Hedge Fund Pioneer Barton Biggs Dies At 79

Jul 16 2012 | 10:57am ET

Hedge fund pioneer and former Morgan Stanley chief global strategist Barton Biggs, the man who predicted the dot.com crash, has died at the age of 79.

Morgan Stanley CEO James Gorman confirmed the Traxis Partners founder's Saturday death in a Monday memo to employees, saying that Biggs "left an indelible mark on our business, our culture and our shared notion of leadership at Morgan Stanley."

A bank spokeswoman said Biggs, a lifelong fitness buff, died after a short illness.

A New York City native, Biggs studied creative writing at Yale University, served three years with the U.S. Marine Corps, taught English at a Maryland prep school, played semiprofessional soccer and tried his hand at writing short stories—he’d go on to write three books, Hedge Hogging, Wealth War & Wisdom and A Hedge Fund Tale of Reach and Grasp—before enrolling in business school at New York University.

Biggs’ financial career began at E.F. Hutton in 1961. Four years later, he co-founded one of the first hedge funds, Fairfield Partners, which returned 133% over his eight-year tenure there. In 1973, he joined Morgan Stanley, founding the bank’s investment management arm in 1975 and serving as its chairman until 2003. Upon his retirement from Morgan Stanely, he founded Connecticut-based Traxis.

Biggs predicted the bull market in U.S. stocks that began in 1982 and warned investors away from Japanese shares in 1989, prior to their collapse but his reputation as a prognosticator was truly made in 1999, when he warned that the craze for Internet stocks would “come to a very bad end” and advised investors to sell their technology stocks. The Nasdaq Composite Index peaked in March 2000 before losing almost 80% of its value over the next two and a half years.

Biggs is survived by a son, two daughters and nine grandchildren. His marriage to Judith Anne Lund ended in divorce.

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