anecdotes

They searched frantically for fundamental factors, nerds scurrying over Excel worksheets like rats on a sinking ship. Financial reporters hit speed dials. Talking heads peppered portfolio managers. Unemployment hovers near 1960 lows. Earnings are at records, growing double digits, fastest since 2011. Profit margins are amongst history’s highest. The global economy enjoys a rare synchronized expansion. Not a single tr

It raced across the night sky at 150,000 mph. No larger than a marble. The meteorite vanished in a trail of brilliant light, a faint green copper glow, come and gone. And his heart raced, recalling that first shooting star, decades ago, a child in a backseat, face pressed to the window, searching the heavens. His excitement late that night, replaced by profound sadness. The tragic fate of that distant star, its surro

“Totally failed. The second he told me how he figured it out, I wanted to puke,” admitted my 16yr old, “can’t believe I didn’t think of it first.” I’d asked Jackson if he solved the problem. You see, last summer, my friend flew his family to Santa Barbara to surf. But discovered that Great White Sharks now mysteriously infest the waters. It’s a problem for most, but not him. He’s mad. The greatest humans always are,

Hate crowds. Love fresh air. Long runs, sunshine, storms, horizons. Solitude. Altitude. So when we moved the firm from California’s mountains to Connecticut’s flats I promised to avoid tight spaces, low ceilings, rush hours. “How many people are here tonight?” I asked the maître d’, entering the private dining room. “Twenty-three at last count,” he answered to my horror. “Terrific, vodka tonic, three limes, keep ’em

To sell implied volatility at current 50yr lows, investors must imagine tomorrow will be virtually identical to today. They must imagine that bond yields won’t rise despite every major central bank eager to hike interest rates and exit QE. They must imagine that economies at or near full employment will not create inflation; that GDP will neither accelerate nor decelerate; that governments will tolerate historic leve

“What are the odds we come across an opportunity in the coming 4yrs to earn 20%?” the investor asked his team. “High,” they answered. “The odds are 100%,” he said, having seen this movie a few times. “So our cost of capital is 5% per year (20% divided by 4yrs), plus the 1% we earn on cash,” he said. His team nodded. “Under no circumstances should we deploy capital unless it earns well more than 6% per year from here

“Let’s step into my office,” he said. So I did. He was my boss. “The firm’s most important client needs help.” I listened, uninterested, unconcerned about clients, their problems. Barely cared about my boss. I had a game to play, solo sport, and loved it to the exclusion of all else. “They need to do a very large trade.” A twenty-six-year-old proprietary trader’s mind is rather primitive. Which is good and bad. Being

“The market has an accident, the Fed returns to QE, slashes interest rates, bonds surge, stocks recover,” said the CIO, high atop his prodigious pile, alone. Staring into the distance. Squinting, straining. “The correlation between bonds and equities remains negative, the risk parity equity/bond portfolios are dented but not destroyed. And we descend to the next lower level in real interest rates. US bond yields turn

“Bitcoin is important,” said Lithium, handsfree on Highway One. “It reminds people that supply scarcity, capital flows, and imagination, matter more than anything.” Bitcoin printed another 20% weekly range. “Risk tolerance is the market’s most important fundamental,” said Lithium, racing through Malibu, SoCal’s sun streaming, steaming, “It’s also the most mysterious of all market drivers.” Like every form of intangib