In the aftermath of the stock market crash of 1929, the Great Depression, and the Second World War, the stock market looked moribund in America. Share prices were still a long way from returning to their peak levels from just before the crash. Brokerage firms were also having trouble engaging with new customers. Trading…
A conventional bond’s value is eroded by inflation, a fact which introduces a meaningful risk to long-term bonds. When inflation is expected to remain stable, investors often try to match the duration of their bond investments to the duration of their liabilities. So, long-term investors like pension funds or individuals saving for their own…
Prior to the commercial revolution of the very late Middle Ages and Renaissance, it was conventional wisdom that money was ‘sterile’ and produced nothing of value by itself. So, most of Europe was skeptical of interest-bearing loans. In those days, the charge of usury could be levelled against anyone charging any interest. However, in the…
Seen in one light, it appeared the perfect time for a U.S. investor to buy a bond in the late 1890s. Disregarding year-to-year movements in prices that largely cancelled out, there was hardly any inflation over long periods of time. Also, the going rates on all sorts of fixed income investments had generally fallen…
Hedge funds became far more numerous and grew to manage far more money in the 1990s and 2000s. As they have grown, successful hedge fund managers and their analysts and traders have become a new personality in finance and successful funds more well-known. Yet, there have been many failures to complement the successes. One…
Many famous traders and investors’ talent is closed to the participation of ordinary people. They manage money at banks and hedge funds where access is exclusive. Some of the best become famous, close their funds to new investment, or even return money to investors so that the best opportunities are preserved for the money managers…
One of history’s most well-known speculators is not so known because of the large amounts of money he made and lost, or because of any particular trade, or a crisis caused by his actions. Rather, Jesse Livermore is remembered as the basis for a character in a book, Reminiscences of a Stock Operator, by the…
The finances of Britain’s royal family results from a complicated history, one where the monarchs were both private and public persons and where their wealth was of both a public and private nature, as it remains to this day. It is probably because of this that press interest in the royal family is not…
Before the end of the 19th century, planning for old age largely revolved around addressing the needs of widows and orphans. Workers themselves may have lived beyond the last years in which they could feasibly work but from this moment on they needed the support of others, largely their families. Only the rich could…
In other industries, illustrious firms almost always go out with a whimper. Few even notice their demise. When they do finally disappear, the obituaries may as well have been written years in advance. Everyone sees the end coming. This is not so often the case in finance. In its short history, Long-Term Capital Management…
