The Man Who Solved the Market

“You have money in the bank or not, at the end of the day,” Mercer told science writer Sharon McGrayne. “You don’t have to wonder if you succeeded . . . it’s just a very satisfying thing.”2

In a matter of months, Meriwether and his colleagues had lost nearly $2 billion of personal wealth, marks on their careers they would never erase.

“The name of the game is not to always be right, but to be right often enough.”

Henry Laufer’s group, which traded all these investments, was on a roll. Laufer’s key strategies—including buying on the most propitious days of the week, as well as at the ideal moments of the day—remained

Oddities in currency markets represented additional attractive trades. Opportunity seemed especially rich in the trading of deutsche marks. When the currency rose one day, it had a surprising likelihood of climbing the next day, as well. And when it fell, it often dropped the next day, too. It didn’t seem to matter if the team looked at the month-t

“I realized I might not be spectacular or the best, but I could do something good. I just had that confidence,” he says.

“I was fascinated by the action and the possibility I could make money short-term,” he says.

Straus and others had compiled reams of files tracking decades of prices of dozens of commodities, bonds, and currencies. To make it all easier to digest, they had broken the trading week into ten segments—five overnight sessions, when stocks traded in overseas markets, and five day sessions. In effect, they sliced the day in half, enabling the tea

An eighteenth-century Japanese rice merchant and speculator named Munehisa Homma, known as the “god of the markets,” invented a charting method to visualize the open, high, low, and closing price levels for the country’s rice exchanges over a period of time. Homma’s charts, including the classic candlestick pattern, resulted in an early and reasona