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New York (HedgeCo.Net) – At a time when most hedge funds are posting their worst year to date, John Paulson somehow manages to stay afloat. The founder of Paulson & Co. has informed investors that his funds are in fact up in November and furthermore, posting double-digit gains.
Paulson’s Advantage Plus Fund, which manages around $10 billion, climbed 3.19 percent in November, with a 33.5 percent gain for the year. His $5 billion Advantage Fund followed suit, posting gains of just over 2 percent in November and 21 percent for the year.
John Paulson bet infamously against the housing market, predicting the subprime fallout that ensued. His insight allowed him to rake in $3.5 billion virtually overnight, giving him the most lucrative Wall Street payday to date. It also landed him on the Forbres Richest List at number 78, with a net worth estimated at $4.5 billion.
Paulson & Co. currently manages approximately $35 billion through several hedge funds.
Julie Scuderi Senior Editor for HedgeCo.Net Email: julie@hedgeco.net
Reuters HK – David Bonderman, one of the the most influential figures in the U.S. private equity industry, said on Thursday his firm, buyout giant TPG Capital TPG.UL, wanted to buy debt assets offloaded by troubled hedge funds.
Bonderman, speaking at the Asian Venture Capital Journal (AVCJ) conference, also said a global recession would be deep and prolonged, and the U.S. housing market would probably fall further.
"When people are giving you debt that is grossly mis-priced, you opt to take it," he said at the conference in Hong Kong.
Volatile markets have forced hedge funds to sell off assets and securities to pay back investors who are keen to scale back on risk and hold cash.
But private equity firms typically have long-term investors, with up to 10-year lock-up periods.
Reuters – David Bonderman, one of the the most influential figures in the U.S. private equity industry, said on Thursday his firm, buyout giant TPG Capital , wanted to buy debt assets offloaded by troubled hedge funds.
Bonderman, speaking at the Asian Venture Capital Journal (AVCJ) conference, also said a global recession would be deep and prolonged, and the U.S. housing market would probably fall further.
"When people are giving you debt that is grossly mis-priced, you opt to take it," he said at the conference in Hong Kong.
Volatile markets have forced hedge funds to sell off assets and securities to pay back investors who are keen to scale back on risk and hold cash.
But private equity firms typically have long-term investors, with up to 10-year lock-up periods.
"Since a lot of hedge funds have a side pocket with a two- to three- to four-year lock-up period, that means that liquid assets are under great pressure," Bonderman said. "And guys like us who have the capital should be buying them."
Asia would emerge from the global downturn earlier than elsewhere and was well-positioned for recovery, said Bonderman, TPG’s founding partner.
Reuters – John Paulson, a U.S. hedge fund manager who gained a superstar reputation with a big bet against the U.S. housing market, was shown holding a 1 billion pound ($1.9 billion) bet against UK banks as short sellers were forced to disclose their positions.
Paulson & Co., run by John Paulson and based in New York, said it had a 1.2 percent short position in Barclays, worth over 350 million pounds, a 1.8 percent short position in Lloyds TSB, and short positions of just under 1 percent in Royal Bank of Scotland and HBOS.
The stakes were unveiled on Wednesday after Britain’s regulator imposed a ban on short-selling financial stocks last Friday, which was followed by similar moves in the United States and elsewhere.
San Francisco Chronicle- The giant housing rescue plan President Bush signed Wednesday might help stanch the bleeding in the housing market, but experts on both sides of the political divide worry that it is, at best, only an emergency step.
In addition to $300 billion in government guarantees to aid homeowners threatened by foreclosure, the administration got extraordinary new powers to backstop mortgage giants Fannie Mae and Freddie Mac after their stocks plunged earlier this month. The legislation gives both companies an open line of credit at the U.S. Treasury and allows the government to buy the companies’ stock through 2009. In return, the companies get a tough new regulator.
But both firms remain weird hybrid entities whose profits are private but whose losses are public, a recipe for excessive risk-taking. The new law makes the government guarantee explicit, exposing taxpayers to losses that could dwarf the savings & loan bailouts of the 1980s that cost taxpayers $300 billion in today’s dollars.
New York (HedgeCo.Net) – John Paulson, the infamous hedge fund manager turned billionaire who bet brilliantly against the housing market, will start a new fund later this year according to a report published on Bloomberg.com.
The new hedge fund will provide capital to financial institutions who have suffered losses due to mortgage writedowns. It was the exact scenario that Paulson predicted that caused the world’s largest banks to write down over $450 billion in losses stemming from the subprime mortgage fallout. In addition, it forced many hedge funds including the two from Bear Stearns that had invested in mortgage-backed securities to implode.
Paulson has not yet stated what his targets are for starting capital in the new hedge fund. Paulson made the Forbes annual list of billionaires for the first time, after taking home an estimated $3 billion in 2007. His firm, Paulson & Co. currently oversees over $33 billion in assets.
Julie Scuderi Senior Editor for HedgeCo.Net Email: julie@hedgeco.net
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Yahoo News- Investors can’t seem to catch a break — Wall Street again starts a week with oil prices at their highest levels yet, and banks poised to reveal that they remain on shaky footing.
None of the troubles that have rocked the market over the past year have let up yet: not the housing market, not high commodities costs, not the ailing financial system.
"We’ve got a fistful of drivers that are working against the market," said Arthur Hogan, chief market analyst at Jefferies & Co. "And they’re all important."
It’s a different collection of worries than the ones that hurled stocks lower at the beginning of the decade, after the technology bubble burst and the Sept. 11, 2001, terrorist attacks sent the country reeling. But many on Wall Street are worried that the effects of the country’s current problems could end up being just as devastating, or more so, for stocks.
Financial Times- John Paulson, the US hedge fund manager who made a fortune for his investors by anticipating the debacle in subprime mortgages, said on Wednesday it was too early to look for bargains in the financial sector and predicted the worst was yet to come for the UK housing market.
Mr Paulson, who founded Paulson & Co 14 years ago and has $33bn in funds under management, said he was “preparing to switch” to long positions on distressed mortgages and banks, but added that such a change could be months – or even a couple of years – away.
He said financial companies could wind up losing as much as $1,300bn in the credit crisis.
