DiscussWorldIssues - Socio-Economic Religion and Political Uncensored Debate - View Single Post - Government-imposed prices for real estate

**Texdolley** · 02-16-2009, 11:55 PM

In his latest book, Niall Fergusson suggested a strategy that went something like this (let's see if I remember it):

Step 1: Get a bunch of investors' capital and buy government bonds.
Step 2: Use bonds as collateral to sell options protecting against an improbable collapse in the market.
Step 3: Repeat Step 1 with the money you got from sale of options (every repetition will be much smaller than the previous).
Step 4: If the market doesn't crash... make a hefty profit.

Do this every year until the market crashes collecting large bonuses along the way. When the market crashes, laugh at the poor fools that invested their money with you.

Yea, that's the "hiding the long tails" strategy

N.N. Taleb has two books out dealing quite fiercely with the subject.

Still, existence of gullible fools with money does not mean the "markets have failed".

02-16-2009, 11:55 PM	#13
Texdolley Join Date Oct 2005 Posts 524 Senior Member	In his latest book, Niall Fergusson suggested a strategy that went something like this (let's see if I remember it): Step 1: Get a bunch of investors' capital and buy government bonds. Step 2: Use bonds as collateral to sell options protecting against an improbable collapse in the market. Step 3: Repeat Step 1 with the money you got from sale of options (every repetition will be much smaller than the previous). Step 4: If the market doesn't crash... make a hefty profit. Do this every year until the market crashes collecting large bonuses along the way. When the market crashes, laugh at the poor fools that invested their money with you. Yea, that's the "hiding the long tails" strategy N.N. Taleb has two books out dealing quite fiercely with the subject. Still, existence of gullible fools with money does not mean the "markets have failed".
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