LTCMs Impact on the International Financial System

LONG TERM CAPITAL MANAGEMENT L.P. – A CASE STUDY Rarely if ever has a single firm had as tremendous an impact on international economics as Long Term Capital Management L. P. (LTCM). This report describes the company itself and its investment strategies, with particular attention paid to its international influence and importance. LTCM’s activities in the financial world ultimately caused a near-collapse in the entire international financial system. In fact, had the Federal Reserve …

…Economic focus: When the sea dries up.” (The Economist, London, September 1999) 16. Lewis, Michael “The Price of Behaving Rationally in a Market Meltdown” (The New York Times Magazine, New York, January 24, 1999) p. 32 17. Jacobs, Bruce I., “When seemingly infallible arbitrage strategies fail.” (Journal of Investing, New York, Spring 1999) 18. Organization for Economic Cooperation and Development, “The LTCM crisis and its Consequences for Banks and Banking Supervision”, June 1999. 19. “The LTCM crisis and its Consequences for Banks and Banking Supervision”