Posts Tagged ‘hedge funds’

2nd big hedge fund closes shop

Friday, August 20th, 2010

Full story here from ZeroHedge. I’m asking myself if the hedgies are seeing some distant tsunami wave heading our way, and are moving to higher ground now.

When we reported that Stanley Druckenmiller had decided to call it a day after a 30 year career, we joked that his action was a stark confirmation that alpha was dead, as more and more hedge funds are increasingly unable to eek out incremental returns over risk free, thereby rendering the whole 2 and 20 business model meaningless. (more…)

Top hedge funder sees himself as a hyena devouring wildebeests

Monday, May 24th, 2010

Full story here from ExiledOnline.

Ray Dalio is a billionaire hedge fund manager who makes more money in a single day than most Americans will earn in their entire lifetimes. That’s because hedge funds are the top of the Wall Street food chain — and Dalio runs the largest hedge fund of all, Bridgewater Associates. Life’s good at the top of this food chain: in 2008, a bad year for most Americans, Dalio took home $780 million. That same $780 million could have paid the salaries of about 20,000 teachers — and those 20,000 teachers could have taught about 400,000 American students (using author Les Leopold’s calculations)(more…)

Time to end the giant tax loophole

Sunday, May 23rd, 2010

Full story here from Business Insider.

Who could be opposed to closing a tax loophole that allows hedge-fund and private equity managers to treat their earnings as capital gains – and pay a rate of only 15 percent rather than the 35 percent applied to ordinary income?

Answer: Some of the nation’s most prominent and wealthiest private asset managers, such as Paul Allen and Henry Kravis, who, along with hordes of lobbyists, are determined to keep the loophole wide open. (more…)

How the FDIC is legally transferring billions to hedge funds

Wednesday, February 10th, 2010

LawdGawdJaysus! The conversion of US to a corporate kleptocracy is complete. Sadly, documented here.

“It is not a secret to anyone who has been closely following the FDIC’s quasi criminal bank takeover practices over the past year, that acquirors of failed banks end up receiving a massive and risk-free gift in the form of taxpayer benefits via the FDIC when it comes to funding losses on a given bank acquisition. Should there be a short sale resulting in a loss to the full principal (not the cost basis mind you)? Not to worry, Sheila Bair is there to hand out taxpayer money to the hedge funds/banks owning the newly transferred assets. A recent example of this was the glaring insider trading which preceded the acquisition of failed AmTrust Bank by New York Community Bancorp, in which both NYB and those who bought calls in advance of information being made public, made massive illegal profits. And as the SEC continues to pretend like this episode never happened, we remind the intellectually subprime Mary Schapiro to finally pursue those involved, and will continue doing so for as long as it takes. But back to the FDIC: the folks at Think Big Work Small have compiled a terrific video detailing exactly how several hedge funds, currently owners of recently created shell holding company OneWest Bank, are picking apart the carcass of failed IndyMac, all the while encouraging short sales (instead of loan mods) as only that way do they get to benefit fully from the taxpayer funded FDIC loss-share arrangements which makes the IndyMac transaction an immediate slam dunk for everyone involved…except America’s taxpayers, and the FDIC’s ever depleting DIF reserve.

As the authors appropriately title the video, this is indeed a slap in our face. And this goes on every single bailout Friday when the FDIC continues handing out billions of dollars under the guise of “loss sharing” arrangements, which is simply a guaranteed profit from the acquirors’ cost basis to 90% of the original loan value: an instantaneous 30% risk free IRR.

Full must watch video after the link (click on the icon below).

CIA agents hired by hedge funds

Tuesday, February 9th, 2010

Sadly, that is not a misprint. Missed this earlier from Huffington Post. George Carlin (if he wasn’t already dead) would most certainly have keeled over from a thrombo on this …

“In the midst of two wars and the fight against Al Qaeda, the CIA is offering operatives a chance to peddle their expertise to private companies on the side — a policy that gives financial firms and hedge funds access to the nation’s top-level intelligence talent, POLITICO has learned.

In one case, these active-duty officers moonlighted at a hedge-fund consulting firm that wanted to tap their expertise in “deception detection,” the highly specialized art of telling when executives may be lying based on clues in a conversation.

Read the whole story: Politico

Ponzi party: no shorts

Wednesday, January 6th, 2010

Full story here from ZeroHedge.

“As part of the Barney Frank proposed Manager’s Amendment, which will accompany HR4173, the “Wall Street Reform and Consumer Protection Act of 2009″, are three little-noticed rules that, if adopted, will make shorting stocks if not impossible, then extremely problematic and difficult. It is obvious why these rules would end up in an amendment: the outcry from retail and institutional traders would have been huge had these proposals made the full text of the proper Bill, and into the full view of the Mainstream Media. So why bother with these – simple. As everyone is aware, Ponzi schemes only work when constantly growing, as otherwise they blow up, implode under their own weight, once price discovery is attempted by all. Case in point: when Madoff’s securities was unable to find another greater fool in the face of collapsing asset values, the jig was up overnight, and the value of the pyramid went from $50+ billion to $0 instantaneously. (more…)

Russian hedge fund theft blown wide open on Youtube

Thursday, October 15th, 2009

Full story here from The International Forecaster.

The Guardian web site is reporting that London based investment company Hermitage Capital has turned to the web to expose a massive fraud involving the highest levels of government. Hermitage CEO William Browder has released his story on the web. It details corrupt and criminal acts that have resulted in a theft of 230 Million dollars. Names are named. Its a great insight into the corrupt workings of government and police. In an even more bizarre twist, Bowder is now wanted for questioning in relation to the acts of fraud. A russian language version of the video has now gone viral in Russia and promises to tear the lid off all efforts to cover up criminal activity by the state and police around the case.

The stunning comment that ends the article is that this activity is commonplace in Russia. “The story sounds like a thriller but isn’t and it’s being repeated every day” (source).

No comments yet for Russian Hedge Fund Theft Blown Wide

“Matrix” finance breaking down

Wednesday, September 9th, 2009

Head deeper down the rabbit hole here from Christopher Story in London. This is very edgy stuff, but if it’s true, the fertilizer is really hitting the oscillator. This is only a tiny snippet of a very long read.

“…Following the ‘lockdown’ of the $14+ trillion of REAL on-the-books funds, including the previously referenced $6.2 trillion of LOAN money, on 10-12 September 2008, all off-balance sheet funds, the source of which cannot be identified, have been totally frozen and cannot be brought back onto the balance sheet. The CEO of Alchemy Partners, Jon Moulton, has now ‘jumped’ because of this.

Once the overdue Settlement payments in the United States have been unblocked by Dr Ben Bernanke, the Chairman of the Federal Reserve, and Timothy Geithner, the US Treasury Secretary, both the US Treasury and the Federal Reserve will cease to exist in the format to which they and the world are accustomed, as they will necessarily be Basel-II (and Basel-III) compliant, which will mean that the most important question in the world – ‘What is the source of funds’ – will govern ALL FINANCIAL TRANSACTIONS. The dual system, with separate sets of books, will collapse.

The crisis has therefore reflected the ruthless determination of a handful of criminal US finance operatives, headed of late by Bernanke and Geithner, taking orders from Bush Sr., to defy the wishes of the international community by blocking the US dimension of the Settlement payouts in order to sustain this double-minded, corrupt system of ‘two sets of books’ that is collapsing.”

Philanthropies and the Economic Crisis

Thursday, May 28th, 2009

A brief indulgence into a big, ugly black hole. From Joan Roelofs via Counterpunch.

Not getting loads of foundation grants? Support yourself by ShadowTrading!

“We in the United States have been endowed with enormous philanthropic foundations, which have been fixing up the world for the last 100 years. One might wonder how their activities relate to the current economic crisis. News on this subject is not found in the headlines, or even on page 23. There is more exposure of foundation garments than of the opulent structures overpinning our system. (more…)

Biden in a ponzi?

Tuesday, April 28th, 2009

Full story here. From Bronte Capital. A nice, well-documented piece about the Vice President’s son and brother apparently working in and around some rather shady hedge funds…you’ll have to go to the link to see the pictures. Tricky deal that–hedge funds putting their marketing info in pictures, not text. Can’t be captured or searched on by Google–which you’d think would be desirable from a marketing standpoint. If you are curious, you can read more here and here.

If you are fed up with high risk and no returns then join Shadowtraders and learn to trade the Futures Market.

“I have been following the Paradigm Global/Ponta Negra and Stanford links for some time.

The first post – on Ponta Negra – got heavy lawyers letters – so I disappeared. There were lots of posts I did not make.

However here is one – quite tame really – that I did not make only a couple of days ago. It was labelled “A service to the clients of Onyx Capital”.

A service to the clients of Onyx Capital
Onyx Capital is updating its website. Onyx Capital is – as their website used to say – a marketer of hedge funds. All it has on the site is a picture of some text. I duplicate it here.

It’s a “picture of text”, not “actual text” which means that it is not findable by Google – nor will it be archived in the Google cache. So when removed it will disappear forever from Onyx’s site but will be stored for posterity here. It is strange to construct a website of entirely pictures rather than searchable text – but that is the way that Onyx seems always to operate.

The current “picture” says that they are updating their personal contact details. At the moment the website contains no phone numbers, no address and no way of contacting Onyx.

If you have your money allocated by Onyx you might find that unacceptable. So I am going to help you out.

Here are the contact details of Onyx before they chose to update their website. It was also in the form of a picture (not text) so you will not find these contacts archived in the Google cache. This makes it very hard indeed for clients to find contact details for Onyx. I copied that picture about a month ago.

Strangely even these marketing details contain no street address – only phone numbers.

Now – Onyx is a financial services marketing organisation. And like all marketing organisations it wants clients to be able to find it. But strangely their contact details have always been in the form of “pictures of text” rather than plain text – and hence have never been archived by Google – making them difficult to find.

To help Onyx in its marketing I have chosen to repeat three of the contact details.

Jeffry Schneider
512 617 6335

Justin Hare
Director of Investor Relations
713 320 2767

Alla Babikova
Managing Director
New York Office
646 594 7598

I have also sought some information about these people – again for the benefit of Onyx clients.

Jeffry Schneider is a hedge fund marketer and financial professional with some standing. He has several CVs on the internet (one of which I have repeated below). He is quoted in this Wall Street Journal story explaining the business relationship between Paradigm Global (a fund of hedge funds) and a certain Alan Stanford. The relationship is minor. Stanford used to market Paradigm’s products (including a cobranded product) and Paradigm held some Stanford moneys. There is no evidence that Paradigm ever allocated any of their client moneys to Stanford. There is no evidence of wrongdoing – only that Paradigm Global are less careful than they should have been about whose name they attached to their product. As there is no evidence of wrongdoing the relationship would not be worthy of an article in the Wall Street Journal except that Paradigm Global is owned by Hunter Biden and James Biden who are Vice President Joe Biden’s son and brother respectively. The link between Stanford and the Bidens is tenuous – at least in the WSJ article. The link between Onyx and the Bidens is strong.

Schneider is also listed as a contact on other funds marketed from the 17th Floor of 650 Fifth Avenue New York. (It turns out that the other funds included Ponta Negra.)

650 Fifth Avenue (17th Floor) is the address of Paradigm Global so he has managed to garner other clients on that floor. If he got clients knocking door to door or by word of mouth on that floor – good luck to him.

Justin Hare has had a dual career. He has worked for Onyx as the head of investor relations (sales) whilst simultaneously working in “relationship management” (sales) for Stanford (which is widely believed to have been a pure ponzi scheme).

I am guessing that the Stanford relationship is the reason that Onyx needs to update its contact details. That however is a pure guess.

Alla Babikova – who works in the New York office of Onyx also sometimes gives her career as the head of marketing for Paradigm Global. The only CV I can find on the web suggests she joined Onyx in September 2009 – something that appears impossible. That said – the CV on the web speaks to a long marketing career.

Jeffry Schneider also acts as the marketing agent for other hedge funds – sometimes with Jared Toren who is not mentioned on these contact details.

Jeffry Schneider and Jared Toren were once sued for allegedly stealing a hedge fund marketing database. They then – alledged in this lawsuit – set up Onyx Capital. The lawsuit gives Onxy’s address – something that is also missing from the contacts page:

6835 Bee Caves Road
Suite 245
Austin Texas

For the benefit of Onyx clients I have repeated – for searching by Google – the physical address of Onyx’s Austin Texas operations. The website did not contain the NYC office address and I do not know it.

I hope this helps Onyx’s clients keep in contact with Onyx. Meanwhile Onyx should – at a minimum – give some contact details on their website and I am looking forward to the website’s next update.