Billionaire hedge fund investor Paul Tudor Jones: Bitcoin is a 'great speculation'

2019 Crypto Hedge Fund Report

https://www.pwc.com/gx/en/financial-services/fintech/assets/pwc-elwood-2019-annual-crypto-hedge-fund-report.pdf

Connecticut State Capital Prepares For Bankruptcy Amid Collapse In Hedge Fund Revenue

It's not just the manufacturing rust belt states (e.g., Michigan, Illinois) which are being hollowed  out by a collapse in the economy.  Apparently the monied class in hedge fund hypocenters such as Connecticut are also struggling with bankruptcy.

http://www.zerohedge.com/news/2017-05-10/connecticut-state-capital-prepares-bankruptcy-amid-collapse-hedge-fund-revenue

Hedge Fund Gold Positioning Has Never Been This Extreme

The meme here is short-term trading hedge fund managers are not the smartest guys in the room.  It generally pays well to be a contrarian when it comes to gold futures.  And right now, the hedgies have never been more bearish.

http://www.zerohedge.com/news/2015-12-19/hedge-fund-gold-positioning-has-never-been-extreme

Click on Image to Enlarge

Hedge Fund Legend Julian Robertson Warns Of A "Complete Explosion" Unless Fed Contains "Boiling, Bubble" Market

http://www.zerohedge.com/news/2015-04-06/hedge-fund-legend-julian-robertson-warns-complete-explosion-unless-fed-contains-boil

Blythe Masters’ Ex-Husband Launches Bitcoin Hedge Fund from the Island of Jersey

Perhaps this is why they are no longer married.  He's into Bitcoin--she's into suppressing silver prices.

http://libertyblitzkrieg.com/2014/07/11/blythe-masters-ex-husband-launches-bitcoin-hedge-fund-from-the-island-of-jersey/

Keiser Report: Banksters' God Complex

http://youtu.be/QkTb8FrQ9ow

Warren Buffett: "The Fed Is The Greatest Hedge Fund In History"

A hedge that is massively over-levered....gee, this will end well.

http://www.zerohedge.com/news/2013-09-22/warren-buffett-fed-greatest-hedge-fund-history

Pacific Group to Convert 1/3 of Hedge-Fund Assets to Gold

http://www.bloomberg.com/news/2013-01-21/pacific-group-to-convert-one-third-of-hedge-fund-assets-to-gold.html

Only in America: Corzine Eyes Starting a Hedge Fund

http://www.benzinga.com/news/12/08/2841744/only-in-america-corzine-eyes-starting-a-hedge-fund#ixzz23sEcp2fP

Meet The Man Behind The Liquidating Hedge Fund That Blew Up The Gold Market

Thanks to Dick for finding this article on gold's recent sell-off.  If a $10 million hedge fund manager can move the gold futures market so violently, imagine what a $10 billion hedge fund manager could do.


http://www.zerohedge.com/article/meet-man-behind-liquidating-hedge-fund-blew-gold-market

John Paulson's new gold fund

To view this Wall Street Journal article you may need a subscription:

http://online.wsj.com/article/SB10001424052748704533904574543713428787876.html

Highlights, for those who can't read the full article:

One of the biggest investors is placing a huge new bet on gold.

John Paulson, who scored about $20 billion of profits between 2007 and early 2009 wagering against the housing market and financial companies, is launching a hedge fund dedicated to buying up shares of gold miners and other bullion-related investments, according to investors.
...
The affinity for gold represents something of a shift for Mr. Paulson, who gained recent recognition as a contrarian. As the dollar has fallen, investors lately have flocked to gold, which traditionally served as an alternative to paper currencies. As the supply of these currencies has risen lately amid government efforts to stabilize global economies, some investors believe their value will fall, helping gold.
...
Mr. Paulson at Tuesday's investor meeting countered that the bull run was only beginning for gold.

He noted that central banks around the globe have gone from sellers of gold to buyers, and that the global supply of gold is constrained.

While harmful inflation isn't on the horizon, he said, Mr. Paulson argued that there is a risk of a burst of inflation down the road. That's because in the past there's been a lag between a surge in money supply and higher inflation. Gold often does well when inflation rises.

Mr. Paulson told investors that the Federal Reserve will prove reluctant to raise interest rates, given the weakness in the economy, which also could pave the way for higher inflation, at least at some point, another reason for his growing conviction about gold.

Worth about $6 billion, Mr. Paulson said he was starting the new fund in part to give himself more personal exposure to gold, according to an investor at the meeting.

The embrace of gold is relatively new for Mr. Paulson. The hedge-fund manager, who mostly invested in merger deals until detecting a housing bubble in 2006, had done no gold investing as of a year ago.

John Paulson

Most of us know who Warren Buffett is, because he is considered the world's best long-term investor, buying undervalued companies with high cash flow, solid balance sheets, and defensible, moat-like market share in their respective industries. In other words, he buys solid companies when they are cheap and under appreciated by the markets.

But the average person knows little of John Paulson. Paulson has been the most successful trader in recent years, making billions of dollars for his hedge fund by betting against subprime mortgage companies and agencies. He went against the crowd in doing so, making the unpopular bet that home values were artificially set too high, and that subprime borrowers would default en masse. He also bet against the banks that were making these reckless loans, and holding toxic assets.

In hindsight, he was a genius for placing these bets. But when he did make them, he would have been considered a lunatic for betting "against America", as most financial pundits, experts, and economists were predicting clear sailing for the economy, despite the looming subprime iceberg ahead. Most didn't see it coming, but he applied logical reasoning and was prescient enough to place huge bets on his investment thesis. The result was billions in profits for him personally and for his clients.

Flash forward to 2009, and John Paulson made another unpopular bet earlier this year. He gobbled up gold mining shares, the GLD ETF, and physical gold. In all, they represent the largest percentage of his holdings. Why did he do that? In his own words:

http://www.goldnewswire.net/gold-%E2%80%93-not-tomorrow-but-5-years-from-now

Once the Fed began directly buying Treasuries and mortgages, I lost faith in the dollar as a reserve currency for my assets... What I'm looking at is not where gold is going to be tomorrow, one week from now, one month from now, three months from now. What I'm looking at is where is gold going to be vis-a-vis the dollar one year from now, three years from now, five years from now.

And I think with a high probability at each of those points, gold will be higher than it is relative to the dollar today. That probability increases the further out you go, and the magnitude of that difference also increases the further out you go. So when I look at what the risk is, the risk to me is far more staying in dollars than it is in gold at this point. - John Paulson

Julian Robertson on CNBC

Julian Robertson is a legend on Wall Street--when he speaks, Wall Street listens. His nickname was "Never Been Wrong Robertson." He founded Tiger Management, once the largest hedge fund in the world, with $22 billion under management at its peak.

Of course, he was wrong a few times: he missed the tech boom, and ended up closing the fund in 2000. His other misses included going long on US Airways, which folded in 2002, and shorting copper last year, which rallied in 2009. However, his market calls have generally been prescient, and his performance and insight on markets is revered by the Street, including many hedge fund managers who learned their craft under Robertson.

http://pragcap.com/were-going-to-pay-the-piper

Bailout or No Bailout?

I'm from the school of let 'em die. If you and I make poor investment decisions, we have to suffer the consequences. These executives applied far too much leverage, took on way too much risk, and after plundering their firms, they get golden parachutes. Where's the accountability factor?

I'm all for the founders of Google earnings billions because they have created a lot of value for consumers, business, shareholders, and employees. But when executives run their firms to the ground, they should not profit from said disasters, whether their firms get bailed out or not. A meritocracy rewards those who add value, not those who detract from it.

As much as I hate that the taxpayers bear the brunt of rescuing an AIG, I reluctantly agree they should probably be bailed out, because if they implode, the cascading illiquidity would essentially freeze up markets worldwide, as the sovereign funds, hedge funds, pension funds, mutual funds, private equity firms, and every financial institution would suffer a loss of confidence in the US financial markets, which would bring about a dark age analogous to the Great Depression. No one wins in that scenario, save the few bottom fishers with cash and balls to step up and play in the deep end of the pool.

But make no mistake: the intended recipients of these bail outs are the big institutions--not necessarily the common man, altho we all are in the same boat.

Having said that, there is a downside to this massive injection of liquidty--re-inflation. Interest rates should be favorable short-term, but when oil approaches $150 a barrel, when gold flirts with $1500/oz, the Fed will have no choice but to raise rates. Again, the lesser of two evils, but still an evil...Eventually, the economic shocks worldwide and the domestic slowdown will eventually dampen demand and cost of living increases, but until then, gold seems more stable than the US Dollar.

You know the world is turned upside down when there is more concern about the USD than the Brazilian currency, Russia has a flat tax, and the US has the 2nd highest tax brackets in the western world. Our leaders have forgotten what has made this country (and California) great.

Signs we are in for rough seas...

A couple days ago, I attended a seminar for mortgage brokers looking to increase their deal flow. One of the many stats cited by the seminar speakers indicates that there's been a 40% attrition rate among loan officers. The positive spin is that there are fewer loan officers chasing the same deal, altho deal flow has decreased significantly, especially refi's. In any case, since I have a couple mortgage planners in my affiliate network, I wanted to get an indication on how bad the industry was, as all I heard from them was doom and gloom about the mortgage industry. My attendance at the seminar confirmed it. I got depressed via osmosis.

Thru a referral from a realtor friend, I visited a senior loan officer, one of the top revenue producers in the country prior to the mortgage industry balloon popping. He went from funding up to 104 loans a month to virtually nothing today. He's lost 5 of his 7 homes, basically losing millions in equity, and starting over. He is sharp, proactive, a strategic thinker--and broke, with a plummeting FICO score. He's working 3 times as hard on each deal, and each deal is bringing in one third the revenue he used to make on loan origination fees. In essence, he has to work 9 times as hard to fund one deal. And only 1 in 10 applications are being funded (the seminar speakers said 1 in 5 applications are accepted). It got me thinking--here was the one of the top producers in the country, and it was no fluke as he was on top of his game. Yet, he was flat broke. What is going on here?

I told him I'm having my best year ever, and so are my affiliate partners in the lending and real estate business. Why? Because my clients protect their equity, thriving even in a severe real estate downturn. I create a need for clients to either refinance--or to sell their existing home, and purchase a new one, in order to acquire new tax-deductible debt. It's due to Rule 264, which defines the limits of acquisition indebtness. Most individuals are unaware of this rule--and so are their CPA's.

The aforementioned loan officer is sharp, he may become a client, and we definitely will work together to shore up his clients' balance sheets. It's too late for some, but there are some who will need our assistance.

I also visited another realtor friend who was a multi-millionaire the last time we met. He owned 5 beautiful homes scattered across the bay area, each worth over a million each. Today, he is upside down on all of them, barely able to fill up the gas tank on his luxury SUV. I know the technical definition of a recession is two consecutive quarters of negative GDP growth, but I really don't care what the government statistics cite. We are deep into a recession--and it's going to get worse. These aren't exactly low-paying jobs people are losing.

The anecdotal evidence is mounting--UBS' mortgage-backed securities department laid off 400 of their staff of 450. JPMorgan Chase bailed out Bear Stearns, the country's 4th largest investment bank. Bank of America bailed out Countrywide--the country's largest mortgage lender. And Texas Pacific Group, a private equity firm, injected billions of capital into Washington Mutual, that little commercial bank on every street corner. It's the ultimate trifecta--investment banks, mortgage banks, and commercial banks. This triple crown of exploding debt is going to implode the US economy. On the other hand, the thoroughbred Big Brown didn't have a chance at his Triple Crown...

And the government continues to artificially deflate reported inflation numbers for their best interests, but to the detriment of every American consumer, but especially retirees living on a fixed income, tied to the cost-of-living index. What's noteworthy is that the cost of food and fuel are not included in the inflation index, with the reason being they are "too volatile" month-to-month to be included in the "core" inflation index. Well, that's Jim-dandy, but the problem lies in the fact that those are the two household components whose costs are skyrocketing. Does anybody really think inflation is only growing at 3%? Pleeze...

In any case, last Tuesday, one of my mortgage planner partners is refinancing 7 properties for 4 of my clients, totaling approximately $4 million. I'm also putting those very same clients into something that is safe, liquid, earns more than their tax-deductible mortgage interest, and compounds tax-free. For those that don't know me well, I'm applying Missed Fortune concepts, a safe, conservative strategy on building wealth by optimizing current assets.

Last night, I had a meeting with a former colleague, who is now at a major investment bank (one of those two-name ones). Altho Missed Fortune concepts are antithetical to what Wall Street espouses, even he agreed to the unconventional, yet straight-forward principles. His caveat is that a money manager can beat Missed Fortune strategies if he/she can achieve a 15% annualized return, pre-tax. I say, good luck...most hedge fund managers strive for 12-15% pre-tax growth, and most money managers underperform the Lipper market averages. My clients earn the index averages tax-free, with a guaranteed floor, and sleep at night. Albert Einstein said "Compounding interest is the 8th wonder of the world". If that's true, tax-free compounding is the 9th wonder.

Doug Andrew, my mentor and friend, really is a genius. Each component of Missed Fortune isn't novel--but how he has taught me to structure each plan--both liabilities and assets--THAT is the secret sauce.