They made zillions shorting anything having to do with subprime and the housing industry* and now they're investing the money they won betting those suckers would fail, earning the title of "unexpected saviors." Reuters reports that many hedge funds are helping keep U.S. home builders out of bankruptcy court until buyers return, offering operating cash or long-term equity financing, as well as purchasing distressed land. Tiger Global Management has taken a 3.55 million share stake in Standard Pacific Corp, and several other unnamed but "notable" funds are following in suit, hoping to profit when the real estate market picks up again.
While Reuters may be christening these guys the next Mother Theresa, you should not be fooled by their charity. In reality, these stone cold bastards are spending a few shekels now to prop up these poor, unfortunate housing stocks until they rally, and when they do, will short these pigs to death one more time.
Struggling home builders find unexpected saviors [Reuters]
*Rumor has it Paulson was scouring regional newspapers about individuals getting foreclosed, and calling the local banks to see if he could get liquidity to short their bank accounts individually.
Posted by HAM05, May 27, 2008 1:40PM
theyre def gonna start shorting commodities as its one huge bubble just ripe to burst.
how am i able to portend so emphatically? after paying 9$ for a tiny sandwich at pret today i mentioned to the decidedly non-finance checkout lady that these little fuckers are getting expensive. she deadpans, "yeah its because wheat prices have gone up"
how does that line go? when youre getting stock tips from the shoeshine boy...