Jesse Livermore. The Great Loner. Original trend trader
On Wall Street, it's always the same thing.. Speculation is as old as this world: today on the stock exchange is that, what has already happened before and what will happen again later.
Jess Lauriston Livermore
People are amazedly interested in, where are such great traders, like Ed Sokota (Ed Seykota) find inspiration and role models? Jesse Livermore (Jesse Lauriston Livermore) one such person, lived in the beginning 20 century. He is one of the earliest trend traders.
Biography of Jesse Livermore
Born in the United States, in South Acton, Massachusetts, in 1877 year.
Coming from a farmer's family, Received – as they would say now – incomplete secondary education, Livermore by the will of circumstances began an independent life at the age of fourteen. Boy, who has mastered a three-year course of mathematics for the year, was not to my liking work in the field and, enlisting the support of the mother, with five dollars in your pocket, he ran away from home. As the legend goes., stagecoach, on which Jess reached Boston, stopped in front of a brokerage office. So fate itself pointed out to the future titan his role.. The owner of the office needed a nimble little one to record stock quotes on the board. – and Livermore took the place.. In six months, he will hold his first trade deal., and a year later he will repay the debt to his mother – and three hundred more from above. Subsequently, Livermore recovered debts even after bankruptcies., when all obligations to creditors have been withdrawn. However, then no one could have imagined, that nimble, a laconic boy will become the largest speculator in the history of mankind, win and lose hundreds of millions of dollars, will be ruined four times and will get back on his feet, will be elevated by the press to the rank of demon of the market and will forever remain in this unenviable role.
Livermore's rise is just as dizzying., as well as his many falls. Making three dollars twelve cents in fourteen, at fifteen he earned a thousand on stock speculation., and by the age of twenty he had turned against himself all the small brokerage offices of the States.: benches like that, in which Jess once worked at the board, were semi-legal – they worked on the principle of gambling establishments, existing at the expense of clients' funds, and not at the expense of commission from transactions, why visitors, who have a bad habit of always winning, to “Trading” were not allowed.
So at the very beginning of the XX century, nicknamed Young Grab (boy plunger), Livermore was on the New York Stock Exchange (NYSE). Actually, in his entire life, he has never been to the NYSE marketplace., no other exchange of those, with whom he had the chance to work – conducting all your operations through brokers. But this did not prevent him from earning and losing fantastic amounts..
IN 1906 Livermore performed his first major surgery, earning hundreds of thousands of dollars, and by the end of the decade he became famous for the million made literally in a day.. In the '20s, he had the most luxurious office in all of New York.: Livermore built his own trading floor, where on a huge board six clerks wrote out quotes for him alone – financial genius preferred to work in complete silence.
Luxury country residences, giant yachts, Numerous “Rolls-Royces”, jewelry for wives and mistresses, drove the audience crazy – he lived on a grand scale and paid for mistakes accordingly.: losing everything several times, to the last cent, Jess left the arena with millions of debts, but invariably returned, expanding the scope of its operations each time.
The peak of Livermore's career
Occurred in 1929 – when, after years of booming, the U.S. was plunged into the abyss of financial panic and economic downturn.. It was his best year.: anticipating the collapse of markets, he made one hundred million dollars. In those fateful days, when ruined speculators poured out of the windows of houses, he fed the market from his hands, and the press called him the main culprit of the total stock market crash and the ensuing decade-long Great Depression.. However, journalists made Livermore a scapegoat long before these dark days., writing off all major price movements on it, who could not find a better explanation, and in the late 20's it came in handy..
Human, the intellectual power of which terrified the powerful of this world, repeatedly forcing financial tycoons and those in power to ask him to temper his ardor and spare the markets. (when asked, and when they threatened), today almost forgotten. You won't find any mention of it in any encyclopedia., for the entire endless Internet – only one gallery with documentary photos and a couple of books, in which the image of Livermore is not distorted by the vested interests of his few biographers..
Book Memoirs of a Stock Speculator
Worth reading for everyone: formally this published in 1923 year the work belongs to the pen of journalist Edwin Lefebvre and tells about the life of a fictional hero, Larry Livingstone. Lefebvre wrote “Memories” based on one long interview with Livermore, but in fact, few people doubt, that most of it Books written by Livermore himself – too subtle and accurate details of this fascinating story, a fictionalized description of the middle years of the great speculator. Another book definitely belongs to the pen of Livermore: this is “How to trade in stocks”, published shortly after his death. As far as I know, it was never translated into Russian., but has been reprinted repeatedly. They say, it was written by Jess after another bankruptcy, hoping to make money to return to the market. Anyway, his name has now been forgotten by all but adventurers., trying to pass off as a gold mine their own sophisticated systems for trading on the stock exchange. It is unlikely that these pathetic attempts deserve a story about themselves..
But are the works of Livermore himself worth anything today?? After all, since then., when he won and lost millions on the stock exchange, almost a hundred years have passed! Trade principles have changed, the markets themselves and the world around them have changed! Back then, there weren't even phones., today the whole world is tied in one global network. Then the tape of the exchange telegraph, board with quotations and own mind – computers today, per second counting billions of numbers. Even charts price movements, without which today no speculator can do, in Livermore's time they were considered nothing more than an outlandish novelty., which had yet to prove its right to life! Changed rules, incomparably increased volumes – are the advice of a century ago able to bring at least some benefit today? Yes, just offer the modern player on the stock exchange to abandon the usual means of technical analysis., and you will be considered as insane.
But open the Livermore books.: booms and panics, deception and hope – all this has already been and will be. Experience, abandoned by Livermore, and today – the best textbook for the speculator and the truth of this statement is obvious to everyone., who has read the primary sources at least once. From the first days until the end of his stock exchange career, he relied on common sense and logic.. You won't find any references to supernatural abilities in it., that is not given to anyone else. He does not have the characteristic for many speculators leading to nowhere philosophical fabrications and black magic of technical systems., incomprehensible even to its creators themselves. Livermore, making millions of dollars in decisions, most of my life came from information about current prices, supply and demand, took into account the news. From time immemorial, markets have been ruled by hope., fear and greed – and this knowledge, in combination with the ability not to repeat their own mistakes, enough to succeed.
Death of Jess Livermore
The story of Jess Livermore is cut short by tragedy, which the institute's nerds like to quote, instructing the younger generation on the true path: having suffered another collapse (say, the reason was the government angry at speculators) and after spending several years on unsuccessful attempts to re-accumulate the initial capital., he committed suicide.
There are always people, who walk faster, than the rest of the crowd. They are destined to lead the rest., and it doesn't matter how much that crowd has changed..