Sunday, 26 October 2014
Last updated 1 day ago
Oct 29 2013 | 7:45am ET
William Fleckenstein's upcoming return to short-selling will be his swan song.
The Fleckenstein Capital manager elaborated on his plans for his RTM 2.0 fund, which is set to debut early next year, five years after he shuttered his last short-only hedge fund, in an interview with The Wall Street Journal. And he made clear that there would be no RTM 3.0.
"This is going to be my last, quote-unquote, campaign," the 60-year-old said, noting that his wife was "remarkably subdued" when he told her he planned to go back into shorting. And since its his final battle, so to speak, he's hoping to amass a lot of firepower before launching his attack.
The Seattle-based hedge fund manager said he wants to raise $200 million before he begins to invest—and that he'll be patient.
"I want to wait until I can have it be more like shooting fish in a barrel, which doesn't happen very often—but it happens," he said. "It happened in early 2000 after the stock bubble burst, it happened in '07, and it'll happen again."
This time, Fleckenstein believes that the Federal Reserve's quantitative-easing program has created another stock bubble—one that is poised to pop when the long-awaited taper of the central bank's $85 billion-per-month bond-buying program begins.
"We're now starting to see really stupid valuations on businesses that may or may not really be businesses," Fleckenstein told the Journal. "People are forgetting that the lower cost of money has powered segments of the economy that has given us an appearance of things being better than they are."
Sep 22 2014 | 4:15pm ET
"I tell people that everybody likes good news and so if you have good performance that’s wonderful,” explains Mike McKitish of Peddie School's endowment, “but it’s the people that want to talk about the bad news or where they drifted and how they came back and how they stayed to their discipline…” that he wants to hear from. Read more…
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