Barton Biggs' latest book is an inspirational rags to riches story of drive and financial talent. Told through the eyes of a fictional insider, this engaging story provides a detailed look at the hedge fund business in the late 1990s and through the first decade of the twenty-first century.
A Tale From the Hedge Fund World chronicles the life of a poor boy who ends up amassing more wealth than he ever thought possible. From studying Wall Street charts while sitting on the sidelines of football practice to realizing how so much money can be made in a short period of time, this book provides a bird's eye view of the inner workings of Wall Street and what it takes to make it there.
- Puts the word of hedge funds in perspective and reveals the competitive and lucrative nature of this field
- Other titles by Biggs: Hedgehogging and Wealth, War & Wisdom
- Also describes the bursting of the mortgage bubble and the great financial crisis that followed
No one knows more about the hedge fund world of the past twenty years than Barton Biggs. His new fable offers an entertaining look at this field and those who aspire to excel within it.
Chapter 1 Big Neck, Virginia 5
Chapter 2 Arizona Union 17
Chapter 3 New York and the Firm 33
Chapter 4 Onward and Upward 51
Chapter 5 Crisis and Confrontation 67
Chapter 6 Moving On 91
Chapter 7 Bridgestone 107
Chapter 8 Revenge of the Geeks 123
Chapter 9 Life Its Own Self 143
Chapter 10 The Halcyon Years 159
Chapter 11 Dinner at the Perots 181
Chapter 12 Big Decisions 193
Chapter 13 The Years of Milk and Honey 209
Chapter 14 The High Probability of the Improbable 223
Chapter 15 2008 Annus Horribilis 247
Chapter 16 The Age of Malevolence 279
Chapter 17 The End of the Affair 297
About the Author 319
Hedge funds were the gold rush of the past 20 years and, like all bubbles and manias, ended with a bust that destroyed many of the egomaniacs and most of the latecomers, and even took out some solid citizens. The immense wealth accumulated in a few years by mostly young hedge fund managers—who haven’t hesitated for a moment to spend it ostentatiously and often rudely—has generated great animosity and envy from everyone else. It’s a tale worth exploring, says Biggs, because it is littered with compelling stories of triumph and tragedy—and offers a myriad of cautionary lessons for all of us.
The story traces the career of Joe Hill, an imaginary character whose path from rags to riches to perdition personifies the arc of the lives of so many hedge fund professionals Biggs has known. Growing up in rural Virginia, Hill develops a powerful will to win that accounts for his personal intensity and toughness, but also his loneliness. Struggling to find a career on Wall Street, he takes a modest job at an investment company. After being initiated into the insidious politics and relationships of office life, he quickly discovers that the stresses of high-performance investing require toughness and a thick skin to survive.
When Hill finally makes it to the upper echelon of the hedge-fund world, he finds out that the environment and stress become comparable to an infantry unit in combat or life on a destroyer in the North Atlantic in World War II. Ultimately, Hill loses everything, not just his career but the love of his life as well. He walks away from it all and, physically exhausted as well as demoralized, never returns to the investment world. Profoundly bone-weary and lonely, Hill is still looking for someone or something to come home to. Readers ask themselves whether it was the great financial catastrophe or his excessive reach and grasp that was the cause of his ruination, the randomness of the markets or hubris spawned by greed.
As the narrative unfolds, readers will come to understand:
- The unique character traits successful investment managers must have
- The extraordinary stresses hedge-fund managers must endure and how it affects—and sometimes ruins—their careers and private lives
- Why big institutions are turning to low-volatility, market-neutral strategies
- The challenges hedge funds face now and going into the future
- Where the big investment firms and investors are putting their money
Professional investors, especially hedge fund types, must have more than superb analytical and judgmental skills, tremendous intensity, and a dollop of luck. To survive and be successful, they must also profoundly comprehend that they are going to be vulnerable to and enslaved by extreme mood swings and terribly susceptible to hubris. Both can be mortally dangerous not just to their investment health but also to the well-being of their most intimate life relationships. Joe Hill learns these lessons the hard way.
A Hedge Fund Tale is a modern hedge-fund tragedy: the story of what happens when a good man’s reach exceeds his grasp. As F. Scott Fitzgerald so succinctly put it, “Show me a hero and I will write you a tragedy.”