About this title: This fast-paced business history chronicles the rise and fall of Long-Term Capital Management, a private asset management firm touted for the renowned intellectual background of its partners. While detailing the failure of this relatively small operation, this volume examines how such a seemingly small-scale economic defeat threatened the stability of world markets.
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Binding: Paperback
Publisher: Random House Trade Paperbacks
Date Published: 2001-10-09
ISBN-13:9780375758256ISBN:0375758259
Description: Very Good. Binding is tight and square. Text is clean, bright and unmarked. Some corner wear. We recommend EXPEDITED MAIL for even faster delivery! read more
Binding: Softcover
Publisher: Random House Inc
Date Published: 2001-10-01
ISBN-13:9780375758256ISBN:0375758259
Description: NEW. Softcover. From an inventory that is 100% brand-new, 100% direct from the publishers' distribution channel. We carry NO pre-owned, NO remaindered. We pack in CARDBOARD to ensure the pristine quality is maintained. (Bubble-wrap alone is NOT sufficient to protect from USPS equipment. ) Guaranteed brand-NEW, protected with CARDBOARD, your satisfaction is guaranteed. BKLUVID: 9780375758256. read more
Edition: NEW ED
Binding: Paperback
Publisher: HARPERCOLLINS PUBLISHERS Country = UNITED KINGDOM
Date Published: 2002
ISBN-13:9781841155043ISBN:1841155047
Description: BRAND NEW PAPERBACK. 275 pages. (275 pages) this title tells the story of long-term capital management where a group of elite investors believe they can beat the market and, like alchemists, create limitless wealth for themselves and their partners. in fact, they create a trillion-dollar hole in the international banking system. illustrations edition new ed (Paperback) read more
Binding: Hardcover
Publisher: Fourth Estate
Date Published: 2000
ISBN-13:9781841155036ISBN:1841155039
Description: Good. **SHIPPED FROM UK** We believe you will be completely satisfied with our quick and reliable service. All orders are dispatched as swiftly as possible! Buy with confidence! read more
"Wow I just finished reading this book (it's about 3 am here) and I can just feel the heaviness of the entire debacle and its lessons weigh upon my shoulders, but it's a good feeling. It's always wonderful to learn and to enjoy the entire process.
What a fantastic read! Lowenstein is quite masterful in explaining both the detailed financial concepts necessary to understand what happened and all the little human errors of sorts that lead to the mess now known as LTCM.
Several times in the midst of reading this book, I could not help but put the book down to contemplate the the immense parallels with the current economic crisis - the role of greed and stubborn stupidity, the huge leverages, the crowd mentality, the debate about the proper role of the Fed, the increasing connectivity of the world through derivatives making the economies fall like dominoes, and more...
Around page 110 (+/- 30), when I read about the difficulties faced by LTCM's naysayers by their own coworkers and employers and clientele, I had to stop to discuss with my dad the danger of the crowd mentality and also the implications for my future.
I can only imagine that many times in the future I will face similar dilemmas where my judgment may conflict with majority view, or I will be given an opportunity that seems so delicious yet so risky. I could (1) either follow my judgment at the risk of my reputation or job (2) follow the crowd to capture a piece of the pie and to appease my superiors or clients or whomever is pushing for the deal, knowing full well it could blow up in my face...it seems like a lose lose.
Of course ideally, I'd like to follow my own judgment since as a lawyer my integrity and judgment is everything...but many people who in good judgment warned about LTCM faced pressures for missing out on the investment opportunities, some getting fired... in fact some got fired even after the bailout as punishment for not taking their concerns high enough up the corporate ladder. In that case, it's not just about riding out the storm, you have to actively fight for attention for what you believe is right. Lowenstein goes into wonderful descriptions of how each bank or its analysts struggles with this precise problem. Most chose the latter, casting away their judgment and their typical practices for the chance to invest with LTCM, and that's how LTCM got away with so much. It's just crazy, but at the same time it happens again and again, this mob mentality...whether with the Germans in WWII, the Hutus in the Rwandan genocide, or here the Wall Street Bankers with LTCM
At the end of the day, it's so interesting to see how the basic principle of corporate finance that I learned this past spring come into play and also where they failed.
Again we are reminded that people's intellect only go so far, when the going gets rough it's all about the fear"
"This is one of the most interesting non-fictional stories that I have ever read. It appears as though the entire thing was created for a movie. It explains the story of Jon Meriwether's hedge fund, Long Term Capital Management(LTCM), and how it almost single-handedly (although it includes the carelessness and hubris of the major banks) brought the financial markets to a halt. It appears that LTCM was about 9 years ahead of their time as their bets with international arbitrage started to go bad, and after losing $1.9 Billion in a single month, the New York Federal Reserve brought in the major banks to orchestrate a bailout of the fund and the institutions that were intertwined with LTCM. Interestingly enough, when the banks were called in to bail out Meriwether, Bear Stearns refused to help out and claimed that it wasn't their problem. Some wondered if this was the reason Hank Paulson, then treasury secretary and a former boss of Goldman Sachs, insisted on Bear being sold for a mere $2 per share (though this was later quintupled after shareholders revolted). There were certainly many on Wall Street, including a fair few at the firm itself, who felt Bear had it coming.
Would recommend this book to all as a precursor and insightful book into the current economic crisis."
"I read this book. While I understood about 30% of it. The main point it makes is how easy it is to appropriate billions of dollars without much planning, and with little actual interest in mind of the people they were investing for. It's all about greed, high-risk taking etc, etc...pretty much the same stupid decisions were made in regards to housing and mortgages. It was all about making a quick buck....at the expense of the world economy.
I wouldn't be surprised if it didn't happen all over again in another 5 or 10 years. Some people are greedy SOB's."
"The book recounts the story of Long-Term Capital Management, a hedge fund that collapsed 1998. The only reason it didn't bring others down with it: Wall Street's major banks intervened at the Fed's behest. But even then, they intervened only because they perceived LTCM--with a trillion dollars in derivatives exposure and leverage that reached 100:1--was too big to fail.
The lessons from that episode are eerily familiar: the dangers of unchecked leverage, undisclosed derivatives, and unbridled hubris.
This book is a prologue of sorts to the more recent financial crisis. LTCM's disintegration could have been a time to impose regulations or let someone suffer the consequences of their actions. Instead, neither route was taken. A quick fix substituted for a real solution. It seems possible we're about to do it again.
This book isn't about the current crisis, but it'll give an idea of how we got here, and why all the banks end up in trouble together. Very worth the read."
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