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The Redemption Deluge Arrives: SAC Bracing For Massive $3.5 Billion In Withdrawals
There is little that has not been said about SAC on these pages in the past 4 years (most recently here). So let's proceed straight to the incremental news:
Breaking: SAC Capital executives are preparing for estimated client withdrawals of $3.5 billion. http://t.co/l2P6Dy8LwX
— Wall Street Journal (@WSJ) June 2, 2013
From the WSJ:
Executives of SAC Capital Advisors LP are bracing for what they have estimated could be $3.5 billion in withdrawals as a quarterly deadline approaches for clients of the hedge-fund giant to ask for their money back, according to people briefed on the matter.
The anticipated withdrawals, which the people described as preliminary estimates that were still in flux going into the weekend, would follow requested withdrawals of $1.7 billion by SAC clients in the first quarter.
If the estimates hold, the outflows would represent more than half of the firm's remaining outside capital and would bring the total amount SAC investors have sought back this year to more than $5 billion. As of mid-May, the firm managed about $5.6 billion in outside money, out of a total of $14 billion in assets, according to details of its operations as described by SAC representatives to clients and others outside the firm.
In other words, the "information arbitrage" powerhouse that was SAC for over two decades, collecting 3 and 50 or so from outside clients, is finished. Going forward it will at best remain as a "family office", managing its own friends and employees' money, however as everyone knows, hedge fund managers make their money not on capital upside (because there is always downside no matter how good PM Ben Bernanke is at offsetting all systemic risk) but on the fees charged from outside clients.
In the meantime, with SAC's regulatory gross leverage of over 3.0x, transforming SAC's net assets of $13 billion into $44 billion in regulatory assets, this means that major unwinds are a-coming.
And as we highlighted last week, assuming pro rata liquidation, here are the stocks that will get hit the first, and the most: SAC's top public equity holdings.
And here, once again purely for entertainment purposes, is cartoonish PR-magnet extraordinaire and straight-to-Netflix Wall Street 2 star, Anthony Scaramucci from December 2012:
I think the entire thing is overblown, that's number one. Two, he's an exceptional investor, he's got a great reputation in the industry. He's a philanthropist and great guy. Number three, since 2008 through 2012 they have the tightest insider trading protocol in the industry. I am an enemy of witch hunts and political witch hunts, it's very unfair and i think the story is overblown and people our country are innocent until proven guilty. He's also let out a statement saying he's in full cooperation with the government.... Skybridge likes to think about things carefully and sometimes be a contrarian.
... Such as "contrarianly" going with those who are about to be shut down. Well, Fund-of-Funds managers may provide absolutely zero value (aside from throwing great Vegas "conferences", of course) but at least their comedy content is unmatched.
Fast forward to 3'40" into the clip:
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mdc their newest postion. Just sayin. $30 comin up
is that bob sacamano's brother...kramers buddy
Philanthropist is Ivy League speak for rapist, right?
time to sell the winners, always the start of a market meltdown.
Dont withdrawals mean liquidations?
What if....what if the money isn't there? What if there isn't $5.9 billion in uh, "segregated client funds" to meet all these redemptions? What if it got Corzined?
Armageddon, that's what. Let 'er rip, baby. It's time for this giant rigged whorehouse to come tumbling down.
financial asses... err assets.
$3.5 large? That's a one day print job for the Fed.
Just saying.
Can't clients just acat the positions without having to liquidate them?
Sadly for me, I don't have enough money to invest in SAC then turn around and ask for a redemption.
You thought you needed to put money in there before you could take it out? That's a common misconception; JP Morgan takes out money they never put in all the time.
Well, glad to see he doesn't own any GLD, or gold stocks.
Philanthropist: one who gives away what he should give back.
More related to Socialism - giving away other people's money to make you feel better about yourself.
The game really is over, seems like it's dragging along though.
don't hate the game
hate the machers
New World Order Out Of Old School Chaos
http://chartistfriendfrompittsburgh.blogspot.com/2013/06/new-world-order-out-of-old-school-chaos.html
Have you EVER posted a comment here without a link to your blog?
Just curious.
What to worry about, they are queuing up to pick up this fine stuff.
To allow such an unwind in this fragile economy would be irresponsible.
Because we wish to do the responsible thing and in the best interest of all parties a orderly transfer will be arrange such the sac will receive market value+ and jpm will pay market value-. Thank goodness we have Jim deamon on our side.
LOL, assholes like Scaramucci defending the indefensible.
I'd love to see these guys lose it all.
'[In the Congressional Record] I have encountered in its dense and pregnant columns denunciations of almost every human act or idea that is imaginable to political pathology, from adultery to Zionism, and of all classes of men whose crimes the legislative mind can grasp, from atheists to Zoroastrians, but never once, so far as I can recall, has that great journal shown the slightest insolence, direct or indirect, to the humble husbandman, the lonely companion of Bos taurus, the sweating and persecuted farmer.
'He is, on the contrary, the pet above all other pets, the enchantment and delight, the saint and archangel of all the unearthly Sganarelles and Scaramuccis who roar in the two houses of Congress. He is more to them day in and day out, than whole herds of Honest Workingmen, Gallant Jack Tars and Heroic Miners; he is more, even, than a platoon of Unknown Soldiers….'
http://unambig.com/tag/h-l-mencken/
That made sense after reading the link.
Daaaaamn Son! Mencken keepin it RAHHHL up in dem halls of Congress.
Little angry are we HL? LOL quite the rant. :-D
I feel better, for a minute there I thought it was BAC
'ello Will. If I caught that fish I would definately throw it back as being inedible and downright fugly. Prolly would stomp on it first before tossing it back in the water.
If I caught that fish, I would give up fishing.
I would love to see Stevie Cohen converted to chum. What a douchebag criminal like Krugman.
Damien Hirst.
Clever. Just retro enough to touch this crowd, but clever.
They'll shit bricks once they see the $100 mil price tag on "For the Love of God"
This article is not only entertaining, its invigorating.
Hope they all put their money in GOLD
Wow - look at all the great choices these brilliant minds made in their selection of equities. I am humbled before such genius. Sirius. Transocean. Ross. On and on. Worth every penny of the management fees they've been paid over the years.
I take it that we can short all of these stocks with impunity...(sarc on)
Insider trading is illegal?
"Depends on what your definition of is is"
-Bill Clinton
>> "Depends on what your definition of is is"
I was ok with that the first few hundred times I saw it posted. Sometimes lurking is a better choice than reguritating up tired schtick that has no relevance to the subject at hand.
How's this?
"Eat a dick"
-BoNeSxxx
Does that qualify as the "sexual relations" that was not had with that woman?
only if you are caught.
Dear gentlemen,
So where is SAC invested? Which shares are going down?
Wasn't it Scaramouche by Raphael Sabbatini who repeated, "Regret is the worst hell a living soul can inhabit."? There's plenty of time for him to read history and remember that it as rude and ignorant as if he had an ice Mt. Rushmore sculture dripping with jumbo shrimps to step on the SALT talks with USSR with his forgettable free money junket.
"once again purely for entertainment purposes, is cartoonish PR-magnet extraordinaire, Anthony Scaramucci..."
Any relation to Bob Sacamano ?
SAC : Strongly Anti Cashing
SAC : Selling Against Conviction
SAC : Start Attacking Collateral
Scaramucci
wasn't he a villan in a Bond movie
ZHers fave- The Man w/ the GOLDEN Gun.
Haha yeah the one with the infamous "Dramatic Revealing of Male Third Nipple" moment
Scaramanga but close enough. This friend of douchebag Cohen was not even in a good Bond film.
You beat me to it. Maybe I should update comments more often?
Scaramucci, Scaramucci will you do the fandango....
[my apologies to Queen fans]
Scaramanga if I remember rightly. Close enough. (You know you're lazy when you can't be bothered googling to check.)
Don't worry asshole- the witch hunts will be child's play compared to what's coming up for douchebags like you.
The SAC is right next to the 'TAINT...
Mr. Cohen, huh? hmmmm....
The only redemption I am interested in is when the government finally begins to arrest these arch-criminals. Providing some justice would be the sweetest redemption.
Then for your sake I hope you are approx. 5 years old, becuase it's going to be another 75 before we even entertain the thought of any justice being served to those fucks. By that time you may be a group leader at club feMa
The squid will be more than happy to nibble on whale bits.
You really don’t even need to play the video. The still shot of Kate Kelly’s face says it all about Stevie (the Don) Cohen and his hit parade man Anthony Scaramucci.
As long as Anthony is being all truthy I wish he would tell us which dealership he used to sell cars for. The guy is a natural.
Maybe Anthony could also tell us how and how much of that 3 & 50 that Stevie charges gets kicked back to Anthony when he puts his clients into Stevies fund.
Hotwax anyone? Pehaps a discount on some undercoating?
He's a philanthropist and great guy
(Nint: Ban gun sales to him. He is a danger to himself and others.)
They will sync their liquidation schedule to the POMO schedule.
Everybody knows clowns with cash don't go to jail.
With 3x leverage only a clown can get, the liquidations should be roughly 3x in each name. Juicy article, thanks ZH!
I made a point of buying some good "Hefeweisen" and a case of 'Kettle Corn', for the(upcoming) SAC>congressional hearings.
.Gov needs some moar 'cannon fodder' to quell the "Summer Riot Season".
Don't forget the slice of lemon (not orange). I'm having one as I write!
So Anthony...are you or are you not redeeming money from SAC?
This is a non-story. It's 10% of assets, the majortiy of the balance is Steve's and other employees. He'll turn it into a family office and tell outside money to F off.
This is a non-story. It's 10% of assets, the majortiy of the balance is Steve's and other employees. He'll turn it into a family office and tell outside money to F off.
WHAT??? GNC but no GM, or Texas Instruments, or Alcoa? Recovery!!!!!
What's "Massive" about 3.5 billion bucks? The FED puts that in the market every single day the market is open! And the FED doesn't even have that 3.5 bil.
Look at the true story Tyler.SAC screwed the wrong guy with their naked short selling schemes and he was brave enough to stand up to the thieves years ago and started the ball rolling.Patrick woke up one morning and saw that the regulators were letting his stock trade these huge volumes daily that dwarfed the outstanding share count. He's a respectable person named Parick Byrne of OverStock.com "ya won't mess this bro no more SAC"
...aaaaaaand stock futures are up on the news.
Next...the rest.
And jail time, like Madoff.
Corzine gets to run a family office because he knows too much about political crimes. SAC...not so much, probably. Greed only pays most for those with tight political connections, ain't that right, Jamie Demon?
They lost 92M in Ebay. After being fee'd to near bankruptcy, it's nice to see someone else lose money in ebay.
Sounds like history is starting to repeat itself (or at least rhyme)
I knew Stevie was done when he bought that torn painting of Steve Wynn's. Le Rip. Where's Banachek when we need him? He would have never paid that claim... he's in "restorations."
http://www.youtube.com/watch?v=g0JFQDmlVME