The energy trader who brought down hedge fund giant Amaranth with his bets on natural gas futures is "said to be planning an energy-focussed hedge fund," according to senior TheStreet.com writer Mark DeCambre. (You might recall that we reported this rumor back when Brian Hunter was allegedly spotted in New York City's Sparks in February.)
So who are Hunter's new sugar daddies?
The planned venture is said to have been seeded with around $750 million to $800 million, from primarily Middle East investors.
Now this makes sense: those "Middle East" types often come from countries that sit atop the Western world's oil supply and might be very interested in diversifying their portfolio with a fund centered around alternative energy strategies.
But we can't help recalling that in Liar's Poker whenever traders couldn't explain the movement of the markets, they blamed the Arabs. Mike Lewis calls it the "logical lie" because it kind of makes sense and is basically irrefutable.
"I spent much of my life inventing logical lies like this. Most of the time when markets move, no one has any idea why. A man who can tell a good story can make a good living as a broker. It was the job of people like me to make up reasons, to spin a plausible yarn. And it's amazing what people will believe. Heavy selling out of the Middle East was an old standby. Since no one ever had any clue what the Arabs were doing with their money or why, no story involving the Arabs could ever be refuted. So if you didn't know why the dollar was falling, you shouted something about the Arabs."
Amaranth's Hunter Tries Again [TheStreet.com]