Hedge-Fund Billionaires Are Just So Gauche, Right?

Falcone
Photo: Patrick McMullan, Getty Images, Reuters

Alpha magazine has released a list of top hedge-fund moneymakers, and as it turns out, last year, as the country stood on the brink of a recession, a few people made a fairly obscene amount of money. In fact, Alpha Notes, last year "may well prove to be the greatest display of individual wealth creation in any year in the modern history of finance." Hot. Among the lucky ones are New Yorkers John Paulson, who made $3.7 billion betting against subprime. George Soros raked in $2.9 billion, and Stevie Cohen could buy a whole new gaggle of Damian Hirsts with his $900 million.

As is her wont, the Gray Lady appears faintly repulsed by these short, fat men and their vulgar accumulation of uninherited wealth, and immediately finds several experts who are happy to remind these upstart Gatsbys of exactly what they are: “To some degree it’s a very gigantic version of Las Vegas,” one economist says evocatively of the hedge-fund market, like there's something so flashy and vulgar and seedy and borderline illegal about it, you know? Except it's actually not illegal. “There is nothing wrong with it,” William H. Gross, the chief investment officer of the bond fund Pimco, tells the Times. “But it’s ugly.” The 'Times' sentiments exactly! The inclusion of Philip Falcone of Harbinger partners ($1.7 million), who recently bought a large stake in the Times and followed it up by purchasing Bob Guccione's monstrosity of a mansion, must have especially rankled the paper. Best remind him who's boss! “Like at the end of the Gilded Age and the Roaring Twenties, we are going the other way,” Gross tells the Times helpfully. “We are clearly in a period of excess, and we have to swing back to the middle or the center cannot hold."

Ooh! Who else is gilded and roaring? The list of top ten earners follows.

1. John Paulson, Paulson & Co. ($3.7 billion)
2. George Soros, Soros Fund Management ($2.9 billion)
3. James Simons, Renaissance Technologies Corp. ($2.8 billion)
4. Philip Falcone , Harbinger Capital Partners ($1.7 billion)
5. Kenneth Griffin, Citadel Investment Group ($1.5 billion)
6. Steven Cohen , SAC Capital Advisors ($900 million)
7. Timothy Barakett, Atticus Capital ($750 million)
8. Stephen Mandel Jr., Lone Pine Capital ($ 710 million)
9. John Griffin, Blue Ridge Capital ($625 million)
10. O. Andreas Halvorsen, Viking Global Investors ($520 million)

Wall Street Winners Get Billion-Dollar Paydays [NYT]
Alpha’s Top Moneymakers [Alpha magazine]