Face value of The Economist (March 14th)

Face value: John Paulson http://www.economist.com/people/displaystory.cfm?story_id=13277415 Paragraph 1: Who he is. He is an investor who continues to win during this financial crisis. His hedge funds marked over 100% returns in 2007, betting against subprime mortgages, netting him $3.7 billion personally. His funds continued to do well last year, too. Paragraph 2: What he does know for. Risk Arbitrage that involves punting on actual/potential merger targets. Paragraph 3: His personality. Fitting icon for the post-boom age: mild-mannered, bordering on weedy and soft-spoken. Paragraph 4: How he won. He avoid leverage, making beds with borrowed money. What he did is "obvious" trade. Paragraph 5: How he won, in practical. Shorting credit. He targeted BBB-rated tranches, the lowest in subprime securities. The practical method he uses is credit-default swaps(CDSS). Paragraph 6: His philosophy toward the investment. Paragraph 7: The reputation and his philanthropic activity. Paragraph 8: Coming year Market. Markets now follows Mr. Paulson as they used to be followers of Mr. Soros. And Mr. Paulson still a net short-seller as he doen't see the economy reaching bottom. Paragraph 9: His recent focus. He starts to recapitalise sick but viable banks. The Recovery Fund, his new funds, took a 25% stocks(?) of Indy Mac, a Californian bank that the government took in hand last July.

Remark: I read the article with my friends. It took 1.5 hour to understand the outline. The article is well organised, so it was interesting to read even though I didn't know the meaning of "credit default swaps"!