Tuesday, 23 September 2014
Last updated 24 min ago
Jul 30 2014 | 9:07am ET
It turns out that there is something that keeps Elliott Management founder Paul Singer up at nights, and it isn’t central bankers or the Obama administration: It’s a solar electromagnetic pulse that could plunge humanity back into the dark ages.
Singer wrote that a solar disturbance the likes of the one that struck earth in 1859 could cripple the global electric grid for months. He called for “a bipartisan push to make the country (and the world) safer from this kind of event.”
“While these pages are typically chock full of scary or depressing scenarios, there is one risk that is head-and-shoulders above all the rest in terms of the scope of potential damage adjusted for the likelihood of occurrence,” Singer wrote to his investors.
His fears of a pulse did not stop Singer from taking aim at his usual targets, writing that “substantial inflation is occurring in many asset classes and service sectors of the global economy, but is not presently recognized or captured by the traditional metrics upon which the [Federal Reserve] relies.” He added that volatility, gold prices and long-term interest rates are “like a coiled spring waiting to burst higher at some unpredictable confluence of events and perceptions,” while stock prices are poised to correct with “head-spinning abruptness and shocking intensity.”
“We believe that current monetary policy is extremely dangerous, the financial system is still over leveraged and opaque, major financial institutions are still essentially dependent on government guarantees to protect them in the event that there is a renewed financial crisis, and an abrupt shake-up could occur at any time.”
Singer also told investors that Elliott had increased its stake in Juniper Networks, with which it struck a deal to avert a proxy battle earlier this year. Elliott said that the company “has numerous pathways for value maximization” without specifying how large its stake has become.
In addition, Singer said he likes European real-estate securities, especially in Italy. But he said little about either Elliott’s new investment in EMC Corp. or about his ongoing fight with Argentina. Nor did he mentioned the firm’s investment in Hong Kong’s Wing Hang Bank.
The hedge fund had bought up nearly 8% of Wing Hang in an apparent effort to force Oversea-Chinese Banking Corp. to increase its offer for the bank. But OCBC refused to do so, and rather than accept the uncertainty of holding on to a listed stub, Elliott tendered its shares, allowing OCBC to de-list Wing Hang, The Wall Street Journal reports.
Sep 22 2014 | 4:15pm ET
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Aug 25 2014 | 11:21am ET
As many of you know, FINalternatives was recently acquired by the owners of Futures magazine, a firm called The Alpha Pages LLC. Today marks the soft-launch of a new sister site for both publications. As its name suggests, The Alpha Pages will cover all types of alternative investments, going far beyond the more well-known ones such as hedge funds and private equity. Read more…
Credit default swaps brought down the London Whale and cost JPMorgan $6.2 billion. Here is how it happened.