Market Lore

The wildest true stories in money and markets, sourced and told in 60 seconds. Not financial advice.

[Market Lore @marketlr]

Sources: https://t.co/PJJ1Y1hAu1 on Goldman's read of CFTC data, Nov 7 ($8B Oct 20-27; $19.5B since Sep 22) · CNBC, Nov 6 ($3,869.85 low on Oct 30; 74.8% Dec hike odds, CME FedWatch) · World Gold Council, Nov 2 (selling led by leveraged investors). Which number surprised you?

[Market Lore @marketlr]

Speculators dumped $8 billion of gold positions in one week.

Five straight weeks of selling, $19.5B since Sept. 22 (CFTC data, per Goldman). On Oct. 30, gold hit a one-year low near $3,870.

Then Friday's jobs report landed...

Is gold losing its value, or just its speculators?

[Market Lore @marketlr]

Sources: [Intel’s $475M charge](https://t.co/DGL0yRYWIG); [Nicely’s FDIV FAQ](https://t.co/ZX3b9M52HJ).

Would you have kept the chip or demanded a swap?

[Market Lore @marketlr]

Thomas Nicely exposed a $475 million chip bug.

He reported it. Intel already knew. Then IBM stopped shipping Pentium PCs…

Would you have demanded a free replacement?

[Market Lore @marketlr]

Sources: EIA Today in Energy (Apr 27 2020); CFTC interim staff report on NYMEX WTI May 2020; Caixin Global on Bank of China Yuan You Bao (~60k clients, ~¥10B, attributed). Settlement -$37.63; low -$40.32. Would you have trusted a bank's oil 'treasure'?

[Market Lore @marketlr]

Sixty thousand people bought Bank of China's oil product. When oil settled at -$37 a barrel, they owed the bank.

The tanks at Cushing were almost full…

Would you have bought a bank's oil "treasure"?

[Market Lore @marketlr]

Sources: Federal Reserve History, "Near Failure of Long-Term Capital Management"; Fortune, Oct 26 1998 (Loomis); WSJ, Nov 16 1998; Lowenstein, When Genius Failed. 14 firms put up $3.6B, none of it Fed money. Should the Fed have let it fail?

[Market Lore @marketlr]

Two Nobel Prize winners were partners in one hedge fund. It lost $4.6 billion in under four months.

It had about $30 of debt for every $1 it owned. Then Russia defaulted, and Warren Buffett's rescue offer ran out of time…

Would you have trusted the Nobel winners?

[Market Lore @marketlr]

Sources: https://t.co/jyprPgY5ea IPO prospectus, SEC (Q4 1999: $5.2M sales, $11.6M cost of goods, $30.7M marketing; $11 IPO); https://t.co/jyprPgY5ea 8-K, Nov 7 2000 (50+ prospects, fewer than 8 would visit); ABC News and LA Times, Nov 2000. Which dot-com flop would you have bought at the IPO?

[Market Lore @marketlr]

In late 1999, https://t.co/jyprPgY5ea sold $5.2M of pet supplies that cost it $11.6M to buy and ship, then spent $30.7M on marketing.

It still went public at $11 a share. Nine months later the stock was worth 22 cents, and the sock puppet was up for sale. #dotcom #financialhistory

[Market Lore @marketlr]

Sources: BBC News, Oct 2007 (~50 men, $25M, 4:45 a.m., "Morgan had the key", "There's the place, King, and here's the pen"); The Morgan Library & Museum; NPR Planet Money, Dec 2013; Bruner & Carr, The Panic of 1907. Should one banker ever hold that much power?

[Market Lore @marketlr]

In November 1907, J.P. Morgan locked about 50 bankers inside his library and kept the key.

Just before 5 a.m., they signed a $25 million rescue and New York's panic finally broke. Six years later, the U.S. created the Federal Reserve.

#PanicOf1907 #JPMorgan

[Market Lore @marketlr]

Sources: Bloomberg Businessweek, Apr 8 2021 (~$20B in two days); Credit Suisse/Paul Weiss report, Jul 29 2021 ($120B gross, $9-10B equity); Federal Reserve, Dec 10 2021 (>$10B bank losses); SDNY, 2024 (18 years). Should banks have to share what their clients owe each other?

[Market Lore @marketlr]

Bill Hwang lost about $20 billion in two days.

His family office, Archegos, told its banks it had $120 billion in bets and only $9-10 billion of its own money left. Each bank saw only its own piece. Together they lost over $10 billion.

#Archegos #investing

[Market Lore @marketlr]

Sources: Reuters, Feb. 28, 2014 (80%, 850,000, 7%); Mt. Gox announcements Feb. 28 & Mar. 20, 2014 (200,000 BTC found Mar. 7); NYT/AP, Mar. 15, 2019 (convicted of falsifying data, cleared of embezzlement). Hacked, or never there?

[Market Lore @marketlr]

One man's Bitcoin exchange lost 850,000 Bitcoin, about 7% of all that existed.

Mt. Gox once handled around 80% of the world's Bitcoin trades. Weeks after its 2014 bankruptcy filing, it said it had found 200,000 coins in an old wallet it thought was empty.

#Bitcoin #MtGox

[Market Lore @marketlr]

Sources: Reuters/NYT, Oct. 27, 1992 (almost $1B; ~$10B bet); Mallaby, The Atlantic (Druckenmiller's $1.5B short, "go for the jugular"); The Independent chronology + BBC On This Day (12%, 15% promised, ERM exit). Hero or villain: should one fund be able to beat a central bank?

[Market Lore @marketlr]

One hedge fund made almost $1 billion betting against the Bank of England.

Sept. 16, 1992: Britain bought pounds, raised rates to 12%, then promised 15%. It didn't work. That night it quit the ERM.

Running it for George Soros: Stan Druckenmiller.

#Forex #Finance

[Market Lore @marketlr]

Sources: NYT, Oct. 30, 1929 (record volume; $8–9B est. loss); UW News / Joe Janes via Galbraith (ticker 152 min late); UPI Dow table (−30.57, −11.73%); New-York Historical Society closing tape ("Good night"). Would you have sold if you couldn't see the price?

[Market Lore @marketlr]

On Black Tuesday, the stock ticker fell so far behind that the tape signed off "Good night" more than 2 hours late.

Oct. 29, 1929. Over 16 million shares traded, a record. Crowds sold on prices that were hours old. The Dow fell 11.7%.

97 years ago today.