Category: Quotes

Categories
Quotes

How hedge funds get their edge

When a former trader from Galleon Group was asked what the word “edge” meant to him, he laughed and said that from the day he started at Galleon to the day he left, it was probably the most commonly used term around the office. It was such a priority, the trader added, that if you didn’t have it, you’d be quickly left behind. It meant that you knew something that others didn’t. Another trader—a witness in the government’s insider-trading investigation—was asked if he knew of any hedge fund that didn’t traffic in illegal information, according to the person familiar with the inquiry: No, the source answered, they would never survive. In this way, trading on nonpublic material information is similar to doping in professional cycling: Once someone like Lance Armstrong starts doing it, everyone else has to as well.

– from BusinessWeek

Categories
Quotes

The Cindrella Principle

Everyone thinks life is one upward, smooth trajectory.  They think of Cinderella in her big castle and forget that she spent decades scrubbing floors, being beaten, and locked in a cold room.  Between “Once upon a time” and “Happily ever after” a lot happens.  Not all of it is good.-by Joshua Kennon

Categories
Quotes

Is my life wasted?

Question:I am turning 27, and feel I have wasted a lot of time. Is it too late?

Answer: Too late for what?

If you slept through your 26th birthday, it’s too late for you to experience it. It’s too late for you to watch “LOST” in its premiere broadcast. (Though, honestly, you didn’t miss much.) It’s too late for you to fight in the Vietnam War. It’s too late for you to go through puberty or attend nursery school. It’s too late for you to learn a second language as proficiently as a native speaker. It’s probably too late for you to be breastfed.

It’s not too late for you to fall in love.

It’s not too late for you to have kids.

It’s not too late for you to embark on an exciting career or series of careers.

It’s not too late for you to read the complete works of Shakespeare; learn how to program computers; learn to dance; travel around the world; go to therapy; become an accomplished cook; sky dive; develop an appreciation for jazz; write a novel; get an advanced degree; save for your old age; read “In Search of Lost Time”; become a Christian, then an atheist, then a Scientologist; break a few bones; learn how to fix a toilet; develop a six-pack …

Honestly, I’m 47, and I’ll say this to you, whippersnapper: you’re a fucking kid, so get over yourself. I’m a fucking kid, too. I’m almost twice your age, and I’m just getting started! My dad is in his 80s, and he wrote two books last year.

You don’t get to use age as an excuse. Get off your ass!

Also, learn about what economists call “sunk costs.” If I give someone $100 on Monday, and he spends $50 on candy, he’ll probably regret that purchase on Tuesday. In a way, he’ll still think of himself as a guy with $100 — half of which is wasted.

What he really is is a guy with $50, just as he would be if I’d handed him a fifty-dollar bill. A sunk cost from yesterday should not be part of today’s equation. What he should be thinking is this: “What should I do with my $50?”

What you are isn’t a person who has wasted 27 years. You are a person who has X number of years ahead of you. What are you going to do with them?

-from Quora

 

Categories
Music Quotes

The beat goes on

When the Fed now writes $85 billion of checks to buy Treasuries and mortgages every month, they really have nothing in the “bank” to back them. Supposedly they own a few billion dollars of “gold certificates” that represent a fairy-tale claim on Ft. Knox’s secret stash, but there’s essentially nothing there but trust. When a primary dealer such as J.P. Morgan or Bank of America sells its Treasuries to the Fed, it gets a “credit” in its account with the Fed, known as “reserves.” It can spend those reserves for something else, but then another bank gets a credit for its reserves and so on and so on. The Fed has told its member banks “Trust me, we will always honor your reserves,” and so the banks do, and corporations and ordinary citizens trust the banks, and “the beat goes on,” as Sonny and Cher sang. $54 trillion of credit in the U.S. financial system based upon trusting a central bank with nothing in the vault to back it up. Amazing!-from Bill Gross

Categories
Anecdotes Quotes

Have you been talking to my wife?

Eric Rosenfeld was one of the founders/Principals of the famous hedge fund LTCM

LTCM started in 1994 with around a Billion $ in assets.It had a spectacularly good run for a couple of years before blowing up in 1998.

Like other founders, Eric kept reinvesting in the fund only to see his fortune disappear as the fund blew up.

Many years later, he gave a mind blowing seminar to MIT students narrating his experiences.

One of the students asked him “Did you put everything into LTCM?”

He replied back “Have you been talking to my wife?”