Only a little less than ten years after his first hedge fund blew up and threatened the stability of the financial system, John Meriwether has announced that his current fund, JWM Partners, will wind down operations after a loss of 44% from September 2007 through February 2009. At the start of 2008, the fund had assets of over $1 billion.
Back in 1998, when Meriwether's first fund (Long-Term Capital Management) got into trouble, the Fed had to arrange a $3.6 billion bailout in order to 'save the financial system.' Today, Fed bailouts to save the financial system cost trillions. Talk about inflation!
Following the closure of his current fund, Bloomberg reported that, "For many investors, John Meriwether is by now just another hedge-fund manager.” Just another hedge-fund manager? How many other hedge fund managers do you know with a resume that includes a US Treasury trading scandal, Long-Term Capital, and now this?
Looks like he didn't want to wait until he surpassed his previous high water mark so that he could start getting his 20% fee on profits. But, his investors got what they deserved since this wasn't his first debacle in hedge funds and they knew that. Guess he didn't hedge very well.
Posted by: DaveinPhilly | July 08, 2009 at 11:48 AM
Three's a charm.
Posted by: VennData | July 08, 2009 at 08:52 PM
He caught lightning in a bottle twice. :)
It just goes to show you much of Wall St is not what you know, but who you know. And now, SOME of his Rolodex won't know him a 3rd time.
Posted by: dave | July 08, 2009 at 11:53 PM