The best part of Roger Lowenstein’s book, When Genius Failed: The Rise and Fall of Long-Term Capital Management:
“Badly in need of a lift, Meriwether called an old friend, Vinny Mattone, who had been the fund’s first contact at Bear Stearns. Mattone, who had retired, was everything that J.M.’s elegant professors were not. He wore a gold chain and a pinkie ring, and he showed up at Long-Term in a black silk shirt, open at the chest. He looked as if he weighed 300 pounds. Unlike J.M.’s strangely wooden partners, Mattone saw markets as exquisitely human institutions — inherently volatile, ever-fallible.
‘Where are you?’ Mattone asked bluntly.
‘We’re down by half,’ Meriwether said.
‘You’re finished,’ Mattone replied, as if this conclusion needed no explanation.
For the first time, Meriwther sounded worried. ‘What are you talking about? We still have two billion. We have half — we have Soros.’
Mattone smiled sadly. ‘When you’re down by half, people figure you can go down all the way. They’re going to push the market against you. They’re not going to roll your trades. You’re finished.’”
