Michael Lewis interview on "Moneyball" (2003)

Michael Lewis is here his 1989 book liars poker defined the 1980s investment world he's now turned his attention to baseball his latest book is Moneyball it tells a story of how Billy Beane the general manager of the Oakland A's turned a small market team into a winning franchise I am pleased to have Michael here you just said to me before we started this is what the best experience the best story the best what it's the best story I've ever walked into as a writer misis Tana schnitz it in baseball for all sorts of reasons it was a great story but here's what I thought interruption I thought Mike was living out in Oakland San Francisco in the Bay Area he's just out there and so here's a story so he decided because he's very good at spinning a tale to write this book about the Oakland A's that's all I thought was there and you're saying this was the best story you've ever found the best book I've ever written I'm sure that in the best story I've ever found it's a it's an astonishing story because it's about not just baseball though it's more baseball than money but it but it's it's about markets there's this wonderful novelistic character at the center of it and the gist of it that this team that has no money is able to compete only by finding people who other teams have found defective and putting them together into this unit of underdogs has become a just juggernaut during the regular season for the last four years this is the Occident of the Yankee experience it is I mean the Yankees can go and buy whatever they need and if they make mistakes it doesn't matter because they can bury them you know that they spend ten million dollars on a Cuban pitcher who can't pitch in the big leagues it doesn't matter because they got hundreds of millions of more after that this is a team that's got 40 million dollars to spend on baseball players as opposed to a hundred and forty 150 and so they've got to be absolutely right with all of it or or it all falls apart and it's forced them to rethink the game of baseball and just the idea that in something as hoary and traditional as baseball it was possible for there to be innovation and new knowledge was astonishing you leave me wide open what did they rethink and what is the innovation that they made happen well they they've rethought quite they've rethought everything them on field strategies which you do during a baseball game to to the valuation of baseball players I mean that they have taken they have taken the spirit of the financial markets especially this financial markets in the 80s when the markets got very complicated and and people all of a sudden who had advanced degrees and in physics and economics would show up on Salomon Brothers trading floor and be able to price securities and value them in a way the rest of the market didn't understand and make huge sums of such riskless profits that that is what this is you have Billy Beane as the John Merriweather of baseball and he don't know what a big star there yeah but he made billions of dollars in Salomon Brothers figuring out how this usually value these securities what Billy Beane has done the same thing hired very smart people drawn on knowledge from outside the industry and and applied it to baseball player said said look baseball players are a collection of traits they have footspeed they have ability to throw and field they've ability to hit hit with power get on base hit for batting average what are these things worth what is each trait worth in a way and and he looks at the market and says well some of these traits are radically radically overvalued footspeed market for footspeed is crazy people pay way too much for it so don't buy it don't buy it the the market for just an ability to get on base even if it's a none sensation especially if it's in a none sensational way it's like walking a lot and dramatically undervalued you go buy that pitchers who throw 100 miles an hour dramatically overvalued he gets one of those in his minor league system and he waits until the guy's had a stretch of a month or so that's really great and then he peddles them off to another team for a to higher price and so what does he look for in a pitcher deception the ability to deceive a hitter and if you can and the ability to deceive a hitter with stuff that isn't terribly you know without throwing that hard is is undervalued so I mean take a look he has a Sai Young Award winner on his staff at Barry Zito Barry Zito on the song award last year and the American League best pitcher in the American League when Barry Zito was in college before the A's drafted and Bear went to a tryout for the San Diego Padres he wanted to play for the San Diego Padres they looked at his fastball they said son you don't throw hard enough to fit to pitch in the big leagues that is a big league baseball prejudice that they are rethinking so you've got this it's because you've got this I mean it's the traditions of baseball are glorious but the traditions of baseball are often in times inefficient and you've got these inefficiencies in in baseball that that this one organization has has sorted out and is exploiting and I just I just thought what an incredible story they also figured out that college stars may be overlooked because they wanted to draft them all out of high school well what they figured out is that that the scouting world generally baseball scouts have except they value excessively promise rather than performance so talent rather than actual skills at playing baseball so they prefer there's been a prejudice in favor of the seventeen-year-old phenom who everybody can imagine one day being a Hall of Fame baseball player Billy Beane was that person that's the other thing so read about this thing that he was maybe the top high school prospect in the country and he had everything that the scouts look for which is a body a great body that they could imagine filling out and becoming you know huge and strong he could run like the wind he could throw but he didn't have the mentality to be a big league hitter he fell apart in the batter's box and they they could have a they can't teach that that's you can't teach that you can't teach that and you especially can't teach and this is something that they A's have discovered you can't teach one of the trick I mean there are hitters Soriano for the Yankees Nomar Garciaparra for the for the Red Sox who who are very valuable hitters to an offense who have no discipline at the plate they swing in all kinds of things they shouldn't swing at they don't walk very much that kind of here exists but he's rare and he anything exists he's expensive the kind of thing the kind of hitter they look for who has a lot who draw it who sort of strings out his at-bat so the pitcher that pitcher gets worn down who walks a lot who doesn't swing at bad pitches that that approach to hitting they've decided can't be trying to teach it for 10 years in the A's organization and they've had very little success and they've decided that this is an innate trait in a in a baseball player that maybe if you got them in diapers Billy Beane said we could treat teach them how to behave at the place you know what isn't Billy Beane write a book what's funny Billy Beane didn't want a book written I mean this started the whole thing this is very funny because this in the book it's only been out a week it has created a furor in Major League Baseball there is you don't see it but it has sports columnists have been you know well one side of the other very violent you say Billy Beane who's got it all wrong and basically saying this is outrageous that Billy Beane let a rider into into the inner sanctum into his office to be a fly on the wall for the year for a year but Billy the truth is at Billy Beane I went to him saying I'd like to write a magazine article trying to understand how it is that this team with no men money wins all these games because the Commissioner's Office says it's all about money and you you can't win unless you have money that's why you need to fix the financial structure of baseball well he said okay if the magazine piece come hang around for a couple of weeks I read for couple he says oh my god this is sensational I mean it is sensational that this is they in rethinking baseball they're they're over here and and and that here you know I said it was like John Meriwether like a Wall Street trader but but the the assets weren't stocks and bonds they were flesh and bones they were they were the players so the players were their big characters in this book but but anyway I got so excited about the thing I said look you just gotta let me do this yeah it's too good a story and he he he was dragged very reluctantly into this project and has gotten all sorts of grief for letting me do it and it's been suggested that he sort of sponsored her invited it but in gently was just the opposite I use all my repertory or guile to get this thing so it seems to me that he is far more valuable if I listen to you than any player playing the game you put your finger on it that is the big inefficiency in baseball right now and you know who figured that out the man who just bought the Boston Red Sox John Henry made his money on Wall Street under understands how markets work look at this looked at baseball he understood because he'd own the Florida Marlins before but he look at he said my goodness we have a huge opportunity here we get Billy Beane in here and and we can exploit the inefficiencies of the game and he offered Billy Beane twelve and a half million dollars over five years to come in and run the Red Sox and he himself acknowledged to me that was cheap that that you could have justified paying ability being a lot more money than that and still and still come out ahead so what happened well it's funny Billy Beane took the job and then went to bed and couldn't sleep and the idea of all that money well it's uncomfortable well you know what made him uncomfortable is this is was very funny charlie is he he when he was 17 years old and the New York Mets came to him and said you're going to be a future Hall of Fame baseball player you are God's gift to baseball you're the best prospect we've seen in ages he had a scholarship to go to Stanford and he was going to go to Stanford and play baseball and football at Stanford and he changed his team on the Mets kind of listened to the money he the Mets cap took him to the big-league club house and he said it was then it all became kind of exciting in real form so he listened to the money that's right he listened to the money and he has had almost a superstition about money ever since then he was never going to make a decision for money and so the fact it was partly all this money was out there I think if I think it freaked him out and he said he was gonna do it wasn't gonna do it again so he turned it down in the end how many World Series of this the Oakland A's won under him none I mean he's been doing it for five years right if I'm five took a team that was below 500 and each year they've won more games during the races and been in the playoffs the last three years they won as many games as a Yankees did last year the the visit their two points to make about this that's what people say in baseball he had won a World Series but let me tell you what happens from the point of view of the guy who's like with this sale Wall Street if you are so smart well you're not rich well that may be more valid but but from the point of view of the guy who's running the thing is just supporting the players on the field there's only so much you can control and what you can control is in a in a large statistical sample when they're a hundred and six James he can he could put a team of feel that is a quality competitive team they can get in getting to the playoffs in these playoffs at crap shoots three out of five games and and and he's actually built a team that is rather if they've been in the past three years they've lost in the first round all three years but and baseball people want to say this whole thing is what he's doing can't be so sensational because he hadn't won a World Series but anybody anybody in a sense you can see that the best team doesn't always win are you so believing in Billy that you think whatever he wanted to do he would have done it well that he had some kind of real talent or is this baseball town interesting question I think that look he's one of these people who he's very very bright he's very charming he's got it he's got ability he's got ability to move through the world and be a success if he had landed on Wall Street he'd have been a superstar trader I mean no question he's exactly that guy you know treasure oh ya know he would have been the best you'd have been granted but but but he's having said that I wouldn't say he's a genius I'd say that he has he's a very gifted ferociously competitive person who has landed in a very peculiar situation reason I ask the question is because I mean he basically took what is sort of an intelligent approach to them they simply said we got myths in this game we're chasing rabbits in this game let's take a look at what really matters what matters is getting on base right what matters is getting people out if you're a pitcher that's rockin on a fastball getting people out that's right I mean it is it would make you were sitting there listening to it it would make complete sense to you that that's true the trick that the hard part of his job is is imposing reform on a big League Clubhouse I mean turning the organization making making people who are used to doing things one way do them another way anything and he just very good at that he's real he's relentless but but but you know ant you asked me what would be the reason he's in this sport is it baseball rendered him unfit for anything but itself he got out of it he spent 10 years wowed around the minor leagues and stuff and he has to be 27 years old and and he doesn't have a college degree and he's not making it as a baseball player that's the only thing he knew how to do one last point because I gotta go it is this notion that I think Billy Beane teaches then teach somebody to you somebody to hit power will come I know other people in golf for example teach them power and and and accuracy will come who not baseball I mean it is it is I think it's very it's true that you can turn you can turn good hitters into power hitters but you turning power hitter into a good hitter I mean the balls moving is the problem I mean that business of just making good contact is so hard that and it is it's it's it's instinctive whereas the power can cut you know that's weight training and whatever else you do Jason job don't so but Ivan Tiger Woods will say it has dude also it's much good 2 or 2 and well but Jason Giambi he didn't hit home runs when he was in college he didn't home runs in the minor leagues he became a power hitter and this often happens and then they sold him to the Yankees they didn't sell me before to raise one oh yeah Moneyball as you can see it right there he wants you to know that when you go to the bookstore you asked for Moneyball thanks for having me Michael Lewis thank you for joining us see you next

Channel: Manufacturing Intellect

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Id: 3JBWSFFAb4w

Length: 14min 27sec (867 seconds)

Published: Mon Feb 20 2017