Summary of Roger Lowenstein's When Genius Failed

By IRB Media

Please note: This is a companion version & not the original book. Book Preview:

#1 The secret of Eckstein’s business was to ride your losses until they turned into gains. He would buy the futures, sell the bills, and wait for the two prices to converge. But instead of converging, the gap widened even further.

#2 Meriwether’s life’s work was to understand and trade financial futures. He had grown up in a Democratic, Irish Catholic stronghold of Mayor Richard Daley in Chicago. He knew virtually everyone in the area, a self-contained world that revolved around the basketball lot, soda shop, and parish.

#3 Meriwether’s escape from Rosemoor was by means of a singular passion: golf. He was a standout member of the Mendel school team and twice won the Chicago Suburban Catholic League golf tournament. He also caddied at the Flossmoor Country Club, which involved a significant train or bus ride south of the city.

#4 Until the mid-1960s, bond trading had been a dull sport. But in the late 1960s, the epidemic of inflation destroyed the world of fixed relationships. By the end of the 1970s, firms such as Salomon were slicing and dicing bonds in ways that Homer had never dreamed of.

• Language: English
• Publisher: IRB Media
• Release date: May 10, 2022
• ISBN: 9798822510760

IRB Media

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Insights on Roger Lowenstein's When Genius Failed

Contents

Insights from Chapter 1

Insights from Chapter 2

Insights from Chapter 1

#1

The secret of Eckstein’s business was to ride your losses until they turned into gains. He would buy the futures, sell the bills, and wait for the two prices to converge. But instead of converging, the gap widened even further.

#2

Meriwether’s life’s work was to understand and trade financial futures. He had grown up in a Democratic, Irish Catholic stronghold of Mayor Richard Daley in Chicago. He knew virtually everyone in the area, a self-contained world that revolved around the basketball lot, soda shop, and parish.

#3

Meriwether’s escape from Rosemoor was by means of a singular passion: golf. He was a standout member of the Mendel school team and twice won the Chicago Suburban Catholic League golf tournament. He also caddied at the Flossmoor Country Club, which involved a significant train or bus ride south of the city.

#4

Until the mid-1960s, bond trading had been a dull sport. But in the late 1960s, the epidemic of inflation destroyed the world of fixed relationships. By the end of the 1970s, firms such as Salomon were slicing and dicing bonds in ways that Homer had never dreamed of.

#5

The bond market was turning topsy-turvy in the 1970s. Two factors dictate a bond’s price: the risk of default, which is not strictly quantifiable, and the interest rate that investors demand for lending money to governments.

#6

By the early 1980s, Meriwether was one of Salomon’s bright young stars. His shyness and implacable poker face played perfectly to his skill as a trader.

#7

Meriwether was a priest of the calculated gamble. He was extremely private, and he wanted to eliminate the element of passion from trading. He wanted to hire traders who were smarter than the Neanderthals who traded from their bellies.

#8

The eggheads, who were hired to help trade the markets, were extremely smart. They