aedens wrote:Also I convey a story from Isaac Newton, which may be true and, in any case, is a great story from Jeremy Grantham.
Newton had the great good luck to get into the South Sea Bubble early. He made a really decent investment and a very quick killing, which mattered to him. It was enough to count. He then got out, and suffered the most painful experience that can happen in investing: he watched all of his friends getting disgustingly rich. He lost his cool and got back in, but to make up for lost time, he got back in with a whole lot more (some of it borrowed), nicely caught the decline, and was totally wiped out. And he is reported to have said something like, “I can calculate the movement of heavenly bodies but not the madness of men.”
I've noted this story a couple times, first in 2008, with regards to Newton and Einstein both losing most of their money in bad investments (searching archives for "Newton" will bring up the posts). I believe it was Newton's niece who verified the story. Einstein's bad investments were revealed when many of his personal letters were published a few years ago. It's been my observation through time that otherwise very intelligent scientists and engineers make horrible investors and traders.
jcsok wrote:aedens wrote:I think Tiberius said it best.....
"Governing Rome is like holding a wolf by it's ears...."
Along a similar vein, a friend and I were discussing the state of the world ponzi scheme, and he used an analogy that Bernanke had a bear by the tail and was swinging it in circles above his head, but he's getting tired, and when he can't swing the bear anymore, its going to eat him (us).
Wow, great analogy. I would add that as Bernanke swings the bear, Bernanke is getting more tired, but the bear is gaining strength and becoming more and more angry.