Schadenfreunde – experiencing pleasure in someone else’s pain.

In Liar’s Poker the head of Solomon Bank, John Guetfreund challenges bond maverick John Merriwether to a 1 million USD hand in Poker. He backs off when the latter ups it to 10 million. Here’s the thing. It wasn’t about the money. It never is. It’s about Schadenfreunde.

As you know our world is a zero sum game which means for every winner there’s a loser. When I started trading German debt I never really understand this concept. That has changed. Also, why would you want pain inflicted on the guy sat on the desk next to you ?

One day it happened and I feel guilty to say I absolutely loved the feeling it gave me. Getting a trade right is one thing but when someone is the other side of that trade – it’s quite another. Ask Carl Ichan and Bill Ackman. They know all about it – a greatness far more than the feeling of gaining money. Ironically, I basked in that feeling whilst having my best year in monetary terms.

The point of this post is to remember it is just a feeling. Expect it but don’t enjoy it too much because one day someone will derive pleasure at your expensive. It is the worse feeling in the world.

Try and be nice because when it goes wrong your world will not feel like it is ending. You will recover to fight another day.



Patrick Reid
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