When Genius Failed: The Rise and Fall of Long-Term Capital Management Paperback | Pages: 264 pages

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Original Title:	When Genius Failed: The Rise and Fall of Long-Term Capital Management
ISBN:	0375758259 (ISBN13: 9780375758256)
Edition Language:	English

Explanation To Books When Genius Failed: The Rise and Fall of Long-Term Capital Management

With a new Afterword addressing today’s financial crisis A BUSINESS WEEK BEST BOOK OF THE YEAR In this business classic—now with a new Afterword in which the author draws parallels to the recent financial crisis—Roger Lowenstein captures the gripping roller-coaster ride of Long-Term Capital Management. Drawing on confidential internal memos and interviews with dozens of key players, Lowenstein explains not just how the fund made and lost its money but also how the personalities of Long-Term’s partners, the arrogance of their mathematical certainties, and the culture of Wall Street itself contributed to both their rise and their fall. When it was founded in 1993, Long-Term was hailed as the most impressive hedge fund in history. But after four years in which the firm dazzled Wall Street as a $100 billion moneymaking juggernaut, it suddenly suffered catastrophic losses that jeopardized not only the biggest banks on Wall Street but the stability of the financial system itself. The dramatic story of Long-Term’s fall is now a chilling harbinger of the crisis that would strike all of Wall Street, from Lehman Brothers to AIG, a decade later. In his new Afterword, Lowenstein shows that LTCM’s implosion should be seen not as a one-off drama but as a template for market meltdowns in an age of instability—and as a wake-up call that Wall Street and government alike tragically ignored.

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Title	:	When Genius Failed: The Rise and Fall of Long-Term Capital Management
Author	:	Roger Lowenstein
Book Format	:	Paperback
Book Edition	:	Deluxe Edition
Pages	:	Pages: 264 pages
Published	:	October 9th 2001 by Random House Trade Paperbacks (first published January 1st 2000)
Categories	:	Economics. Finance. Business. Nonfiction. History

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Ratings: 4.19 From 22157 Users | 622 Reviews

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Too big to fail.... LTCM might have not been the first to be bailed out. It wasn't the last. However, it might have the dubious distinction of being possibly the only firm who had a lions share to play in what eventually turned into a global contagion. Read and re-read. Save for posterity. The fund boys: Meriwether, the leader, Victor Haghani & Larry Hilibrand, the overbearing maverick traders, Profs Merton and Scholes, the Nobel laureates and tutors to the rest of the street and many

Thrilling! Hard to put down. It is a sober reminder that not even the giants of modern finance, the ones whose equations we encounter in textbooks, are infallible. It shows how difficult it is to measure and quantify risk. For a long time, volatility was a proxy for risk. Long term's typical strategies hinged on how markets became efficient over time which in turn led to lower volatilities and shorter spreads between treasuries and other riskier bonds. So, Long Term was typically short

Lowenstein displays remarkable prescience. Not only is "When Genius Failed" a great read, it accurately foreshadows the "weapons of mass destruction" risks, to quote Warren Buffett, that would lead to the subprime meltdown and Great Recession. Reading this book, along with Kindleberger's "Manias, Panics, and Crashes" allowed me to foresee the Great Recession, steer clear, and avoid damage. It also helped me to better understand booms and busts in my own upcoming book "Cleantech Con Artists."

"They had forgotten the human factor." Sometimes 'vulgar Marxist' accounts of economics can be eerily similar to efficient markets theory because they assume a sort of natural outcome of exploitation and trading. This allows them to make simple predictions about the future. Yet people in markets continuously do things that aren't even in their narrow self-interest. And they do these things because of their personalities and prejudices. They are arrogant or bold or timid. You can't understand

Everyone has their own opinion on what should be under compulsory literature at school. Here's mine: finance students should all read When Genius Failed. I was taught in university about the Bell curve, Black-Scholes option pricing formula, and all other various ways on how to assess risk and return. It is human nature to seek certainty, or the ability to assess probabilities. In financial markets this has been so for decades, but we do not seem to be any closer to the answer today than we were

(3.5) Eerily similar to a crisis almost exactly 10 years laterAn interesting, well-told if brief account of the rise and fall of Long-Term Capital Management (you remember that one, don't you?). When things get heated it was along the lines of Sorkin's Too Big to Fail, but otherwise a decent treatment of the significant events in the life and death of LTCM.Don't have too much more to share other than how prescient the following quotation (the book was written in 2000) was (or, perhaps how Wall

This books gets three stars because it is a serviceable summary of its topic but is in now way outstanding. If you like finance, specifically statistical modeling and hedging strategies, you will find this tale of Nobel Prize hubris gone wrong because "muh models" didn't predict multiple standard deviation events intriguing. If you like reading about bad actors using arms of the federal government to engineer golden parachutes for them, you'll REALLY like this book.What is tough about this book