The Times loves rich people so much it cries for them when they lose 20% of their investments in a hedge fund, and the poor, wealthy hedge fund manager feels he must retire from the business:
Two weeks from now, a seven-year-old hedge fund called Alson Capital Partners will return around $800 million to its investors, and shut its doors for good. […]
The fund was founded and managed by Neil Barsky, 51, a former Wall Street Journal reporter-turned-Morgan Stanley analyst, who started his first hedge fund in 1998, just as the “hedge fund decade” was gaining steam. … At its peak, Alson Capital had $3.5 billion under management, charged a 1.5 percent management fee, took 20 percent of the profits, and, when you include Mr. Barsky’s predecessor fund, produced compounded annualized returns of 12.11 percent a year. It’s fair to say he’s made a pretty penny. […]
Although his fund lost money in 2008, it did not blow up; as he put it, the 20 percent loss was “not a disaster but not good.” Although he was forced to make redemptions to investors who bailed out, enough remained that he could have stayed in business. What really caused him to exit the hedge fund business is that he felt ground down by the relentlessness of the job.
Yes, I feel terrible for Mr. Barsky and all his wealthy investors who lost 20% of the wealth they had accumulated over the last decade before the market crashed last year. So sad, another unemployed millionaire burned out from making more millions for his clients. It’s a dirty rotten shame I tell you. Luckily, for him, he seems to have made the right decision:
“I don’t feel a sense of defeat,” Mr. Barsky said, as I was preparing to leave. “We have done well by investors and by our employees. We comported ourselves ethically. Three months ago,” he added, “I started to read books on Buddhism. What I learned is how much of what we do is ego-driven. Why do I feel I have to be the best hedge fund manager? I started to have perspective. You probably want your hedge fund manager to eat raw meat. But as we unwind, I’m pretty comfortable with my mind-set.”
I bet Mr. Barky is comfortable with his financial condition, too. Or at least more so than the millions of unemployed people who don’t have time to contemplate the words of the Buddha because they’re too damn busy having to find a new job to keep paying for their kids’ food, pay their mortgage or rent, or find some way to deal with a family health crisis now that they’ve lost their health care coverage. But, hey, none of those people were a “source” for a New York Times Financial writer, so their little problems don’t amount to a hill of beans in this world, do they. At least, not to Joe Nocera, the author of this paean to his wealthy ex-hedge fund manager and “friend.”
Thanks Joe, you sure put my problems in perspective.
I’d like to emphasize that Barsky and his investors lost 20% of what they gained over the last ten years while people like my husband and myself have lost 20% of what we had during that same time period.
Actually, more than 20%; let’s look at the data: Ten years ago, my husband had a corporate job. Including health insurance, 401K/pension matching contributions, sick leave, vacation & holiday pay, he earned — before taxes — around $88K which was the going rate for his skill-set in the New South. Today, he’s a contract employee which means we can’t afford the health insurance we had, the 401K got cashed in a few years ago to fill in during a period of job transition, no paid days off of any kind and even with an expanded skill-set he was lucky to earn $63K last year. You do the math.
We’ve moved six times in the last four years pursuing his declining employment options. We’ve owned and sold three houses without reaping any equity from them. After one of the closings, he walked away with a ZERO on the bottom line! (It was a rental/investment property that had declined into negative returns and he was extremely relieved to be rid of it without losing even more money to maintainance and declining property values.) We currently own a house that is worth half the price of the house we had in 2000. And we’re lucky! We’re happy to have what we’ve got now! We truly feel that we’ve traded in a rat-race life for a better wage-slave life… except…
The main thing we’ve lost is our delusion of stability and security. Especially, my husband had the idea that working hard, giving 110% of his best effort to his job, would result in a steady increase in income and lead to a secure retirement. He hadn’t been hit upside the head the way I had by a disabling disease; he hadn’t suffered a “fall from grace.” So now we both live with the low-simmering anxiety, with knowing how quickly what we have now can evaporate.
and people here and at the orange site wonder why I complain about the trillions thrown to the banksters and pennies thrown to the rest of us.
sjct, I’m sure that whopping $30-$40 bi-monthly “tax break” in your and your husband’s paycheck is helping you a lot, eh?
This story continues the theme of the It’s Tough For An Investment Banker To Live In NYC On A Mere $500,000 Per Year story, and the Support Group For Young Women Dating Bankers story. To the Sulzbergers these people are interesting, and everyone should agree with them on that. The unemployed pressmen and copy editors recently laid off from the New York Times owned Boston Globe are just boring people Times readers shouldn’t deign to care about.
Did you watch Frontline’s report on Madoff last week? One of the most striking things I got out of it was how goddamn dumb these guys are, and how totally useless. All Madoff and all the operators who fed off his scam did nothing but take other peoples’ money and pass it along. That’s it. They hadn’t a clue where the money went, how it was making a profit, who was involved, what the business plan was, nothing.
What they were doing — and we’re talking big-time banks and brokers here — was no different in kind, and took no more intellect or understanding of anything, than is needed by the guy buying a carton of cigarettes and selling them one stick at a time on the street. The only different is that the cig guy is working with 30 bucks of his own capital while the “investment advisor” grifters were working with millions/billions of other peoples’ money.
Their story is pretty much the story of all of Wall Street and all the banks. I thought Jesse Jackson’s characterization was brilliant: they’re money scalpers, buying at 3% and selling at 6 (or 12. or 18. or 31.) There is a fatal disease in a society where such people ever get rich in the first place. The beginning of a cure will happen when we hear no more bullshit about how we live under a “merit system” where the magical “market” allocates resources “efficiently”. The cure will near completion when we have tax and regulation policies in place that redistribute the national wealth on the basis of fairness and common sense, not the faith-based dogmas of the cult of the market.
They (the NYTimes) don’t have a fucking clue. The thought that they believed this bullshit deserved any inkspace is Exhibit 1,2,3 as to why, WHEN the NYTimes Company goes Chapter 11, I won’t feel one iota of sorrow for them.
I hope this guy does more than just read books on Buddhism. He’s on the right path there, but I’m skeptical as to how far he understands his own ego. The fact that he brags about his own reading tells us something.
%$#&@@!! My father put in 20 years at an engineering company after putting in 20 years in the Navy. Both my parents had tens of thousands of dollars of stock in it when my mother passed away. The stock took a nosedive around that very time. I think it went from about $35 a share when she died to about $0.10 a share when her estate was finally settled.
So you can guess how much sympathy I have for these poor guys who only lost a fifth of their profits.
yet another reason why I despise the NYT and everyone who works there and everything it stands for.
and I’m very tempted to add “and everyone who reads it”, since you’re paying to ingest their stupidity.
There is an infinite supply of misinformation available to you, and you’ll be smarter if you don’t read any of it.
Fortunately their online content is free.