Elliott Management

Paul Singer Has A Plan

Well, if you wouldn't mind...It’s easy. Step one: Buy credit default swaps. Step two: Sue to have company whose CDS you own put into bankruptcy against its will and before your swaps expire.

Elliott Management Corp. has been adding to derivatives trades that would pay off if Caesars Entertainment Corp. defaults as the hedge fund helps orchestrate a bankruptcy plan for the casino operator’s biggest unit, according to two people with knowledge of the trading.

Step three: Righteously insist that the above makes no sense whatsoever. Step four: Laugh maniacally and count your money. Read more »

The Curse Of Cristina Kirchner?

We don’t know if Paul Singer believes in karma or what-goes-around-comes-around or South American witchcraft. What we do know is that immediately after forcing Argentina into default, his hedge fund’s worst month in five years dawned.

Oh yea, by the way? Paul Singer’s worst month in five years was a 0.8% drawdown. So he’s probably not too worried. Read more »

Would he go so far as to describe his fellow hedge fund manager’s business tactics as hostage situation-esque? Yes, yes he would. Read more »

With its peso currency at record lows, foreign reserves down more than 5 percent over the last year and vast shale oil and gas resources laying undeveloped in its southern Patagonia region, Argentina is desperate to tap foreign financing. But the debt case, which stems from Argentina’s default on nearly $100 billion in sovereign bonds 12 years ago, is blocking its access to the international bond market. “Today we are in the hands of an international financial power comprised of small, voracious interests that form a real international mafia,” Jorge Capitanich, the Cabinet chief and government spokesman, told reporters in Buenos Aires. Many Argentines side with their government against a group of hedge funds that rejected the country’s 2005 and 2010 debt restructurings in which holders received less than 30 cents on the dollar. Holdout funds led by Elliott Management Corp and Aurelius Capital Management bought Argentine bonds at a discount before and after the 2002 default and have pressed their demand for payment of 100 cents on the dollar in the U.S. courts. [Reuters]

If Argentina doesn’t want to sit down with the Elliott Management founder and vulture-investor-in-chief, that’s OK. EMC Corp. can’t wait to hear from him about how its “federation strategy” is a total disaster than that it should sell its most successful business. Read more »

Along with not scoring goals, the country is also not doing anything about paying its bills and thus avoiding having as many defaults in the 21st century as it had World Cup titles in the 20th. Read more »

Paul Singer Explains It All

Fresh off a busy week in Davos, the Elliott chief pronounceth on the top issues of the day. For starters, he doesn’t get this whole bitcoin thing:

Paul Singer, founder of $23.3 billion Elliott Management Corp., told investors he was “shocked” by the virtual currency Bitcoin’s popularity and skeptical of its long-term prospects, according to a quarterly letter sent this week.

“There is no more reason to believe that Bitcoin will stand the test of time than that governments will protect the value of government-created money, although Bitcoin is newer and we always look at babies with hope,” Mr. Singer wrote.

Gold, however, he likes, even if he doesn’t fully understand what’s going on with it right now.

Mr. Singer encouraged investors to consider gold, which he wrote was “currently available at a good price….”

Gold is out of fashion, but we think the explanation for why it has been drifting down is not compelling. The economy seems stuck in the doldrums, but most so-called ‘experts’ have been changing their minds almost weekly about when they think the economy will finally begin a long-term acceleration to the upside,” Mr. Singer wrote in the letter.

He doesn’t like banks breaking the law and getting away with it.

“Lawlessness is a slippery slope,” the letter said, addressing one of the most controversial topics in financial services today, one seldom reported on or discussed in the media. “If a little ‘excess discretion’ is used… or a law is ignored in thousands of subtle ways, then over time the rule of law will be replaced by corruption and whim,” the letter said….

“Laws are not self-executing,” Singer wrote in the investor letter, as he cited a need for those entrusted to interpret the law and handle investigation and enforcement responsibilities to do so “with honesty and intelligence.”

He really doesn’t like all this talk about raising the minimum wage.

“Put bluntly, these policies would destroy jobs and cause companies and even entire industries to move elsewhere. These movements are politically motivated–a way for politicians to fake compassion,” Singer wrote in a letter to investors of his $23.3 billion Elliott Management on Jan. 27.

“If they gain traction, millions more people will make the transition from gainful employment to government dependency as jobs get priced out of existence by the rise in employment costs. Such policies would inexorably lead to lower economic growth, higher unemployment and a citizenry that is less and less self-sufficient.”

But most of all, he really, really doesn’t like it when hedge funds stupid enough to invest in Argentina’s post-haircut bonds waste his goddamned time with ridiculous pie-in-the-sky bullshit, when he and Cristina Kirchner could just hash the thing out over lunch. Read more »

Paul Singer’s Guilty Pleasure

Derivatives may be imperiling global stability and undermining society, but the Elliott Management chief just can’t help himself. Read more »