Laurent L Jacque Knihy

Focusing on major financial failures, this book delves into the significant derivatives disasters of the past fifty years, detailing the cases of Metallgesellschaft, Barings Bank, Long Term Capital Management, and others. It reveals how flawed financial engineering and reckless speculation led to substantial losses and bankruptcies. By examining the stories of these institutions, the book uncovers the complexities of the derivatives market and the consequences of unchecked risk-taking and rogue trading.

This book analyzes in depth all major derivatives debacles of the last half century including the multi-billion losses and/or bankruptcy of Metallgesellschaft (1994), Barings Bank (1995), Long Term Capital Management (1998), Amaranth (2006), Societe Generale (2008) , AIG (2008) and JP Morgan- Chase (2012).

The book provides a comprehensive analysis of major derivatives failures over the past fifty years, detailing significant losses and bankruptcies of institutions such as Barings Bank and AIG. It explores the dual nature of derivatives—both as potential financial innovations and as sources of risk—highlighting the consequences of flawed financial engineering and rogue trading. Each chapter focuses on a specific case, categorizing derivatives from simple to complex. The text emphasizes the need for vigilant risk management and smarter controls, making it essential for financial professionals.