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| Recognizing I try to have a longer term view towards things, & have witnessed many bizarre events and people, in the late sixties my CPA introduced me to a scrap metal dealer with extensive interests in the Midwest, mostly Iowa. He is long gone but was an example of how a seasoned trader with a strong view of things operates.
He began to purchase London copper, then at extremely low prices. This fellow dealt with several brokers. I cannot recall the exact year, in the meantime he is buying copper every time it declined in price, but as prices advanced…he called a fellow dealer in Nebraska (who he’d heard was short) & warned him ‘copper is headed to the 80 cent level.’ Egos became involved…the short position bankrupted the Nebraska dealer & my guy purchased the bankrupt firm.
Copper did, by the way, advance to the high eighties & my guy bought it all the way on every dip in price. The advance in price also bankrupted a London Bank. This transaction caused quite a bit of turmoil as the trade wondered how a fellow from Iowa could suddenly own a key position in the world's copper market.
Regardless, one day having an adult beverage with my accountant, he was much older than I, I asked him how the transition acquiring the bankrupt company was proceeding. He laughed…said he’d found a $2.5 million discrepancy in the Nebraska dealer’s books and discovered the bank (Big New York Bank) had made a mistake in calculating the exchange rate between British Pound and the dollar; the bank being the loser….my accountant had called specifically to send the bank a $2.5 million check. The banker replied (not exact quote)..”No, just forget it. It’ll just raise too many eyebrows as that was last year & someone would wonder why I made the mistake.”
$2.5 million was a decent amount of change in 1975. New York Bankers. Also suggests an accounting problem.
Edited by SeniorCitizen 2/15/2008 10:01
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Quick Inflation Story
