So big news? The HF industry is rescuing the sub-prime mortgage industry. Surprise. The players in that space smell blood and also a huge payday as they effectively pick up entire portfolios for pennies on the dollar and then manage the risk to reap the rewards. Nice.
PTJ II is jumping into the political arena full-force. He's hosting a 500 person fund-raising dinner for B.
Obama at Paul's waterfront CT estate. May 19
th is the date so make sure to mark it on your calendars.
Some guy out of
Calpers is griping about HF fees. So what else is new. 2/20 is the industry norm. A few funds are still in the 1/20 structure while others are feeling quite proud of their fund and going with 3/30 and then there's Simon Renaissance fund which charges a 5%
mgt fee and 44% of profits. I guess that's why he made over $1B personally in 2006. Investors (private and institutional) are still paying up for the non-correlated performance to equities and/or the lower-risk-for-higher-reward formula that has worked well in the past. The space is crowded though so the industry will probably continue to see different approaches to the
mgt fee/incentive fee issue.
Question: will I ever receive my Bad Aquila Deal t-shirt from Pirate Capital? Time will tell. I promise to wear it with pride if the day ever comes.
Off-shore funds have quietly fallen into the sniper scope of Congress. In the good old boy network of Washington DC, somehow the members of Congress are going against centuries of unspoken policy of letting the rich get richer (and helping them along the way) as they are proposing to limit or close the loopholes for evading federal taxes off-shore. Someone may want to remind them who funds their political campaigns.
So Citadel looks to be the latest behemoth hedge fund that will begin incubating smaller funds. Diversification and the chance to hit the winning lottery ticket with an off-the-charts performer are the probable reasons to go down this incubator path.
The latest hot term on the street: buckets. Also, the term that is being used more frequently that has ominous
connotations: dark pools of liquidity. Who sits around and thinks up the stuff?
Sallie Mae went private in a $25B deal. Southwest Air and
BOL are two more companies that are rumored to be on the selling block. So that will be the theme of 2007. The huge surge in PE deals. Like the HF industry before them, the PE industry is becoming the darling of institutions. Once that occurs, the money comes fast and furious. Kind of reverting back to the
pre-stock market days. Has there ever been a time when public companies were being taken private at such a fast rate? Maybe back in the 80's heyday of
Boesky and
Miliken et al....before my time for sure. I was knee deep in 17 West and trying to pass my classes.
London vs. NYC. Looks like London is winning the battle as momentum has shifted over to the other side of the pond for who can claim the title of World' Financial Center. The HF industry in "The City" is absolutely booming. $ is being made and accumulated like crazy. Well, NYC....we're waiting....
Want to see a bunch of really nice real estate that only a small number of Americans can afford: check out
brownharrisstevens.com. Unbelievable.
and finally, congrats to Amazon (
amzn) for an '
amazin' quarter that blew the doors of all analyst's estimates and it trading $13 higher than where it was two days ago...cheers!'
oh yeah, and one more thing....the dow closed above 13K yesterday for the first time ever...
Happy Thursday.
Labels: commentary, djia, gossip, hedge funds, media, pe, politics