Enron, WorldCom, HealthSouth, and numerous other public companies were able to fool their auditors, fool their investors, and fool the public, all the time being in the public eye. As for the community of traders.....
The major effect the Market Wizards book had on me was showing me that there are people out their than can become great successes through trading. This was more important than the how. Since reading those books I've believed there is a way to succeed in trading. The how is not so important, it comes with time. But if you don't believe in yourself you can never succeed. So many of the market wizards started terrribly, and quite a few lost everything and came back to be really successful. I learned from that I had to want it bad if I was going to succeed, and I had to do more than the other 98% to be outstanding. Runningbear
Imagine the mindset he must have had. At one point, if you're down 5 million in the stock, then the thought process might have been "I'm not going to let this stock destroy all of my hard work over the years." Down 10 million, same thing - there's no way one stock could do this to me. And then it's gone.
He really had a personal connection with the company. Director ect. IMO big prob was that the stock traded about 50k a day and he had 2,000,000 shares at about $15.00 avg. No way out.
Hero(s) All! but you have to wonder what are their records with these two major events/environments 1) introduction of SSF's and how it challenges the Equity/Index Options markets 2) effect of the negative dismal economy and the war effect on trading
This is the result of Baldwin attempting to enrich himself outside the sphere of his expertise (read, very short-term pit scalping)... if he indeed sunk most of his winnings into a now defunct tech stock (read, a medium to longer-term investment), this action was indicative of a separation of risk perceptions when dealing with $ outside of pit scalping... inside the pit, Baldwin was highly risk conscious (even if he bet the bank on occasions, without a precise understanding of position sizing, he would, nevertheless, never have let things get too far away from him when scalping; in a hyper-short term environment, I am of the view that position sizing deficiencies are not as fatal relative to such deficiencies in longer-term plays, since the discipline of fast executions in the pit occurs on average in the context of a 1:1 Risk:Reward ratio) but he seemed to lose his appreciation of the consequences of taking excess risk the moment he left the pit (I guess that he basically bet the bank, with no regards to position sizing... fatal when position trading)... if Baldwin is now back inside the pit, he will again be in his element of precision R:R= 1:1 scalping and I, for one, do not doubt his ability to thrive there and regain his lost wealth...