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#1 megabear

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Posted 13 December 2002 - 01:21 AM

Here's an interesting site some of you might want to browse. Check out the photo gallery. Here's a guy that made
100 million in 1929 going short. But...he did end up killing himself; bummer.

Link to photos.

Edited by DrStool, 13 December 2002 - 02:19 PM.


#2 SusanJBear

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Posted 13 December 2002 - 12:18 PM

I know it sounds like heresy, but I have long disagreed with the label for Jesse Livermore "GREATEST stock trader that ever lived."

Yes, after reading about him I learned he was amazingly skilled and had an incredible intuition, and he was a BIG trader with BIG stakes - but he lost his fortune again and again. He did do well in the crash of 1929 - and then lost much of his magic touch after that.

There are a few hanging out on this board, I believe, who were better at managing losses than Jesse Livermore.

#3 Slothrop

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Posted 13 December 2002 - 01:26 PM

I agree with the Bear woman. Jesse, may he rest in peace, cannot be labeled "the greatest trader who ever lived" for 2 reasons:

1) He kept losing the money.
2) He killed himself.

Sorry, but either one of those is grounds for disqualification and the two together are profound.

Greatest trader? Why not go with the proven statistics?
Larry Williams is the only trader on record to have turned 10 grand into a million in a year's time.

Now, that's trading.

I would also count George Soros as at least in the top 5.

#4 DrStool

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Posted 13 December 2002 - 02:12 PM

I have heard from others more knowledgeable than I that those legends about Livermore re his suicide and dying broke are false.


All the books by and about Livermore are avaialbe in Doc's bookstore. Use the search box at the bottom of the page, using keyword Livermore, or start here.

Also, Reminiscences of a Stock Operator is indispensible.

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#5 DrStool

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Posted 13 December 2002 - 02:24 PM

I have redirected the link in the first post to the referenced phot pages. The rest of the site is a bookstore. I love linking to outside sites, as long as they are not in direct competition withDoc's bookstore..

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#6 Slothrop

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Posted 13 December 2002 - 02:55 PM

According to the website "jesselivermore.com", he did himself in. And there's the photo of Jesse and his lovely wife just before he did it...right here.

#7 Slothrop

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Posted 13 December 2002 - 02:59 PM

And here's Jesse chatting with the bankruptcy referee.

#8 DrStool

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Posted 13 December 2002 - 04:06 PM

Looks like he did commit suicide, but he was also pretty damn old.

The thing about dying broke isn't true though.

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#9 Slothrop

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Posted 13 December 2002 - 04:14 PM

You're right, Doc. It looks like he made money, then lost it, then made it back again, then lost it, then made it back again...and so on.

Nice touch there I didn't know before: on the plus days he always paid off debts from the previous bankruptcies. Very gentlemanly.

#10 machinehead

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Posted 13 December 2002 - 07:34 PM

Read Jesse's story in Reminiscences of a Stock Operator. He got his start in bucket shops. No actual orders were placed on the NYSE. Like Ladbroke's in London, the bucket shops were simply taking bets on outcomes. The punters picked their stock and put as little as 1% down. After that, if the tape printed a 1% drop, they lost their bet. If a gain occurred, they could cash out at a profit.

Obviously most punters got blown out by ordinary noise and volatility. But if you think about it, the bucket shops were essentially selling single-stock futures at zero premium. That can be a fatal game against a buyer who knows what he's doing.

Livermore, an ace tape reader, consistently bought breakouts (or shorted drops through support) and made tons of cash. The bucket shops quickly banned him. Like casinos, they only expected to take in money, not pay it out. A player like Livermore who consistently won was no longer welcome.

When MH used to live in Taipei, there were commodity bucket shops on Nanjing East Road. Same deal -- they weren't actually placing trades on any exchange. It was just local punters playing the odds against the house, using published quotes to keep score. Heavy hitters who preferred equities could get a private lounge at their broker's office, with girls to hand carry their orders and fills, and fetch champagne while they watched the tape. Jesse would have loved it ... thought I saw him hanging out there one day on Jen Ai Road.
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#11 MaxxPain

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Posted 13 December 2002 - 08:25 PM

His suicide is really an insignificant part of his life story. It may have had more to do with the behavior of his crazy wives and offspring than his trading. I consider him a great trader with one minor flaw, he was totally addicted to the game. He couldn't quit. If I could only make one of his fortunes I'd be done. I'd just be hiding in my bunker cleaning my guns and counting my stockpile of ammo.

Crap, I might have to buy another book.

#12 HiHat

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Posted 13 December 2002 - 09:06 PM

Livermore suffered from bouts of BLACK depressions
for most of his life.

His son Paul helped Jesses wife move valuables from
apartment before officials could qwestion her.
He estimated she had about 2 million dollars in cash
in paper bags.

#13 BAREister

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Posted 13 December 2002 - 10:04 PM

Look, the guy was a genius AND a manic depressive. He ran with a fast crowd and had a nutty family and was filthy rich, a deadly combination for most, with prolonged exposure to such stresses. He was honorable in paying off his debts and ruthless, quixotic, really. He didn't die broke. He was, simply, by dint of his ruthlessness and willingness to risk huge amounts of money at a time, a brilliant, and justifiably legendary trader, from the get-go, the "Boy Plunger" was.
No idea his family was so crazy. "Poor" guy. He died unhappily. No man can truly count himself happy until he's on his deathbed reflecting upon his life, HRFF once read, and it's true.
Tiberius died broken and unhappy. Suleiman I the Magnificent, did as well. Both had riches and power almost without precedent. History is full of such examples.

As HRFF read today, wealth is a state of mind:

"Being rich isn't about money. Being rich is a state of mind. Some of us, no matter how much money we have will never be free enough to take time to stop and eat the heart of a watermelon - and some of us will be rich without ever being more than a paycheck ahead of the game.'

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#14 Goldmember

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Posted 13 December 2002 - 10:35 PM

Markets knew how how to cleanse out the rot very quickly and efficiently then. Plunge protection teams consisted of JP Morgan himself and other bankers, who were most assuredly not hurt a bit from inevitable plungings. More likely than not they were excellent plungers themselves. Bear market declines were fast, freaky, and highly profitable to those doing the plunging. Real panic with hurricane velocity. Livermore's "Boy Plunger" escapades in 1907 are worth the price of the book alone. He was already covered and buying it up when the market was on the point of illiquid destruction, once again a step ahead of JP Morgan, who had sent an aide to the exchange floor to appeal to Livermore to cease his short selling to enable the market's survival. No Feds, PPTs, Greenies, or other crap to interfere with a good plunging. Psychology and liquidity ruled the day, Mr Market ambled along the path of least resistance perpetrated by cash flow and wherever the mood of the day sent the cash. I suppose that is still how it works today but the monster is a humongous much slower responding beast day, even or especially given todays so called 'high volatility'. Volatility, crap, we ain't seen nothing! Now I'm just rambling........
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#15 DogBoy

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Posted 14 December 2002 - 12:35 PM

"Bear market declines were fast, freaky, and highly profitable to those doing the plunging"

It's interesting how the big guys made their fortunes on fast and furious declines (and often manipulated) in the old daze and now they make their fortunes by manipulating the upside rallys.

I attribute this to one or both of the following:

1) it's not P.C. (politically correct) to make money on stocks goin down. Da Boyz being the upright "good citizens" that they are recognize the the old games won't fly to the public anymore so they jus flip the table and make it the other way. Gotta keep up appearances ya know.

2) Maybe we're it's cause we're in a Grand Super Cycle in which we've been in a Bull phase for centureis and have noe begin the Bear Phase ? Furthermore that fast plunges are characteristic of Bull markets and fast rallies are symptomatic of Bear markets.

In any case it seems that unlike the old days the boyz seem to fight plunges like cats and dogs and they let rallies rip to the upside with abandon.

Anyone else have any theories on this ?





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