Tuesday, October 21, 2008

Self-inflicted wounds hurt hedge fund industry

Dealbook by the New York Times reports that Andrew Lahde is closing his funds and returning money to investors. The article reprints Lahde's "farewell" letter to investors. Unfortunately, the letter is more of a "screw you" than a farewell and wanders into head-scratching territory including a defense of growing hemp and recommendations on what George Soros should do with his free time.

Lahde writes, "I was in this game for the money. The low hanging fruit, i.e. idiots whose parents paid for prep school, Yale, and then the Harvard MBA, was there for the taking. These people who were (often) truly not worthy ofthe education they 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 behavior 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."

That's all the industry needs: proof that egotistical managers are pulling fast ones on naive investors.

Hopefully, people (and the media) will recognize that Lahde operated his own LA-based fund for less than two years and his opinion should be taken with a grain of salt.

A story on Bloomberg gives a little more information about Andrew Lahde.

No comments: