John Paulson

[winston]

Paulson & Co. Buys Gold-Mining Shares, Adds to Bank of America By Kelly Bit

Nov. 14 (Bloomberg) -- John Paulson, the billionaire hedge-fund manager having the worst year of his career, bought shares of Bank of America Corp. and gold miners including Randgold Resources Ltd. and Agnico-Eagle Mines Ltd. in the third quarter.

Paulson, 55, has been betting on an economic recovery by the end of 2012 and lost money this year on investments including Bank of America, Citigroup, and Sino-Forest Corp.

Money managers who oversee more than $100 million in equities must file a Form 13F within 45 days of each quarter’s end to list their U.S.-traded stocks, options and convertible bonds.

The filings don’t show non-U.S. securities or how much cash the firms hold.

Paulson’s Advantage Plus Fund, which tries to profit from corporate events such as takeovers and bankruptcies, rebounded 2.4 percent in October, leaving it down 44 percent this year.

Source: Bloomberg

[winston]

Paulson Said to Cut Risk in Main Hedge Funds
By Kelly Bit

The New York-based firm, which has $28 billion in assets, has cut the so-called net exposure in its main hedge funds to 30 percent, Paulson told investors on Nov. 14, according to the people, who asked not to be identified because the company is private. That number stood at 60 percent about four months ago.

The firm is reducing its bullish bets across all funds until there is more certainty that Europe can contain its debt crisis, Paulson said at the Metropolitan Museum of Art in New York, part of a two-day annual meeting for investors.

Paulson’s biggest funds, Advantage Plus and Advantage, which have $11 billion in combined assets and aim to profit from corporate events such as takeovers and bankruptcies, fell 44 percent and 29 percent this year through October, respectively.

His Recovery Fund, which invests in assets Paulson believes will benefit from a long-term economic upturn, slumped 25 percent in 2011.

Paulson said on a conference call with investors in July that he had cut bullish investments to 60 percent from 81 percent and may pare risk further.

Paulson, 55, has been betting on an economic recovery by the end of 2012, fueling his bullishness on U.S. banking stocks that contributed to this year’s losses.

Citigroup Inc., Paulson’s fifth-largest stock holding in the third quarter, according to data compiled by Bloomberg, fell 41 percent this year through yesterday.

Bank of America Corp., the firm’s 12th-largest stock position, slumped 54 percent in 2011. Paulson added 3.88 million shares of Charlotte, North Carolina- based Bank of America last quarter.

The firm received less than 8 percent in year-end redemption requests for all its funds by the end of last month, which means withdrawal orders totaled about $2 billion.

Clients were permitted to pull a maximum of 25 percent of assets, or about $7 billion. Paulson and his employees account for about half of the firm’s capital.

Hedge funds declined 2.9 percent this year through Oct. 31, based on Bloomberg’s aggregate index, as global stocks tumbled amid a worsening European debt crisis and the threat of a U.S. recession.

http://www.bloomberg.com/news/2011-11-1 ... risis.html

[winston]

Paulson funds down again in December: source By Katya Wachtel

NEW YORK (Reuters) - There will be no holiday cheer for hedge fund manager John Paulson this month, as his dismal performance in 2011, is capped off by another miserable performance so far in December.

The Paulson & Co.'s Advantage Plus fund, which has been the firm's worst performer all year, is down another 9 percent through December 16, sending yearly losses to about 52 percent, according to a person familiar with the numbers.

The Paulson Advantage fund, the firm's largest portfolio, is also hurting again this month, declining about 6 percent. The fund is down about 36 percent year-to-date.

The Standard and Poor's 500 stock index has been flat so far in December.

A spokesman for Paulson & Co. declined to comment.

For Paulson, one of the $2 trillion dollar hedge fund industry's biggest stars, 2011 has been a year in which nothing has seemed to work.

His funds have suffered badly from big bets on Bank of America (BAC.N), Hewlett Packard (HPQ.N) and Hartford Financial Services (HIG.N) and Sino-Forest (TRE.TO).

Those losses were compounded by unfulfilled predictions by the billionaire hedge fund manager, that the U.S. economy would experience a recovery this year.

Instead, the economy has stagnated, and global markets have whipsawed as the European sovereign debt crisis worsened through the second half of the year.

The average hedge fund was down about 4.37 percent through November, according to Hedge Fund Research's broadest industry index.

Meanwhile, the gold fund that earned Paulson billions in 2010, is off about 7 percent for the year, according to an investor. The once safe-haven commodity has slumped 18 percent since September, when it hit $1,920 an ounce.

At the end of the third quarter, Paulson was the largest shareholder of the SPDR Gold Trust (GLD.P) exchange-traded fund with about 20 million shares, according to quarterly regulatory filing.

http://www.reuters.com/article/2011/12/ ... inessearly

[iam802]

John Paulson Says Greece May Default, Spurring Euro Breakup

http://www.bloomberg.com/news/2012-02-1 ... ravel.html

Paulson & Co., the $23 billion hedge fund whose founder John Paulson is seeking to recover from record losses last year, said Greece may default by the end of March, triggering the breakup of the euro.

Greece may need an unprecedented 90 billion euros ($117 billion) to meet funding requirements under the anticipated agreement on private sector involvement, the recapitalization of the banks and other funding needs, Paulson estimated in a year- end letter sent to clients this month.

“We believe a Greek payment default could be a greater shock to the system than Lehman’s failure, immediately causing global economies to contract and markets to decline,” the hedge fund said in the letter, a copy of which was obtained by Bloomberg News. The euro is “structurally flawed and will likely eventually unravel,” it said.

Two years after pledging to pull Greece back from the brink, European leaders are torn between pouring more aid into the country or risking an unprecedented national bankruptcy that might force the nation out of the euro and spur renewed market turmoil.

“It seems likely that the pressure to keep the euro together becomes too great and it ultimately falls apart,” Paulson said in the 100-page letter. The firm said its biggest concern are European banks, which have borrowed more than their U.S. counterparts and don’t have enough equity to withstand a credit crisis.

‘Biggest Disappointment’

Paulson, who became a billionaire in 2007 by betting against the U.S. subprime mortgage market, lost 51 percent in one of his largest funds last year as his wagers on a U.S. economic recovery went awry. He sold his entire stakes in Citigroup Inc. and Bank of America Corp. last quarter before the shares rallied this year.

“Bank of America has been the biggest disappointment in our banking portfolio,” Paulson said.

The holdings, which he began aggressively building in 2009, were among his largest last year.

“While we have seen a reasonable recovery in the U.S. with leading indicators in early 2012 trending positive and equity valuations well below historical norms, the European sovereign debt crisis remains the overriding risk in the markets,” the hedge fund said.

As a result, Paulson said it cut its so-called net exposure in its Advantage funds, which are among the firm’s largest, to 32 percent as of Jan. 31 from 82 percent at the start of last year. Those funds seek to profit from corporate events such as takeovers and bankruptcies.

Demand for Gold

Armel Leslie, a spokesman for New York-based Paulson, declined to comment on the letter.

The hedge fund reiterated its view that government spending around the world will fan inflation, supporting demand for gold and that now is the time to invest in the metal.

“By the time inflation becomes evident, gold will probably have moved, which implies that now is the time to build a position in gold,” the hedge fund said, adding that it expects the price differences between bullion and gold miners to narrow this year.

Paulson said it expects continued market volatility and the European debt crisis to affect merger activity in 2012. The firm said it still sees opportunities for investment gains in Motorola Mobility Holdings Inc., which Google Inc. is planning to acquire, as well as AMC Networks Inc., Ralcorp Holdings Inc. (RAH) and Delphi Automotive Plc.

M&A Outlook

Paulson started 2011 expecting an increase in mergers and acquisitions, a position that cost the Paulson Partners Enhanced Fund, which invests in shares of merging companies and lost 19 percent last year. Heightened price swings affected the firm’s positions in takeover targets, Paulson said.

Paulson partners’ capital in the firm’s credit funds climbed to 69 percent at the end of last year from 57 percent at the end of 2010, while the portion of outside investor money dwindled after the Credit Opportunities Fund fell 18 percent in 2011. Paulson reduced its credit exposure, which includes investment-grade corporate bonds, high-yield and distressed securities, because risks related to the European debt crisis remain, the firm said.

[iam802]

John Paulson Sued Over Sino-Forest Investment

http://blogs.wsj.com/deals/2012/02/21/j ... od=WSJBlog

[kennynah]

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[winston]

PAULSON GOES SHORT ON GERMAN BUNDS

John Paulson, the billionaire hedge fund manager who foresaw the collapse of the US housing market, is shorting German government bonds in a wager that the eurozone debt crisis will significantly deepen in the coming months.

Many Paulson & Co clients were rattled last year by steep losses across Mr Paulson's range of funds. His flagship Advantage plus fund dropped 51 per cent in value, wiping out billions of investors' money.

http://edition.cnn.com/2012/04/18/busin ... index.html

[winston]

Paulson Funds Fell in June as Rally Undercut Euro Wager By Kelly Bit

John Paulson, the billionaire hedge- fund manager seeking to reverse record losses in 2011, is digging himself into a deeper hole with a bet that Europe is facing a financial crisis.

The $22 billion firm had losses in all its funds last month as stock markets rose. The losses were led by a 7.9 percent drop in his Advantage Plus Fund, according to an update to investors obtained by Bloomberg News. That leaves the fund, which seeks to profit from corporate events such as takeovers and bankruptcies and uses leverage to amplify returns, down 16 percent this year.

Paulson, 56, who became a billionaire by betting against the U.S. subprime mortgage market, told investors in April that he was shorting European sovereign bonds and buying credit- default swaps on the region’s debt, or protection against the chance of default. In February he said the euro is “structurally flawed,” and will eventually fall apart.

“The risk of a European financial crisis is the largest risk in the market,” Paulson told investors in a letter dated yesterday, in which he said hedges and short sales caused the losses. “Our funds are positioned to protect capital when market gyrations produce drawdowns.”

Paulson relayed his concerns about the European debt crisis to investors this year after losing 51 percent in 2011 in his Advantage Plus fund, which was driven by an ill-timed bet on a U.S. economic recovery. The gold-share class of the fund declined 6.6 percent in June and 14 percent this year.

http://www.bloomberg.com/news/2012-07-0 ... wager.html

[iam802]

Paulson betting on housing recovery.

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Paulson Said To Buy 875 Acres Of Land In Las Vegas Area

http://www.bloomberg.com/news/2012-08-0 ... -area.html

Paulson & Co., the hedge fund run by billionaire John Paulson, purchased more than 875 acres of land in a resort community in the Las Vegas area, a bet on a housing recovery in the region as the supply of homes shrinks.

The $17 million purchase at Lake Las Vegas in Henderson, Nevada, was made through the Paulson Real Estate Recovery Fund, which seeks to build houses on raw land and resell the properties to homebuilders, said a person with knowledge of the deal. The fund bought the majority of what remains undeveloped at the 3,600-acre (1,456-hectare) site, said the person, who asked not to be named because the details were private.


The deal was among the largest land purchases in the area in at least three years, according to Greg Gross, director of the Nevada region for Metrostudy, a Houston-based firm that tracks new construction. The Las Vegas area has fewer than 13,000 vacant lots for homebuilding, a small portion of which are for sale, he said. Inventories of available properties also have declined in the past year as foreclosures in Nevada slid.

“Paulson & Co. was prompted to invest heavily in the Las Vegas market because the supply of new housing is rapidly receding and few new projects are being planned in the Henderson area,” Gross said.
Armel Leslie, a spokesman for New York-based Paulson & Co., declined to comment.

Home Inventory

At the end of July, there were 16,944 single-family homes listed for sale in the Las Vegas area, a 25 percent decline from a year earlier, the Greater Las Vegas Association of Realtors said today. The median price of a single-family property was $133,000, up 9 percent from July 2011.

Foreclosures in Nevada plunged in the past year after the state passed a law making it a crime to wrongfully seize a property from a delinquent borrower. In the Las Vegas area, the number of homes with foreclosure filings fell 61 percent in the first half of 2012 from a year earlier, according to Irvine, California-based data provider RealtyTrac Inc.

The master developer of Lake Las Vegas filed for bankruptcy in 2008, saying it had debt of as much as $1 billion and $500 million in assets. It won approval of an exit plan in 2010 that raised money for creditors, in part with plans to sue the company’s former investors, including billionaire brothers Sid and Lee Bass.

Hotels, Casino

The master-planned community, about 17 miles (27 kilometers) from the Las Vegas Strip, is centered around a 320- acre man-made lake. It has two hotels, a casino, a golf course, stores and restaurants, and 1,800 townhomes and condominiums, said Robyn Yates, broker and owner of Windermere Prestige Properties at Lake Las Vegas. Paulson purchased land on the north shore of the lake that was known as Rainbow Canyon, she said.

“What it means is that somebody with a lot of money believes in the community,” Yates said.

John Paulson, who became a billionaire in 2007 by betting against the U.S. subprime mortgage market, has in the past few years been buying real estate directly or through his funds. His holdings include properties in Nevada, Colorado, Arizona, California, Florida and Hawaii.

[winston]

Billionaire John Paulson is "doubling down" big on gold

Billionaire John Paulson raised his stake in an exchange-traded fund tracking the price of gold, while selling other stocks during the second quarter, leaving his $21 billion hedge fund with more than 44 percent of its U.S. traded equities tied to bullion.

Paulson & Co. purchased an additional 4.53 million shares of the SPDR Gold Trust, the firm's largest position, and bought more shares of NovaGold Resources Inc. (NG), according to a Form 13F filed yesterday with the U.S. Securities and Exchange Commission.

Source: Bloomberg