Photos of the launch event at Crossword, Kemp’s Corner

Photos of book launch event at Crossword, Kepmps Corner, Mumbai last year

 

Post by @KarmayogKnowleg.

Source: Photos of the launch event at Crossword, Kemp’s Corner

Advertisements

Photos of the book launch event at Sapna Book Centre, Bengaluru

Book launch event at Sapna Book Centre, Bengaluru last year

 

Post by @KarmayogKnowleg.

Source: Photos of the book launch event at Sapna Book Centre, Bengaluru

Reading from the book at the launch at Crossword, Kemps Corner, Mumbai

Book launch event at Crossword, Kemps Corner, Mumbai last year

Photo post by @KarmayogKnowleg.

Source: Reading from the book at the launch at Crossword, Kemps Corner, Mumbai

History repeats. It just looks different

September 1998 is when the star-studded hedge fund Long Term Capital Management (LTCM) was wound up. Large institutional investors bailed it out. One bank – Bear Stearns,  refused to participate.

A decade later, Bear Stearns was bought over by J P Morgan Chase. Trouble at the bank had started after two of its hedge funds got into trouble.

Reason for failure of LTCM – derivative trades using leverage

Reason for failure of Bear Stearns’ hedge funds – derivative trades using leverage

History repeats. It just looks different.

#RidingTheRollerCoaster – 245

Laymen’s definition of a bubble

The laymen’s definition of a speculative bubble rests on hindsight. A lay interpretation of a bubble is merely what happens before a crash!

A rational speculative bubble exists when asset prices become separated from fundamental values, and when investors believe that this will continue. Note that transitory departures from fundamental values, due, perhaps, to changes in conditions of liquidity, to adverse behaviour of market-makers, or to “uninformed” traders’ misperceptions about price, are not speculative bubbles. A necessary characteristic of a rational speculative bubble is that it be self-fulfilling, that either investors are not aware that it exists and so behave in ways that perpetuate it, or investors are indifferent to the existence of the bubble because they believe that a “greater fool” will rescue them from the consequences of overpayment.

  • From a paper entitled “Stock market crashes: What have we learned from October 1987?” by Prof. Peter Fortune, the then visiting scholar at Federal Reserve Bank of Boston

#RidingTheRollerCoaster – 244

Anniversary of Lehman Brothers’ bankruptcy

Lehman Brothers, then the fourth largest investment bank in the US, filed for bankruptcy on 15th September 2008. It is important to check if we have learnt any lessons in these eight years.

One of the major lessons is that while this was a catastrophic event, nobody could predict it. In fact, many expected Lehman also to be bailed out by the US Government. It did not happen. The firm filed for bankruptcy.

Today, many try to predict what is likely to happen. The game continues.

There are few lessons we never learn, or easily forget – both at our own peril.

#RidingTheRollerCoaster – 243