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FT Intel - USDCHF sell idea
Retail is long, institutional players are net short
Technical Trend is bearish
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Please email [email protected] using your registered email address and include your account number along with a brief explanation of the issue. The team will review it and follow up with you directly.
Hi, weโre sorry to hear about your experience. If you have a specific issue related to your account, weโd like to look into it for you.
Please email [email protected] using your registered email address and include your account number along with a brief explanation of the issue. The team will review it and follow up with you directly.
Hi, weโre sorry to hear about your experience. If you have a specific issue related to your account, weโd like to look into it for you.
Please email [email protected] using your registered email address and include your account number along with a brief explanation of the issue. The team will review it and follow up with you directly.
A 28 year old Broker Crashed a 233 year old Bank (lost a billion dollars) ๐๐
The story of Nick Leeson and the collapse of Barings Bank is one of the craziest stories in financial history. Imagine a bank that financed wars against Napoleon, where the British Queen herself held her money, and that survived two world wars... Only to be wiped off the face of the earth in 1995 by a single man in his twenties, sitting in an office in Singapore. Here's how it happened: The Rise of the "Golden Boy" - In the early '90s, Nick Leeson was a real star. He was sent to Singapore to run operations for Barings Bank on the local stock exchange (SIMEX). His job in theory was arbitrage, risk-free betting on small differences in stock prices between the exchanges in Singapore and Tokyo. He brought the bank huge millions, bringing in almost 10% of the total profit of the entire group, and the bosses in London adored him. They trusted him so much that they did not set up any serious oversight - he was "his own boss.". Mistakes happen in trading - someone clicks wrong, buys instead of selling. Thatโs why Leeson opened an account under the code name "88888" (eight is a lucky number in Asia) to temporarily record such technical errors there. However, he soon realized a dangerous flaw in the system: he could also hide his own losses in that account. Instead of admitting to his bosses when he lost money on a bad trade, he would simply shove that minus under the rug (to account 88888) and then start risking increasingly crazier and larger amounts to recover the money before anyone noticed. Classic revenge trading and gamblerโs doubling down. By the beginning of 1995, Leeson had accumulated hundreds of millions of pounds in losses on the secret account. He was betting huge amounts of other people's money that the Japanese market (Nikkei index) would remain stable and not move too much. January 1995, a catastrophic earthquake hit the Japanese city of Kobe. Thousands of people died, and the Japanese economy and stock market have collapsed. What did Leeson do? Instead of cutting losses, his ego took over. He decided to buy even more. He bet on a quick recovery of the Japanese market with sick leverage. But the market continued to bleed, and his loss increased exponentially hour by hour. Escape and a note on the desk At the end of February, the loss reached an astronomical 827 million pounds (over a billion dollars) โ which was almost twice the entire available capital of Barings Bank. Leeson realized the game was over and that there was no return. He neatly packed his things and left a small note on his desk that simply said: 'I'm sorry.' He fled with his wife to Malaysia, then to Brunei, and eventually to Germany. He was arrested a few days later at Frankfurt airport while trying to flee back to Europe. Epilogue Barings Bank, over two centuries old, was declared bankrupt that same weekend. In the end, it was sold to the Dutch bank ING for exactly โ 1 pound. Nick Leeson was sentenced to six and a half years in prison in the notorious Singaporean prison (he served four). While in prison, he survived colon cancer, got divorced, and wrote the autobiography "Rogue Trader," which was later made into an excellent film starring Ewan McGregor. The lesson of the story? Never let the same person trade money and simultaneously check their own books (compliance). And yes, the diamond hands strategy really doesn't work when you're trading a billion dollars of someone else's money on leverage.
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