fatvegan

It seems that when heavily leveraged investors go bust the standard excuse is always "But markets aren't suppose to do that." The whole point of leverage is that when markets are behaving "normally" you can make a bunch of money, but when they behave erratically you can lose all the money you made before you know it. When Long Term Capital Management went bankrupt they used this excuse. If only returns had just stuck to their harmless normalishly distributed movements, everything would have been fine. I've heard an equivalent complaint from one firm damaged by the recent movement in US credit markets.

If leveraging didn't require a very difficult skill, then you wouldn't be able to make so much money out of it. If you're going to use heavily leveraged investments over the long-term you'd better know when to unwind, because sooner or later you will need to. It's no good whingeing after it's all over that you were too stupid to know what your risk exposure was.

The only thing worse than a whinger is a rich whinger who has everything going for them except their own competence.