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My kind of Hedge Fund Manager
#1



http://www.portfolio.com/views/blogs/dai...u?tid=true

October 18, 2008 - 8:31AM


Andrew Lahde, the hedge-fund manager who quit after posting an 870% gain last year, said farewell to clients in a letter that thanks stupid traders for making him rich and ends with a plea to legalize marijuana.
Lahde, head of Santa Monica, California-based Lahde Capital Management, told investors last month he was returning their cash because the risk of using credit derivatives - his means of betting on the falling value of bonds and loans, including subprime mortgages - was too risky given the weakness of the banks he was trading with.

''I was in this game for money,'' Lahde, 37, wrote in a two-page letter in which he said he had come to hate the hedge-fund business. ''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 sides of my trades. God Bless America.''

Lahde, who managed about $US80 million, told clients he'll be content to invest his own money, rather than taking cash from wealthy individuals and institutions and trying to amass a fortune worth hundreds of millions or even billions of dollars.

''I do not understand the legacy thing,'' he wrote. ''Nearly everyone will be forgotten. Give up on leaving your mark. Throw the Blackberry away and enjoy life.''

Request for Soros

He said he'd spend his time repairing his health ''as well as my entire life - where I had to compete for spaces at universities, and graduate schools, jobs and assets under management - with those who had all the advantages (rich parents) that I did not.''

He also suggested that billionaire George Soros sponsor a forum in which ''great minds'' would come together to create a new system of government, as the current system ''is clearly broken.''

Lahde ended his letter with a plea for the increased use of hemp as an alternative source of food and energy that segued into a call for the legalization of marijuana.

''Hemp has been used for at least 5000 years for cloth and food, as well as just about everything that is produced from petroleum products,'' he wrote. ''Hemp is not marijuana and vice versa. Hemp is the male plant and it grows like a weed, hence the slang term.''

'Innocuous Plant'

He added, ''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.''

Lahde said the only reason marijuana remains illegal is because ''Corporate America, which owns Congress, would rather sell you Paxil, Zoloft, Xanax and other addictive drugs, than allow you to grow a plant in your home without some of the profits going into their coffers.''

Lahde graduated from Michigan State University with a degree in finance and holds an MBA from the University of California, Los Angeles. He worked at Los Angeles-based hedge fund Dalton Investments before founding his own firm two years ago with about $US10 million.

Lahde wasn't available for comment. A woman at his firm, who asked not to be identified, confirmed the authenticity of the letter.
"The philosophers have only interpreted the world, in various ways. The point, however, is to change it." Karl Marx

"He would, wouldn't he?" Mandy Rice-Davies. When asked in court whether she knew that Lord Astor had denied having sex with her.

“I think it would be a good idea” Ghandi, when asked about Western Civilisation.
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#2
Magda Hassan Wrote:


http://www.portfolio.com/views/blogs/dai...u?tid=true

October 18, 2008 - 8:31AM


Andrew Lahde, the hedge-fund manager who quit after posting an 870% gain last year, said farewell to clients in a letter that thanks stupid traders for making him rich and ends with a plea to legalize marijuana.
Lahde, head of Santa Monica, California-based Lahde Capital Management, told investors last month he was returning their cash because the risk of using credit derivatives - his means of betting on the falling value of bonds and loans, including subprime mortgages - was too risky given the weakness of the banks he was trading with.

''I was in this game for money,'' Lahde, 37, wrote in a two-page letter in which he said he had come to hate the hedge-fund business. ''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 sides of my trades. God Bless America.''

Lahde, who managed about $US80 million, told clients he'll be content to invest his own money, rather than taking cash from wealthy individuals and institutions and trying to amass a fortune worth hundreds of millions or even billions of dollars.

''I do not understand the legacy thing,'' he wrote. ''Nearly everyone will be forgotten. Give up on leaving your mark. Throw the Blackberry away and enjoy life.''

Request for Soros

He said he'd spend his time repairing his health ''as well as my entire life - where I had to compete for spaces at universities, and graduate schools, jobs and assets under management - with those who had all the advantages (rich parents) that I did not.''

He also suggested that billionaire George Soros sponsor a forum in which ''great minds'' would come together to create a new system of government, as the current system ''is clearly broken.''

Lahde ended his letter with a plea for the increased use of hemp as an alternative source of food and energy that segued into a call for the legalization of marijuana.

''Hemp has been used for at least 5000 years for cloth and food, as well as just about everything that is produced from petroleum products,'' he wrote. ''Hemp is not marijuana and vice versa. Hemp is the male plant and it grows like a weed, hence the slang term.''

'Innocuous Plant'

He added, ''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.''

Lahde said the only reason marijuana remains illegal is because ''Corporate America, which owns Congress, would rather sell you Paxil, Zoloft, Xanax and other addictive drugs, than allow you to grow a plant in your home without some of the profits going into their coffers.''

Lahde graduated from Michigan State University with a degree in finance and holds an MBA from the University of California, Los Angeles. He worked at Los Angeles-based hedge fund Dalton Investments before founding his own firm two years ago with about $US10 million.

Lahde wasn't available for comment. A woman at his firm, who asked not to be identified, confirmed the authenticity of the letter.

...it isn't gonna look good on his CV.....but hey Lahde, pass that thing in your hand over here.....! Shows you can't fool all the people all the time.....only most. Also shows why 'they' keep grass illegal - it makes you see things like hedge funds from another 'angle'....ditto the 'consentual' perceived 'reality' and 'morality'.
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#3
http://www.truthdig.com/report/page2/200...e_america/

The Idiots Who Rule America

by Chris Hedges

Our oligarchic class is incompetent at governing, managing the economy, coping with natural disasters, educating our young, handling foreign affairs, providing basic services like health care and safeguarding individual rights. That it is still in power, and will remain in power after this election, is a testament to our inability to separate illusion from reality. We still believe in "the experts." They still believe in themselves. They are clustered like flies swarming around John McCain and Barack Obama. It is only when these elites are exposed as incompetent parasites and dethroned that we will have any hope of restoring social, economic and political order.
"Their inability to see the human as anything more than interest driven made it impossible for them to imagine an actively organized pool of disinterest called the public good," said the Canadian philosopher John Ralston Saul, whose books "The Unconscious Civilization" and "Voltaire's Bastards" excoriates our oligarchic elites. "It is as if the Industrial Revolution had caused a severe mental trauma, one that still reaches out and extinguishes the memory of certain people. For them, modern history begins from a big explosion--the Industrial Revolution. This is a standard ideological approach: a star crosses the sky, a meteor explodes, and history begins anew."
Our elites--the ones in Congress, the ones on Wall Street and the ones being produced at prestigious universities and business schools--do not have the capacity to fix our financial mess. Indeed, they will make it worse. They have no concept, thanks to the educations they have received, of the common good. They are stunted, timid and uncreative bureaucrats who are trained to carry out systems management. They see only piecemeal solutions which will satisfy the corporate structure. They are about numbers, profits and personal advancement. They are as able to deny gravely ill people medical coverage to increase company profits as they are able to use taxpayer dollars to peddle costly weapons systems to blood-soaked dictatorships. The human consequences never figure into their balance sheets. The democratic system, they think, is a secondary product of the free market. And they slavishly serve the market.
Andrew Lahde, the Santa Monica, Calif., hedge fund manager who made an 870 percent gain last year by betting on the subprime mortgage collapse, has abruptly shut down his fund, citing the risk of trading with faltering banks. In his farewell letter to his investors he excoriated the elites who run our investment houses, banks and government.
"The low hanging fruit, i.e. idiots whose parents paid for prep school, Yale, and then the Harvard MBA, was there for the taking," he said of our oligarchic class. "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."
"On the issue of the U.S. Government, I would like to make a modest proposal," he went on. "First, I point out the obvious flaws, whereby legislation was repeatedly brought forth to Congress over the past eight years, which would have [reined] 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."
Democracy is not an outgrowth of free markets. Democracy and capitalism are antagonistic entities. Democracy, like individualism, is not based on personal gain but on self-sacrifice. A functioning democracy must defy the economic interests of elites on behalf of citizens. This is not happening. The corporate managers and government officials trying to fix the economic meltdown are pouring money and resources into the financial sector because they only know how to manage and sustain established systems, not change them. Financial systems, however, are not pure scientific and numerical abstractions that exist independently from human beings.
"When the elite begin to think that money is real, the crash is coming," Saul said in a telephone interview. "That is just a given in history. Because what they've done is pull themselves out of the possibility of looking in the mirror and thinking, this is inflation, speculation, this is fluff. They can't do it. And when you say to them, gosh, this is not real. And they say, oh, you don't understand, you're so old-fashioned, you still think this is about manufacturing. And of course, it's basic economics. And that's what happens every single time.
"The difficulty is you have a collapse, you have a loss of face by the people who are there, and it's not just George Bush, it's very, very deep," Saul said. "What we're talking about is the need to rethink the departments of economics, of political science. Then you have to rethink the whole analytic method of the World Bank. If I'm the secretary of the treasury, and not a guy like [Henry] Paulson, but I mean a sort of normal secretary of the treasury or minister of finance, and I say, OK, we've got a real problem, let's get the senior civil servants in here. Gentlemen, ladies, OK, clearly we have to go in another direction, give me some ideas. Well, those people don't have any other ideas because at this point they're about the fourth generation of what you might call neoconservative globalist managers, unfairly summarized. So they then go to the people who work for them, and you work down; there's no one in there with an alternate approach. I mean they'll have little alternatives, but no basic differences in opinion. And so it's very difficult to turn anything around because they've eliminated all opposing ideas inside. I mean it's the problem of the Soviet Union, right?"
Saul pointed out that the first three aims of the corporatist movement in Germany, Italy and France during the 1920s, those that went on to become part of the Fascist experience, were "to shift power directly to economic and social interest groups, to push entrepreneurial initiative in areas normally reserved for public bodies" and to "obliterate the boundaries between public and private interest--that is, challenge the idea of the public interest."
Sound familiar?
"There are a handful of people who haven't been published in mainstream journals, who haven't been listened to, who have been marginalized in every way," Saul said. "There are a couple of them and you could turn to them. But then who do you give the orders to? And the people you give the orders to, they are not going to understand the orders because it hasn't been a part of their education. So it's a real problem of a good general who suddenly finds that his junior generals and brigadiers and corporals, you want them to do irregular warfare and they only know how to do trenches. And so how the hell do you get them to do this thing which they've never been trained to do? And so you get this kind of disorder, confusion inside, and the danger of what rises up there is populism; we've already had populism in a way, but we could get more populism, more fear and anger."
We may elect representatives to Congress to end the war in Iraq, but the war goes on. We may plead with these representatives to halt Bush's illegal wiretapping but the telecommunications lobbyists make sure it remains in place. We may beg them not to pass the bailout but 850 billion taxpayer dollars are funneled upward to the elites on Wall Street. We may want single-payer, not-for-profit health care but it is not even discussed as a possibility in presidential debates. We, as individuals in this system, are irrelevant.
"I've talked to several Supreme Court justices, several times in several countries," Saul told me, "and I say, look, in your rulings, can you differentiate easily in cases between the social contract and the commercial contract, and to which the answer is, we can no longer differentiate. And that lies at the heart of the problem. You don't have the concept of the other, and of obligation of the individual leading to individualism. You can't have that if the whole legal system has slipped over the last, really, 50 years, increasingly, to a confusion between the social contract and the commercial contract. Because they are two completely different things. The social contract is about the public good, responsible individualism, imagining the other. The commercial contract is a commercial contract. They're not supposed to be confused. They don't actually fit together. The commercial contract only works properly when the social contract works in a democracy."
The working class, which has desperately borrowed money to stay afloat as real wages have dropped, now face years, maybe decades, of stagnant or declining incomes without access to new credit. The national treasury meanwhile is being drained on behalf of speculative commercial interests. The government--the only institution citizens have that is big enough and powerful enough to protect their rights--is becoming weaker, more anemic and less able to help the mass of Americans who are embarking on a period of deprivation and suffering unseen in this country since the 1930s. Consumption, the profligate engine of the U.S. economy, is withering. September retail sales across the U.S. fell 1.2 percent. The decline was almost double the 0.7 percent drop analysts expected from consumers, whose spending represents two-thirds of U.S. economic activity. There were 160,000 jobs lost last month and three-quarters of a million jobs lost this year. The reverberations of the economic meltdown are only beginning.
I do not think George W. Bush or Barack Obama or John McCain or Henry Paulson are fascists. Rather, they are part of a cabal of naive, mediocre and self-deluded capitalists who are steadily weakening political and economic structures to a point where our democracy will become so impotent that it can be blown aside, probably with broad popular support. The only question is how this will happen. Will there be a steady and slow decline as in the late Roman Empire when the Senate ended as a farce? Will we see a powerful right-wing backlash from those outside the mainstream political system, as we did in Yugoslavia, and the rise of a militant Christian fascism? Will there be a national crisis that allows those in power to instantly sweep away all constitutional rights in the name of national security?
I do not know. But I do know that what is coming, as long as our oligarchy remains in charge, will not be good. We will either recover the concept of the public good, and this means a revolt against our bankrupt elite and the dynamiting of the corporatist structure, or we will extinguish our democracy.
"The philosophers have only interpreted the world, in various ways. The point, however, is to change it." Karl Marx

"He would, wouldn't he?" Mandy Rice-Davies. When asked in court whether she knew that Lord Astor had denied having sex with her.

“I think it would be a good idea” Ghandi, when asked about Western Civilisation.
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#4
Note the Bullington connection, the friendship with Mandelsohn, the ownership of Atticus Capital Hedge Fund, his friendship and advisory role to Russian oligarch Oleg Derikaspa, his even closer friendship with Russian oligarch Roman Abramovich and his training in Lazard Bros in London (always a core player in the Oxford "Group" - the Rhodes-Milner 'kintergarden').

http://www.dailymail.co.uk/femail/articl...-all.html#

The richest Rothschild of them all

By Zoe Brennan
Last updated at 08:22 02 April 2007


Party boy: Nat Rothschild has shed his wild side to earn a fortune
As the young man spoke, silence descended. Gathered around the table at this high-powered lunch in central London earlier this month were the elite of the British business world.

Marcus Agius, chairman of Barclays bank, Sir David Arculus of the O2 telecoms giant, and Ian Davis, the global managing director of McKinsey consulting company, put down their knives and forks to listen.

The unassuming man - 20 years younger than the assembled company - delivered a considered and incisive view of global markets with a gravitas that belied his youth.

One witness says: "It was incredibly impressive. He waited for his moment, and then came across as calculating and powerful. I think everyone was taken by surprise.

"I found it impossible to square what I knew of his previous wild-child existence with the man who sat before us."

The man in question was Nat Rothschild - the 35-year-old scion of the wealthy banking dynasty, one-time black sheep of the family, and now a rising star in his own right.

Earlier this month, the New York Times highlighted his extraordinary metamorphosis from playboy to hedge fund prince, and tipped him as "a kingmaker in his own right, and an investor who some say may become the richest Rothschild of them all".

An extravagant assertion - but not without some plausibility. Rich-list compiler Philip Beresford says: "He has been on my radar for some time. He jets around the world empire-building, keeping in touch with his deals via the latest satellite communications. He has the years on his side and the right connections.

"What he needs is one of those historic opportunities like the ones seized by his ancestors. If he gets that golden moment, he could be the richest one of his generation."

Nat is in line to become the fifth Baron Rothschild and inherit around £500million from his banker father.

But now, thanks to a complicated web of private equity investments in the Ukraine and Eastern Europe, and his partnership in Atticus Capital, a hugely successful £7billion hedge fund, Nat is set to exceed the fortune he will be bequeathed with his own earnings.

His wealth has been accrued in his role as the adviser to Oleg Deripaska, one of the richest oligarchs in Russia and the owner of the aluminum giant Rusal, which recently merged with two other companies to create the world's largest aluminum company.

And, although discreet in his business deals, privately he lives the life one would associate with a Rothschild. His best friend is Roman Abramovich, the owner of Chelsea Football Club, and he is currently rumoured to be dating the young film actress Natalie Portman.

An accomplished skier, his principal residence is in Klosters, Switzerland, and he uses his Gulfstream jet to travel between his other homes in Paris, Moscow, London, New York and Greece. Two formally attired butlers accompany him everywhere.

Nat is a generous and gregarious host, who lavishes his guests with vintage champagne and wine from the Rothschild vineyards - but he no longer raises a glass himself: that would be to lapse into the libertine existence he has left behind.

For his rise is all the more noteworthy given the fact that it once appeared that Nat Rothschild - sadly like several of the dynasty before him - was self-destructing.

In 1996, one of Nat Rothschild's cousins, Amschel, hanged himself at the age of 41. He had just been asked to fill a leading position in the family bank in London.

Four years later, another cousin, Raphael de Rothschild, died in Manhattan from a heroin overdose. He was just 23.

For some years it appeared that Nat Rothschild, too, would follow in their blighted footsteps. From an early age, he appeared an unlikely dealmaker.

A contemporary at Eton remembers him as "a rather scruffy and unpredictable boy with a rebellious streak, who you would never have tipped to make a big success of his life".

At one stage during his Eton career, Rothschild was sent to live with a master, in a vain attempt to rein him in.

The friend says: "He seemed the classic example of a boy born into huge privilege, weighed down with parental expectations, but who resisted any type of conformism and resented authority."

He adds: "To be honest, aside from his name, he's the last person I would have expected to end up running his own hedge fund - but then perhaps that's what's made him so successful. He has a willingness to take risks, to seek out the extreme, to act impetuously."

While at Oxford, Rothschild soon became infamous for his excesses. He was a member of the notorious Bullingdon Club, the debauched all-male drinking society with a reputation for drug-taking and wanton vandalism, which counts David Cameron among its former members.

Indeed, Rothschild once pushed a portable toilet down a steep hill - with a friend still inside.

An Oxford friend remembers: "We were at Wadham together. Nat was rarely out of black tie, he would drink and party through the night, and then sleep through the day in his formal suit, much to the dismay of his history tutors.

"He's not blessed in the looks department, he's got carrot-red hair and freckles. But Nat is very charming and has a penchant for fast cars.

"At college, he was known as a babemagnet - at parties, the beautiful girls would flock to him like bees to honey. That's what the name Rothschild does for you. Women seem to find it a very powerful aphrodisiac."

Favoured girls would be asked back to his father Jacob's lavish country estate, where the young lothario reputedly slashed their car tyres so that he might detain them long enough to seduce them.

An escort girl recently claimed that in 1994, Rothschild asked her to supply drugs and strippers to a party at the Rothschild stately home, Waddesdon Manor, Buckinghamshire, which is now run by the National Trust.

She said: "They were very precise in what they wanted - three slim black girls in stockings, suspenders and high heels. They also wanted the girls to do extras."

When Nat embarked on a romance with Kate Moss's friend, model Annabelle Neilson, his family must have cast a jaded eye over his latest choice, whom he had met on a beach in India. They were even more horrified when, aged just 23, he eloped with her to Las Vegas, and married her.

"It was a huge shock to Jacob and his wife, Lady Serena," says a close family friend. "They expected him to date models and sow his wild oats - but marrying Annabelle was incredibly impetuous and obviously against the advice of the family lawyers. They were just appalled.

"The girl's party trick was to climb onto the dining table in her tiny dress and stilettos and dance amid the crystal and silver. Rather vulgar, I'm afraid. Nat's parents predicted it would end in tears, and it did."

For a while, the couple appeared to live a gilded life, gracing the pages of glossy magazines - partying in Cannes with friends such as supermodel Elle Macpherson, designer Alexander McQueen, and "It" girl Tamara Beckwith, or sunning themselves in the Caribbean.

After just three years of partying - and cataclysmic rows - the couple divorced and Neilson reportedly received a generous financial settlement in return for rescinding the dynastic name and signing a confidentiality agreement.

At that moment, alone in New York and, according to friends, "a mess", Rothschild took stock of his hitherto aimless society life.

Those close to him say that he suddenly found something repellent in his lifestyle. He decided to turn his back on partying and step up to his name.

To that end, he joined the merchant bank Lazards in London and then moved to New York. There Nat met Timothy Barakett, a young investor who was trying to raise money for Atticus, his new hedge fund (basically, a private investment fund open only to selected individuals and following a complex investment strategy).

He asked Barakett for a job, but was turned down. The men stayed in touch, though, and two years later, Barakett took Rothschild on, giving him the title of director of business development - a position in which he was, of course, able to open doors for his partner. At the time, they were Atticus's only two employees. But not for long.

Since its inception, the fund has grown an incredible 30 per cent a year and now has £7billion under its management. Success has brought huge rewards: in 2005, Rothschild was paid just over £40million.

According to insiders, he made even more than that last year. "He has had an incredible evolution, and he has done it on his own,"

Barakett told the New York Times. "It's not about family connections. He has a knack for identifying talented people and interesting investments."

Those close to Rothschild believe he is haunted by the desire to live up to his father Jacob's accomplishments, and is determined to enhance the family name.

He has recently joined his father in a business venture, JNR, which invests in Russian companies. There is a plan to float it on the London Stock Exchange next year, with some valuations approaching £2billion, making Nat's share worth £300million.

Like many Rothschilds before him, he is an avid collector of contemporary art - one of his favourite pieces being a life-sized canvas of a decapitated bikini-clad woman by the British artist Julian Opie.

When on business in America, he lives in a breathtaking, minimalist Manhattan town house, which is about to be featured in Men's Vogue.

The property is littered with giant flat-screen TVs and expensive boys' toys, with lacquered sliding panels hiding any mess.

Modernistic touch screens control the music, heat and televisions, and an outdoor shower graces the rooftop terrace.

Only the wine cellar betrays his old-money heritage, with the family connections to Chateau Mouton and Chateau Lafite-Rothschild.

Some 670-odd backlit bottles are cradled inside a series of top- of-the-range glass- doored refrigerators, jeroboams of Pierre-Jouet champagne jostling for space with the finest vintages from Bordeaux.

David Chipperfield, his architect, says: "Normally you build a house around somebody, around that person's rituals. But Nat isn't a person who necessarily stays in the house that much. His life is much more eccentric, much more erratic."

In fact, he rarely spends more than four days in the same place, flying in his elaborately equipped private jet from Siberia, to Switzerland via Greece, to New York - but always retaining a link to Britain.

Indeed, the dramatic centrepiece staircase of his five- storey New York house is fashioned out of English oak, while outside - rather incongruously - is a traditional moss- covered English country house garden.

There is only one thing missing, of course: a wife to share in his success.

After his disastrous marriage, Nat has shunned any long-term commitment, but he has reportedly had flings with Jonathan Aitken's daughter, Petrina Khashoggi, and Ivanka Trump, and is now seeing 25-year-old Natalie Portman - who is about to star as Anne Boleyn in The Other Boleyn Girl - taking her on a discreet date to Wiltons restaurant in St James's.

Just how has it suddenly gone so right? A friend from Rothschild's early days says: "It seemed that he suddenly discovered a way to harness his rebellious streak to his advantage, and he was off like a rocket.

"The next thing you know, he's got his own private jet and butler, and is a master of the corporate universe. "It's as if he just can't help making money."
The shadow is a moral problem that challenges the whole ego-personality, for no one can become conscious of the shadow without considerable moral effort. To become conscious of it involves recognizing the dark aspects of the personality as present and real. This act is the essential condition for any kind of self-knowledge.
Carl Jung - Aion (1951). CW 9, Part II: P.14
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#5
http://www.ft.com/cms/s/0/001385a8-77bd-...fd18c.html

Atticus Capital principals to be hit where it hurts most
By James Mackintosh
Published: September 1 2008 03:00 | Last updated: September 1 2008 03:00
For most of the past decade, Atticus Capital has been a force to reckon with in global markets. From its base in New York, the hedge fund, which had more than $20bn of assets under management at its peak last year, helped dictate the course of mega-mergers and corporate strategy at some of the world's biggest companies - and made a fortune in the process.

Founded by Tim Barakett, a Canadian, in 1995, the young manager soon hired Nathaniel Rothschild, son of Lord Jacob Rothschild, to act as co-chairman and draw on his connections to raise money. He subsequently poached David Slager, a British-educated Dutch trader, from Goldman Sachs, who launched a European fund that grew rapidly to pass the original Global fund Mr Barakett runs.

All three of them went on to make personal fortunes in the bull market, which ended in summer last year. Mr Barakett and Mr Slager were estimated by Trader Monthly magazine to have made $250m-$300m each last year, with Mr Rothschild adding to his family's wealth with a similar income. The three of them, together with other staff, have more than $1.4bn invested in the $14bn fund, with Mr Barakett and Mr Slager having the vast bulk of their personal wealth tied up in Atticus.

When the credit crunch hit in August last year, Atticus was caught out. The firm had a $1bn position in Britain's Barclays Bank, where it was publicly opposing efforts by John Varley, chief executive, to buy Dutch rival ABN Amro - a deal that Barclays lost to Royal Bank of Scotland - as well as major unhedged holdings across many large companies. Mr Slager's fund plunged more than 10 per cent in the month, its worst result yet, as banking shares, and Barclays, tumbled. Still, investors were unconcerned. The funds made back all their losses over the next two months, and the European fund ended 2007 up 28 per cent after fees - not a patch on the 44 per cent and 63 per cent gains of the previous two years, but still a phenomenal result for such a large fund.

This year, investors have been more worried. The fund's low levels of short-selling, which can hedge against falling markets, and its enormous position in Deutsche Börse and NYSE Euronext, the stock exchanges, has hammered its results. Mr Slager has recorded his seven worst months since the credit crisis hit, and at the end of August was down 32.9 per cent this year. Mr Barakett has fared slightly better, but was still down 25 per cent.

Now the fund and its top executives are braced for at least a year without bonuses, as Atticus will receive no performance fees - the bulk of its income - until the funds have made back their losses - requiring gains of 50 per cent for Mr Slager and 33 per cent for Mr Barakett.

"Perhaps one concludes that the time is over for them," said one investor. However, other investors said the dire results over the past 12 months were just a "natural" give-back of some earlier profits. Clients who put money with Mr Slager when his fund launched in 2001, for example, have still made more than three and a half times their money, turning $10m at launch into almost $37m.

Nicola Horlick, in the latest report to shareholders in Bramdean, the London-listed investment fund she runs, said its holding in Atticus European was expected to be volatile, and was kept small as a result. "Given that the manager maintains concentrated positions, the heavy losses in declining markets are not surprising," she wrote.

Still, this year's losses have been galling for Atticus, which believes it has picked strong companies in sectors which are fundamentally sound.

"We continue to be disappointed by what we believe is an over-reaction in specific themes to concerns about growth," it said in a report to Atticus European investors last month.

"These valuations indicate persistent fear, and reflect the willingness of many investors to de-risk their portfolios uneconomically," it wrote. "Historically, these conditions have indicated the wrong time to sell equities, and we believe that remains true today."

The latest regulatory filings show Atticus running with three big investment themes at the end of June: mining and oil/energy, including a $1bn holding in ConocoPhillips; financials and stock exchanges, including more than €1bn ($1.47bn) of Deutsche Börse, and a combined $1bn in Visa and Mastercard; and US rail, with $1bn of Union Pacific and another $1bn in Burlington Northern Santa Fe and Norfolk Southern. The hedge fund focuses on large companies, unlike many rivals, taking very large, concentrated positions. It originally started out following the "event-driven" strategy: buying cheap stocks where a corporate event could provide a catalyst for a jump in the price.

As it grew bigger and more powerful it began to provide the catalyst itself, pushing management to take action it believed would boost the stock. In the case of Phelps Dodge, the miner, it even hired its own investment bankers to find a buyer, ahead of its sale last year to Freeport-McMoRan. It halved its $1.1bn equity stake in the second quarter, although it also bought $200m worth of options.

Atticus has come under scrutiny for its links to The Children's Investment fund, an aggressive London activist hedge fund run by Chris Hohn, a Harvard friend of Mr Barakett.

The two have frequently bought the same stocks or taken the same general views - including their focus on US rail - and are the two largest shareholders in Deutsche Börse.

They worked together to prevent the exchange's purchase of the London Stock Exchange, although subsequently they have diverged in views, particularly with regard to ABN, where Mr Hohn was pushing the Dutch bank to sell, while Atticus was trying to stop Barclays from buying.

Concerns that they could be seen as acting together, highlighted by an inconclusive investigation by the German regulator, were behind Mr Hohn's resignation last year as a director of RIT Capital, the listed Rothschild investment trust, where Mr Rothschild is also a director. RIT is an investor in Atticus, and the hedge fund rents its London office from RIT.
The shadow is a moral problem that challenges the whole ego-personality, for no one can become conscious of the shadow without considerable moral effort. To become conscious of it involves recognizing the dark aspects of the personality as present and real. This act is the essential condition for any kind of self-knowledge.
Carl Jung - Aion (1951). CW 9, Part II: P.14
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#6
Peter Lemkin Wrote:...it isn't gonna look good on his CV.....but hey Lahde, pass that thing in your hand over here.....! Shows you can't fool all the people all the time.....only most. Also shows why 'they' keep grass illegal - it makes you see things like hedge funds from another 'angle'....ditto the 'consentual' perceived 'reality' and 'morality'.

Peter,
If I remember correctly,the conclusions for the CIA-MK-Ultra "truth drug" experiments showed that marijuana worked the best.Mr.Lahde seems to validate that conclusion.Wall Street needs a SMOKE-in!!!!!!

TURN ON-TUNE IN-GIVE THE MONEY BACK...........
"You never change things by fighting the existing reality. To change something, build a new model that makes the existing model obsolete.”
Buckminster Fuller
Reply
#7
Like I always used to say:
"Pot is a very dangerous drug: it causes peace" Smile

Dawn
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