As you know, Ezra Merkin, the disgraced Madoff feeder, is in the process of wrapping up his firm after sustaining huge losses in the Ponzi. According to Bloomberg, Merkin’s two big funds, Ariel Fund Ltd. and Gabriel Capital LP, lost about 41% of the value in the scam.
But wait! This isn’t actually that bad. Think of all the funds that have lost 50% or more. Citadel, for one, has been cut in half, so have a number of other legitimate strategies. Sure, they can halt redemptions and their holdings might rebound (Merkin’s losers cant’ rebound, they just disappeared), but still, you might have people for whom Merkin was their top money manager.
He got caught up in a scam and was only down 40%. He might be a genius after all. He needs to advertise that and hang a shingle once again.