Tuesday, March 2, 2010

Betting on the Blind Side - By Michael Lewis

On his way to his meeting with Greenblatt, Burry was racked with the anxiety that always plagued him before face-to-face encounters with people. He took some comfort in the fact that the Gotham people seemed to have read so much of what he had written. “If you read what I wrote first, and then meet me, the meeting goes fine,” he said. “People who meet me who haven’t read what I wrote—it almost never goes well. Even in high school it was like that—even with teachers.” He was a walking blind taste test: you had to decide if you approved of him before you laid eyes on him. In this case he was at a serious disadvantage, as he had no clue how big-time money managers dressed. “He calls me the day before the meeting,” says one of his e-mail friends, himself a professional money manager. “And he asks, ‘What should I wear?’ He didn’t own a tie. He had one blue sports coat, for funerals.” This was another quirk of Mike Burry’s. In writing, he presented himself formally, even a bit stuffily, but he dressed for the beach. Walking to Gotham’s office, he panicked and ducked into a Tie Rack and bought a tie. He arrived at the big New York money-management firm as formally attired as he had ever been in his entire life to find its partners in T-shirts and sweatpants. The exchange went something like this: “We’d like to give you a million dollars.” “Excuse me?” “We want to buy a quarter of your new hedge fund. For a million dollars.” “You do?” “Yes. We’re offering a million dollars.” “After tax!”