Product Description

A rare look inside the world of activist hedge funds from one of this country′s top investors

In 2002, David Einhorn, the President of Greenlight Capital, gave a speech at a charity investment conference and was asked to share his best investment idea. He described his reasons why Greenlight had sold short the shares of Allied Capital, a leader in the private finance industry.

What followed was a firestorm of controversy. Allied responded with a Washington, D.C. style spin–job–attacking Einhorn and disseminating half–truths and outright lies. Undeterred by the spin–job and lies, Greenlight continued its research after the speech and discovered Allied′s behavior was far worse than Einhorn ever suspected. Fooling Some of the People All of the Time is the gripping chronicle of this saga, and this edition contains all new updates from the author. Page by page, it delves deep inside Wall Street, showing how the $6 billion hedge fund Greenlight Capital conducts its investment research and detailing the maneuvers of an unscrupulous company. Along the way, you′ll witness feckless regulators, compromised politicians, and the barricades our capital markets have erected against exposing misconduct from important Wall Street customers.

• Goes behind the scenes to detail the truth about investing, short selling, and the politics of business
• Shows the failings of Wall Street: its investment banks, analysts, journalists, and especially our government regulators
• Offers insights into the battles surrounding hedge funds
• Reveals the immense difficulties that prevent the government from sanctioning politically connected companies

At its most basic level, Allied Capital is the story of Wall Street at its worst. But the story is much bigger than one little–known company. Fooling Some of the People All of the Time is an important call for effective law enforcement, free speech, and fair play.

Product Details

• Amazon Sales Rank: #36323 in Books
• Published on: 2008-05-27
• Original language: English
• Number of items: 1
• Binding: Hardcover
• 380 pages

Review
"Instead of stewing in private, Einhorn wrote a book "Fooling Some of the People All of the Time" about his six–year ordeal with Allied." (Daily Mail, September 18, 2008)

Review
“…a welcome antidote to the thousands of books written for investors that paint a sunny picture of companies”. FT.com Tuesday 10 June 2008

“Mr Einhorn’s book recounts behind–the–scenes details of the sort that are seldom made public…an instructive guide for general investors…” Financial Times Tuesday 16 June 2008

From the Inside Flap
In 2002, David Einhorn, the President of Greenlight Capital, gave a speech at a charity investment conference to benefit a children′s cancer hospital. He was asked to share his best investment idea, so he did. He described his reasons why Greenlight had sold short the shares of Allied Capital, a leader in the private finance industry. Greenlight bet that the stock would decline because the company′s business was in trouble and its accounting was corrupt. Einhorn′s speech was so compelling that the next day, when the New York Stock Exchange opened for trading, Allied′s shares remained closed. So many investors wanted to sell or short the stock that the NYSE could not balance all the sell orders to open Allied’s trading in an orderly fashion.

What followed was a firestorm of controversy. Allied responded with a Washington, D.C.–style spin–job— attacking Einhorn and disseminating half–truths and outright lies. Rather than protect investors by reviewing Einhorn′s well–documented case against Allied, the SEC—at the behest of the politically connected Allied— instead investigated Einhorn for stock manipulation. Over the ensuing six years, the SEC allowed Allied

to make the problem bigger by approving more than a dozen additional stock offerings that raised over $1 billion from new investors. Undeterred by the spin–job, lies, and investigations, Greenlight continued its research after the speech and discovered Allied’s behavior was far worse than Einhorn ever suspected— and, shockingly, it continues to this day.

Fooling Some of the People All of the Time is the gripping chronicle of this ongoing saga. Page by page, it delves deep inside Wall Street, showing how the $6 billion hedge fund Greenlight Capital conducts its investment research and detailing the maneuvers of an unscrupulous company. Along the way, you′ll witness feckless regulators, compromised politicians, and the barricades our capital markets have erected against exposing misconduct from important Wall Street customers. You will also discover the immense difficulties that prevent the government from sanctioning politically connected companies—making future Enrons inevitable. This revealing book shows the failings of Wall Street: its investment banks, analysts, journalists, and especially our government regulators.

At its most basic level, Allied Capital is the story of Wall Street at its worst. But the story is much bigger than one little–known company. Fooling Some of the People All of the Time is an important call for effective law enforcement, free speech, and fair play.

Customer Reviews

A Revelation for Those Who Believe Efficient Markets and Good Regulation Exist

David Einhorn is a man who believes in checking out companies carefully. When he saw that Allied Capital wasn't following accounting rules and was making lots of bad loans, he smelled an opportunity to make money as the company collapsed. After investing, he had an opportunity to share his idea at a charity event. Allied Capital's stock quickly dropped in response.

This book describes six years of battling to get the story out of what he had learned, to persuade regulators to crack down on Allied Capital so the rules would be followed, and to stop any illegal activities at Allied Capital. The book is written from Mr. Einhorn's perspective.

Along the way, Allied Capital decided that it had to discredit Mr. Einhorn's allegations and his motives.

After many years of battling, Mr. Einhorn learned a number of important lessons:

1. Policing small capitalization companies is a low priority for reporters, analysts, institutional investors, and regulators.

2. If a company keeps paying a dividend (even if it's not smart to do so), many individual investors will be attracted and will be loyal.

3. The Small Business Administration is more interested in shoveling out money to small businesses than it is in ensuring that fraud isn't being perpetrated on the tax payers.

4. Wall Street investment banks will help defend any company that pays a lot of fees.

5. With enough new capital, large mistakes can be smoothed over.

I'm sure that if he were faced with the same investment opportunity today, Mr. Einhorn would run rather than take a short position.

I highly recommend this book to people who learned about perfectly efficient markets and active, honest regulators in school. "Let the investor watch out for himself or herself" would be a better motto in describing the capital markets.

This book will be boring to those who want to a quick take. But you need to read all of the misrepresentations, misstatements, and personal attacks to get a true sense of how the game is played.

If you want a more recent version of this problem, just look at securitized mortgages.

Thanks for sharing, Mr. Einhorn!

Captivating read
This is without doubt one of the best books I have read for a long time. A captivating read and one of those books you dont want to put down. Not an investing book as such, because it is written in a way that describes the authors long running battle to expose highly dubious business pratices at a large financial company, but written in a way that also educates the reader at the same time (on how some companies try to manipulate the numbers, etc). Well worth reading even if you have no interest at all in investing.