We don’t know a derivative contract from an IPO, but we do have some idea how much $5 billion is--roughly 5000 times what we’ve earned in our best year. $5 billion is how much hedge-funder Brian Hunter lost for Amaranth Advisors in a single week. As Trader Mike points out, that Hunter was given so much leash to gamble investors money was freaky, considering he had already blown $51.2 million for his previous employer, Deutsche Bank.
According to the New York Sun, Amaranth, which eventually went bust, topped the losers for 2006.
What tickles us, is the psychodelic disconnect between investorites and the piles of lost cash. Our favorite comes from a contributer to an online “risk forum,” who wrote:
According to the founder of Amaranth Advisors LLC, Nick Maounis, “highly unusual market behavior” was to blame. “We did not expect that the market would move so aggressively against our positions,” he said. But most would surely agree that $6 billion of losses warrants a look at risk management procedures…
“Warrants a look”? How ’bout a butt fuck with paring knife.
Now comes word that Amaranth founder Nick Maounis, the guy who gave Brian Hunter all that leash, wants to start a new fund.
Fund blows $5 billion in one week; goes bust; reincarnates as new fund; begs investors for cash. Makes sense to us.