How do you lose $5 billion in one week?

LTCM lost 4.6 billion but over 4 months according to wikipedia.
Nick Leeson lost 1.4 billion at Barings Bank.

So a $5 billion blowup in 5 days has to be the biggest and fastest blowup of all time. Or am I wrong?

 

hey all i was just watching bloomberg tv. the reporter was interviewing a professor from boston university and asked him what is the risk to the buyer of amaranth's energy portfolio. the professor replied:

"well, i like to look at risk simply. nat gas can go to 0, so that's about $5. but just a few months ago nat gas was at $15. so the upside is better than the downside."

 

Ok. Pick a strategy that you know will lose money going forward.

 

By letting everyone know about the position so that they can bet against it.

 

i wonder who will be taking the otherside of the trade when they unwind their natural gas positions. this may be the short term bottom for natural gas....

 

I think you may have missed my point. Please read my post again.

 

If this guy isn't cool, I don't know

 

It's like this

First all the hedge funds robbed the public blind by kiting the energy complex beyond all reason.

Then the tables were turned.

It's a nasty business, aint it.

 

I'ts a lot easier to lose money due to the very thing that is supposed to keep you from losing money.

I'll let you guess what it is.

 

FWIW, Citadel will make a billion off this deal, minimum. They have the capital to ride out the shots the funds may take. WTF would attempt to run stops at $5.00 against Citadel?

Time to buy NatGas. I think it's going to be an abnormally cold Winter.