Black Edge summary

Introduction

Black Edge by Sheelah Kolhatkar. Black Edge explores inside information and dirty money. It details the quest to bring down Wall Street's most wanted man. It is common knowledge these days that Wall Street has much to answer for.

After the two thousand seven to two thousand eight financial crisis, one hoped governments would crack down on global financial excesses. Sadly, that simply has not been the case. The injustice of this state of affairs is perfectly personified. It is personified by Steve Cohen, a Wall Street investor.

He made billions of dollars by attaining a black edge over fellow investors. Cohen procured illegal insider information about companies' performances. This was in order to gain an advantage over fellow investors. To the outside world, he was miraculously lucky.

He was always betting on the right companies at the right time. In reality, as investigative journalist Sheelah Kolhatkar discovered, he almost certainly utilized an unfair advantage to surpass his rivals.

Steve Cohen's Early Trading Success

Steve Cohen was a talented trader. He was blessed with early success, but faced insider trading charges. In two thousand eight, amidst the worldwide financial crisis, United States federal agents were taking down Raj Rajaratnam.

He was a Wall Street titan. They discovered something fascinating. Rajaratnam was illegally using inside information from companies. He traded on this information and profited massively.

The agents were intrigued by one name. It kept cropping up during interviews with Wall Street insiders: Steve Cohen. Was there an even larger case waiting to be uncovered? Rajaratnam, it turned out, was small fry.

The investigation was only just getting started. So who is Steve Cohen? Let us start from the beginning. Steve Cohen was born in nineteen fifty six.

He grew up in a middle-class family on Long Island, New York. From a young age, he was fascinated with finance. As a student at the famous Wharton School of the University of Pennsylvania, he read the Wall Street Journal every morning. He followed the stock market.

He was talented too. He played poker with his fellow students and made a lot of money doing so. In nineteen seventy eight, fresh out of Wharton as a twenty-one-year-old, he landed a job at Gruntal and Company, a New York brokerage firm. Even then, his skills shone through.

In one afternoon, he made four thousand dollars. This was a huge figure in nineteen seventy eight. Cohen was successful, making five million dollars to ten million dollars a year. But it did not take long for the first signs of wrongdoing to appear.

He faced charges of insider trading. In nineteen eighty five, the Securities and Exchange Commission, or SEC, looked into Cohen's transactions. Cohen had received inside information through a friend. It was about an imminent takeover of electronics company RCA by General Electric.

Cohen invested heavily in RCA shares. He made twenty million dollars in profits when the takeover was announced. Even though the criminal case was later dropped, it strongly indicated Cohen had a somewhat unorthodox approach to trading.