Considering he has apparently transformed into a mortgage backed securities bull (in selective cases) it's interesting to hear that John Paulson doesn't seem interested in using cheap government leverage and guarantees to participate in the public-private plan to pick up legacy assets, as he told the Times. Why not? We actually have no idea, given Paulson's soft spoken treatment of the subject, but it is great fun to speculate.
Perhaps the prospect of an ever-changing regulatory morass or retroactive witch-hunts turned off our hero? Or perhaps Paulson would simply prefer to cherry pick his own hit-list of prospective value plays, avoid the gamble of an auction and the spectacle of banks trying to game the system? Lots of buyer's regret potential here. Leveraged buyer's regret, actually. It is also not particularly hard to imagine that anything the banks want to sell might be less attractive than a few carefully picked distressed assets from better motivated sellers.
Is Paulson alone? We would like to find out. Dealbreaker is going to keep a running tally of who decides to opt out and in. So far:
Bridgewater: Considering it.
Citadel (according to sources): Considering it.
Paulson: No.
Let us know as you hear. Share: tips at dealbreaker dot com.
Top Hedge Fund Managers Do Well in a Down Year [The New York Times]
Posted by guest , Mar 25, 2009 3:09PM
That's a Peter Max I would gladly display in my apartment.
Posted by guest , Mar 25, 2009 3:12PM
BX might be in
Posted by miami , Mar 25, 2009 3:20PM
Dan Loeb: No.
Posted by guest , Mar 25, 2009 3:20PM
Third Point: hell to the nah
Posted by miami , Mar 25, 2009 3:24PM
first off, you're second,
and second, it's: Hell 2 da naw Lamar style.
Posted by guest , Mar 25, 2009 3:25PM
Why (aside from blind greed) would an retail investor put money in these assets, when not even the banks that hold them on the BS fully understand the product?
Posted by guest , Mar 25, 2009 3:27PM
"aside from blind greed"...for what other reason would one run a hedge fund (not saying hf's are bad, they're not, but you're not in it to make friends).
Posted by guest , Mar 25, 2009 3:35PM
any rumors for walmart first year #s??
Posted by guest , Mar 25, 2009 3:50PM
a lot of hedge funds will sit this one out. You basically are going to have to hold this sht to maturity to win this gamble right? What if you want out in 2 or 3 years? Will there be a mkt for it?
Not many hedge funds have 10yr+ time horizons for investments.
Posted by guest , Mar 25, 2009 4:10PM
Anyone who thinks partnering with the government on this trade is a good idea deserves the screwing they're going to get.
- Fixed Income
Posted by guest , Mar 25, 2009 4:16PM
well he has the cash to buy what he wants it would be bad for him to increase demand by providing capital to a bunch of retards wanting to pump up prices before he can buy what he wants
Posted by dubs , Mar 25, 2009 4:37PM
Of course he's against it, it's not like his fund is going to be considered as one of the 5 funds for the securities portion. He's on the outside looking in.
Posted by Anal_yst , Mar 25, 2009 4:40PM
Cheers to the guy if he can time it (as good as almost anyone) on the way down AND on the way up (if such a thing exist/will exist).
Posted by guest , Mar 25, 2009 4:40PM
he passes on distressed bonds daily when he doesn't get his price. this dude will never be forced into a trade. should some as no surprise
Posted by guest , Mar 25, 2009 6:26PM
Maybe he has some dignity?
Will gladly take advantage of idiots but not the wholesale looting of the taxpayer.
Posted by guest , Mar 25, 2009 8:44PM
This is a fucking joke. The minute they accept financing the government will exert the same control that they have over the banks.
From there 2 options:
1. Investment burns, HFs get taken over
2. Investment does well, public outrage demands HF bonuses to be paid back
Its a fucking joke
Posted by guest , Mar 25, 2009 8:49PM
Option 3 - Hedgies get a real job.
Posted by guest , Mar 25, 2009 9:16PM
@ 17
corollary #1- returns at endowments, pension, insurance cos., etc. go down, as service provided by hedgies is compromised
Posted by guest , Mar 26, 2009 4:04AM
@18 -- Or endowments etc. make just as much, post-fees, through index funds ...
Posted by guest , Mar 26, 2009 4:16AM
why do you think Geithner and Bernanke all of a sudden want the power to regulate, seize and wind down HFs?! if they get it there won't really be a choice in the matter b/c ever HF will have a gun to their heads to participate in this shit show.
Posted by guest , Mar 26, 2009 5:05AM
The trick will be to ride the coat tails without the commitment. Front run the government telegraphed trades while not being subject to all of the public outrage. Unless, they plan a special tax for not cooperating...hmmm