Vegas & The Aftermath - Diary

[redarmi]

Prior to Bernie's book, I read a right corker, & rated it even higher.

Entitled "The Greatest Trade Ever - how one man bet against the markets & made $20 billion".

It's about a quiet, unassuming chap by the name of John Paulson.

http://en.wikipedia.org/wiki/John_Paulson

In the years leading up to the credit crunch, he spotted that subprime mortgages were due to go underwater, so he did the weirdest thing - he sold insurance policies on them. Not exactly on single mortgages though, they were "bundles" of 1,000's of mortgages which Institutions had created as a bit of financial engineering.

Then, when the market went south, & everyone started foreclosing on the mortgages, he SOLD those policies for a lot more than he paid, selling them to the exposed institutions who had burned their fingers, having first protected himself via CDS's, which in themselves became worth a fortune.

The big Credit Rating Agencies came out of the story dreadfully - they got it completely qrong, assessing that less than 1 in 100 subprimes would go underwater, an incredibly naive assumption or calculation, however you look at it.

Bit hard to get into at first, with stuff like CDS - credit default swaps - & CDO's - collaterized debt obligations, but once you get your head round all that, it's a stunning expose of the financial system as then was. I can't pretend I fully understood it all, but it's like baseball stats, you don't need to understand them to enjoy baseball.

It's almost as good, in business/markets sense, as the story of Long Term Capital Management, who somehow leveraged up a tiny asset base to borrow some $40 billion before going tits up & almost causing the world financial stystem to collapse.

John was mocked by one & all, he was really swimming against the tide, but he hung in, & got his result eventually. Gotta be brave to keep betting when for 4 years, the market defied his beliefs, & moved against him, but he stood his ground, hung in, & got there. That takes guts. What a legend, though he is not universally respected, as some say he sort of caused the credit crunch. Mostly those who bet the wrong way, I might add.

Now that's a REAL degenerate.

Terrific read, & v highly recommended. It's by Gregory Zuckerman.

Read a couple of books on this subject and whilst I enjoyed this one I thought "The Big Short" by Michael Lewis was the best and if anyone is into this kind of thing and hasn't read "Liars poker" by Lewis I would highly recommend that.  One of the best books on the culture within the big financial firms i have ever read although i am sure someday soon someone is going to write a great book about Goldman Sachs.

[tikay]

Prior to Bernie's book, I read a right corker, & rated it even higher.

Entitled "The Greatest Trade Ever - how one man bet against the markets & made $20 billion".

It's about a quiet, unassuming chap by the name of John Paulson.

http://en.wikipedia.org/wiki/John_Paulson

In the years leading up to the credit crunch, he spotted that subprime mortgages were due to go underwater, so he did the weirdest thing - he sold insurance policies on them. Not exactly on single mortgages though, they were "bundles" of 1,000's of mortgages which Institutions had created as a bit of financial engineering.

Then, when the market went south, & everyone started foreclosing on the mortgages, he SOLD those policies for a lot more than he paid, selling them to the exposed institutions who had burned their fingers, having first protected himself via CDS's, which in themselves became worth a fortune.

The big Credit Rating Agencies came out of the story dreadfully - they got it completely qrong, assessing that less than 1 in 100 subprimes would go underwater, an incredibly naive assumption or calculation, however you look at it.

Bit hard to get into at first, with stuff like CDS - credit default swaps - & CDO's - collaterized debt obligations, but once you get your head round all that, it's a stunning expose of the financial system as then was. I can't pretend I fully understood it all, but it's like baseball stats, you don't need to understand them to enjoy baseball.

It's almost as good, in business/markets sense, as the story of Long Term Capital Management, who somehow leveraged up a tiny asset base to borrow some $40 billion before going tits up & almost causing the world financial stystem to collapse.

John was mocked by one & all, he was really swimming against the tide, but he hung in, & got his result eventually. Gotta be brave to keep betting when for 4 years, the market defied his beliefs, & moved against him, but he stood his ground, hung in, & got there. That takes guts. What a legend, though he is not universally respected, as some say he sort of caused the credit crunch. Mostly those who bet the wrong way, I might add.

Now that's a REAL degenerate.

Terrific read, & v highly recommended. It's by Gregory Zuckerman.

Read a couple of books on this subject and whilst I enjoyed this one I thought "The Big Short" by Michael Lewis was the best and if anyone is into this kind of thing and hasn't read "Liars poker" by Lewis I would highly recommend that.  One of the best books on the culture within the big financial firms i have ever read although i am sure someday soon someone is going to write a great book about Goldman Sachs.

By sheer chance, "The Big Short" is my current read.

Think it's the 5th book I've read on that whole subprime affair, & the weird & not-so-wonderful derivatives sidebar story, & in every one, of course, the identity of the villains & heroes change slightly, depending on who is telling the tale.

There is a common misconception that all of a sudden, when the balloon burst, there was a shortage of cash in the system, which is quite wrong, of course, the amount of cash in the system remained unchanged, it just moved to different places. It was the CREDIT that disappeared.

It was a crisis that was long overdue.

[AndrewT]

Interesting little film here - film footage of Las Vegas in 1962.

http://vimeo.com/30582217

[redsimon]

Prior to Bernie's book, I read a right corker, & rated it even higher.

Entitled "The Greatest Trade Ever - how one man bet against the markets & made $20 billion".

It's about a quiet, unassuming chap by the name of John Paulson.

http://en.wikipedia.org/wiki/John_Paulson

In the years leading up to the credit crunch, he spotted that subprime mortgages were due to go underwater, so he did the weirdest thing - he sold insurance policies on them. Not exactly on single mortgages though, they were "bundles" of 1,000's of mortgages which Institutions had created as a bit of financial engineering.

Then, when the market went south, & everyone started foreclosing on the mortgages, he SOLD those policies for a lot more than he paid, selling them to the exposed institutions who had burned their fingers, having first protected himself via CDS's, which in themselves became worth a fortune.

The big Credit Rating Agencies came out of the story dreadfully - they got it completely qrong, assessing that less than 1 in 100 subprimes would go underwater, an incredibly naive assumption or calculation, however you look at it.

Bit hard to get into at first, with stuff like CDS - credit default swaps - & CDO's - collaterized debt obligations, but once you get your head round all that, it's a stunning expose of the financial system as then was. I can't pretend I fully understood it all, but it's like baseball stats, you don't need to understand them to enjoy baseball.

It's almost as good, in business/markets sense, as the story of Long Term Capital Management, who somehow leveraged up a tiny asset base to borrow some $40 billion before going tits up & almost causing the world financial stystem to collapse.

John was mocked by one & all, he was really swimming against the tide, but he hung in, & got his result eventually. Gotta be brave to keep betting when for 4 years, the market defied his beliefs, & moved against him, but he stood his ground, hung in, & got there. That takes guts. What a legend, though he is not universally respected, as some say he sort of caused the credit crunch. Mostly those who bet the wrong way, I might add.

Now that's a REAL degenerate.

Terrific read, & v highly recommended. It's by Gregory Zuckerman.

Read a couple of books on this subject and whilst I enjoyed this one I thought "The Big Short" by Michael Lewis was the best and if anyone is into this kind of thing and hasn't read "Liars poker" by Lewis I would highly recommend that.  One of the best books on the culture within the big financial firms i have ever read although i am sure someday soon someone is going to write a great book about Goldman Sachs.

By sheer chance, "The Big Short" is my current read.

Think it's the 5th book I've read on that whole subprime affair, & the weird & not-so-wonderful derivatives sidebar story, & in every one, of course, the identity of the villains & heroes change slightly, depending on who is telling the tale.

There is a common misconception that all of a sudden, when the balloon burst, there was a shortage of cash in the system, which is quite wrong, of course, the amount of cash in the system remained unchanged, it just moved to different places. It was the CREDIT that disappeared.

It was a crisis that was long overdue.

Just got "The Big Short", sorting my books to take on trip to Vegas. What were the other books you read on subprime and would you recommend any? (Might pick a few up at airport)

[neeko]

"Fool's Gold" by Gillian Tett is good too.

[doogan]

just read the jonny cash book "Cash"  a amazing life story of a troubled character and amazing musician. Well worth a read.

[TightEnd]

Ready for the day ahead

http://ow.ly/i/k9fu

[DaveShoelace]

Ready for the day ahead

http://ow.ly/i/k9fu

assumed it would be the trademark 'tikay asleep in cardroom picture'

[George2Loose]

Made day 2 of the 6 max. Chipped up as usual I see.

[TightEnd]

Story time, tikay.....

Click to see full-size image.

[tikay]

Made day 2 of the 6 max. Chipped up as usual I see.

Stack relative to blinds, I have peaked now, & am ready to pounce.

Yesterday, I either.....

Abso crushed, but was called in a super super sick spot by some fish who got lucky (all other players are fish, obv), meh.

Or.......

Sat there quietly, not good enough or lucky enough to build a stack.

Gotta say though - how much fun is 6-Max live? Wow, loved it. So civilised.

[EvilPie]

Sick sweat for the last longer today mate.

Me with my 25 bigs against you, your 11 bigs and clear skill edge.

Could be a close one.

[millidonk]

Source: Article ref the passing of singnificant but lesser known people in the last month: http://www.bbc.co.uk/news/magazine-15520303

If it had not been for Annie Penrose, RAF pilots might have found themselves piloting Shrews rather than Spitfires in the Battle of Britain. Her father, Sir Robert McLean, was chairman of Vickers between the wars and worked closely with R J Mitchell who was designing a new single-seater fighter. Mitchell had wanted to call the new plane the Shrew but McLean insisted it was called the Spitfire, the nickname he had bestowed on his somewhat headstrong daughter. After opposition from the Air Ministry he finally got his way. Annie, who was born in India, went on to marry the actor Robert Newton before his drinking and womanising led to divorce. She later married Beakus Penrose and became the chatelaine of the Killiow Estate in Cornwall which she ran well into her 80s.

[tikay]

Incredible - & not a spark to be seen!

http://uk.news.yahoo.com/polish-plane-makes-emergency-landing.html

[tikay]

Anyone catch the opening episode of Attenborough's "Frozen Planet"? Definitely 10 out of 10. Drama, tragedy, comedy, crime, & absolutely stunning camerawork.

How did they get Attenborough up on the very peak of that Arttic mountain ridge? He's 85, so I'm not sure I can imagine him dangling from a helicopter to get there.

The whole thing is the TV Event of the year for me, witrhout a doubt.

Here's some of the comedy. And crime.

http://www.youtube.com/watch?v=MlbxRBfGAr0