A hard-hitting analysis of how Michael Milken contrived to add junk bonds to the tricks of Wall Street's trade. Drawing mainly on the public record, Stein (Financial Passages, 1984) sheds considerable light on who and what helped Drexel Burnham's resident genius to peddle roughly $200 billion worth of so-called high-yield debt instruments during the 1980's. Underpinning what Stein characterizes as a purposeful Ponzi scheme designed to co-opt domestic capital markets was, the author asserts, a bright shining lie: that defaults on obligations of less than investment-grade ran at about 1.5 percent, a rate enticingly below the double-digit levels that actually prevailed. This misrepresentation made junk bonds acceptable to inattentive academics, credit agencies, government regulators, journalists, and others, including professional money managers. Among other consequences, Stein recounts, Milken (who's due for release from a federal penitentiary next March) was able to build a private network of issuers (grateful to have a liquid after-market of any sort for their risky securities) and venturesome investors (pleased to pocket the generous returns afforded by fixed-income vehicles of decidedly dubious quality). With buyers as well as sellers under his control, Milken had the equivalent of a captive market, which he turned into an immensely lucrative money machine via rigged bids and other unsavory means. Cases in point ranged from inducing members of the club to acquire S&Ls through providing war chests for corporate raiders, charging exorbitant advisory fees, trading on inside information, and bribing portfolio managers. All told, Stein estimates, the junk-bond king realized upwards of $24 billion in ill-gotten gains for himself and loyal courtiers during a 12- year reign whose socioeconomic costs have yet to be reckoned with any precision. As accessible and credible an explanation of Milken's misdeeds as has yet appeared.