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I don't think equating LTCM with fraud is exactly right. They used an incredibly risky strategy and had their leverage blow up in a black swan event. A failure,
by jzebedee 9y ago
I don't think equating LTCM with fraud is exactly right. They used an incredibly risky strategy and had their leverage blow up in a black swan event. A failure, but not fraud.
- unknown_apostle 9y agoNo you're right, it's fundamentally wrong to compare Meriwether with Corzine. But my kneejerk response was to the "entrust your money".
- btilly 9y agoA black swan event caused by the phenomena that previously uncorrelated financial indicators temporarily become correlated under stress. A few months after they blew up, their portfolio was profitable again.