Professor Elam

Tuesday March 30 2021

Here is another story on Archegos meltdown last Friday.

https://finance.yahoo.com/news/one-world-greatest-hidden-fortunes-002617417.html

I wonder how many more Bill Hwang's are out there, borrowing more and more, higher and higher leverage, and losses all around when the margin calls  arrive.A popular idea in the late 1980s was the concept of portfolio insurance. But when the sell off hit in October 1987, PI made the selling just that much worse, the opposite of what a hedge was supposed to do.

this reminds me of Long Term Capital Management.

https://en.wikipedia.org/wiki/Long-Term_Capital_Management

not all fraudsters intend to defraud, consider  the case of Nick Leeson who destroyed Barrings Bank.

https://en.wikipedia.org/wiki/Nick_Leeson