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Pastimes : The Naked Truth - Big Kahuna a Myth -- Ignore unavailable to you. Want to Upgrade?

To: IceShark who wrote (6894)	9/23/1998 11:26:00 PM
From: Investor2	Read Replies (1) \| Respond to of 86076

Re: "US Taxpayer guarantee for all the losses of the big speculators, ..." Doesn't sound fair, to me. Let free markets rule. Best wishes, I2

To: IceShark who wrote (6894)	9/24/1998 12:48:00 AM
From: Joseph G.	Read Replies (1) \| Respond to of 86076

<<WASHINGTON (AP) -- A private investment fund nearly collapsed Wednesday from losses on more than $100 million [?] invested in financial markets around the world, The Washington Post reported in Thursday's editions. In response, chief executives and other top officials from two dozen of the world's largest banks and brokerage firms spent six hours Wednesday at the New York Federal Reserve Bank putting together a preliminary rescue plan of more than $3.5 billion, the newspaper said. The Greenwich, Conn.-based fund, Long-Term Capital Management L.P., is run by John Meriwether, a former bond arbitrage specialist at Salomon Brothers. Partners include Nobel prize-winning economists Robert Merton and Myron Scholes. The Post described the rescue package as a takeover by creditors who want to buy time to recover some of the firm's losses. The consortium of banks lending the money will now own 90 percent of the firm and appoint an oversight committee to make sure its market exposure is reduced. The committee will consist of representatives from Goldman Sachs & Co., Merrill Lynch & Co. (NYSE:MER - news), Morgan Stanley Dean Witter, Travelers Group Inc. (NYSE:TRV - news) and UBS Securities Inc. In a statement Wednesday night, Long-Term Capital said it believed the infusion of new funds would enable it to manage its investments, and hopefully recover some of its losses. Long-Term Capital has trading contracts based on securities worth nearly $1 trillion, an investment banker close to the talks, told the Post. The fund, like many hedge funds, uses a complex computer-based strategy to invest in bonds and currencies from around the globe. Earlier this month, Long-Term Capital said it had lost $2.5 billion or 52 percent of its net assets, in trading so far this year. Market sources told the Post some of the losses were related to the Russian bond market and the defaulting of ruble currency hedges by Russian banks. >>