Investors in Bear Stearns’s ‘We’ve basically got nothing’ and ‘We’ve got a nickel’ hedge funds (the High-Grade Structured Credit Strategies Enhanced Leverage Fund and the High-Grade Structured Credit Strategies Fund, respectively), taking issue with the lack of value, are exploring legal action. Ross Intelisano, of Rich & Intelisano, whose services have been retained by two investors in the funds said that his clients are “shocked and angered by the losses” and “were under the impression that at least for the fund [that they were invested in] that the losses were much milder," which was probably because up until Tuesday, Bear Stearns was pretending the funds still had value.
Bear Stearns declined to comment on the possible litigation, so here’s an imagined conversation from 383 Madison Avenue.
Richard Marin: Uh, Mr. Cayne, they’re threatening legal action.
James Cayne: Wah? My half-hearted, barely sincere, too little, too late apology wasn’t good enough?
Richard Marin: Apparently not.
James Cayne: Fuck it. Let’s go golfing.
Richard Marin: Okay, but no cheating this time.
James Cayne: You can trust me, Dick.
Angered Bear fund investors eye legal action [CNN Money]
Posted by RandomGirl , Jul 19, 2007 12:42PM
The greedy bastards who invested to begin with must have just expected money to rain from the heavens?
Posted by Musicman , Jul 19, 2007 1:03PM
True, randomgirl, most of us who invest in funds, stocks, securities, etc.....expect a mushroom return and overnight. But, the bastards who take your money going in knowing they have the ubrellas of charitable trusts and too numerous to mention hiding places for your buck that the SEC cannot and show no interest in finding and stopping. Good Day.
Posted by jkibbel , Jul 19, 2007 1:05PM
with the three lawsuits Bear has on them right now, you won't have to worry about subprime doing them in.
Posted by spec , Jul 19, 2007 1:07PM
if you're going to put money in something speculative (like low-grade credit) then you should make sure that it only represents a small fraction of your overall wealth ... then when (because that is what happens with a high probability to high risk speculative investments) it goes to zero, your overall portfolio isn't affected too much.
but then again, i guess being a "highly sophisticated investor" means you can be a dimwit.