Background: Incredible India can do your Head in

The Calcutta Club, where The Raj remains in residence

I’ve been coming to this place on and off for about two decades now but the contrasts can still leave you a bit more than bemused.

As our Kingfisher Airlines flight taxiied in to Kolkata — new name of Calcutta, a gift of their identity politics — airport, you can see the place hasn’t changed in the last two decades with that same air of “really can’t be assed” decay.  But the airline I’m flying is new and swanky, with a young and rather good-looking flight attendant who smiles like she actually means it.  And there are a lot more aircraft on the tarmac as well.   You notice the Indian Air Force Embraer Legacy executive jet

Background: Is Coffey Causing too Many Ripples at Moore?

When Greg Coffey was at GLG running their superstar EM Fund, there were rumors the risk manager was not allowed any oversight of his hedge and long-only funds.  This came from their prime brokers so there is some credence to that statement.  We ourselves would notice his sometimes high allocations to illiquid (how does a ski resort in Hungary strike you?) or downright terrifying (private banks in Nigeria?) positions.  No one said anything because most of these positions paid off and there was also Greg’s trading style.  Sometimes he would trade around a position more than 50 times.  A day!

Trade Notes: Stay Long Russia or Edge Towards the Door?

Image via Wikipedia

Around 2007, Tim Rogers —  Valartis’ MC Russian Market Fund PM — said something very interesting about prospects in Russia.  He thought the days of making a killing just by picking under-appreciated Russian companies (i.e., pretty much any Russian company) were pretty much gone after the third level of privatizations.

Henceforth, the managers would have to make money the hard way:  by really working on picking the few remaining gems.  He’s no longer at Valartis, but it would be interesting to see how he would manage now.

Background: Whatever Happened to Tim Rogers?

Geneva at Night

Tim Rogers used to manage the MC Russian Market Fund for Valartis out of Geneva.  I first met him in 2005-6, invested in his fund(s) soon afterward and love the guy as a good solid manager who — perhaps unsurprisingly for a Canadian — is also a very nice guy.  He came to fund management and Russia investment in a rather roundabout way.

In the early/mid 90’s his girlfriend (he tells this story to a lot of investors, so I’m not breaching any confidences) wanted to travel overland from Hong Kong to Geneva.  A large part of this trip necessitated train travel through Yeltsin’s Russia.  The energy of the place then got him thinking about investing in the newly-privatized parts of Russian industry.

Background: Grameen Bank’s Model Under a Foreseen Threat

Monte Dei Paschi Di Siena

Good old-fashioned partnership merchant banks lending out proprietary money is where banking started (hence the picture of Monte Dei Paschi Di Siena, the oldest surviving bank):  a partnership with long money to lend, taking the risk and the profits of new ventures from the next crop to the next shipload of whatever coming into port.

Modern banks are built around the concept of borrowing short and lending long:  borrow money short-term (from depositors or worse, short-term money markets) and lend long-term.  That’s where the image of the bank (and the banker) becomes critical.  Essentially, banks then become a legally sanctioned Ponzi Scheme: