They are both defunct they each used an excessive amount of leverage; their blow ups were public, closely watched, and spectacular.
But what might be most unusual is a strange similarity between the two of them. The bets that blew up LTCM eventually paid off a few months after the debacle. It was the leverage, not the directional bets, that killed them.
I wonder: Might something similar occur with MFG? Had they not used used leverage, would their European bets soon begun to have paid off . . . ?
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