything." (Lewis, 09:27)
- 01:00 Michael Lewis explains that while each financial crisis is unique ("each is its own specimen"), there are underlying similarities:
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Opaque Incentives and New Dangers
- 10:30 Lewis makes an unsettling point about current incentive structures, referencing a contemporary president whose family fortunes are tied to crypto: "We have someone in a very powerful position who's got an incentive, a personal financial incentive to create a financial crisis... That's just weird." (Lewis, 11:08)
Origins and Craft Behind The Big Short
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How the Book Came Together
- 12:50–19:00 Lewis shares the serendipitous process that led to The Big Short:
- After failing to write a memoir about post-Katrina New Orleans, he stumbled onto the financial story following insights from analyst Meredith Whitney.
- What started as a magazine piece quickly revealed book-sized potential: "The minute I have the concept and I have a basic sense that the characters are available to me... I was just like off and running." (Lewis, 18:34)
- Realized he was welcomed, not shunned, by Wall Street's new generation, many inspired by his earlier book, Liars Poker.
- 12:50–19:00 Lewis shares the serendipitous process that led to The Big Short:
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Finding the Right Story and Characters
- 19:14–24:00 Derek asks about Lewis’s process for identifying compelling protagonists:
- "In the early stages, it's always the same. It's the sound and feeling of banging my head against the wall. I sense there's something on the other side..." (Lewis, 20:07)
- Once he recognizes a simple frame (“giant bet, most smart money on the wrong side, a constellation of oddballs on the right”), the fun begins: "You're almost like a casting director with a script in hand." (Thompson, 23:45)
- Lewis describes choosing characters by the unique paths they took to the right insight, and by "who am I going to have the most fun writing about." (Lewis, 26:00)
- 19:14–24:00 Derek asks about Lewis’s process for identifying compelling protagonists:
The Ongoing Legacy of the Financial Crisis
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How the Financial Crisis Built Today’s World
- 28:24–33:41 Lewis lays out the GFC’s cascading consequences:
- Rise of cryptocurrency as a reaction to institutional mistrust: "What is crypto? I see it as an expression of mistrust of institutions, of government and banks." (Lewis, 28:35)
- Political radicalization: “Elizabeth Warren and Steve Bannon... are supercharged by the financial crisis. Bannon would tell you that he was politicized and radicalized by the financial crisis.” (Lewis, 29:27)
- The roots of Trumpism, populist anger ("the world is rigged by elites"), and declining faith in American institutions.
- Banks made “more boring,” but interesting/risky parts of finance migrated to high-frequency traders and private equity.
- 28:24–33:41 Lewis lays out the GFC’s cascading consequences:
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American Credibility and the Global Order
- The U.S.'s financial mismanagement eroded global trust:
- "Our credibility took a huge hit... if you want to write the story of the decline of the American empire, I think they'll look at that [the crisis]." (Lewis, 33:34)
- The U.S.'s financial mismanagement eroded global trust:
On Learning (or Not) from Crisis
- Inability to Internalize Lessons
- 34:06–39:10 Both men puzzle over society’s failure to institutionalize crisis lessons:
- Lewis laments undermined firefighting institutions: “The mechanism for stopping the next financial... has been so weakened. And you would have thought that in a rational society people would look at what happened and say... let’s keep those functioning. But that’s not where we are.” (Lewis, 35:44)
- Thompson discusses public memory and missed opportunities, especially post-COVID (“We didn't look at one of the great public policy successes of the last 70, 100 years... say, God, how do we replicate this a thousand times over? We didn't. We've basically forgotten it.” (Thompson, 38:48)
- 34:06–39:10 Both men puzzle over society’s failure to institutionalize crisis lessons:
AI as the Next Bubble and Disruption
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Cynicism about AI’s Economic Promise
- 39:52–46:21 Lewis is skeptical of current AI hype:
- "I’m far less interested in artificial intelligence than I am in natural stupidity." (Lewis, 40:18)
- He doubts massive investment will pay off: "It feels kind of indiscriminate. Nobody has a very persuasive story to tell about how the money is going to be made."
- What worries him: Disregard for massive social dislocation from job elimination and lack of plans for affected people.
- 39:52–46:21 Lewis is skeptical of current AI hype:
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AI’s Limits for Storytelling and Reporting
- Thompson argues that AI threatens jobs defined by repetition, but not original nonfiction reporting:
- "Your job is to begin from this place of absolute... ignorance. You have no idea what your next protagonist is going to be. There's no formula. It emanates entirely from within you... And this is the thing that AI is worse at doing." (Thompson, 45:17)
- Thompson argues that AI threatens jobs defined by repetition, but not original nonfiction reporting:
"Abundance" and the Politics of Scarcity
- Derek Thompson’s Book: Abundance
- 46:54–52:14 At Lewis’s request, Thompson outlines the inspiration for his book Abundance:
- Originated in COVID-era scarcity of basic goods.
- Expands to chronic U.S. scarcities: housing, clean energy, health care innovation.
- Argues for an “abundance agenda”—a progressive focus on building, affordability, and breakthroughs.
- 46:54–52:14 At Lewis’s request, Thompson outlines the inspiration for his book Abundance:
The Experience of Book-to-Movie Adaptations
- On Books Becoming Movies
- 52:59–59:30 Lewis describes his hands-off approach:
- He sells rights and lets filmmakers take over: "I tell them... it's yours. I'm not going to complain... They refuse to believe that I feel that genuine detachment."
- Enjoys unexpected friendships with directors, and is happy to support the movies—especially when they succeed.
- On watching The Blind Side for the first time: “I cried during the movie and I laughed a lot and I thought, when have I done... am I doing that in movies? Not really often." (Lewis, 54:46)
- Considers himself lucky with adaptations: "I have three plate appearances and in each case I got extra base hits." (Lewis, 57:55)
- 52:59–59:30 Lewis describes his hands-off approach:
The Joy (and Process) of Writing
- Flow, Pleasure, and the False Myth of Creative Suffering
- 59:55–63:28 Lewis outlines his “peak experience” as a writer:
- "When I'm four chapters into a book and I know how it all goes... The train is on the tracks and I'm all by myself... It's singing for me. I can hear it." (Lewis, 59:55)
- Unlike many writers, Lewis delights in the craft: "I never had that… agony of the artist thing. What drew me to it was the pleasure of it… when I have the story and I'm writing it, I'm in such a state of pleasure that I just want the reader to feel that pleasure." (Lewis, 62:00)
- 59:55–63:28 Lewis outlines his “peak experience” as a writer:
On Legacy and the Moneyball Effect
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How Michael Lewis Thinks About Influence
- 66:25–70:22 Lewis likens his books’ impact to messages in a bottle:
- "I don't think I have any real responsibility to it once the book is written… the message in the bottle is a metaphor that often occurs to me." (Lewis, 66:25)
- Enjoys seeing books influence culture, even when controversial (e.g., Moneyball's reception among baseball traditionalists).
- Admits to the real impact of analytics ("It is true that Moneyball made baseball more boring... that just so happens to be a deep truth about baseball.") but doubts data-driven approaches have made sports or entertainment uniformly worse.
- 66:25–70:22 Lewis likens his books’ impact to messages in a bottle:
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Jokes About "Lewis Ball"
- The episode ends with an extended bit about "Lewis Ball," a fictionalized, more exciting version of baseball involving a live lion or tiger on the field—a nod to the limits of pure analytics in entertainment and gameplay. (70:22)
Notable Quotes and Moments
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On Financial Bubbles:
- "The financial system is always trying to hide risk. It's put on earth to expose it and price it accurately. But in fact, it's really valuable to be able to hide it."
— Michael Lewis, 07:43
- "The financial system is always trying to hide risk. It's put on earth to expose it and price it accurately. But in fact, it's really valuable to be able to hide it."
-
On Incentives and Leadership:
- "We have someone in a very powerful position who's got an incentive, a personal financial incentive to create a financial crisis... That's just weird."
— Michael Lewis, 11:08
- "We have someone in a very powerful position who's got an incentive, a personal financial incentive to create a financial crisis... That's just weird."
-
On Storytelling:
- "It's the sound and feeling of banging my head against the wall. I sense there's something on the other side of the wall and it's worth banging my head on it."
— Michael Lewis, 20:07
- "It's the sound and feeling of banging my head against the wall. I sense there's something on the other side of the wall and it's worth banging my head on it."
-
On Writing:
- "When I'm four chapters into a book and I know how it all goes... I know for me that's obviously some people aren't going to like it, but it's singing for me... I get such pleasure from that moment."
— Michael Lewis, 59:55
- "When I'm four chapters into a book and I know how it all goes... I know for me that's obviously some people aren't going to like it, but it's singing for me... I get such pleasure from that moment."
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On Abundance and Scarcity:
- “I just thought the whole experience of this pandemic just feels like one scarcity after another... The antidote to what seems like a century of scarcity... is an abundance agenda.”
— Derek Thompson, 47:12
- “I just thought the whole experience of this pandemic just feels like one scarcity after another... The antidote to what seems like a century of scarcity... is an abundance agenda.”
-
On Legacy:
- "I don't think I have any real responsibility to it once the book is written… the message in the bottle is a metaphor that often occurs to me."
— Michael Lewis, 66:25
- "I don't think I have any real responsibility to it once the book is written… the message in the bottle is a metaphor that often occurs to me."
Timestamps for Key Segments
- 00:44 — Episode begins after ads and introduction
- 06:05 — Michael Lewis joins the conversation
- 06:58–09:37 — Explaining the nature of financial crises and bubbles
- 12:26–19:14 — The backstory of writing The Big Short
- 19:14–26:04 — On craft: finding the right characters and story structure
- 28:24–33:41 — The GFC’s political, social, and global legacy
- 39:52–46:24 — Is AI the next crisis? Parallels, skepticism, and social risk
- 46:24–52:05 — The story and reception of the "Abundance" book
- 52:59–59:30 — Lewis on books becoming movies and the collaborative process
- 59:55–63:28 — The joy and flow of writing; myth of painful artistry
- 66:25–70:22 — Lewis on legacy, analytics, and the culture-wide “Moneyball” effect
- 70:22–71:28 — The "Lewis Ball" joke about making sports kinetic and unpredictable
Final Thoughts
This episode illuminates the deep link between our financial past and present, offers an inside look into the making of iconic nonfiction, and delivers warm, honest wisdom about both societal failures to learn—and the writer's private joy in the craft. Michael Lewis and Derek Thompson create a space where sweeping ideas feel both intimate and accessible, masterfully carving faces from the marble block of recent history.