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Nassim Nicholas Taleb

This is without-a-doubt the best background piece on Taleb that I've read. Enjoy:

On a freezing day in March 2007, Nassim Taleb walked into a conference room at Morgan Stanley's Manhattan offices on 47th Street and Broadway to address a group of the firm's risk managers. His message: Your models don't work.

Using a whiteboard to scribble out his calculations, Taleb, now 48, began one of his rants, this time against stress tests -- Wall Street lingo for examining how a market rout will play out. Stress tests are inherently risky because they ignore rare but potentially devastating events, Taleb said.

``Past shortfall doesn't predict future shortfall,'' the options trader turned best-selling author recalls telling the assembled group of about 40. The risk managers, part of a tribe of mathematical model makers known in the finance world as quants, stared back at him blankly, and a debate ensued, according to people who were there..." Continue Reading


Books by Taleb: The Black Swan and Fooled By Randomness

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Your opinion wanted: Why is Bear Stearns trading at $6 when it's been purchased at $2?

My blog is brand new and so I have low (read no) expectations of recieving any replies.

That said what are your thoughts? If BSC had been purchased by JPM for $2 a share in stock why is it trading at $6. The government has already approved the deal. Can't we just buy JPM and short BSC and profit on the spread? What am I missing? What rumors have you heard regarding a better bid?

I look forward any responses.

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Bear Stearns: The Facts, Some Opinion, and Who Stands to Lose the Most

Wow what a difference a little time makes. In January Bear Stearns was worth $30 Billion and after Firday's firesale was worth about $3.5 Billion and now it sold for under $250 million dollars to JP Morgan Chase (JPM) yesterday. Essentially, BSC investors have been crushed.

The Facts:

The Merger Agreement (PDF)

JPMorgan to Buy Bear Stearns for $2 a Share in ALL Stock Deal

Some Opinion:

Todd Sullivan comments on what he feels like is an incredible bargain:
JP Morgan Dimon's Bargain Purchase
Todd left some room for doubt on whether the shareholders will approve the merger.

See who stands to lose the most and who the large shareholders are here:
A Stake Through the Heart

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Weekend Reading

Weekend Reading From Value Investing News


  1. Why Warren Buffet is richer than the Hedge Fund managers - a tale of two business models

  2. Notes From A Conversation with Munger

  3. Does the magic formula work?

  4. Marvel - Superhero Value?


  5. Berkowitz Sees Volatility As An Opportunity

  6. A Solid Bet: The Case For Ternium Steel

  7. Sneak Preview of The Four Filters by Bud Labitan

  8. Free RSS Feeds for Company Filings on EDGAR