Real Talk on Dry Powder, Private Capital, Barack Obama, and the New Nigerian Prince

Nov 1 2017 | 1:55pm ET

 On Wednesday, we discuss statements at the SuperReturn Private Credit event in Chicago, the comedy stylings of a former U.S. president, and the greatest spam email to hit our inbox in years. 

Quotes of the Day 

“Now, this isn’t where I was born, I was born in Kenya… That’s a joke.”

That’s former President Obama doing his standup tour.

The latest stop was at the Foundation Summit in Chicago, where Obama began his career as a community organizer in the 1980s.

Give it a week.

Amy Schumer will steal this line and claim it is a coincidence.

“We just turned positive for the year, which is progress.” 

That’s Bill Ackman.

After back-to-back double-digit losses in 2015 and 2016, Pershing Square is now more than 20% off its bottom. Overall the firm last $4 billion – or the GDP of Sierra Leone – on Valeant.

Ackman has been very forthright about the underperformance and mistake of being a passive investor in Valeant. Be sure to read his comments at SALT 2017 regarding the lesson learned.

“I think you should feel very pleased if he is picked by Trump to be the head of the Federal Reserve.” 

That’s Neal Wilson, co-founder and COO of EJF Capital.

Wilson gave the first talk during a discussion at the SuperReturn Private Credit event in Chicago. He then took part in a panel on the macro-economic outlook for the global economy with Mark Affolter of Ares Capital, Hans-Jörg Baumann at Stepstone, and Theodore Koenig of Monroe Capital.

Finalternatives is in attendance at the Four Seasons in Chicago. As the first two sessions wrap up at lunch time, two speakers really have stood out. First is Wilson, who really hit the nail on the head when it comes to explaining the major factors that will drive small-bank consolidation in the future. At an event centered around private capital investment, there is always optimism and talk about opportunity and one’s strategies.

But Wilson left viewers of The macro/economic outlook – what is on the horizon?” panel with a strong parting shot on global risk. He argued that the U.S. banking sector is very well capitalized. He worried, however, that the next fiscal shock will come from outside the United States, and mentioned Italy’s ongoing financial condition as a source of potential risk.

The next talk that really a strong industry perspective came from Ryan Flanders at Preqin. Flanders is the Head of Private Debt Products. Flanders did a very strong job at separating the numbers to explain just how much dry powder continues to grow in the space.

Finalternatives will get a copy of his presentation and dig into the numbers later this week. Overall, there is a lot of money looking for a home. Perhaps that is why his five minute chat on actual deployment and its timing was the highlight of the presentation.

Stay tuned.

“Is this a thing that people are sending out now?”

That’s Finalternatives publisher Jeff Joseph in a phone call to your humble editor on Wednesday morning.

Jeff received the following email yesterday afternoon.

The subject line is “Help me make a difference.”

Is this a real thing or have Nigerian Prince scam just taken on a whole new level? You'll know right away, as the letter has not been edited.

From: Bernie L Madoff [mailto:]
Sent: Monday, October 30, 2017 4:20 PM
Subject: Help Me Make a Difference

Hello Dear

I am Bernie Madoff the founder of wall street firm Bernard L. Madoff
investment securities LLC in 1960 and was the former chairman of NASDAQ. I
was accused of fraud worth over $65 billion dollars and was arrested on
Dec 11,2008 and on march 12,2009. I pleaded guilty to 11 federal crimes and
admitted to operated the largest ponzi scheme in history, I am currently
in Butner federal prison outside Durham, North Carolina, serving a
150-year sentence, I regret a lot of my mistakes and I want to make amends
with the remaining days i have left, giving the people back what I stole
from them.

Let me not go into many details. I have Millions of Euros in offshore
financial house, This money nobody knows about it except my bank officers
because the money was deposited under serial codes. I need your help right
now not only to reinvest the money.50% will go to charity and 20% will be
mapped out for the promotion of gospel and building of churches and
mosques all over the world and 25% for you while 4% goes to the bank
officials who will help you facilitate the transaction and 1% for my up
keeping in the prison and I know that I will die soon because of my heart
attack and kidney cancer. Ruth my wife will not come and visit or talk to
me my two sons, Mark committed suicide in 2010, and Andrew died of cancer
in 2014. I want to die knowing that i have touch life and make a
difference please I want this business to be completed as soon as

Kind respect
Bernie Madoff


Hedge Fund and Private Equity Reading List

Finalternatives is tied up at the conference, so there is no homework today. 

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Garrett Baldwin is the voice of the The Daily Alpha, the features editor for Modern Trader magazine, and the author of The Man with The Big Red Balloon.

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