Term’s total loss on Monday was $553 million, coincidentally equal to its loss of a month before. In percentage terms, this Monday’s loss was far worse: it ate through a third of Long-Term’s equity, leaving it with just under a billion dollars. And the fund still had more than $100 billion in assets. Thus, even omitting derivatives, its leverage was greater than 100 to 1—a fantastic figure in the annals of investment. Now, if Long-Term lost even a mere 1 percent more, it would be wiped out.
