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And after reading my other replies, I guess you realized your Efficient Market mantra was out of date and just plain wrong, which is why you don't have any real response.
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To be honest I don't know enough about LTCM but plan on reading When Genius Failed to find out.
Effecient Market Hypothess is hardly dead and I am not sure what lack of responses you are referring to.
I believe the market to be effecient for the individual investor. He is up against too much information, too many eyeballs and too much money to win.
He is virtually guaranteed to fail against the indexes.
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