The greatest trade ever
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The Greatest Trade Ever
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Here are the instructions to help you enable JavaScript in your web browser. In , hedge fund manager John Paulson realized something few others suspected — that the housing market and the value of subprime mortgages were grossly inflated and headed for a fall.
Paulson, who knew mergers and acquisitions, knew little about real estate or how to wager against housing. But Paulson saw an opportunity to bet against the market in complicated derivative investments. Colleagues at investment banks scoffed at him and investors dismissed him. Even professionals skeptical about the housing market shied away from him. But Paulson, obstinate, bet heavily against risky mortgages and precarious financial companies anyway.
Of course, timing is everything. And, although Paulson lost tens of millions of dollars as real estate and stocks continued to soar, he redoubled his bet, putting his hedge fund on the line. Then, the markets imploded in the summer of , and Paulson saw profits. Subscribe Sign In. Continue reading your article with a HFLR subscription.
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The Greatest Trade Ever: The Behind-the-Scenes Story of How John Paulson Defied Wall Street and Made Financial History [Zuckerman, Gregory] on. The Greatest Trade Ever: The Behind-the-Scenes Story of How John Paulson Defied Wall Street and Made Financial History - Kindle edition by Zuckerman.
Look Inside. Nov 03, Minutes Buy. In , hedge fund manager John Paulson realized something few others suspected—that the housing market and the value of subprime mortgages were grossly inflated and headed for a major fall.
This book really made me stop and think about the financial industry in more depth. At times breath taking in its idolizing of greed, and the way the US crisis became a global crisis, the author spins
He had spent a career as an also-ran on Wall Street. But Paulson was convinced this was his chance to make his mark.
Paulson's background was in mergers and acquisitions, however, and he knew little about real estate or how to wager against housing. He had spent a career as an also-ran on Wall Street. But Paulson was convinced this was his chance to make his mark. He just wasn't sure how to do it. Colleagues at investment banks scoffed at him and investors dismissed him. Even pros skeptical about housing shied away from the complicated derivative investments that Paulson was just learning about.
Do we really need to hear another retelling of the events that led to the collapse that may have dimmed the career prospects of an entire generation of Americans? For the sake of America's young people, I think the answer is "yes". Zuckerman's explanation of the events that led up to the Collapse of ? The Federal Reserve Bank, anxious to prevent a recession, set real interest rates at historic lows 1 percent nominal in mid, which meant a negative real interest rate for a bank. This created the germ of the housing bubble. The bubble's growth was sustained by Wall Street's compensation structure, in which employees were able to earn billions of dollars in take-home pay by exposing their shareholders to trillions of dollars in risk. Everyone on Wall Street enjoyed wonderful annual paydays while investors were exposed to risks that ensured that they'd be wiped out eventually. Houses are a bit cheaper than they were in
The book investigates the reasons and consequences of the subprime mortgage crisis and the role that hedge fund manager John Paulson played in those events.
T he mania that gripped investors in the wild bubble years of the 00s is widely portrayed as a universal affliction, but in fact a few stubborn souls refused to succumb. This book tells the story of one such refusenik, hedge fund manager John Paulson , who was not only sceptical about the health of the over-inflated US housing market, but bet against it — and won. The scale of Paulson's big bet, "the greatest trade ever", as Greg Zuckerman describes it, was extraordinary.
Written as a heartwarming contemporary parable, this book points you beyond worn-out fads and flavor-of-the-month management techniques to the strategies that will make you a truly outstanding leader. Find inspiration and a fresh perspective on the art of leadership in this account of a cub reporter who lands the interview of a lifetime and walks away with the keys to exceptional leadership. When the reporter meets with the most respected CEO in America, the businessman shares the seven secrets he learned long ago from his mentor--an eccentric but brilliant professor who taught him proven management principles that, while ancient in origin, are applicable in today's fast-paced, high-tech world. Through this charming story dotted with humor, you'll learn how to infuse work with meaning and how to engage, energize, and ignite their workforce by using these same secrets, which include:. It will teach you how to lead the people close to you so they will view their work as a calling rather than merely a job, a place to belong rather than a place to work. It is a powerful metaphor for leaders that reaches back 5, years. It is. The Way of the Shepherd. The groundbreaking follow-up to the international bestsellera hands-on guide to putting McKinsey techniques to work in your organization. While the first book used case studies and anecdotes from former and current McKinseyites to describe how "the firm" solves the thorniest business problems of their A-list clients, The McKinsey Mind goes a giant step further. It explains, step-by-step, how to use McKinsey tools, techniques and strategies to solve an array of core business problems and to make any business venture more successful. Designed to work as a stand-alone guide or together with The McKinsey Way, The McKinsey Mind follows the same critically acclaimed style and format as its predecessor. In this book authors Rasiel and Friga expand upon the lessons found in The McKinsey Way with real-world examples, parables, and easy-to-do exercises designed to get readers up and running.
The bets took his hedge fund from relative obscurity to household name, earning himself and his investors windfall profits. Paulson was left with a lot of options after he analyzed the housing market and decided that credit standards were too loose. He could go short any number of different quality bonds — from subprime the lowest quality to prime the highest quality. At the time, there were a lot of cracks in the prime market, with individuals getting mortgages that they never should have qualified for. However, instead of fighting that fight and waiting for defaults on higher-rated bonds, Paulson knew that the first cracks would appear in the weakest market. So he went short subprime mortgage bonds.
