29 of 36 people found the following review helpful:
2.0 out of 5 stars
this guy is unbelievable, November 10, 2002
This review is from: Rogue Trader: How I Brought Down Barings Bank and Shook the Financial World (Hardcover)
The author appears to be one of the most character-challenged individuals of all-time, a major piece of work. By accumulating incredible unauthorized trading losses of around one billion dollars, he single-handedly brought down one of the oldest banking institutions in England, and left countless people without jobs and investments worth millions. What is absolutely amazing is the fact that while he never denies the fraud he committed, throughout the book he seems intent on blaming his superiors for their inability to discover his losses. While it is true that his superiors were so enamored of the fictitious gains his unit was reporting that they didn't want to ask hard questions, it is Mr. Leeson who is responsible for the wreckage. He never expresses any remorse whatsoever for the damage he inflicted. He was greatly perturbed because he couldn't serve his prison sentence in England, instead being returned to Singapore.
Without the proper education or pedigree, Leeson somehow managed to be promoted from a settlement clerk to running the Barings Singapore futures operation. Apparently his idea of having fun is to get plastered and moon some flight attendants in a bar, for which he was arrested by the Singapore authorities. Certainly he knew how strict laws are in Singapore, and he could have served a year in jail. It seems back in England, he hung out at pubs with friends who would unzip their pants and place their private members in the hands of unsuspecting females.
The book is of some interest to traders, because Leeson commits every cardinal sin in trading. He had no business ever setting foot near a trading floor. His biggest error was his complete inability to cut his losses, the most fundamental requirement for successful trading. He averages down or "doubles up" his positions when they are moving against him, another critical mistake. He constantly "hopes" the market will move back in his direction, and attempts to move the entire market by taking huge positions. While it is possible to move a market temporarily if one is trading large enough positions, the market will always continue on its established trend. The author continually engages in this futile strategy, at one point losing 60 million dollars in one day trying to change the direction of the market.
Finally, the book is not a terribly interesting read, in that a significant portion of it is repetitious detailing of how he conceals his mounting losses to his superiors through the use of "creative accounting". Perhaps that is why the book is now out of print. The one thing that he does care about is his wife, who at the time of publication of the book was still standing by him. If she has any good sense, she would drop him like a bad habit.
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10 of 12 people found the following review helpful:
2.0 out of 5 stars
Surprisingly unsophisticated, October 28, 2003
By A Customer
This review is from: Rogue Trader: How I Brought Down Barings Bank and Shook the Financial World (Hardcover)
Somehow Nick Leeson ended up with the reputation as some kind of whiz kid but reading this book you get a different sense. The derivatives Mr. Leeson was trading do not seem particularly sophisticated (don't compare this to LTCM). But you wouldn't learn much about them from this book. I got the sense that Mr. Leeson was grappling with very basic financial questions. As a consequence, the book tends to be repetitive in a description of losses getting out of control and the soap opera building around that. You also have a nagging feeling that you never get the full story. However, the book is interesting where it describes the complete breakdown of financial and management controls.
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6 of 7 people found the following review helpful:
5.0 out of 5 stars
Good story, but not particularly "vindicating.", June 24, 2001
This review is from: Rogue Trader: How I Brought Down Barings Bank and Shook the Financial World (Hardcover)
I guess, in order to create some overarching conflict, and keep the story from looking like one long apology, Leeson had to dwell on the issue of management controls. This, however, would only seem a sound line of inquiry if he could actually prove the controls would have any value, absent his own activities (and questionable character).
An organization as (historically) successful as Barings had been, particularly in an industry as competitive as merchant banking, will dispense a significant amount of discretion to mid-level managers in-order to facilitate innovation and risk-taking, two activities paramount to success in merchant-banking.
Therefore, Leeson can't possibly have been alone in enjoying his level of localized discretion, at that or any other time in Barings' history, though HE ALONE misused it to such catastrophic results. Perhaps, then, the question is not should we check better on our employees' actions, but should we even hire employees that we aren't 100% sure could effectively utilize our level of discretion?
While Leeson apparently acted in order to retain his leadership position, he effectively revealed his inability to lead by:
1) Creating a culture, within his office, of sloppiness and irresponsibility. (By allowing employees to utilize the 88888 account, rather than condition them, either by reprimand or more aggressive training, against making so many mistakes.)
2) Mistaking his superiors' TRUST of his own abilities for "aloofness," and thereby failing to properly utilize (rather than ABUSE) that trust.
3) Never, ever, ever owning up to his mistakes, or actually devising long-term solutions to his problems (like, say, never using the 88888 account after the first two times he cleared the balances, or simply not putting his OWN trading errors in the account.) ------ All this having been said, however, Leeson's account of his activities, and his flare for storytelling (or his co-author's, duh) make this a sufficiently enjoyable read.
Aspiring traders in particular should probably read this story just in order to get a grasp of some trading concepts, as well as a general account of life as a trader (albeit a dishonest and irrational one such as Leeson).
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