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Showing posts from January, 2015

The Mr. Weissberg Lesson

I recently received an email inviting me (and countless others) to attend a conference on the topic of Distressed Investing.  The letter was somewhat apologetic, saying that with the high prices of US assets and the general scarcity of distress in the market dealmakers are finding it hard to invest.  The letter then went on to say the words that should make investors shudder:  “But there are profitable opportunities for those who seek them out; and many managers are moving outside of their conventional investment profiles to find them – in the energy sector, in retail, or in Europe.”

Don't Fight The Fed

This was one of the key mantra’s I heard repeatedly early in my career when I traded mortgage-backed securities and sat on the bond trading desks at two major investment banking firms.  Back then, in the 1980’s, the mantra seemed to me to overstate the power of the Fed’s ability to move markets.  The concept of QE, or printing money to buy securities, was unimaginable then.  The main power of the Fed rested in its ability to influence only the shortest end of the yield curve (or short term rates, for those of you who don’t come from the finance world).   It seemed back then, in the days of what seemed to be free markets, that the forces of the marketplace, expressed by the thousands of participants coming together to by and sell securities and to borrow and lend money, set the more important longer term rates that directly affected most borrowings – including home mortgages, commercial real estate loans, and corporate borrowings.

I Don’t Like… (Fill in the blank)

I was having dinner with my family the other evening when my 12 year-old daughter recounted her recent conversation with a classmate.  Somehow their conversation drifted to the possibility of our families vacationing together, or in the same Hawaii location, and the classmate then told her that might not be such a good idea because his uncle doesn’t like her dad (me).  He explained that the uncle is in the same business as her dad (me), had never met him (me), but that he (me) was pretty famous in his business.  We actually had a good laugh about the whole thing.  It reminded me of the countless times in my years on Wall Street when I’d heard second and third hand how so-and-so didn’t like me or had bad things to say about me, and how invariably the person was unknown to me and had never even met me.

Character Is Tough to Teach

If you’re a fan of sports then you must appreciate the San
Antonio Spurs basketball team.   Their coach, Gregg Popovich,
is the longest tenured coach in U.S. professional sports and in
his 19th year has a run going of 17 consecutive winning seasons
and five NBA championships.  He graduated from the U.S. Air
Force Academy and it is obvious in how he runs his team that
discipline and character are the hallmarks he continues to
carry forward with him from that past. I’ve been a lifetime fan
of basketball and, as a New Yorker, was pretty sure I’d never
see a team as well managed and admirable for their team play
as the N.Y. Knicks championship teams from the 1969-70 and
1972-73 seasons.  But I think that last year’s Spurs
championship team surpassed all previous teams.  Their team
was comprised of a bunch of good but not great talents (maybe
one or two former great ones who were past their primes).  It
was their character and commitment to winning as a team that
made them so outstanding a…