Fred Swede-ml. Market dreams of Wall Street

Fred Swede-ml. Market dreams of Wall Street

Released in 1940, Fred's Book Swede (Fred Schwed) "Where is the boat yet?" (Where Are the Customer 'Yachts?) Is considered a classic investment. Its name was born from the once popular joke on Wall Street: a guide showing a visitor the financial district Ho York, drew his attention to some beautiful ships anchored off shore. "Look, - said the guide, - this is yacht brokers and bankers." What a naive visitor said: "Where is the boat yet?" The Book Swede,based on his own experience casts a satirical look at Wall Street, in the spirit of Mark Twain. It also provides some astute philosophical definitions, for example: "Investing and speculation are two different things, and a wise man advised to engage the first and avoid the second. This is about how to explain the troubled adolescent that Love and passion - two different things. "

He was born in New York, and ero dating Fraud Wall Street began early - his father was a member of the New York Stock Exchange curbs. " The Swede went to Princeton, but it was thrown out with the highest rate - at night it caught in a dorm room with the girl. He completed his higher education at Columbia University. After graduation he worked as a reporter in "The New York Times," and then "The Wall Street Journal," before he became to work with client accounts in a stock brokerage firm. Obviously, he was not very high opinion of his work, judging by what he was talking about sellers of mutual funds: "They can be compared with the sellers of life insurance policies. Remember how these life insurers: first, they cause slight irritation, then become nauseous, and then push the policy directly to you in the throat. "

The Swede also dabbled in trade, but claimed not to become rich as a trader, because I listened to the cynical colleague Irishman: "Al's something in the first place have been established securities? - Said the Irishman. - They are designed to be sold, so they sell the same ". This cynicism, of course, on display at the "Market of the Wall Street of Dreams" for Swede laughs Wall Streeters, who considers himself a prophet, scholar and magician money.



Wall Street, - reads a sinister old joke - it is a street that has at one end of the river, and at the other cemetery. "

It's pretty nice, but if only somewhere in the middle of a children's garden, it would be even sweeter.

For over ten years I have watched every day of the activities of the street, mainly from the vantage point of the trade table. In our business, we have access to all forms of communication, but heliograph. We exchange for an incredible network of wires quotes, orders, bluff, fabrications, untrue and nonsense. The first four necessary components of the date of execution of the broker in the securities market. An outright lie is quite rare and in the long run turns out to be unprofitable business practices. Here I would like to talk about nonsense - the product, which oozes weeks and years, with an absolute constant rolling waters of the Mississippi.

My work - constantly talking to many of these wires with an order clerks, traders, speculators and partners. The first part of their conversations are usually intelligent and competent, and sometimes on the verge of brilliance. This is the part relating to quotations and fiction, then, but if the case fit the mood, there comes a time when, still under the impression that they are doing important work, they begin to express their thoughts. They may relate to a particular stock market in general or the fate of the nation.

Let's look at two very common thoughts.

Thought Number One: "It seems that after lunch may be a slight rise." It proclaims the young by Mr. Joseph Vayzenhaymerom who have completed two classes of high school. At the time of his inspiration, he chews gum and stares at the ticker tape He accompanies his statement look so knowing that it seems almost carnivorous.

Number Two is thought by Mr. C. Hugo Bigshotom and shatters all the wires. Let me just jump to her conclusion:

Hence it is clear that for the next fifteen years period, investment demand for solid convertible securities with lower coupon, but bearing an attractive feature of convertibility will enjoy a deserved popularity among astute investors, that will involve more classical forms of the written agreement of the bond issue.

Now the question arises: which of these two statements more stupid? Any of them, as you know, it might be correct. And both of them (or set of statements of this kind) promote the sale of securities by billions of dollars.

You may be inclined to think number two, because it sounds silly onomatopoeic.

I think it's hardly fair. Junior Joe does not know so many long words. But he contends that says something that has some meaning, and says it is just as certainly, as Mr. Bigshm. The latter, who graduated from business college and had attended courses in English literature, can do to make his statement sounded stupid. But since none of them has no factual or intellectual basis for expressing any of these thoughts, I would argue that they are both equal.

Now we need right here to say that none of these people are not a liar and not even a fraud.

If you ask Joe why, after lunch would be a small growth stocks, he will answer unequivocally. He says that there is a decrease in sales, he can see that the shares held by steel companies firmly just above the recent past lows and that "they" (whoever these "they" are) begin to accumulate second-class carriers. "But the market goes too far - can add it (arguing that in his heart he is not crazy optimist, but more like a banker of the old type) - They do not wish to see the market run away."

It's amazing, this language is universally used in courtrooms, not just in New York, but from coast to coast. It seems that someone has invented a kind of "Esperanto" to a variety of ways not to say anything at all.


Street DREAM
And if you ask what else, an educated guy, on which he bases his fifteen-year forecast, it will lead so many reasons that you'll be sorry you asked. But he should know better. If he ever tear his nose from the details of his remarkable business and would consider it and its history as a whole, it will be forced to admit the sad truth that the unfortunate few financial "experts" have ever known in the next three years (not to mention the fifteen ), what will happen with any class of securities, and that most are usually stunningly wrong in the assessment of a much shorter time than that.

And yet it is not a liar, as well as our other friend. They are both in the power of voluntary delusion child does not have the force myself to believe anything that is too unpleasant. But we expect that the child will grow up and learn to distinguish reality from what is only his passionate hope.

We, however, require too much of our romantic Wall Streeters - and they are all romance, otherwise they would never choose this business, the business of dreams. They still dream of conquest, revolution and power for themselves and for the people whom they give advice.

Some people on Wall Street can not lose them, having spent enough years. But they almost never lose an absolute dream: a secret that there is logically conceivable, in the rise and fall of financial enterprises - that "deep study" of this world, might have something to prove, he tells dedicated, when growth starts, or give a speculator a better than equal chance to conduct profitable operations or guarantees of reliable 4-percent increase over several generations. All these things obviously are not predictable, but the truth is too bitter to look at her eyes open.

If this business - mindless business, what will happen to people involved in them?

I'm not just talking about their livelihood, which at the moment is probably at its lowest level (about this exchange.) For any language of the people or the languages ??of angels can not keep the audience from Wall Street, as soon as prices begin to to grow rapidly.

The main threat is to their self-esteem. If a person can not be an authority in his own profession, in general, than he can achieve credibility?

The dealer at the roulette table does not claim to know something about the manner in which the numbers drop. It only ensures that rates paid properly and that the institution robbed is no work that requires expertise.

But none uollstritovets not want to be just the dealer. He insists that he is a prophet and a scholar, magician and money.


Bankers and Thinkers
Let's start at the top and work our way down - it's not such an unusual method of making a career on Wall Street. Consider the color of this population - a truly conservative banker.

This man - an impressive specimen, radiating healthy warmth, the result of moderation in eating habits, lifestyles and thinking. He sits on his throne for the mahogany desk and says, with different intonations and in different contexts: "None." He's on top of or near the top of one of those financial empires, and whose lives were sent with such prudence, insight and razumnostyo that today, the Big House has almost as much money as he had in 1900.

This, I believe this man is doing well is the best. Years pass, and never in anything not to be accused - did not even have any scandals, some of his accounts have lost nothing, and the rest, at least, lose their money slowly and with dignity. When this great man asked investment advice, he immediately picks some ultra-reliable enterprise category "AAA"., Which in principle can not make the buyer any money and only a slight chance to assert them. Even the boom hysteria can not draw him into reckless speculation. He reminds me of another case. I once heard a doctor say to another: "He knows enough medicine to cause the patient any harm."

It sits firmly entire '26, '27 and '28 year, unfortunately, he begins to gently wake up in the '29 year. (Sight, as these young insolent make state within three years, can affect even the most persistent.) But he goes again, and although a lot of money lost, no one broke. He apologizes for a fact that gave way to human feelings, and resumes his thirty-year policy of careful listening and pronouncing the "No"

Long ago, a generation ago when it was smart to be cool, original amassed hundreds of millions in a more realistic business - say, selling firewater to Indians. And the current state of the grandchildren, sitting in a trance, courteous, perhaps not so stupid as it sounds. I just suspect they think that buying and selling securities worse occupation than I think. But they did not write about this article, they simply avoid it as much as possible without losing their privileges.

Then move on to partners, managers, customer accounts, sales departments and heads of statistics. These gentlemen are stable and fast thinking in five and a half days a week, and when they start to lose other people's money, they really lose them. And his, too.

Partners are usually more impressive than the managers of client accounts, because they usually have a small personal kabinetiki, sometimes lined with oak panels, where they give birth to their thoughts, while managers of client accounts to spawn in the common room. The client, usually sitting in the common room, often just a guy who loves to talk tough in male company, but does not belong to her. This makes the common room unsuitable place for deep reflection,

Nevertheless, managers manage client accounts to come to the same tragic conclusions as partners.

Statistics are in the depths of space in the academic silence. It is not allowed noisy or talkative tickers customers and Thinkers surrounded volumes of reference materials and the latest Novosibirsk everywhere. They all have slide rules, which are all known to be more scientific than the rods fortunetelling. They conduct exhaustive studies of many "special situations" and eventually find out about the affairs of a corporation absolutely everything, except maybe for one detail: soon after the start of the next fiscal year, the corporation is subject to section 77.

Despite its isolation, statistics manage to come to the same general conclusions as partners and managers of client accounts, If we generalize these findings, their basic principle can be freely expressed in the following way: buy when they grow up, and sell when it insists margin clerk.

Obviously, thinking uollstritovets can not avoid action on this principle.

He definitely can not buy when the stock fell, because when they bottom, "conditions" appalling. You can not claim from an experienced leader on Wall Street to buy stocks when the paper car companies have just reached a new low, unemployment is at its peak, and metallurgical facilities loaded with less than half, and a very large man ("Of course, I can not tell you his name ") has just informed him confidentially that one of the big companies, underwriters in the Midwest got into really serious trouble.

Unfortunately for all concerned, this is the only time when stocks are cheap.

Far-sighted investor buys when "conditions" are good, however, when the "conditions" are good, stocks are expensive. Then the devil, "conditions" getting worse, and shares are getting cheaper, margin clerk sends him a telegram from one of a kind of financial information it receives from Wall Street, do not contain any if or but.


OCCULT SCIENCE
I do not know more interesting people below Chambers Street, as readers of graphs representing a small but passionate cult.

A typical, properly devoted reader of graphs, do not pay no attention to the "conditions" - whether it be flood, famine, pestilence or war. He arms the schedule (the simplest type), depicting the ups and downs of the market prices in general or separate class of stock or commodity futures. That he is studying, not looking at the news ticker. He claims that they can distinguish in the dentate line repeating the model (shape) and behaviors that suggest some variations to it when it appears again, his technical jargon contains the phrase "the configuration of head-and-shoulders", "double tops", "double bottoms "and" tears escape. "

There is always a significant number of the pathetic fools who hold a study of the last thousand numbers which have appeared on the roulette wheel, in search of a recurrent model. It is unfortunate, but they usually find it.

I'm no good to explain the secrets of graphs, although I myself have repeatedly been interpreted in this subject. Maybe I do not understand their true identity. I must say that the science of chart reading is close to astrology, but most readers will have schedules too much education and mental discipline to consider astrology seriously.

I once hinted to one of the followers of graphics that I am not a client and that he can tell me what the essence of this nonsense. He was offended, as if I had said something indecent about his religious faith.

All I could conclude from my studies, - reading graphs complicated way of proving the simple theorem, whose essence is this: when a stock for a considerable time increased, and they will continue on for some considerable time to rise and the same is true for the downgrade.

Just ego, but in reality it is not so. The quickest glance at any chart will show you that everything is different.

On Wall Street There is a widespread opinion. " Readers charts - it's dark occult science professor, even though most of them poor. Bankrupt reader graphs, however, never blames his method - he, if anything, more enthusiastic than other solvent supporter, to which you can sometimes stumble. If education does not stop you from asking. xo how is it that he is sitting without pants. It is very unsophisticated report that made ordinary human error, not believing his own schedule.


Investment trust
Ego explanation, magnificent in its simplicity, should be the envy of the presidents of investment trusts. S times a year, with the exception of the boom years, these poor devils have to explain to the sublime prose, as all ego happened. They have about as much chance of an effective apology, as the arsonist.

The financial report of the investment trust as neprikrashen! Not only widows and orphans but can understand it. They bought shares of the trust for so much, and now (after deduction of expenses), they are just so many.