jimbo - Somalia is hot right now.
jimbo - Somalia is hot right now.
Because otherwise my argument is shattered in a million pieces.
I chose to look at the data that confirm my point. Don't professional gamblers (I mean financial advisers) do that all the time?
OK, so over the last 19 years his investment grew by 14% a year, which is not bad, but it doesn't seem to be something astonishingly fantastic. I think most people would be able to do something like that if you go into a market when it is recovering from a crash, and go out as soon as the next crash comes. Something many of you (for reasons unknown) haven't done.
Come on, the guy has billions, and therefore is able to influence the market...
Hey, chill out. This is supposed to be a fun thread.
Let me copy paste the quote of Jimbo again. But this time real slow, so you have time to read it:
As a bank run progresses, it generates its own momentum, in a kind of self-fulfilling prophecy: as more people withdraw their deposits, the likelihood of default increases, and this encourages further withdrawals. This can destabilize the bank to the point where it faces bankruptcy.So it starts with 10 people, which increases to 100, 1000, thousands, etc. The last people in the queue don't get any money, the first get everything. So when there is a run on the bank it's crucial to be at the beginning of the line. And that's where I was!
In this case the bank didn't fall because people stopped believing it would. But it could have fallen, if people had continued to believe it would.
Can someone please explain to Jimbo what is going on? He really doesn't seem to get it.
Pinko,
The only people in those queues were people who did not have a lot of money anyway. Those who did have a significant of money in the bank (myself included) didn't panic, kept it there and the truth is until those people start to withdraw you do not really have a run on the bank.
When you look at the average of what was withdrawn which I read was around the $1000 mark you realise it was not a run at all just a mass panic by those who had no sense and were obviously illiterate enough not to be able to read and understand the deposit protection scheme here in HK.