Churchill almost went bankrupt

(written by lawrence krubner, however indented passages are often quotes). You can contact lawrence at: lawrence@krubner.com

This makes me feel a bit better about my own history:

Money also illuminates his inner life. The Black Dog struck in 1937-8, when he was savaged by margin calls in the hundreds of thousands of pounds on his appallingly ill-thought-out share portfolio, pursued by the Inland Revenue, enormously overdrawn at his bank, writing 2000 words a day or more for fear that his publisher would reclaim the long-spent advance on Marlborough: His Life and Times. Of course he was depressed.

That he made it to 1940 without going bankrupt reflects great credit on his financial advisers, notably William Bernau, his bank manager and insurance broker at Cox’s and then Lloyds for two decades until the stress finally caught up with him, Cecil Vickers and WSC’s brother Jack Churchill at Vickers & Da Costa, his Lloyds tax adviser Geoff Mason, and his lawyer Anthony Moir.

…One way to look at his finances is as an exercise in cash-flow management of the kind summed up in Adam Kotsko’s classic financial advice for graduate students, the art of being broke. Churchill as a Grad Student isn’t actually that far wrong – we’re talking about someone with no cash and lifestyle expectations way above his income, but who has substantial long-term earnings potential. Like Kotsko, he got by through ruthlessly prioritising those payments that had to be made now, in full, and in cash, and letting the others ride, as well as always maximising the committed but undrawn credit available.

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