Volcano Pompeii. Before its catastrophic eruption of 1991, Pinatubo was an inconspicuous volcano, unknown to most people in the surrounding areas. Two other examples are the long-dormant Soufrière Hills volcano on the island of Montserrat, thought to be extinct before activity resumed in 1995, and Fourpeaked Mountain in Alaska, which, before its September 2006 eruption, had not erupted since before 8000 BCE and had long been thought to be extinct. The three common popular classifications of volcanoes can be subjective and some volcanoes thought to have been extinct have erupted again. To help prevent people from falsely believing they are not
Long-Term Capital Management invested in other derivatives such as equity options. Under prevailing US tax laws, there was a different treatment of long-term capital gains, which were taxed at 20.0 percent, and income, which was taxed at 39.6 percent. The earnings for partners in a hedge fund was taxed at the higher rate applying to income, and LTCM applied its financial engineering expertise to legally transform income into capital gains. It did so by engaging in a transaction with UBS (Union Bank of Switzerland) that would defer foreign interest income for seven years, thereby being able to earn the more favourable capital gains