Re: Another book question
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There were a lot of people involved with LTCM and their demise. I hardly think the blame lies at their feet.
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Yes, it does. Merton and Scholes were founding partners of LTCM (along with John Meriwether) and actively planned LTCM's strategies. They actively solicited investors for LTCM. They don't deserve all the blame, just a huge portion of it.
If they were trying to prove that academics can't beat the market without taking excess risk, they were a huge success. Of course, Buffett knows how, which is why he declined to invest in LTCM.
And after reading my other replies, I guess you realized your Efficient Market mantra was out of date and just plain wrong, which is why you don't have any real response.
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