TAKE A TIP

The speculator's deadly enemies are ignorance, greed, fear and hope. All the statue books in the world and all the rule books on all the Exchanges of the earth cannot eliminate them from the human animal.
                                               Jesse Livermore

Somebody forgot to tell all the politicians and the social do-good crowd.

Jesse Livermore was one of the all-time great stock market traders amassing several fortunes over his career. He shorted the market before the big 1929 Crash, pocketing nearly $100 million dollars, a sum that equates to roughly $12 billion today.

In 2009 almost a century later another famous Wall Street icon, probably 100 times more famous than Livermore in his day, was asked reflecting on the market's recent doldrums: "Why can't we learn the lesson of the last recession. Look where greed has gotten us."

The Omaha Oracle, Warren Buffett, replied, "Greed is fun for a while. People can't resist it."

Buffett went on to point out what in our opinion was the most important point implied in Livermore's statement, one most people either fail to or refuse to learn about the human species, "...however far human beings have come, we haven't grown up emotionally at all. We remain the same."


Livermore's comment about statue and rule books in our judgment is even more telling. Humans will keep on doing what humans do, regulations and rules notwithstanding; and all the Kings horses and all the King's men aren't going it change it. What they can do, however, unintended or otherwise, is makes things much worse.

We had a spate of high profile athletes recently commit suicide. It's highly unlikely the way they died will tarnish their athletic feats. Nor should it. Jesse Livermore likewise died by his own hand, a fact some might use to try to tarnish his feats. But as Buffett noted much of human kind has yet to emotionally grow up. If you entertain any hope of making serious money in the market take a big tip from two of history's best players.