Hedge fund managers; good-bye and good luck.

Economic crisis? Heard about it? Well, this is straight from the horses mouth.

Oh, and BTW. Thanks for leaving.

Andrew Lahde, a hedge fund manager who made a whopping 866% increase on ‘his’ investments, betting against the subprime crisis, cashed out recently. His final words…

Today I write not to gloat. Given the pain that nearly everyone is
experiencing, that would be entirely inappropriate. Nor am I writing
to make further predictions, as most of my forecasts in previous
letters have unfolded or are in the process of unfolding. Instead, I
am writing to say goodbye.

Recently, on the front page of Section C of the Wall Street
Journal, a hedge fund manager who was also closing up shop (a $300
million fund), was quoted as saying, “What I have learned about the
hedge fund business is that I hate it.” I could not agree more with
that statement. I was in this game for the money. The low hanging
fruit, i.e. idiots whose parents paid for prep school, Yale, and then
the Harvard MBA, was there for the taking. These people who were
(often) truly not worthy of the education they received (or supposedly
received) rose to the top of companies such as AIG, Bear Stearns and
Lehman Brothers and all levels of our government. All of this behavior
supporting the Aristocracy, only ended up making it easier for me to
find people stupid enough to take the other side of my trades. God
bless America.

There are far too many people for me to sincerely thank for my
success. However, I do not want to sound like a Hollywood actor
accepting an award. The money was reward enough. Furthermore, the
endless list those deserving thanks know who they are.

I will no longer manage money for other people or institutions. I
have enough of my own wealth to manage. Some people, who think they
have arrived at a reasonable estimate of my net worth, might be
surprised that I would call it quits with such a small war chest. That
is fine; I am content with my rewards. Moreover, I will let others try
to amass nine, ten or eleven figure net worths. Meanwhile, their lives
suck. Appointments back to back, booked solid for the next three
months, they look forward to their two week vacation in January during
which they will likely be glued to their Blackberries or other such
devices. What is the point? They will all be forgotten in fifty years
anyway. Steve Balmer, Steven Cohen, and Larry Ellison will all be
forgotten. I do not understand the legacy thing. Nearly everyone will
be forgotten. Give up on leaving your mark. Throw the Blackberry away
and enjoy life.

So this is it. With all due respect, I am dropping out. Please do
not expect any type of reply to emails or voicemails within normal
time frames or at all. Andy Springer and his company will be handling
the dissolution of the fund. And don’t worry about my employees, they
were always employed by Mr. Springer’s company and only one (who has
been well-rewarded) will lose his job.

I have no interest in any deals in which anyone would like me to
participate. I truly do not have a strong opinion about any market
right now, other than to say that things will continue to get worse
for some time, probably years. I am content sitting on the sidelines
and waiting. After all, sitting and waiting is how we made money from
the subprime debacle. I now have time to repair my health, which was
destroyed by the stress I layered onto myself over the past two years,
as well as my entire life — where I had to compete for spaces in
universities and graduate schools, jobs and assets under management –
with those who had all the advantages (rich parents) that I did not.
May meritocracy be part of a new form of government, which needs to be
established.

On the issue of the U.S. Government, I would like to make a modest
proposal. First, I point out the obvious flaws, whereby legislation
was repeatedly brought forth to Congress over the past eight years,
which would have reigned in the predatory lending practices of now
mostly defunct institutions. These institutions regularly filled the
coffers of both parties in return for voting down all of this
legislation designed to protect the common citizen. This is an
outrage, yet no one seems to know or care about it. Since Thomas
Jefferson and Adam Smith passed, I would argue that there has been a
dearth of worthy philosophers in this country, at least ones focused
on improving government. Capitalism worked for two hundred years, but
times change, and systems become corrupt. George Soros, a man of
staggering wealth, has stated that he would like to be remembered as a
philosopher. My suggestion is that this great man start and sponsor a
forum for great minds to come together to create a new system of
government that truly represents the common man’s interest, while at
the same time creating rewards great enough to attract the best and
brightest minds to serve in government roles without having to rely on
corruption to further their interests or lifestyles. This forum could
be similar to the one used to create the operating system, Linux,
which competes with Microsoft’s near monopoly. I believe there is an
answer, but for now the system is clearly broken.

Lastly, while I still have an audience, I would like to bring
attention to an alternative food and energy source. You won’t see it
included in BP’s, “Feel good. We are working on sustainable
solutions,” television commercials, nor is it mentioned in ADM’s
similar commercials. But hemp has been used for at least 5,000 years
for cloth and food, as well as just about everything that is produced
from petroleum products. Hemp is not marijuana and vice versa. Hemp is
the male plant and it grows like a weed, hence the slang term. The
original American flag was made of hemp fiber and our Constitution was
printed on paper made of hemp. It was used as recently as World War II
by the U.S. Government, and then promptly made illegal after the war
was won. At a time when rhetoric is flying about becoming more
self-sufficient in terms of energy, why is it illegal to grow this
plant in this country? Ah, the female. The evil female plant –
marijuana. It gets you high, it makes you laugh, it does not produce a
hangover. Unlike alcohol, it does not result in bar fights or wife
beating. So, why is this innocuous plant illegal? Is it a gateway
drug? No, that would be alcohol, which is so heavily advertised in
this country. My only conclusion as to why it is illegal, is that
Corporate America, which owns Congress, would rather sell you Paxil,
Zoloft, Xanax and other additive drugs, than allow you to grow a plant
in your home without some of the profits going into their coffers.
This policy is ludicrous. It has surely contributed to our dependency
on foreign energy sources. Our policies have other countries literally
laughing at our stupidity, most notably Canada, as well as several
European nations (both Eastern and Western). You would not know this
by paying attention to U.S. media sources though, as they tend not to
elaborate on who is laughing at the United States this week. Please
people, let’s stop the rhetoric and start thinking about how we can
truly become self-sufficient.

With that I say good-bye and good luck.

All the best,

Andrew Lahde

(Thanks Rafe)