The good managers will not only be fine but make even more money this year. Our fund is up over 40% this year and thats without excess leverage. There are many more like that and this shakeout is great for good funds because the bad / marginal manager will close up shop and that money will flow to managers who are outperforming. Studio and 1BR manhattan pricing will soften but aside from that its etremely stable. Manhattan forclosures have been nonexistant to date and any distressed apartment gets bought real fast. Supply/new builds have slowed so inventory is not a problem here as it has been in some overdeveloped parts of the country. I wish you were right because then I'd buy even more property.Date: 10/2/2008 6:40:12 AM
Author: tradergirl
I'd say that's less likely than it would have been 3 weeks ago. You can't short a lot of individual stocks and options have gone haywire because of that and the high VIX. The end of September was when 'investors' had to put in their redemption requests to hedge funds (lol) and they have to sell now to give money back to people who requested it. Futures driven programs are probable but there are fewer IBs around to do it anymore. We'll get a better sense of what's what when the short selling ban expires (3 days after the 'rescue' bill is enacted). No matter what, it's going to be a bloodbath for most hedge funds this year. That was a disgusting bubble as well and this year and next should see the herd being thinned considerably. No more 30 year old masters of the universe 'running' 500M of OPM and taking down $10M for themselves. Should do wonders for NY real estate prices. People who think Manhattan can never go down really ought to go back and look at NY Times articles in 1990-1994 or so.
get your money ready. you''ll get a chance to buy at a lower level.Date: 10/2/2008 7:44:28 AM
Author: stone_seeker
The good managers will not only be fine but make even more money this year. Our fund is up over 40% this year and thats without excess leverage. There are many more like that and this shakeout is great for good funds because the bad / marginal manager will close up shop and that money will flow to managers who are outperforming. Studio and 1BR manhattan pricing will soften but aside from that its etremely stable. Manhattan forclosures have been nonexistant to date and any distressed apartment gets bought real fast. Supply/new builds have slowed so inventory is not a problem here as it has been in some overdeveloped parts of the country. I wish you were right because then I''d buy even more property.Date: 10/2/2008 6:40:12 AM
Author: tradergirl
I''d say that''s less likely than it would have been 3 weeks ago. You can''t short a lot of individual stocks and options have gone haywire because of that and the high VIX. The end of September was when ''investors'' had to put in their redemption requests to hedge funds (lol) and they have to sell now to give money back to people who requested it. Futures driven programs are probable but there are fewer IBs around to do it anymore. We''ll get a better sense of what''s what when the short selling ban expires (3 days after the ''rescue'' bill is enacted). No matter what, it''s going to be a bloodbath for most hedge funds this year. That was a disgusting bubble as well and this year and next should see the herd being thinned considerably. No more 30 year old masters of the universe ''running'' 500M of OPM and taking down $10M for themselves. Should do wonders for NY real estate prices. People who think Manhattan can never go down really ought to go back and look at NY Times articles in 1990-1994 or so.
Stoneseeker, my thoughts exactly re: GE and the Buffett deal.Date: 10/2/2008 7:44:28 AM
Author: stone_seeker
The good managers will not only be fine but make even more money this year. Our fund is up over 40% this year and thats without excess leverage. There are many more like that and this shakeout is great for good funds because the bad / marginal manager will close up shop and that money will flow to managers who are outperforming. Studio and 1BR manhattan pricing will soften but aside from that its etremely stable. Manhattan forclosures have been nonexistant to date and any distressed apartment gets bought real fast. Supply/new builds have slowed so inventory is not a problem here as it has been in some overdeveloped parts of the country. I wish you were right because then I'd buy even more property.
To answer the OP's question, I would say yes and no. They offered a scary alternative scenario in which the probability of it occuring is increasing. So yes they did scare main street but for a good reason. I am not saying this bill is the best solution but its the only one they can pass in short order. America loves to throw money at problems and that is whats happening. GE, a company that has been around forever, a good credit and probably in the 401K of millions of Americans needed to pay 10% to raise money. Thats ridiculous. If they have to pay 10%, what will smaller companies have to pay? What if they cant pay that rate? Those a real situations that have serious impacts on the lives of everyday folks.
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Yep, seems like we'll have a "correction" in the hedge fund salaries. Masters of the universe no more...Date: 10/7/2008 9:00:56 AM
Author: tradergirl
More on the coming hedge fund and private equity crackup. And not soon enough. Some day if you really want to get annoyed, read up on how private equity funds make their money. They 'buy' companies using borrowed money, strip out all equity to pay themselves 'fees' and then 'run' the companies by 'cost cutting' (i.e., eliminating jobs). The ultimate goal is to hold on for a few years and then flip the company back out into the public markets for yet another profit. Think 'Flip this Corporation' as opposed to 'Flip this House.' It's is truly unbelieveable.
http://www.thestreet.com/story/10440873/1/kass-baby-its-cold-outside.html
http://www.reuters.com/article/reutersComService4/idUSTRE49236D20081003
http://www.pbs.org/newshour/bb/business/jan-june07/equity_02-08.html
Exactly.Date: 10/2/2008 7:44:28 AM
Author: stone_seeker
The good managers will not only be fine but make even more money this year. Our fund is up over 40% this year and thats without excess leverage. There are many more like that and this shakeout is great for good funds because the bad / marginal manager will close up shop and that money will flow to managers who are outperforming. Studio and 1BR manhattan pricing will soften but aside from that its etremely stable. Manhattan forclosures have been nonexistant to date and any distressed apartment gets bought real fast. Supply/new builds have slowed so inventory is not a problem here as it has been in some overdeveloped parts of the country. I wish you were right because then I''d buy even more property.
To answer the OP''s question, I would say yes and no. They offered a scary alternative scenario in which the probability of it occuring is increasing. So yes they did scare main street but for a good reason. I am not saying this bill is the best solution but its the only one they can pass in short order. America loves to throw money at problems and that is whats happening. GE, a company that has been around forever, a good credit and probably in the 401K of millions of Americans needed to pay 10% to raise money. Thats ridiculous. If they have to pay 10%, what will smaller companies have to pay? What if they cant pay that rate? Those a real situations that have serious impacts on the lives of everyday folks.