Friday, March 28, 2008
The latest sad travail of John Meriwether
I am confused. Does John Meriwether get all the breaks? Or is it that he can't catch one? The greatest and most heralded trader of the old, fabled Salomon is once again being brought to his knees by the credit markets. First, it was the Treasury scandal back at Solly, then it was the blowup of Long Term Capital Management(LTCM). Now his group of hedge funds, JWM Partners LLC, is on the ropes. The largest fund in the group is rumored to be down by 28% YTD. One of the sadder details in the story is that he was actually not nearly as leveraged as he had been back in the heyday of LTCM(he was only levered 14 to 1).
Obviously the guy is super bright, if only because he can consistently blowup and then get people to fund his latest venture. I guess there are second acts in American life. Even third. My guess is that if forced to shutdown his funds, that he will start yet another. People will no doubt clamor to give him money, confident that they can get find a chair when the music stops.