Archive - May 16, 2009

Much speculation lately focuses not so much on what the stock market will do (the answer to that should be self-evident, especially once shorting stocks again becomes a practical reality), but what the impact of recent economic policies will be not just on inflation (regional or global), but also on that most sacrosanct piece of paper, the U.S. dollar.

Much speculation lately focuses not so much on what the stock market will do (the answer to that should be self-evident, especially once shorting stocks again becomes a practical reality), but what the impact of recent economic policies will be not just on inflation (regional or global), but also on that most sacrosanct piece of paper, the U.S. dollar.

Troubled RenTec, which not only made WSJ last night, but also CNBC today, may not have to suffer much longer. Based on information Zero Hedge has received, the assets at Jim Simons' investor-open, RIEF fund, have plummetted over the past 3 years. The fund which was started as one with up to $100 billion in potential capital, is a mere shadow of its once fabled self.

Below are the AUM for RIEF at various points in time. Continuing the trendline implies some very troubling lack of capital in the not too distant future.

Troubled RenTec, which not only made WSJ last night, but also CNBC today, may not have to suffer much longer. Based on information Zero Hedge has received, the assets at Jim Simons' investor-open, RIEF fund, have plummetted over the past 3 years. The fund which was started as one with up to $100 billion in potential capital, is a mere shadow of its once fabled self.

Below are the AUM for RIEF at various points in time. Continuing the trendline implies some very troubling lack of capital in the not too distant future.

The charts below demonstrate unmistakably just how phenomenally bipolar the market has become, and just how aggressively asset managers are chasing after risky assets in order to make up for 2008 losses. Alas, nobody has learned any lessons from the credit bubble where fast, slow, dumb and smart money was all chasing the riskiest assets, all of which ended in tears for far too many people. The result so far for 2009: exactly the same pattern is repeating itself.