Roger Lowenstein

For the first three years plus of their fund, the world moved exactly the way they thought it would move.

For the first three years plus of their fund, the world moved exactly the way they thought it would move.

For the first three years plus of their fund, the world moved exactly the way they thought it would move.

You know, they seem to have a formula. People are always looking for a formula, a technique, a model, you know, something that they can say, I just plug this in and tomorrow I'll be X percent richer. The day after tomorrow, I'll be, you know, X plus Y percent richer.

You know, they seem to have a formula. People are always looking for a formula, a technique, a model, you know, something that they can say, I just plug this in and tomorrow I'll be X percent richer. The day after tomorrow, I'll be, you know, X plus Y percent richer.

You know, they seem to have a formula. People are always looking for a formula, a technique, a model, you know, something that they can say, I just plug this in and tomorrow I'll be X percent richer. The day after tomorrow, I'll be, you know, X plus Y percent richer.

If you own a stock and it triples, that stock that you own is a lot more expensive than it used to be. That might still be a good investment, but it's probably not as good an investment as before it tripled.

If you own a stock and it triples, that stock that you own is a lot more expensive than it used to be. That might still be a good investment, but it's probably not as good an investment as before it tripled.

If you own a stock and it triples, that stock that you own is a lot more expensive than it used to be. That might still be a good investment, but it's probably not as good an investment as before it tripled.

All you know is, hey, the math isn't as good as yesterday. We're a little richer today, but that means tomorrow doesn't look as enticing. And they could and should have adjusted their portfolio.

All you know is, hey, the math isn't as good as yesterday. We're a little richer today, but that means tomorrow doesn't look as enticing. And they could and should have adjusted their portfolio.

All you know is, hey, the math isn't as good as yesterday. We're a little richer today, but that means tomorrow doesn't look as enticing. And they could and should have adjusted their portfolio.

It wasn't that one asset went against them or another did, but that every asset, every asset that they traded went against them.

It wasn't that one asset went against them or another did, but that every asset, every asset that they traded went against them.

It wasn't that one asset went against them or another did, but that every asset, every asset that they traded went against them.

You had what I call the human factor, which tilted the odds.

You had what I call the human factor, which tilted the odds.

You had what I call the human factor, which tilted the odds.

The street knew what their basic trade was. So the street, either for self-protective reasons because they were in the same trades as LTCM and they said, hey, I don't want to be exposed to the kind of losses they're having. I'm going to get out, which moved markets against them. Or sort of more aggressive posture saying, I think LTCM is vulnerable. What they own, I'm going to bet against.

The street knew what their basic trade was. So the street, either for self-protective reasons because they were in the same trades as LTCM and they said, hey, I don't want to be exposed to the kind of losses they're having. I'm going to get out, which moved markets against them. Or sort of more aggressive posture saying, I think LTCM is vulnerable. What they own, I'm going to bet against.