Tuesday, May 5, 2009

On Victor Niederhoffer, Insanity and More

I have always thought it would be interesting to observe Victor Niederhoffer in a tight spot. How would he handle himself? The man has blown up two hedge funds, and has literally lost hundreds of millions of dollars, a combination of his own money and that of his clients. Twice! I would love to be sitting having a beer with this guy on the day he knew one of his hedge funds was cooked goose.

I read his book, The Education of a Speculator, a long time ago (just before he blew up his first hedge fund) and wrote up a review somewhere and said the book was nuts. It is still in stores! The only thing I recall from the book is that he said he didn't read the Wall Street Journal and instead read, regularly, the National Enquirer, for investment insight.

I note that age has not disrupted his insanity. At his blog, today, he writes words which would seem only appropriate as dialogue for a sequel to the movie, Being There:

Everything you need to know about the market you can learn from shaving. Today I put on the shaving cream and reached in the cabinet for the razor. a new package of razors was there, and I fumbled around for a few minutes trying to open the package. The hands were so slippery I couldn't do it. I got close to the top and the side but no razor. A personage passed by and said "if you just would open the package up before wetting the hands, it would be so much more fruitful." So many things in life like that look so easy, start so well, but end in frustration from the well turned ankle to the most beautiful opening.
To me it's nuts. But, maybe this is deep, maybe it is Niederhoffer trying to be deep, or maybe it is how he feels about his life.


I have a soft spot for the outliers.

By Obama attempting to level the field and set up regulations for everything, the outliers won't have a chance. They will never pass standard regulatory requirements.

Most insane people are just that, but every once and awhile what appears as insanity is just superior sanity. Only freedom to allow those who appear insane to do their thing, will result in society eventually benefiting from the very few that truly have superior insight. This is the stuff that is suffocated in a command and control society, the mutations of life.


  1. The man seems to be having an out of body experience when he says "the hands" instead of "my hands."

    Maybe the "personnage" was his disembodied ego/self looking on, fervently suggesting how to correct the crash course that is his life.