This is the End and a New Beginning
7 months ago
Sunday, October 19, 2008
Saturday, October 18, 2008
FWD: Hedge Fund Manager Andrew Lahde Hates Hedge Fund Industry, Quitting Immediately
(From Financial Armageddon)
October 17, 2008
Today I write not to gloat. Given the pain that nearly everyone is experiencing, that would be entirely inappropriate. Nor am I writing to make further predictions, as most of my forecasts in previous letters have unfolded or are in the process of unfolding. Instead, I am writing to say goodbye.
Recently, on the front page of Section C of the Wall Street Journal, a hedge fund manager who was also closing up shop (a $300 million fund), was quoted as saying, “What I have learned about the hedge fund business is that I hate it.” I could not agree more with that statement. I was in this game for the money. The low hanging fruit, i.e. idiots whose parents paid for prep school, Yale, and then the Harvard MBA, was there for the taking. These people who were (often) truly not worthy of the education they received (or supposedly received) rose to the top of companies such as AIG, Bear Stearns and Lehman Brothers and all levels of our government. All of this behavior supporting the Aristocracy, only ended up making it easier for me to find people stupid enough to take the other side of my trades. God bless America.
There are far too many people for me to sincerely thank for my success. However, I do not want to sound like a Hollywood actor accepting an award. The money was reward enough. Furthermore, the endless list those deserving thanks know who they are.
I will no longer manage money for other people or institutions. I have enough of my own wealth to manage. Some people, who think they have arrived at a reasonable estimate of my net worth, might be surprised that I would call it quits with such a small war chest. That is fine; I am content with my rewards. Moreover, I will let others try to amass nine, ten or eleven figure net worths. Meanwhile, their lives suck. Appointments back to back, booked solid for the next three months, they look forward to their two week vacation in January during which they will likely be glued to their Blackberries or other such devices. What is the point? They will all be forgotten in fifty years anyway. Steve Balmer, Steven Cohen, and Larry Ellison will all be forgotten. I do not understand the legacy thing. Nearly everyone will be forgotten. Give up on leaving your mark. Throw the Blackberry away and enjoy life.
So this is it. With all due respect, I am dropping out. Please do not expect any type of reply to emails or voicemails within normal time frames or at all. Andy Springer and his company will be handling the dissolution of the fund. And don’t worry about my employees, they were always employed by Mr. Springer’s company and only one (who has been well-rewarded) will lose his job.
I have no interest in any deals in which anyone would like me to participate. I truly do not have a strong opinion about any market right now, other than to say that things will continue to get worse for some time, probably years. I am content sitting on the sidelines and waiting. After all, sitting and waiting is how we made money from the subprime debacle. I now have time to repair my health, which was destroyed by the stress I layered onto myself over the past two years, as well as my entire life – where I had to compete for spaces in universities and graduate schools, jobs and assets under management – with those who had all the advantages (rich parents) that I did not. May meritocracy be part of a new form of government, which needs to be established.
On the issue of the U.S. Government, I would like to make a modest proposal. First, I point out the obvious flaws, whereby legislation was repeatedly brought forth to Congress over the past eight years, which would have reigned in the predatory lending practices of now mostly defunct institutions. These institutions regularly filled the coffers of both parties in return for voting down all of this legislation designed to protect the common citizen. This is an outrage, yet no one seems to know or care about it. Since Thomas Jefferson and Adam Smith passed, I would argue that there has been a dearth of worthy philosophers in this country, at least ones focused on improving government. Capitalism worked for two hundred years, but times change, and systems become corrupt. George Soros, a man of staggering wealth, has stated that he would like to be remembered as a philosopher. My suggestion is that this great man start and sponsor a forum for great minds to come together to create a new system of government that truly represents the common man’s interest, while at the same time creating rewards great enough to attract the best and brightest minds to serve in government roles without having to rely on corruption to further their interests or lifestyles. This forum could be similar to the one used to create the operating system, Linux, which competes with Microsoft’s near monopoly. I believe there is an answer, but for now the system is clearly broken.
Lastly, while I still have an audience, I would like to bring attention to an alternative food and energy source. You won’t see it included in BP’s, “Feel good. We are working on sustainable solutions,” television commercials, nor is it mentioned in ADM’s similar commercials. But hemp has been used for at least 5,000 years for cloth and food, as well as just about everything that is produced from petroleum products. Hemp is not marijuana and vice versa. Hemp is the male plant and it grows like a weed, hence the slang term. The original American flag was made of hemp fiber and our Constitution was printed on paper made of hemp. It was used as recently as World War II by the U.S. Government, and then promptly made illegal after the war was won. At a time when rhetoric is flying about becoming more self-sufficient in terms of energy, why is it illegal to grow this plant in this country? Ah, the female. The evil female plant – marijuana. It gets you high, it makes you laugh, it does not produce a hangover. Unlike alcohol, it does not result in bar fights or wife beating. So, why is this innocuous plant illegal? Is it a gateway drug? No, that would be alcohol, which is so heavily advertised in this country. My only conclusion as to why it is illegal, is that Corporate America, which owns Congress, would rather sell you Paxil, Zoloft, Xanax and other additive drugs, than allow you to grow a plant in your home without some of the profits going into their coffers. This policy is ludicrous. It has surely contributed to our dependency on foreign energy sources. Our policies have other countries literally laughing at our stupidity, most notably Canada, as well as several European nations (both Eastern and Western). You would not know this by paying attention to U.S. media sources though, as they tend not to elaborate on who is laughing at the United States this week. Please people, let’s stop the rhetoric and start thinking about how we can truly become self-sufficient.
With that I say good-bye and good luck.
All the best,
Andrew Lahde
October 17, 2008
Today I write not to gloat. Given the pain that nearly everyone is experiencing, that would be entirely inappropriate. Nor am I writing to make further predictions, as most of my forecasts in previous letters have unfolded or are in the process of unfolding. Instead, I am writing to say goodbye.
Recently, on the front page of Section C of the Wall Street Journal, a hedge fund manager who was also closing up shop (a $300 million fund), was quoted as saying, “What I have learned about the hedge fund business is that I hate it.” I could not agree more with that statement. I was in this game for the money. The low hanging fruit, i.e. idiots whose parents paid for prep school, Yale, and then the Harvard MBA, was there for the taking. These people who were (often) truly not worthy of the education they received (or supposedly received) rose to the top of companies such as AIG, Bear Stearns and Lehman Brothers and all levels of our government. All of this behavior supporting the Aristocracy, only ended up making it easier for me to find people stupid enough to take the other side of my trades. God bless America.
There are far too many people for me to sincerely thank for my success. However, I do not want to sound like a Hollywood actor accepting an award. The money was reward enough. Furthermore, the endless list those deserving thanks know who they are.
I will no longer manage money for other people or institutions. I have enough of my own wealth to manage. Some people, who think they have arrived at a reasonable estimate of my net worth, might be surprised that I would call it quits with such a small war chest. That is fine; I am content with my rewards. Moreover, I will let others try to amass nine, ten or eleven figure net worths. Meanwhile, their lives suck. Appointments back to back, booked solid for the next three months, they look forward to their two week vacation in January during which they will likely be glued to their Blackberries or other such devices. What is the point? They will all be forgotten in fifty years anyway. Steve Balmer, Steven Cohen, and Larry Ellison will all be forgotten. I do not understand the legacy thing. Nearly everyone will be forgotten. Give up on leaving your mark. Throw the Blackberry away and enjoy life.
So this is it. With all due respect, I am dropping out. Please do not expect any type of reply to emails or voicemails within normal time frames or at all. Andy Springer and his company will be handling the dissolution of the fund. And don’t worry about my employees, they were always employed by Mr. Springer’s company and only one (who has been well-rewarded) will lose his job.
I have no interest in any deals in which anyone would like me to participate. I truly do not have a strong opinion about any market right now, other than to say that things will continue to get worse for some time, probably years. I am content sitting on the sidelines and waiting. After all, sitting and waiting is how we made money from the subprime debacle. I now have time to repair my health, which was destroyed by the stress I layered onto myself over the past two years, as well as my entire life – where I had to compete for spaces in universities and graduate schools, jobs and assets under management – with those who had all the advantages (rich parents) that I did not. May meritocracy be part of a new form of government, which needs to be established.
On the issue of the U.S. Government, I would like to make a modest proposal. First, I point out the obvious flaws, whereby legislation was repeatedly brought forth to Congress over the past eight years, which would have reigned in the predatory lending practices of now mostly defunct institutions. These institutions regularly filled the coffers of both parties in return for voting down all of this legislation designed to protect the common citizen. This is an outrage, yet no one seems to know or care about it. Since Thomas Jefferson and Adam Smith passed, I would argue that there has been a dearth of worthy philosophers in this country, at least ones focused on improving government. Capitalism worked for two hundred years, but times change, and systems become corrupt. George Soros, a man of staggering wealth, has stated that he would like to be remembered as a philosopher. My suggestion is that this great man start and sponsor a forum for great minds to come together to create a new system of government that truly represents the common man’s interest, while at the same time creating rewards great enough to attract the best and brightest minds to serve in government roles without having to rely on corruption to further their interests or lifestyles. This forum could be similar to the one used to create the operating system, Linux, which competes with Microsoft’s near monopoly. I believe there is an answer, but for now the system is clearly broken.
Lastly, while I still have an audience, I would like to bring attention to an alternative food and energy source. You won’t see it included in BP’s, “Feel good. We are working on sustainable solutions,” television commercials, nor is it mentioned in ADM’s similar commercials. But hemp has been used for at least 5,000 years for cloth and food, as well as just about everything that is produced from petroleum products. Hemp is not marijuana and vice versa. Hemp is the male plant and it grows like a weed, hence the slang term. The original American flag was made of hemp fiber and our Constitution was printed on paper made of hemp. It was used as recently as World War II by the U.S. Government, and then promptly made illegal after the war was won. At a time when rhetoric is flying about becoming more self-sufficient in terms of energy, why is it illegal to grow this plant in this country? Ah, the female. The evil female plant – marijuana. It gets you high, it makes you laugh, it does not produce a hangover. Unlike alcohol, it does not result in bar fights or wife beating. So, why is this innocuous plant illegal? Is it a gateway drug? No, that would be alcohol, which is so heavily advertised in this country. My only conclusion as to why it is illegal, is that Corporate America, which owns Congress, would rather sell you Paxil, Zoloft, Xanax and other additive drugs, than allow you to grow a plant in your home without some of the profits going into their coffers. This policy is ludicrous. It has surely contributed to our dependency on foreign energy sources. Our policies have other countries literally laughing at our stupidity, most notably Canada, as well as several European nations (both Eastern and Western). You would not know this by paying attention to U.S. media sources though, as they tend not to elaborate on who is laughing at the United States this week. Please people, let’s stop the rhetoric and start thinking about how we can truly become self-sufficient.
With that I say good-bye and good luck.
All the best,
Andrew Lahde
Tuesday, October 14, 2008
Sunday, October 12, 2008
三件關於電視的事
1. 近日股市波動，有人曾經問我：「為甚麼秋官主演的電視劇沒有上映，但股市走勢卻每況越下呢？」我答：「欣宜好像快有電視劇上映，其影響力可能比為父的更甚‧‧‧‧‧‧」
2. 看到「蔡瀾嘆名菜」這一個節目，想到的並不是羡慕他能夠和三位美女一起吃豪華美食（更好的是電視台付賬），而是不禁感嘆：「朱門酒肉臭，路有凍死骨」。
3. 今天回家後看到王賢誌和韓君婷主持的「選美風雲五十年」，十分欣賞王賢誌訪問的技巧和內容，為節目生色不少，值得一讚。
2. 看到「蔡瀾嘆名菜」這一個節目，想到的並不是羡慕他能夠和三位美女一起吃豪華美食（更好的是電視台付賬），而是不禁感嘆：「朱門酒肉臭，路有凍死骨」。
3. 今天回家後看到王賢誌和韓君婷主持的「選美風雲五十年」，十分欣賞王賢誌訪問的技巧和內容，為節目生色不少，值得一讚。
Saturday, October 11, 2008
金融海嘯
十月九日是小弟的生日。在 2002 年的這一天美股見底，之後的五年股市節節上升；在 2007 年的這一天卻見頂，反覆回落至今，唔......
我們這一代人可說是見證了大時代：八九民運、中國改革開放、蘇聯解體、互聯網興起、科網爆破、沙士疫症以至現時蓆捲全球的金融海嘯，將來和子孫談話不怕找不到話題了。
我對這次危機有一點看法。為免長篇大論，只把它們點列出來：
1. 中國長久以來實行「韜光養晦」的策略，直到現在已經算是世界的強國之一。危機在前，中國可以籍此機會增強在國際間的影響力，和強國討價還價。在中國，有甚麼是凌駕於經濟發展呢？是政治。台灣獨立、印度擴張、打擊西藏分離份子等問題，在這個時候全部都可以和美國、歐洲做談判。世界上有經濟實力化解金融危機的國家可能只有中國和俄羅斯，而後者在油價崩潰後的經濟亦未許樂觀。中國股市雖然低迷，但相對國民生產總值所佔的比重並不高，而且美國衰退對中國的影響其實亦沒有外界所推測的大。中國和日本是持有美國政府債券最多的兩個國家，但日本今年的政治不穩且有衰退之虞；要發揮在國際上的影響力的話，這是最佳的時機。
2. 金融海嘯不是世界末日。這只是一個汰弱留強的遊戲，而這亦是資本主義的本質。可以預期，各國以洪水浸銀行以拯救經濟的時日不遠。美國發動印鈔機，雖然理論上會引致通脹加劇，但以現時的環境來說，通縮的威脅恐怕還比較嚴重。何況今年是大選年，即使將來會有甚麼更大的問題也好，可以解決燃眉之急的話，美國財金官員一定會做。解決了這個危機之後，又會有更大的泡沫產生。
3. 在這件事中，投資銀行成為眾矢之的。無可否認它們在這件事中要負上很大的責任。但即使投資銀行不存在，我深信這些精英還是會用其他方法去滿足其貪念，結果還是會造成不一樣的危機。以前投資銀行最喜歡僱用 PSD (Poor, Smart, Desire to be Rich)，利用他們的智慧和貪念去賺錢；沒有了投資銀行不代表人類的貪念會消失。可能下次所引發的是....生化危機？
題外話：下年就是八九民運的二十週年。我本來覺得如果今年沒有毒奶事件的話，平反六四是有可能的。在成功舉辦奧運和航天員出艙後，值民間喜氣洋洋的時候開始檢討六四事件，為下一年作預備並不是沒有可能。習近平最近以「執政黨」而非「革命黨」來形容中國共產黨，這亦是一個微妙的變化，值得留意。
我們這一代人可說是見證了大時代：八九民運、中國改革開放、蘇聯解體、互聯網興起、科網爆破、沙士疫症以至現時蓆捲全球的金融海嘯，將來和子孫談話不怕找不到話題了。
我對這次危機有一點看法。為免長篇大論，只把它們點列出來：
1. 中國長久以來實行「韜光養晦」的策略，直到現在已經算是世界的強國之一。危機在前，中國可以籍此機會增強在國際間的影響力，和強國討價還價。在中國，有甚麼是凌駕於經濟發展呢？是政治。台灣獨立、印度擴張、打擊西藏分離份子等問題，在這個時候全部都可以和美國、歐洲做談判。世界上有經濟實力化解金融危機的國家可能只有中國和俄羅斯，而後者在油價崩潰後的經濟亦未許樂觀。中國股市雖然低迷，但相對國民生產總值所佔的比重並不高，而且美國衰退對中國的影響其實亦沒有外界所推測的大。中國和日本是持有美國政府債券最多的兩個國家，但日本今年的政治不穩且有衰退之虞；要發揮在國際上的影響力的話，這是最佳的時機。
2. 金融海嘯不是世界末日。這只是一個汰弱留強的遊戲，而這亦是資本主義的本質。可以預期，各國以洪水浸銀行以拯救經濟的時日不遠。美國發動印鈔機，雖然理論上會引致通脹加劇，但以現時的環境來說，通縮的威脅恐怕還比較嚴重。何況今年是大選年，即使將來會有甚麼更大的問題也好，可以解決燃眉之急的話，美國財金官員一定會做。解決了這個危機之後，又會有更大的泡沫產生。
3. 在這件事中，投資銀行成為眾矢之的。無可否認它們在這件事中要負上很大的責任。但即使投資銀行不存在，我深信這些精英還是會用其他方法去滿足其貪念，結果還是會造成不一樣的危機。以前投資銀行最喜歡僱用 PSD (Poor, Smart, Desire to be Rich)，利用他們的智慧和貪念去賺錢；沒有了投資銀行不代表人類的貪念會消失。可能下次所引發的是....生化危機？
題外話：下年就是八九民運的二十週年。我本來覺得如果今年沒有毒奶事件的話，平反六四是有可能的。在成功舉辦奧運和航天員出艙後，值民間喜氣洋洋的時候開始檢討六四事件，為下一年作預備並不是沒有可能。習近平最近以「執政黨」而非「革命黨」來形容中國共產黨，這亦是一個微妙的變化，值得留意。
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