Hedge fund manager David Einhorn said first-quarter gains from betting against the Japanese currency cushioned declines tied to gold, and told investors that monetary policy affirms his strategy on both assets. “The Bank of Japan officially joined the global monetary printing race,” Einhorn said today on a conference call held by his Greenlight Capital Re Ltd. (GLRE) reinsurer. “It seems that every time a central banker takes a more aggressive action, without short-term negative consequences, it reinforces the behavior of other central bankers. We believe that recent events, including the regime change at the Bank of Japan, support our long-term thesis of both a weaker yen, and stronger gold.”
Cohen vows to clean up SAC (NYPost)
SAC Capital’s Steve Cohen told investors yesterday he is determined to clean up the $14 billion hedge fund that has seen five former employees either plead guilty or confess to insider trading. Cohen, in a May 2 letter to investors — a copy of which was obtained by The Post — said that starting Jan. 1, 2014, SAC will claw back compensation of any analyst or portfolio manager whose conduct leads to regulatory or criminal sanctions. SAC will also claw back deferred compensation for those who leave during or after a probe. Cohen is also beefing up his compliance department by adding nine people to its 36-person team. And he is limiting employee calls to four a year to any single person in an expert network, where much of the insider trading has occurred.
Vanity Fair’s ‘The Hunt for Steve Cohen’ (ComplianceWeek)
I already gave you a head’s up on the great Moby Dick-themed art that accompanied an article in the June 2013 Vanity Fair entitled, “The Hunt for Steve Cohen.” The article by Bryan Burrough and Bethany McLean is now available online (click here), and it is a terrific, in-depth look at the broad investigation conducted by Preet Bharara of the Southern District of New York into insider trading by hedge funds. Burrough and McLean are not newcomers to this world. Burrough is a former investigative reporter at The Wall Street Journal and the co-author of Barbarians at the Gate, the famous look at the leveraged buyout of RJR Nabisco.
Paulson Gold Fund Said to Lose 27% Last Month as Metal Falls (1) (BusinessWeek)
Billionaire John Paulson, the hedge- fund manager seeking to reverse two years of losses in some of his strategies, lost 27 percent in his Gold Fund last month after the precious metal and related securities plummeted, according to two people familiar with the matter. The loss brings the strategy’s decline to about 47 percent this year, said the people, who asked not to be identified because the information isn’t public. The fund is made up primarily of Paulson’s own money, one of the people said. The strategy has about $500 million, down from about $700 million at the end of March.
Gold may get a break if Paulson, other big funds are flushed out (MarketWatch)
John Paulson’s Gold Fund lost 27% in April, according to a report on Bloomberg Tuesday, citing someone familiar with the matter. That’s a chunk of change, and explains why the SPDR Gold Trust (NYSEARCA:GLD) -1.65% keeps heading south, says Tyler Durden over at ZeroHedge. Durden says there may be a gold lining amid signs of major selling from Paulson and others. ”The good news is that once levered players such as Paulson are finally blown out, there is hope that only far more rational, ‘non-weak handed’ players remain at the table,” he says.
