Chaos Kings: How Wall Street Traders Make Billions in the New Age of Crisis

Chaos Kings: How Wall Street Traders Make Billions in the New Age of Crisis

Scott Patterson
$30.00
Publication Date: June 6th, 2023
Publisher:
Scribner
ISBN:
9781982179939
Pages:
336
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Description

Written by a veteran Wall Street Journal reporter, this is a fascinating and “closely observed chronicle of the storm-chasing edgelords of finance and the critics with whom they clash” (The New York Times)—the billion-dollar traders and crisis predictors who strive to turn extreme events into financial windfalls.

There’s no doubt that our world has gotten more extreme. Pandemics, climate change, superpower rivalries, cyberattacks, political radicalization—virtually, everywhere we look there is mayhem bearing down on us, putting trillions of assets at risk.

And at least two factions have formed around how to respond. In Chaos Kings, Scott Patterson depicts how one faction, led by Nassim Nicholas Taleb, bestselling author of The Black Swan, believes humans can never see the big disaster coming. In their view, extreme events—so-called Black Swans—while inevitable, will always catch us by surprise. In 2007, Taleb’s longtime collaborator, Mark Spitznagel, launched the Universa hedge fund, which would go on to make billions protecting investors against unforeseen chaos in the market.

A second faction, which relies on complex formulas, believes looming chaos can be detected. Chief among these risk prognosticators is Didier Sornette, a colorful French mathematician who enjoys riding his motorcycle at speeds in excess of 170 miles per hour. When Sornette looks out from what he calls his Financial Crisis Observatory in Zurich, Switzerland, what he sees are Dragon Kings—punishing events that are unlikely to occur but have probabilities that can be predicted…and defended against.

Which faction is right? All of our financial futures may depend on the answer. “Detailed yet accessible, this will appeal to fans of Michael Lewis’s The Big Short” (Publishers Weekly).

About the Author

Scott Patterson has been a reporter for more than two decades, mostly at The Wall Street Journal in New York City, Washington, DC, and London. His 2010 New York Times bestseller The Quants was about the rise of mathematical traders and their near destruction of the financial system. His second book, Dark Pools, which exposed how high-frequency trading had rigged the stock market, was lauded by a pantheon of financial writers. A winner of the Loeb Breaking News Award, Patterson has made frequent appearances in the media, including on CNBC, The Daily Show, and Fresh Air. He lives in Alexandria, Virginia, with his wife and son.

Praise for Chaos Kings: How Wall Street Traders Make Billions in the New Age of Crisis

A Wall Street Journal bestseller

“Rock-star status is reserved for a clique who have made storm-chasing in stocks and bonds into something between an art and a science, and an extraordinarily lucrative one at that. They are the subject of Chaos Kings, a new book by Scott Patterson, who casts an engaging and accessible light on what makes these oddball savants tick, and how they make fortunes from disaster….The power of the competing egos at play and the urgency of their message on everything from pandemics to the climate to the health of your lifesavings carry the tale.”
—Financial Times

“A closely observed chronicle of the storm-chasing edgelords of finance and the critics with whom they clash…Even those unfamiliar with, or uninterested in, the oscillations of the stock market may find themselves gripped by Patterson’s account.”
—The New York Times

“In Chaos Kings, the indefatigable Scott Patterson has done it again: delivered a riveting account of Wall Street mavericks whose unconventional understanding of risk has netted them a fortune and us a fascinating account of how they did it. The unlikely partnership between Mark Spitznagel and Nassim Taleb has made them rich, saved their clients from financial calamity and, under Patterson's deft pen, produced an epic page turner.”
—William D. Cohan, New York Times bestselling author of Power Failure, Money and Power, and House of Cards

“A closely observed chronicle of the storm-chasing edgelords of finance and the critics with whom they clash…Even those unfamiliar with, or uninterested in, the oscillations of the stock market may find themselves gripped by Patterson’s account.”
—The New York Times

“Wall Street Journal stalwart Patterson continues his explorations of high finance with a clutch of contrarian risk takers...Deft, accessible analysis and guidance.”
—Kirkus Reviews (starred review)

“An illuminating investigation…The author has a knack for translating complicated financial maneuvers into easily comprehensible terms…Detailed yet accessible, this will appeal to fans of Michael Lewis’s The Big Short.”
—Publishers Weekly

“Scott Patterson's Chaos Kings is an extraordinary exploration of cutting-edge efforts to understand the manifold and interconnected risks slamming civilization at an alarming rate. It's a critical read for anyone with an interest in what's coming next and how to prepare for it, financially and otherwise. Scott has an uncanny knack for diving into the fascinating convergence of technology and investing, so I'm always excited to see what he's discovering.”
—Bradley Hope, New York Times bestselling co-author of Billion Dollar Whale and co-founder of Project Brazen 

“Financial markets covet stability; they don’t like surprises.  In our new age of crisis, Scott Patterson convincingly recounts how a unique type of trader has learned to embrace the disruptions and make a lot of money doing so.  Combining risk theory, finance, and portraits of some of the most interesting billionaires of doom, Patterson takes us on a disturbing tour of what could come tumbling down.  But he also provides a detailed road map showing average citizens how to steer past catastrophe. You’ll be left wondering whether these Chaos Kings are brilliant, opportunistic, visionary, or even loathsome. In Patterson’s lively account, you’ll definitely find them fascinating.”
—Juliette Kayyem, former Assistant Secretary of the Department of Homeland Security, and author of The Devil Never Sleeps: Learning to Live in an Age of Disasters  

“We live in a world of pandemics, climate change, war, and unstable institutions. Scott Patterson’s fascinating Chaos Kings is a provocative look at those placing big bets who believe they have tamed the financial risk whipped up by these unruly beasts. It holds perceptive insights for anyone who lives—or invests—in our modern uncertain world.”  
—Russell Gold, author of Superpower and The Boom  

“Fast paced like a thriller but, also, thought-provoking in its willingness to show us the range of possible catastrophes, Chaos Kings tracks the adventures of contrarian investors who, rather than hide from chaos and confusion, seek it out.  Their reward in many cases: a fortune. This book teems with great stories as well as market insights that you won’t get from conventional investors.” 
—Aaron Brown, formerly, Chief Risk Manager at AQR Capital Management, and author of The Poker Face of Wall Street and Red-Blooded Risk