6 ms·

Totally different scale, but this reminds me of Jesse Livermore, possibly the best speculator of all times. > Following the end of World War I, Livermore secre

Totally different scale, but this reminds me of Jesse Livermore, possibly the best speculator of all times. > Following the end of World War I, Livermore secretly cornered the market in cotton. It was only interception by President Woodrow Wilson, prompted by a call from the United States Secretary of Agriculture, who asked him to the White House for a discussion that stopped his move. He agreed to sell back the cotton at break-even, thus preventing a troublesome rise in the price of cotton. When asked why he had cornered the cotton market, Livermore replied, "To see if I could, Mr. President." A true hacker of the markets. https://en.wikipedia.org/wiki/Jesse_Lauriston_Livermore https://en.wikipedia.org/wiki/Jesse_Lauriston_Livermore

toomuchtodo 7y ago
In the same vein, Vince Kosuga cornering the onion market in 1955. https://www.npr.org/2015/10/22/450769853/the-great-onion-corner-and-the-futures-market https://www.npr.org/2015/10/22/450769853/the-great-onion-cor...
- defen 7y ago
  While we're on the topic of weird agricultural laws, from 1949-2015 we had a strategic raisin reserve https://en.wikipedia.org/wiki/National_Raisin_Reserve https://en.wikipedia.org/wiki/National_Raisin_Reserve
- H8crilA 7y ago
  Yep, that's a great story too. It's so ridiculous that this is still in force: > The Onion Futures Act is a United States law banning the trading of futures contracts on onions as well as "motion picture box office receipts". > In 1955, two onion traders, Sam Siegel and Vincent Kosuga, cornered the onion futures market on the Chicago Mercantile Exchange. The resulting regulatory actions led to the passing of the act on August 28, 1958. As of January 2020, it remains in effect. https://en.wikipedia.org/wiki/Onion_Futures_Act https://en.wikipedia.org/wiki/Onion_Futures_Act > The president of the Chicago Mercantile Exchange, E.B. Harris, lobbied hard against the bill. Harris described it as "Burning down the barn to find a suspected rat". The measure was passed, however, and President Dwight D. Eisenhower signed the bill in August 1958. Thus, onions were excluded from the definition of "commodity" in the Commodity Exchange Act.
  - Lazare 7y ago
    This is touched on in the Wikipedia article, but it's interesting that the onion market is well known for being significantly more volatile (and thus, bad for farmers) than other normal markets for vegetables. It is a literally textbook example in why banning derivatives is unlikely to be the easy fix some imagine for market failures.
    - eru 7y ago
      And gives you a hint for why banning 'price gouging' doesn't help either. (Despite the overall strong sentiment in favour of such silly laws in the discussion on this article. Economics can be a bit counter-intuitive for humans.)
      - deleted 7y ago
        [deleted]
      - Lazare 7y ago
        Agreed 100%. Also, here's an interesting story: https://www.ft.com/content/6a09e4a6-655a-11ea-b3f3-fe4680ea68b5 https://www.ft.com/content/6a09e4a6-655a-11ea-b3f3-fe4680ea6... > French industrials group Air Liquide is selling its Schülke unit, whose products range from the alcohol-based hand rubs that have become a hot commodity since the outbreak started, to hospital disinfectants and industrial cleaning products. > > It is asking would-be buyers to offer a higher sum than it first envisaged when the sale process began last year, according to people familiar with the situation, reflecting what one person called the “coronavirus effect”. Of course, the reason the business might be worth more is because it's going to make higher profits. In theory Air Liquide could cut prices to ensure its profits stayed the same. In fact, not doing so means they're profiting off Covid-19, right? Which I guess suggests the real problem with what this guy did is scale; he only had a few thousand bottles. If he'd only realised he should have been buying a factory!
        eru 7y ago
        Or building one!
deleted 7y ago
[deleted]
MrFoof 7y ago
The classic one often talked about in business schools is Robert Taylor buying up all liquid soap pump capacity in the US when he launched, "Softsoap" to head off other companies muscling him off the shelves through superior marketing and contracts with retailers. http://www.todayifoundout.com/index.php/2019/06/time-guy-cornered-liquid-soap-market-buying-literally-piece-inventory-available-u-s/ http://www.todayifoundout.com/index.php/2019/06/time-guy-cor... Basically had the market to himself for a year.
pengaru 7y ago
Well that was an interesting little rabbit hole with a grim end, thanks for sharing. "His son, Jesse Livermore Jr., committed suicide in 1975. His grandson also killed himself."
- H8crilA 7y ago
  Survival > happiness > money. You can argue about the order of the first two. Remember about this and don't leave your home, people!
- myalphabet 7y ago
  It isn't all grim! His granddaughter is successful porn star Brandi Love.
nemo44x 7y ago
Apple did this with tiny rotating hard drives before they announced the first iPod. The essentially bought the next 1.5 years worth. This helped the iPod from having serious competition while they ramped marketing.
webninja 7y ago
Also, “In 1955, Onion Futures accounted for 20% of trades in the futures market. In the fall of 1955, Siegel and Kosuga bought enough onions and onion futures so that they controlled 98 percent of the available onions in Chicago.[4] Millions of pounds (thousands of tonnes) of onions were shipped to Chicago to cover their purchases. By late 1955, they had stored 30,000,000 pounds (14,000 t) of onions in Chicago.[5] They soon changed course and convinced onion growers to begin purchasing their inventory by threatening to flood the market with onions if they did not.” ~Onion Futures Act on Wikipedia: https://en.m.wikipedia.org/wiki/Onion_Futures_Act https://en.m.wikipedia.org/wiki/Onion_Futures_Act
groby_b 7y ago
If by "true hacker" you mean utter disregard for anybody else's livelihood, sure. He doesn't so much look like somebody worthy of admiration, and more so of pity.
- wolco 7y ago
  The system doesn't come with your morality and doesn't operate to provide livelihood to the greatest number of people. Pity the man who was able to show the unequalness the market may bring if you must. But many of the changes in laws can be attributed to holes in the system that were exposed.
  - groby_b 7y ago
    "The system" is what we choose to build. It isn't some unchangeable fundamental part of nature. We choose if it does, or doesn't have morality. It's depressing so few choose morality, and then hide behind "it's the system". It's a choice. I wish people would own that choice, if they chose a system without morality, without consideration for their fellow humans. And yes, I do pity him. His life is sad, and empty, and his final note is heartbreaking. "My dear Nina: Can't help it. Things have been bad with me. I am tired of fighting. Can't carry on any longer. This is the only way out. I am unworthy of your love. I am a failure. I am truly sorry, but this is the only way out for me. Love Laurie"
    - cercatrova 7y ago
      Not necessarily. Systems can become amoral even if actors in the system are moral. Consider corporations. Their fitness function so to speak is to amass capital, as much as possible in fact. Even if everyone inside were moral, they are tended towards actions that increase capital, while not necessarily having all the responsibility of the decision, and so their morality does not come into play, because they don't know the true extent of their decisions. Responsibility throughout the organization therefore diffuses. It is like an ant colony, where each individual performs actions whose combined effects give the entire system some sense of individuality separate from its components.
    - 7y ago

toomuchtodo 7y ago

In the same vein, Vince Kosuga cornering the onion market in 1955. https://www.npr.org/2015/10/22/450769853/the-great-onion-corner-and-the-futures-market https://www.npr.org/2015/10/22/450769853/the-great-onion-cor...

defen 7y ago
While we're on the topic of weird agricultural laws, from 1949-2015 we had a strategic raisin reserve https://en.wikipedia.org/wiki/National_Raisin_Reserve https://en.wikipedia.org/wiki/National_Raisin_Reserve
H8crilA 7y ago
Yep, that's a great story too. It's so ridiculous that this is still in force: > The Onion Futures Act is a United States law banning the trading of futures contracts on onions as well as "motion picture box office receipts". > In 1955, two onion traders, Sam Siegel and Vincent Kosuga, cornered the onion futures market on the Chicago Mercantile Exchange. The resulting regulatory actions led to the passing of the act on August 28, 1958. As of January 2020, it remains in effect. https://en.wikipedia.org/wiki/Onion_Futures_Act https://en.wikipedia.org/wiki/Onion_Futures_Act > The president of the Chicago Mercantile Exchange, E.B. Harris, lobbied hard against the bill. Harris described it as "Burning down the barn to find a suspected rat". The measure was passed, however, and President Dwight D. Eisenhower signed the bill in August 1958. Thus, onions were excluded from the definition of "commodity" in the Commodity Exchange Act.
- Lazare 7y ago
  This is touched on in the Wikipedia article, but it's interesting that the onion market is well known for being significantly more volatile (and thus, bad for farmers) than other normal markets for vegetables. It is a literally textbook example in why banning derivatives is unlikely to be the easy fix some imagine for market failures.
  - eru 7y ago
    And gives you a hint for why banning 'price gouging' doesn't help either. (Despite the overall strong sentiment in favour of such silly laws in the discussion on this article. Economics can be a bit counter-intuitive for humans.)
    - deleted 7y ago
      [deleted]
    - Lazare 7y ago
      Agreed 100%. Also, here's an interesting story: https://www.ft.com/content/6a09e4a6-655a-11ea-b3f3-fe4680ea68b5 https://www.ft.com/content/6a09e4a6-655a-11ea-b3f3-fe4680ea6... > French industrials group Air Liquide is selling its Schülke unit, whose products range from the alcohol-based hand rubs that have become a hot commodity since the outbreak started, to hospital disinfectants and industrial cleaning products. > > It is asking would-be buyers to offer a higher sum than it first envisaged when the sale process began last year, according to people familiar with the situation, reflecting what one person called the “coronavirus effect”. Of course, the reason the business might be worth more is because it's going to make higher profits. In theory Air Liquide could cut prices to ensure its profits stayed the same. In fact, not doing so means they're profiting off Covid-19, right? Which I guess suggests the real problem with what this guy did is scale; he only had a few thousand bottles. If he'd only realised he should have been buying a factory!
      - eru 7y ago
        Or building one!

deleted 7y ago

[deleted]

MrFoof 7y ago

The classic one often talked about in business schools is Robert Taylor buying up all liquid soap pump capacity in the US when he launched, "Softsoap" to head off other companies muscling him off the shelves through superior marketing and contracts with retailers. http://www.todayifoundout.com/index.php/2019/06/time-guy-cornered-liquid-soap-market-buying-literally-piece-inventory-available-u-s/ http://www.todayifoundout.com/index.php/2019/06/time-guy-cor... Basically had the market to himself for a year.

pengaru 7y ago

Well that was an interesting little rabbit hole with a grim end, thanks for sharing. "His son, Jesse Livermore Jr., committed suicide in 1975. His grandson also killed himself."

H8crilA 7y ago
Survival > happiness > money. You can argue about the order of the first two. Remember about this and don't leave your home, people!
myalphabet 7y ago
It isn't all grim! His granddaughter is successful porn star Brandi Love.

nemo44x 7y ago

Apple did this with tiny rotating hard drives before they announced the first iPod. The essentially bought the next 1.5 years worth. This helped the iPod from having serious competition while they ramped marketing.

webninja 7y ago

Also, “In 1955, Onion Futures accounted for 20% of trades in the futures market. In the fall of 1955, Siegel and Kosuga bought enough onions and onion futures so that they controlled 98 percent of the available onions in Chicago.[4] Millions of pounds (thousands of tonnes) of onions were shipped to Chicago to cover their purchases. By late 1955, they had stored 30,000,000 pounds (14,000 t) of onions in Chicago.[5] They soon changed course and convinced onion growers to begin purchasing their inventory by threatening to flood the market with onions if they did not.” ~Onion Futures Act on Wikipedia: https://en.m.wikipedia.org/wiki/Onion_Futures_Act https://en.m.wikipedia.org/wiki/Onion_Futures_Act

groby_b 7y ago

If by "true hacker" you mean utter disregard for anybody else's livelihood, sure. He doesn't so much look like somebody worthy of admiration, and more so of pity.

wolco 7y ago
The system doesn't come with your morality and doesn't operate to provide livelihood to the greatest number of people. Pity the man who was able to show the unequalness the market may bring if you must. But many of the changes in laws can be attributed to holes in the system that were exposed.
- groby_b 7y ago
  "The system" is what we choose to build. It isn't some unchangeable fundamental part of nature. We choose if it does, or doesn't have morality. It's depressing so few choose morality, and then hide behind "it's the system". It's a choice. I wish people would own that choice, if they chose a system without morality, without consideration for their fellow humans. And yes, I do pity him. His life is sad, and empty, and his final note is heartbreaking. "My dear Nina: Can't help it. Things have been bad with me. I am tired of fighting. Can't carry on any longer. This is the only way out. I am unworthy of your love. I am a failure. I am truly sorry, but this is the only way out for me. Love Laurie"
  - cercatrova 7y ago
    Not necessarily. Systems can become amoral even if actors in the system are moral. Consider corporations. Their fitness function so to speak is to amass capital, as much as possible in fact. Even if everyone inside were moral, they are tended towards actions that increase capital, while not necessarily having all the responsibility of the decision, and so their morality does not come into play, because they don't know the true extent of their decisions. Responsibility throughout the organization therefore diffuses. It is like an ant colony, where each individual performs actions whose combined effects give the entire system some sense of individuality separate from its components.
  - 7y ago