Towering figures in finance: Take a tumble

Isn’t life funny?  Last week I wrote about Charles Mackay – he of the Extraordinary Popular Delusions and the Madness of Crowds 1841 book – who said, ‘those who sound the alarm over an approaching railway crisis have somewhat exaggerated the danger’.  A week later, here I am quoting Sir John Templeton, ‘it was an amazing day on the 24th October 1929 when Jesse came home and his wife thought they were ruined, and instead he had the second best trading day of anyone in history’, making at least $100 million.

Dreamt up by STA Vice Chairman Charles Newsome, March’s monthly meeting was a real treat for habitués and newcomers alike.  The ‘fireside chat’ with author and publisher Tom Rubython was a surprise and a delight.  Perhaps because the format was novel, and the speaker controversial, Charles felt the need to drag along his colleague at Investec Wealth & Investment, Jacqueline, for moral support – and to help sort the boxes of books on offer.

Tom, our British speaker, is a man who’s turned plenty a trick in his time, starting as a market trader straight from school – and no, not financial markets but street markets.  From there he quickly turned to publishing magazines, trade ones mainly though with a handful of business and general news ones thrown in for good measure.  He explained how, over the years, he’d come to be on first name terms with the judges in Court 13 – where libel cases are heard.  ‘People seem to accept what’s written in books as the truth, verbatim, whereas magazines get writs’.

Eventually he chose to write biographies – of dead people.  His book, Jesse Livermore – Boy Plunger, took many years to write, with help from Davis Peett, not just because of painstaking research at newspaper cuttings libraries, but because the original book only recently came out of the 70 year UK copyright.

He has been fascinated with the man, his psychology, the mind-set of a trader, and the use of margin, for a long time.  He believes that Jesse has character flaws, might have been bipolar, and to a certain extent autistic, possibly caused by his dirt farmer background and mistreatment by his Dad – yet he was a brilliant mathematician and a serious womaniser.

I’ll leave you to read all the juicy details in the book, published by

And with a quote from Victor Niederhoffer, ‘Livermore went bankrupt for at least the fourth time in 1934.  [He] was back where he started at 16.  He did not seem to learn from his mistakes’.

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One comment on “Towering figures in finance: Take a tumble
  1. James Smithson says:

    Jesse Livermore’s contemporary William D. Gann has provided the following interesting assessment of the man:

    “Jesse L. Livermore, one of the most spectacular traders of his day, made millions of dollars in the stock and the commodity markets. He went broke several times and went through bankruptcy several times, and a few times he paid out after he had gone bankrupt. Livermore was an honorable man and believed in paying debts even after he had been relieved through the courts of bankruptcy. I first met Livermore in 1908 and again in 1913 when he was trading through the firm of Murray Mitchell and Company, which failed, and I lost all of my money. In 1917 when Livermore came back and made a fortune, he not only paid back my proportionate part of money which I lost through the Mitchell failure, but paid everyone else. This was an honorable thing to do, and because of Livermore’s honor and honesty, in 1934 when he was broke, I backed him and got other people to raise money and back him. Livermore came back again and made money. But Livermore’s one weak point was that he never studied anything, except how to make money. He never studied the rules for keeping money. He had the greed and the desire for power, and when he got a large amount of money, he could not trade conservatively. He tried to make the market go his way instead of waiting until the market was ready to follow the natural trend. Livermore, after making the many fortunes, committed suicide and died practically broke. Why did a man who made so many millions of dollars as Livermore not keep them? It is because each time he had the same greed, the same desire for power, to be a great man and run the market. He wanted to rule, and he did not figure that the unexpected could happen, which it did and always will, and the result was that he lost his money” (“45 Years In Wall Street” by W. D. Gann, 1949, page 117).

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About Nicole Elliott

Nicole Elliott

A graduate of the London School of Economics and Political Science (BSc Social Psychology) Nicole Elliott has worked in banks in the City of London for the last 30 years. Whether in sales, trading or forecasting technical analysis has always been the bedrock of her thinking. Key expertise lies within all areas of treasury: foreign exchange, money markets, fixed income and commodities.

She has also added to the body of knowledge of the industry writing the first western book on Ichimoku Cloud Charts. Strong media links and a cult following are due to her prescient calls on the markets and often entertaining format.

Nicole can be contacted at

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