Recharger The Dog » hedge-funders in jail

A Wikipedia for investors

Recharger — Sun, 11 Feb 2007 17:46:05 +0000

Now we have Valuewiki, a reader-built knowledge base for Wall Street confidence men to steal the money that we’ve neglected to spend on Jack Daniels and Oxycontin. The site works much like Wikipedia.org — anyone can contribute and edit existing articles. Theoretically, if a whole lot of savvy Wall Street types have identified an undervalued stock, then the stock is truly undervalued.

What we don’t get — what we will never get because we were born without a brain — is the following: if everyone identifies the same undervalued stock, won’t that spur investment, raise the price, thus crapping the undervalued part?

Another thing: Valuepedia is giving away $100 dollars EVERY DAY (major bucks to us; 1/10 of a peanut to them) to anyone who contributes truly original investment advice. Dust off your abacus, Mr. and Mrs. Investor.

Hurry, Hurry Get Yer Undervalued Stocks

Recharger — Fri, 09 Feb 2007 05:21:34 +0000

Controlled Greed is a Virginia-based blog that specializes in identifying undervalued stocks, says editor John Bethel. That we spent time reading his blog is good reason for you stay far away from us and John Bethel’s picks. Financially-speaking, we have always been wrong. In fact, Recharger is broke because he invests all his dog bones in Vita Creamed Herring and Chinese take-out. Nevertheless, he will share Mr. Bethel’s current holdings (all, we assume, undervalued stocks) with you. Whatever happens, don’t beat us up:

Another LSD Flashback

Recharger — Thu, 18 Jan 2007 22:10:36 +0000

You heard it here first. John M. Angelo and Michael Gordon, chief honchos of meglo-hedge fund Angelo, Gordon & Co. (which describes itself as “specialists in non-traditional investments” and manages $12 billion in assets, and, we kid you not, has cornered the market on paintball supplies) are the first hedge fund clones. After years of toil, South Korean scientists duplicated the C.E.O. (not sure which one), thus halving his wealth and his season Yankee tickets.
Are you listening, S.E.C.?

Find this man a jail cell.

Recharger — Sat, 13 Jan 2007 23:10:48 +0000

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.

Beavis and Butt-head Do Wall Street

Recharger — Fri, 24 Nov 2006 03:13:06 +0000

RECHARGER WANTS TO KNOW — ARE WE ALL SUCKERS? Can we not tell the difference between an Academy Award and a Nobel Prize in economics? Reading an account of the book When Genius Failed on Underthecounter.com, gets us thinking: could we, with the right canine grooming, a serious suit from Barneys, and a strong bark, make a $2 million Christmas bonus despite having led investors into one of the biggest debacles in financial history?

Take Myron Scholes, half of the famed Black-Scholes duo, Nobel Prize winners who, in 1994, founded LONG-TERM CAPITAL MANAGEMENT (LTCM) A HEDGE FUND THAT WENT ON TO LOSE $4.6 BILLION IN LESS THAN FOUR MONTHS BEFORE IT WENT BUST. In 2005, Scholes was found guilty of setting up an illegal tax shelter to avoid paying taxes on company profits investments, and the IRS fined him and his partners more than $40 million.

Where’s Scholes now? Teaching economics at Stanford University.