Editing Long-Term Capital Management (section)

== Aftermath ==
In 1998, the chairman of [[Union Bank of Switzerland]] resigned as a result of a $780 million loss incurred from [[Option (finance)#Short put|writing]] [[put option]]s on LTCM, which had become significantly [[Valuation of options#Intrinsic value|in-the-money]] due to LTCM's collapse.<ref name="FinancialHistory" />

After the bailout, Long-Term Capital Management continued operations. In the year following the bailout, it earned 10%. By early 2000, the fund had been liquidated, and the consortium of banks that financed the bailout had been paid back, but the collapse was devastating for many involved. [[David W. Mullins Jr.|Mullins]], once considered a possible successor to [[Alan Greenspan]], saw his future with the [[Federal Reserve System|Fed]] dashed. The theories of Merton and Scholes took a public beating. In its annual reports, Merrill Lynch observed that mathematical risk models "may provide a greater sense of security than warranted; therefore, reliance on these models should be limited."<ref>{{Harvnb|Lowenstein|2000|p=235}}</ref>

After helping unwind LTCM, John Meriwether launched [[JWM Partners]]. Haghani, Hilibrand, Leahy, and Rosenfeld signed up as principals of the new firm. By December 1999, they had raised $250 million for a fund that would continue many of LTCM's strategies – this time, using less leverage.<ref>{{Harvnb|Lowenstein|2000|p=236}}</ref> With the credit crisis of 2008, JWM Partners LLC was hit with a 44% loss from September 2007 to February 2009 in its Relative Value Opportunity II fund. As such, JWM Hedge Fund was shut down in July 2009.<ref>{{Cite news |date=July 8, 2009 |title=John Meriwether to shut hedge fund - Bloomberg |work=[[Reuters]] |url=https://www.reuters.com/article/meriwether/john-meriwether-to-shut-hedge-fund-bloomberg-idUSBNG46678320090708 |access-date=11 January 2018 |archive-date=5 February 2021 |archive-url=https://web.archive.org/web/20210205092645/https://www.reuters.com/article/meriwether/john-meriwether-to-shut-hedge-fund-bloomberg-idUSBNG46678320090708 |url-status=live }}</ref> Meriwether then launched a third hedge fund in 2010 called JM Advisors Management. A 2014 ''Business Insider'' article stated that his later two funds used "the same investment strategy from his time at LTCM and Salomon."<ref name="Business Insider">{{cite news |last1=Yang |first1=Stephanie |title=The Epic Story Of How A 'Genius' Hedge Fund Almost Caused A Global Financial Meltdown |url=https://www.businessinsider.com/the-fall-of-long-term-capital-management-2014-7 |access-date=12 July 2024 |work=[[Business Insider]] |date=Jul 11, 2014 |archive-url=https://web.archive.org/web/20210515145845/https://www.businessinsider.com/the-fall-of-long-term-capital-management-2014-7 |archive-date=2021-05-15}}</ref>