Former LTCM founder returns to fray

Discussion in 'Wall St. News' started by tireg, Jul 16, 2006.

  1. tireg

    tireg

    From the Times Online:
    http://business.timesonline.co.uk/article/0,,9063-2266037,00.html

    "THE Nobel Prize-winning founder of Long Term Capital Management (LTCM), the hedge fund whose implosion brought financial markets to the brink of collapse in 1998, is back in the world of hedge funds, The Times has learnt.

    Robert Merton said that a new fund focused on emerging markets had been created under the umbrella of Integrated Finance, the boutique investment bank that he set up in 2003 with Roberto Mendoza, the former vice-chairman of JPMorgan and ex-chairman of Egg, the internet bank. Peter Hancock, the former chief financial officer of JPMorgan, is also a founding partner of the bank, whose backers include BNP Paribas and ACE, the Bermuda insurer.
    More in article
     
  2. mahras2

    mahras2

    Scholes already is chairman of his 2billion+ fund (there was a piece of him in a recent bloomberg mag). All of them have nice shops set up by now.
     
  3. those guys are kewl...
     
  4. How fun to be able to trade like crazy and get bailed out by the US Government. Who here has seen the NOVA pbs special on the LTCM ordeal.
     
  5. mahras2

    mahras2

    Only 30 million raised by one of the biggest names in finance. The same guys who were able to coax out >1 bill for LTCM as a startup before it became common.

    Pretty wild.

    Thanks for the info on Scholes' fund.
     
  6. Pekelo

    Pekelo

    yeah but it wasn't because of losses, but he couldn't rise enough capital.

    Although I still don't get it, he had 30 mill, not that huge, but he could have traded it and a year later he would have more credibility. Or am I missing somthing?
     
  7. tireg

    tireg

    I think at the relative institutional level he's used to playing, 30MM is peanuts. To compare, It's like blowing out a 500k account and then starting over with only 3k. Overhead would kill you. Would you even bother?
     

  8. his strategy requires much more capital to effectively execute.

    surf
     
  9. BCE

    BCE

    It was on Frontline on PBS. A great series. Here's a link. http://www.pbs.org/wgbh/pages/frontline/shows/crash/
    I was hoping they would have this as one of the programs you can watch online. But I guess it's too old now.
    Here are the ones you can watch. http://www.pbs.org/wgbh/pages/frontline/view/
    I do have a VHS tape of this I recorded. Fascinating. And actually, as I recall, if they had been able to hold their positions, they would have made some good money. And also Warren Buffett had wanted to take on their positions at a discounted rate, but Greenspan and the banks cleaned this up as we know. :)
    Sept. 23, 1998
    Pushed by the New York Federal Reserve, a consortium of leading US financial institutions provides a $3.5 billion bailout to Long Term Capital Management, one of the largest US hedge funds, amidst fears that a collapse could worsen the panic in the financial markets.
    Sept. 24, 1998
    Stocks on Wall Street and in Europe swoon amid fears that the losses suffered by the world's largest banks in the Long Term Capital debacle could put the entire banking system at risk.
     
    #10     Aug 21, 2006