I just heard about this guy, Andrew Lahde and found his letter pretty interesting/crazy/extraordinary >_<. Andrew Lahde is a California-based hedge fund manager who in 2007 earned some fame for achieving return rates in the vicinity of 1000% with his Lahde Capital, based in Santa Monica, California. The fund speculated on increases of U.S. subprime mortgage defaults. He earned a bachelor's degree in finance from Michigan State University and an MBA from UCLA. Basically, what happened is that he earned a lot of money ($300 mil), and then decided to close down the fund about 2 weeks ago. Here is part of his letter:
"What I have learned about the hedge fund business is that I hate it.
I was in this game for the money. The low-hanging fruit, the idiots whose parents paid for prep school, Yale and then the Harvard MBA, who were there for the taking.
These people who were (often) truly not worthy of the education they had 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 behaviour 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.
I will no longer manage money for other people or institutions. Some people, who think they have arrived at a reasonable estimate of my net worth, might be surprised that I would call it quits with such a small war chest. That is fine; I am content with my rewards. I have enough of my own wealth to manage. I will let others try to amass nine, 10 or 11-figure net worths.
Meanwhile, their lives suck. Appointments back to back, booked solid for the next three months, they look forward to their two-week vacation in January during which they will be glued to their Blackberries or other such devices.
What is the point? They will all be forgotten in 50 years anyway. I do not understand the legacy thing. Nearly everyone will be forgotten. Give up on leaving your mark. Throw the Blackberry away and enjoy life. So this is it. With all due respect, I am dropping out. Please do not expect any type of reply to emails or voicemails within normal time frames or at all.
I have no interest in any deals in which anyone would like me to participate. I truly do not have a strong opinion about any market right now, other than to say that things will continue to get worse for some time, probably years. I am content sitting on the sidelines and waiting. After all, sitting and waiting is how we made money from the sub-prime debacle."
You can google his name and will find a lot of articles talking about him now. I have a thought, which I have been pondering for a while now.. It seems to me that the crisis time gives the rich an opportunity to get richer, while the poor will still get poorer. Isn't that sad? I'm talking about guys who have capital to buy all the assets (houses, stocks, etc) when they are at low prices and can actually hold on to it and wait until the economy gets better and the assets gain much higher values to sell them... Anyhow, I hope you'll tell us what you think about Lahde's letter.
2 comments:
I think that this is the mind frame of half of the finance world. In fact, I find this letter amusing. I have noticed that some people (maybe most) in the finance world are bitter, money grubbing world who hate their jobs. The statement Lahde wrote is right on target..."Appointments back to back, booked solid for the next three months, they look forward to their two-week vacation in January during which they will likely be glued to their BlackBerries or other such devices. What is the point? They will all be forgotten in 50 years anyway. Steve Ballmer, Steven Cohen, and Larry Ellison will all be forgotten. I do not understand the legacy thing. Nearly everyone will be forgotten. Give up on leaving your mark. Throw the BlackBerry away and enjoy life."
I found this letter one of the most honest if sad things I have read about what caused the credit crisis. For one I feel pity for these people that focus their lives around the attainment of money and the sad state our nation is in that wealth is equated with happiness. But what I find sadder is not the investment bankers, who were given endless opportunities and ended up in such a hollow meaningless life in search of the next big buck. I feel sad for the people that are in the lower income brackets, that are trying very hard to make something of themselves but are in the end denied opportunities because of the greed and selflessness of the filthy rich. It has been said before, but this is one of the greatest tragedies in American society.
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