The Original Big Short Unfortunately, the concept of diversification probably The Amsterdam Stock Exchange, founded by the Dutch never crossed Jesse’s mind. He somehow managed to lose East India Company in 1602, is recognized as the world’s all his money and was bankrupt by 1934. The bankruptcy oldest stock exchange. It facilitated a secondary market to resulted in an automatic suspension of his membership trade stocks and gave rise to trading clubs during the mid- on the Chicago Board of Trade. In 1940, the legendary 17 century where speculators would congregate. trader, suffering from depression, shot himself in the Messengers would rush to and from the exchange to cloak room of Manhattan’s Sherry-Netherland Hotel. update pricing to customers. Rise of the Machines In 1867, the invention of the stock- The combination of elevated How things have changed from ticker machine, also known as the Jrvestor complacency andl sa those simpler days when humans ticker tape, obviated the need for were doing the trading. Today, messengers. Stock transaction data tightening Fed makes the with the advent of technology, was transmitted by telegraph toa wiarker-onlneabletes pullback. market activity is dominated by ticker tape that would continuously passive and various quantitative print out abbreviated company strategies. It is estimated that names (ticker symbols) followed by the price and volume fundamental discretionary investors now account for only data. Thomas Edison later upgraded the system to reach 10% of the trading volume. Big inflow into major ETFs a printing speed of one character per second. Ticker tape prompted buying across the board regardless of company eliminated the need for messengers and allowed people to specific issues and valuations. Big data and machine trade in “real time” from long distance. learning are the new buzz words. Forbes recently featured a quant fund run by three twenty-somethings. Their In 1900, 14 year-old Jesse Lauriston Livermore starte