So farewell
then
Pequot Capital
Management
Hedge
Fund.
You told
investors
you
channel-checked
more accurately
than
anyone...
...counted cars
in a
fab's lot
at 9pm
to stay ahead
of the
herd.
And you didn't
dispel flattering
rumours
your Wharton interns
were dumpster-diving.
on your
behalf.
But it seems
your research
edge was
less-than
salubriously
on the edge.
Quite aptly,
'Pequot'
translates as:
"Men of
the Swamp"
Perhaps there
is more
justice in
the second liquidation
of the Pequot
than in
the first.
(With apologies to PrivateEye and EJ Thribb and posthumous ackowledgement to Greg Newton)
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14 comments:
I think Fred Hickey is secretly rejoicing about Pequot's demise. You can tell Samburg and Hickey cannot stand each other in those annual Barron's roundtables. When they argued about the fate of RIMM, the contempt between the 2 is palpable.
Any advice on how to separate the scums from the boy scouts of the money management business?
synchro - I'd not seen Hickey's stuf in several years, but would love to see a recent (but not too recent to not infringe copyright etc.) sample if you had a copy....
anonymous - the problem is that those that break the rules often earn more money. so like investing in sin, does one opt for higher returns dishonestly, or lower returns honestly. This is of course a simplification but even Warren Buffet has done lame and dubious things. So its hard to know. I think the biggest problems for investors are agency/principal issues, followed by the honesty and integrity with which predominantly agents (driven by distortions in incentive structures) zealously pursue their objectives.
Perhaps another questions might be: "Would Samberg/Pequot have cheated if the penalty for being caught cheating was total forfeiture and clawback of all performance fees earned in said pursuits. I'd reckon compliance would be a whole lot tighter if such language were written into Info Memos.
Two Pequots stood in the Nutmeg State
and sorry, I could not visit both
and, being one gambler long I stood
and weighed my choice as best as I could
as to which would provide the greater growth
So having but little cash to risk
while Samberg required some major bucks
I took my stake to the Indian Tribe
in hopes of a tryst with Lady Luck
I played a game that favored the Tribe
while Samberg's games' returns were lush
Yet, strangely, our fates did coincide
we both were dealt the Royal Flush
(sorry, couldn't hep myself)
"I think the biggest problems for investors are agency/principal issues"
I am confused. Shouldn't it be the other way around, i.e., it seems that invstors should demand that integrity comes before alignment of interests. For if the money manager is a scumbag, then does it matter if he promised his investors that their interests are aligned?
You Bastard Richard Branson!!!
You are cursed in all languages.
Cassandra,please comment with your wise words about the following :
http://www.youtube.com/watch?v=Uxt9HwfPwPo
Anonymous 6:47;
Oh wow, where does one start. Rather, than play critic with what ostensibly must have been a fun job interviewing a bunch of inarticulates at 200am, and making a video collage with the results, I would simply say that I share the opinions articulated by Tony Judt in "Reappraisals". Far from being off the mark,, Judt hits bulls-eye after bulls-eye, though is most illuminating (and correct IMHO) at unconventionally explaining the abortion that represents Israeli politics post 1991, and the [deterministic?] perditious road where it leads. Having some adult American leaders (like Obama) stand up and say "Enough!" may be that which saves Israel from itself with the pernicious destructive support of the far-right. Read Judt's collection of essays. They are a pleasure to imbibe.
email me off-line to discuss further if for whatever reason you're really interested in my thoughts.
p.s. - the deleted comments were spam...
Cassandra,
Appreciate the Tony Judt book recommendation which I will be reading soon and will e-mail you my thoughts later.Your comments were very well worded/Thanks for the response.
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