Friend-of-the-blog Cassandra has been waxing lyrical on the subject of leverage recently, perhaps because of first-hand observation of what appears to be significant deleveraging activity in single name Japanese stocks.
When Macro Man proffered a modest contribution to Cassie's collection of leverage verse, occasional poster/impressive polymath/tastefully-initialled Mencius Moldbug suggested that he republish in this space. And so, by popular demand, Macro Man presents his first-ever financial sonnet!
Shall I compare thee to a levered trade?
Thou art more lovely and more temperate.
Rough winds do shake the market call you made;
Perhaps thou erred in selling options of short date.
Sometimes too hot the market darling shines,
And oft the ertswhile star is dimmed;
And every trade from time to time declines,
Alas! The over-levered ones are trimmed;
Just as a short-term extreme is made,
And soon a tidy sum thou ow'st;
Forsooth, thou start to feel afraid,
In real time, thy loss it grow'st and grow'st:
The levered trade, in time of volatility?
A dang'rous game, as you can finally see.
When Macro Man proffered a modest contribution to Cassie's collection of leverage verse, occasional poster/impressive polymath/tastefully-initialled Mencius Moldbug suggested that he republish in this space. And so, by popular demand, Macro Man presents his first-ever financial sonnet!
Shall I compare thee to a levered trade?
Thou art more lovely and more temperate.
Rough winds do shake the market call you made;
Perhaps thou erred in selling options of short date.
Sometimes too hot the market darling shines,
And oft the ertswhile star is dimmed;
And every trade from time to time declines,
Alas! The over-levered ones are trimmed;
Just as a short-term extreme is made,
And soon a tidy sum thou ow'st;
Forsooth, thou start to feel afraid,
In real time, thy loss it grow'st and grow'st:
The levered trade, in time of volatility?
A dang'rous game, as you can finally see.
10 comments
Click here for commentsReading this bit of excellence, I thought I'd better rethink any assumptions I might have had about your alma mater. But I'm left with one doubt...
ReplyThe map found at http://mooreschool.sc.edu/moore/pr/maps/Map1.htm seems to indicate that the Salkehatchie campus is located in a place (this without glasses and early in the day, mind you) called Waterboard. Please advise.
CB, I fear some comments made over at Capital Chronicle may have left you with the wrong impression. While I am from South Carolina, I did not, unlike Rawdon, attend the University of South Caolina. (If you're interested, my alma mater is a much-loathed private institution in North Carolina.)
ReplyThere was a slight misreading of the map; it is actually USC-Salkehatchie at Walterboro. But to be honest, I don't know the non-coastal Low Country very well; other than going to the beach, I rarely forayed far South of Due West or Ninety Six.
Glad you like the poem, though.
CB - Thought of you last night as a friend (a wine importer) scored (what appears to be) some primo spanish oil along with my Albarino. Of course its probably ordinary for a connoisseur like you, but for those starved of the real thing.....
ReplyThanks M. I was a little worried about that.
ReplyCass - An albariño? In your climes? Aren't you a lucky girl.
Waxing poetic?
ReplyBe sure to check out the Refco Rhyme: From Bad to Verse at:
http://www.fenews-digital.com/fenews/200601/?pg=9
macro-man, a dookie? who would have guessed.
Replyyour jayhawk friend
""Money is a new form of slavery, and distinguishable from the old simply by the fact that it is impersonal -- that there is no human relation between master and slave.": Leo Nikolaevich Tolstoy - (1828-1910)
ReplyRussian writer
As long as this is created out of NOTHING as an interest bearing DEBT, where every one is enslaved from cradle to grave. The so called FREE trade is UN FREE, UN FAIR and UN JUST.
Interest is not necessary or inevitable, hence inflation can be abolished and national debts too.
In the First world the cretins(in the words of Murdoch) are allowed some creature comforts so as to make good cannon fodders, but in the Third World a child is murdered every THREE seconds as a result of interest charges.
The HOLOCAUST have been alive and well for decades, this is also part of population control.
When the powers that be have secured the necessary control of the resources, then the lesser breeds of the First World will be given the same treatments of the Third World.
The trouble with the enslaved, is as long as they are allowed to pontificate ''freely''they thing they are the masters.
As Kissinger pointed out it's not the reality but the perception that matters.
As in the main hands are being thrown up in the air as there are no alternatives, besides perhaps Marxism.
There is an alternative I came across.A non violent too.
The Modern Universal Paradigm / Money Supply (interest free)
acceptable to all races, religions,and continents.
The penny is beginning to drop as the financial Armageddon/tsunami is sweeping across the world, speed is being stalled by SWF's, the flood gates are open nothing will stop the melt down
Moneylender
You should not do it - write poetry on the market, especially aping Shakespeare. It is an open invitation to invent. I offer an amended version - the last six lines
ReplyShall I compare thee to a levered trade?
Thou art more lovely and more temperate.
Rough winds do shake the market call you made;
Perhaps thou erred in selling options of short date.
Sometimes too hot the market darling shines,
And oft the ertswhile star is dimmed;
And every trade from time to time declines,
Alas! The over-levered ones are trimmed;
A naked abyss opens at extremes,
And rich losses mount to kiss their apogee,
Fear strikes, all balance goes,
Red entries mount, too fecund for the credit won.
Remember these words who deal in debt cupidity,
Gross leveraged trades die many deaths in volatility.
MM - When you start doing Poe, it might be the moment to take a whack from the long side...
Reply-C-
Cassie...is that a dare!?!?!?!
Reply