Reuters reports this morning that the total assets of Amaranth were around $2.78 billion at the end of September, which probably means the numbers are even lower this morning. Presumably Amaranth, which has announced its plans to liquidate, continues to sell assets and honor investor redemption notices.
It's probably a good sign that assets are still as high as they are and that Amaranth continues to employ as many people as it does. It shows that Amaranth is not exactly conducting a fire-sale. Rather, they seem to be actually trying to have an orderly wind-down, salvaging some value for investors through asset sales.
At least that was our argument to a friend in the investment community last night. He disagreed. His position was that Amaranth should get rid of everything and everyone right now and get its investors back all their money now.
"If I had money in Amaranth, I'd want it out now. I can make more with my money buying things that work than they can selling things that don't," he said.
We looked down into our glass, wondering if anyone else had overheard the conversation. The bar was very quiet. Mostly the jingle-bell sounds of icecubes in glasses. Everyone had heard this rant of the angry capitalist. At least it was over.
Then he started up again. "They've still got hundreds of employees? They're being nice and finding them all jobs. Fuckers. Are they a labor union now? Who told them this was the way to spend investor dollars? If I were an Amaranth investor I'd be pissed that they were still turning the lights on over in Greewich," he said.
We took a long draw on our scotch. Ice banging against our teeth and wondering why our instinct was to imagine ourselves as an Amaranth employee while our friend could only see himself as an Amaranth investor. Some of us, it seems, are born to work for others. And some of us are those others.
Amaranth Advisors LLC on Tuesday disclosed its net asset value has fallen nearly 70 percent in September from a peak of $9.2 billion in August after wrong-way energy trades decimated the once-prominent hedge fund group.Greenwich, Connecticut-based Amaranth, which previously estimated it lost 65 percent to 70 percent of its assets in bad commodity bets in September, disclosed the latest results in a letter to investors Tuesday obtained by Reuters.
Amaranth suffered a $6.4 billion loss -- the worst hedge fund loss ever -- in September, leaving the firm with about $2.78 billion at the end of the month from a peak of around $9.2 billion in August.
Amaranth net asset value fell 69.8 pct in Sept [Reuters]
Posted by mk, Oct 11, 2006 10:39AM
As a former Amaranth employee (having gotten out well before the deluge), I am glad that the sr. management is taking care of those who remain.
It is not easy with a family and a mortgage and car payments and everything else to watch your paycheck go up in flames.
Amaranth *used to be* a GREAT place to work back in the day, say 2003 - early 2004. Lots of smart people, particularly in IT infrastructure.
Don't tar everyone just because some kid blew it all on a bad bet: At least management is (finally) taking some responsibility and looking out for the little guys. The investors, sure, I feel sorry for them; but, the kind of individuals who invested in Amaranth will still have their million$$. The pension funds will make it up sooner or later.