The CEOs, some of whom may have been conflicted as they had personally invested significant sums in LTCM
, all agreed to contribute their independent stockholders' capital.
That lead LTCM
to ignore a low-probability risk that these patterns could change--a change subsequently caused by a default on Russian government bonds.
Now a university professor, Taleb once founded a hedge fund, Empirica Capital, that was run along very different lines to those of LTCM
previous vice chairman of the Fed, was a major LTCM
Counterparties of LTCM
were required to mark their positions
439) After the collapse of LTCM
, however, many dealer-banks required full collateralization of hedge fund transactions.
And I do believe Geithner was involved in the LTCM
The amplification mechanism discussed in these papers may be used to understand purely financial crises, independent of any effects on the real economy, such as the stock market crash of 1987 and the LTCM
crisis of 1998.
Figure 2 shows a schematic of the LTCM
in-tube refrigerant flow boiling test loop.
This was the case of the LTCM
(Long Term Capital Management) Bank, and also the Carlyle Capital investment fund that led Bear Stearns to collapse.
In August of 1998 Russia defaulted on its debt and the financial markets came unraveled and LTCM
nearly went bankrupt.
is a long-gone goose, but asset pricing remains.