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> Date: Thu, 24 Sep 1998 15:20:23 -0400
> From: "Gaius Marius" <magnus@xxxxxxxxxxx>
> To: <omega-list@xxxxxxxxxx>, "Stewart Taylor" <staylor@xxxxxxx>
> Subject: Re: Hedge Fund Blowups
> New York Times had an article today on John Merriwether's Long Term Capital
> . Essentially, it states that the NY Fed Reserve had to bail them out else
> if they started to unwind their $90 billion portfolio, it'll cause other
> portfolios to collapse. What I like to know is how did they get so much
> leverage (their capitalization was about $4billion..now down to about $2
> billion) ?
>
My understanding is that the only involvement of the Fed was advisory
and hosting the meeting. The Fed put in exactly $0 outside of that.
I could be wrong about that, but that was my read.
BTW, anybody catch Greenspan's comments on the farm "crisis". He
basically said he was pro- Freedom to Farm, and that it's time the
farmers got with free markets and assume risk like everyone else.
Farm supports blow away the $90 billion LTC threw away.
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"It's hard to make predictions, especially about the future."-Yogi Berra, Visionary, 19??
"I think there is a world market for maybe five computers."-Thomas Watson, IBM Chairman, 1943
"640 K ought to be enough for anybody."-Bill Gates, Microsoft Chairman, 1981
"With over 50 foreign cars already on sale here, the Japanese auto industry isn't likely to carve out a big slice of the U.S. m
arket for itself"- Business Week, 1958
"TV won't be able to hold on to any market it captures after the first six months. People will soon get tired of staring at a p
lywood box every night."- 20th Century Fox's Daryl F. Zanuck, 1946
"Don't sweat petty things. Don't pet sweatty things."-Anonymous
"When you are courting a nice girl an hour seems like a second. When you
sit on a red-hot cinder a second seems like an hour. That's relativity." -
Albert Einstein
Shawn Devlin
mailto:shawnd@xxxxxxxxxxxxx
http://www.netcom.com/~shawnd/shawn.html
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