Daily Speculations

The Web Site of Victor Niederhoffer & Laurel Kenner

Dedicated to the scientific method, free markets, deflating ballyhoo, creating value, and laughter;  a forum for us to use our meager abilities to make the world of specinvestments a better place.



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Dulcinea, by Victor Niederhoffer

A question was raised concerning the accuracy of the predictions of one of our members recently. I am accustomed to being pilloried by the trend followers and chartists as the poster boy for how not to run a fund, one who can't make a living trading and must turn to writing for a living. One who has written "the worst book in the world" with no practical wisdom in it beyond what could be found in Barron's. Thus, when one of ours was accused of being almost 1/10 as prone to losses, for just one brief interval, as we are at all times, I immediately leapt to his defense in words similar to those of Don Quixote to the merchants of Toledo.

From: Chapter IV, "Of What Befell Our Knight After He Had Sallied From The Inn," Don Quixote

Having proceeded about two miles, Don Quixote discovered a company of people who, as it appeared, were merchants of Toledo, going to buy silks in Murcia. There were six in number; they carried umbrellas, and were attended by four servants on horseback and three muleteers on foot. Scarcely had Don Quixote espied them when he imagined it must be some new adventure; and to imitate as nearly as possible what he had read in his books, as he fancied this to be cut out on purpose for him to achieve, with a graceful deportment and intrepid air he settled himself firmly in his stirrups, grasped his lance, covered his breast with his target and, posting himself in the midst of the highway, awaited the approach of those whom he already judged to be knights-errant; and when they come so near as to be seen and heard, he raised his voice, and with an arrogant tone, cried out, "Let the whole world stand, if the whole world does not confess that there is not in the whole world a damsel more beautiful than the Empress of La Mancha, the peerless Dulcinea del Toboso!"

The merchants stopped at the sound of these words, and also to behold the strange figure of him who pronounced them; and both by the one and the other they perceived the madness of the speaker; but they were disposed to stay and see what this confession meant which he required; and therefore one of them, who was somewhat of a wag, but withal very discreet, said to him,

"Signor cavalier, we do not know who this good lady you mention may be; let us but see her, and if she be really so beautiful as you intimate, we will, with all our hearts, and without any constraint, make the confession you demand of us."

"Should I show her to you," replied Don Quixote, "where would be the merit of confessing a truth so manifest? It is essential that, without seeing her, you believe, confess, affirm, swear, and maintain it; and if not, I challenge you all to battle, proud and monstrous as you are; and whether you come on one by one (as the practice of the laws of chivalry requires), or all together, as is the custom and wicked practice of those of your stamp, here I wait for you, confiding in the justice of my cause."

"Signor cavalier," replied the merchant, "I beseech your worship, in the name of all the princes here present, that we may not lay a burden upon our consciences by confessing a thing we never saw or heard, and especially being so much to the prejudice of the empresses and queens of Alcarria and Estremadura, that your worship would be pleased to show us some picture of this lady, though it be no bigger than a barleycorn, for we shall guess at the clue by the thread, and therewith we shall rest satisfied and safe, and your worship contented and pleased. Nay, I verily believe we are so far inclined to your side that, although her picture should represent her squinting with one eye and distilling vermillion and brimstone from the other, notwithstanding all this, to oblige you, we will say whatever you please in her favour."

"There distils not, base scoundrels!" answered Don Quixote, burning with rage, "There distils not from her what you say, but rather ambergris and civet among cotton; neither doth she squint, nor is she hunchbacked but as straight as a spindle of Guadarrama; but you shall pay for the horrid blasphemy you have uttered against so transcendent a beauty!" So saying, with his lance couched he ran at him who had spoken with so much fury and rage that, if good fortune had not so ordered that Rozinante stumbled and fell in the midst of his career, it had gone hard with the rash merchant.