Daily Speculations The
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Inspired by Robert Louis Stevenson's great novel Treasure Island,
I am writing about piracy and markets with
particular reference to such things as the constant changes in strategy that
the pirates and Long John were always making. For example:
- Changing allegiance from pirates to treasure hunters on a dime.
- The large number of escape
hatches they always had: keeping the boy as hostage, and holding the escape
boats on Treasure Island with the Hail Mary defense of begging for clemency
should their escape be impossible.
- The emphasis on short-term planning
but lack of long-term planning so typical of the day traders who get
drunk every night and don't keep good watch and go berserk when the nearness
of the treasure chest beckons.
- Expert use of duplicity at all
times, pretending to be cooks and ordinary seaman and getting hired as able
seaman on just the right treasure boat, thereby front-running the squire and
his party in a fashion so similar to that described by Harris.
ability, even though untaught, to navigate almost as well as Jack Aubrey himself,
by landmarks, entrances and shoals.
- The strict
hierarchy of command with honor among thieves so that no one can dispose of
the captain until he is given a fair trial and no stealing from one another is allowed.
How similar this is to the pirates we meet with in our trading, whose
word is their bond and who would rather go broke than dishonor a commitment to
another member but take no prisoners vís-a-vís trades with the
- The secret respect we have for Vikings and pirates because of
their ability to elude the law-abiding -- the same way we secretly admire those
who have elaborate ways of front-running us in our day-to-day activities.
- The elaborate role of superstition -- for example, the fear of the ghost of
Flint, and how this delayed the pirates. In the same way, so many traders
use charts as a pacifier, thereby allowing them to fall victim to changes
in fundamentals, as happened today. What other things can we learn from pirates? I'm
out of my depth.
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