Sean Andrews: > ... I guess I've mostly been schooled on this crisis by listening to > Doug's show (he definitely predicted this crisis several years ago)
I predicted this crisis in 1994, prior to which I knew nothing about finance. 1994 was the year I started to learn about this finance thing after a job I took in the business as an unemployed mathematician and the first two things I experienced were the bankruptcy of Orange County because of its treasurer Citron's heavy investments in inverse floaters (which are highly sensitive to the changes in interest rates) by leveraging his portfolio through the repo market up to about 3 times and the collapse of David Askin's CMO hedge fund. Both were making leveraged bets that the interest rates would remain low in 1993, yet the interest rates went up. Both lost billions: Askin's fund went out of business and Citron bankrupted Orange county. A soon as I saw these collapses, I said, hey, there is something wrong about these and the next year Mexican crisis started. Indeed, the rise of Zapatistas, and the so-called anti-globalization movement, were an outcome of that crisis. Do I get any credit for predicting "this crisis" in 1994 or get punished because I could not predict "this crisis" prior to 1994, since I knew nothing about finance or economics before that? I guess, I started to sound like Henry: http://lists.econ.utah.edu/pipermail/a-list/2008-October/073187.html So, I better stop here. Best, Sabri _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
