Saturday, March 26, 2011

Money Wisdom #009

"The study of money, above all other fields in economics, is one in which complexity is used to disguise truth or to evade truth, not to reveal it. The process by which banks create money is so simple the mind is repelled. With something so important, a deeper mystery seems only decent."

John Kenneth Galbraith  Money: Whence it came, where it went (1975)

Money Wisdom #008

Michael has just done his first trade which has caused his customer to lose $65K.

"And you want to know how I felt? I should have felt guilty, of course but guilt was not the first identifiable sensation to emerge from my exploding brain. Relief was. I had told him the news. He was shouting and moaning. And that was it. That was all he could do. Shout and moan. That was the beauty of being a middleman, which I did not appreciate until that moment. The customer suffered. I didn't."

Michael Lewis Liar's Poker (1989) p.199

Saturday, March 19, 2011

Money Wisdom #007

"If you are a self-possessed man with a healthy sense of detachment from your bank account and someone writes you a cheque for tens of millions of dollars you probably behave as if you have won a sweepstake, kicking your feet in the air and laughing yourself to sleep at night at the miracle of your good fortune. But if your sense of self-worth is morbidly wrapped up in your financial success you probably believe you deserve everything you get. You take it as a reflection of something grand inside you. You acquire gravitas, and project it like a cologne..."

Michael Lewis Liar's Poker (1989) p.69

Tuesday, March 15, 2011

Money Wisdom #006

"I remain more than ever convinced that, until we fully understand the origin of financial species, we shall never understand the fundamental truth about money: that, far from being 'a monster that must be put back in its place', as the German president recently complained, financial markets are like the mirror of mankind, revealing every hour of every working day the way we value ourselves and the resources of the world around us.

It is not the fault of the mirror if it reflects our blemishes as clearly as our beauty."

Niall Ferguson The Ascent of Money (2008) p.358

Tuesday, March 8, 2011

Money Wisdom #005

"... as John Maynard Keynes once observed, in a crisis 'markets can remain irrational longer than you can remain solvent'."

Niall Ferguson The Ascent of Money (2008) p.328