Beating the system with Hedge Funds: this makes me sick

[malaise]

http://online.wsj.com/article/SB120036645057290423.html?mod=todays_us_nonsub_page_one


<snip>
On Wall Street, the losers in the collapse of the housing market are legion. The biggest winner looks to be John Paulson, a little-known hedge fund manager who smelled trouble two years ago.

Funds he runs were up $15 billion in 2007 on a spectacularly successful bet against the housing market. Mr. Paulson has reaped an estimated $3 billion to $4 billion for himself -- believed to be the largest one-year payday in Wall Street history.

Now, in another twist in financial history, Mr. Paulson is retaining as an adviser a man some blame for helping feed the housing-market bubble by keeping interest rates so low: former Federal Reserve Chairman Alan Greenspan. (See article.)

[Hydra]

1. Ironies abound

I bet Greenspan warned him about the coming crisis- "smelled trouble" indeed.

[northzax]

4. i konw a few people who bet against the boom

including some who lost because they mistimed their bets. Goldman Sachs, for instance, is making money off this, since they bet on collapose

[malaise]

13. And they had the benefit of the other

Paulsen. Funny how they escaped unscathed. Makes you shake your head and wonder.

Sp.

[northzax]

19. well, I was smart enough

with no financial training at all, to understand that rates were going up, and that I couldn't afford the ARM I was offered last year, so it's not that tough. I am much more shocked by those that thought the bubble was going forever.

[malaise]

20. Valid point

but you didn't make billions betting on it.

[northzax]

21. well, I didn't have billions to bet

but I made thousands betting on an interest rate hike, and saved myself thousands more by not taking a mortgage I would, very soon, be unable to afford. had I known how badly banks were exposed to this (I certainly didn't) I would have shorted their stocks.

[malaise]

22. Good for you n/t

[northzax]

23. thanks

I missed out on the tech boom and the housing boom, gotta be ahead of the curve once, right?

[malaise]

5. That is what makes me sick

These men work all sides don't they?

[sam sarrha]

8. i would too if could even pay the F'n rent..

[Hydra]

9. Yeah, the biggest joke in the world:

"Insider Trading"

Unless of course you are Martha Stewart.

[malaise]

11. Bingo n/t

[The Backlash Cometh]

24. Greenspan guilty of insider training? I would be shocked!

[Hydra]

25. Yeah, I bet

:evilgrin:

[The Backlash Cometh]

26. hee-hee. How did you like my freudian slip?

I meant to say insider trading.

[Hydra]

28. That was pretty good!

Greenspan doesn't need to inside trade- he can print his own money. He takes care of his friends, though, apparently.

[CorpGovActivist]

2. K&R n/t

[wtmusic]

3. Why?

Paulson isn't making the market go down. If anything hedge fund managers create a check against runaway optimism.

More power to him if he can make some money in this lousy market.

[malaise]

6. I have a problem with Greenspan being an

adviser.

[sam sarrha]

7. and i bet he didn't pay 1 cent in taxes on it.. unlike the common man who wins the lottery...we pay

the big taxes up front before we get the money..no loopholes

[Lou Syffire]

27. No, he paid a business friendly 15% tax on it

because it was profit on a transaction.

You, who were a liberal arts major OTOH, paid 33%.

[sam sarrha]

29. that is before the loop holes, etc. bill gates paid the same amout of taxes as a worker making $80K

last year..... smart ass
http://mypage.uniserve.com/~synergy/pg1-33.htm

[Gman]

10. Poor Greenspan

He was a super-human god in the late 90's during the tech boom. His name was mud when the bubble burst. He was a wonder-boy when interest rates were low and investment was going crazy. His name is mud again since it all collapsed.

I don't know if he's a good guy or a bad guy.

[elizfeelinggreat]

17. He is married to

Andrea Mitchell. Does that help?

[jgraz]

12. What's really sick is that we'd be bailing him out had he bet wrong

God forbid those rich people should actually lose money.

[malaise]

14. Yep taxpayers always lose n/t

[gateley]

15. Yep, THEY lose their money, WE bail them out.

And we have no say in it. nt

[elizfeelinggreat]

16. interesting

Interesting that they are reporting this when they didn't report that financial hedging around 9/11. I remember reading about it and not getting any details, does anyone else remember that? short selling or something?

[malaise]

18. Very good point

There were lots of details here. The dungeon may be a good place to look.

[high density]

30. After you "reap" $3-4 billion, why the heck don't you retire?

:crazy:

[sam sarrha]

31. cause theyre mentallt ill, the suffering they profit from goes way past OCD, THEY NEED INTERVENTION