In mid-May, Australian fund manager John Hempton started a blog which is already one of the best in the world for serious analysis of finance investment ideas on both the long and the short side. Coming back from holiday today I found a wealth of amazing blog entries there. Here’s just a taster of what Hempton’s done in the past couple of weeks:
- Premonitions of disaster in Spain, and the limitations of the Norwegian solution, and what all this means for the Baltics in general, and Swedbank in particular. "I used to think Swedbank would probably survive. I now think it probably goes to zero."
- The risks aren’t on the credit side of banks’ balance sheets, they’re on the funding side. See: Alliance & Leicester, WaMu.
- The difficulty of shorting subordinated bank debt.
- The differing definitions of subprime, and the deceleration in subprime delinquencies.
- "There will eventually be a Japanese exit for many American financials."
- And, best of all, Hempton admits his mistakes.