One year ago
| Jim Cramer (Image: CNBC) |
»» T. Boone Pickens bet Mad Money’s Jim Cramer $100 that his energy plan would pass Congress by Memorial Day. Cramer won the bet as the Pickens Plan, introduced in July 2008, still hasn’t gotten through Washington. Asked if Cramer had collected his money, a CNBC spokesman declined to comment.
Bolstered by newly high oil prices, Pickens continues to promote the initiative. “Congress and the Administration need to act immediately to put a plan in place that addresses this Crisis,” Pickens said in a February statement. “Getting off OPEC oil and onto our own resources should be the number one priority in America. We cannot continue to let what is happening in other countries dramatically impact our economy here in the United States.”
»» Ian Morley, chairman of Allenbridge Hedgeinfo, a pension consulting firm, argued that hedge funds don’t cultivate moral hazard—they expose it. AR caught up with Morley to ask how his thesis holds up given recently world news.
“Nobody anywhere seems to learn any lessons,” says Morley, writing from a hedge fund conference in Dubai. “The bankers have had a week’s pocket money confiscated but largely remain unreconstructed. The hedge funds face an onslaught of ill-intentioned legislation as they lack the clout of the bankers to benefit from specialist pleading and utility-type perception.”
“In stark Darwinian contrast, the bad hedge funds are gone and we all own the bad banks. The good hedge funds will remain astute investors and early warning indicators of future excess,” adds Morley. “With busted governments and arrogant banks running things, moral hazard remains an unwanted and invidious after dinner guest. I expect we, not they, will all get sick again in the not so distant future.”
Five years ago
»» UBS made strides in winning market share among leading prime brokers by picking up at least 13 mandates for new funds with $50 million of assets launched in 2005.
Today, UBS’s prime brokerage unit is in flux. Its head, Stu Hendel, resigned this week to take a similar position at Bank of America Merrill Lynch. Two other UBS prime brokerage executives also just left, Jonathan Yalmokas and Charlotte Burkeman. UBS declined to comment.
»» Long/short equity funds began the year with exceptional performance, gaining 4.35%. Among the big winners in January 2006 were three names that would later gain notoriety for the reasons other than savvy investing.
Galleon Management’s Captain’s Offshore gained an estimated 12.39% while the Admiral’s Overseas Fund rose some 6.6% (Galleon shut down in 2009 amid charges of insider trading and founder Raj Rajaratnam’s much-anticipated trial began this week).
Art Samberg’s Pequot International gained 7.1% (the firm announced in May 2009 that it would shut down because of an SEC investigation into alleged insider trading of shares of Microsoft by Samberg. Samberg and the firm paid $28 million settle the insider trading charges (the firm neither admitted nor denied wrongdoing).
Dmitry Balyasny’s Atlas Global Investments gained 6.12% (Balyasny Asset Management was subpoenaed—but never accused of wrongdoing—in the government’s massive insider trading probe and suspended their use of third party research firms as a result).
