Kyle Bass

Kyle Bass
Born Miami, Florida
Residence Dallas, Texas, United States
Alma mater Texas Christian University
Occupation Founder & President, Hayman Capital
Hedge fund manager

J. Kyle Bass is the founder and principal of Hayman Capital Management, L.P., a Dallas-based hedge fund. Bass became well-known after successfully predicting and benefitting from the subprime mortgage crisis by purchasing credit default swaps on subprime securities issued by various investment banks (similar to shorting the bonds).

Bass has since continued to attract media attention for his prediction of the European sovereign-debt crisis and his expectations regarding the economic future of Japan and Argentina.[1][2]

Biography

Bass was born on September 7, 1969, in Miami, Florida, where his father managed the Fontainebleau Hotel, before moving to Dallas, Texas. Bass attended Texas Christian University in Fort Worth on a diving and academic scholarship and graduated with a BA of Business Administration in Finance and Real Estate Finance in 1992.

Following a brief stint at Prudential Securities, Bass began working at the Dallas office of Bear Stearns, where he became a Senior Managing Director at 28, before leaving to become a Managing Director in Legg Mason’s Dallas office.

In December 2005, when Legg Mason sold the portion of the business where he worked, Bass left Legg Mason and started Hayman Capital Management, L.P., to serve as the investment manager to a "global special situations" hedge fund that he planned to launch. Shortly after launching the hedge fund in February 2006, Bass became convinced that there was a residential real-estate bubble in the United States one of the few investors to successfully predict and benefit from the subprime mortgage crisis, bringing him notoriety in the financial services industry.

Bass is a member of the Board of Directors of the University of Texas Investment Management Co. (UTIMCO), which manages over $27 billion of assets. He is a founding member of the Serengeti Asset Management Advisory Board[3] and serves on the board of directors of the Troops First Foundation,[4] Business Executives for National Security[5] and Texas Ranger Association Foundation.[6] Additionally, Bass is a member of the Advisory Council of the Comeback America Initiative which is dedicated to promoting fiscal responsibility and sustainability. Bass has testified as an expert witness before the U.S. House of Representatives, U.S. Senate and Financial Crisis Inquiry Commission.[3]

Famed bestselling author Michael Lewis, begins his 2011 book Boomerang: Travels in the New Third World with an opening profile of Bass and tells of his time at Bass's ranch outside of Dallas, TX.[7]

Hayman Capital

Bass’s first hedge fund was launched in early 2006 after raising $33 million from friends and family plus $10 million from his personal savings. Hayman Capital is a global special situations fund. Bass admits that he was tipped off by an investment banker from New York City while both were attending a wedding in Spain.[8][9] After returning to the US, Bass hired several private investigators to determine the ease of obtaining a mortgage. Bass spent a significant amount of time studying the residential mortgage market and performed research to identify which residential mortgage backed securities (RMBS) composed of low-quality mortgages were most likely to default. This investment thesis was expressed by purchasing credit default swaps against the securitizations he deemed to be most unstable, which essentially was a manner of shorting the bonds using synthetic instruments. After purchasing the positions for his flagship fund in 2006, Bass raised additional capital for a special fund dedicated exclusively to capitalizing on the unique opportunity that existed in the market place. Bass managed or advised over $4 billion of positions in subprime RMBS. In December 2007, after a wave of foreclosures had swept across the US, Bass was featured on Bloomberg TV as making a fortune betting against these subprime securities.

Beginning in 2007, Bass’s flagship fund began purchasing credit default swaps (insurance against default) on government bonds in Greece and other European countries.[10]

References

  1. ↑ , D Magazine APR 2008 Debt Recession Worldwide Finances Global Debt Bomb
  2. ↑ "Kyle Bass Answers Questions At iCIO Investment Summit". ValueWalk. December 4, 2013.
  3. ↑ 3.0 3.1 "Speakers — New York 2010". Value Investing Congress. Retrieved December 12, 2014.
  4. ↑ "Board Members". Troops First Foundation. Retrieved December 15, 2014.
  5. ↑ "Our Members". Business Executives for National Security. Retrieved December 16, 2014.
  6. ↑ "The Texas Ranger Association Foundation". Texas Ranger Association. Retrieved December 16, 2014.
  7. ↑ Rob Copeland (October 3, 2011). "Michael Lewis homes in on Kyle Bass’s killer instinct in new book". Institutional Investor's Alpha.
  8. ↑ "House of Cards" interview CNBC, 2009
  9. ↑ Octastaff (April 11, 2015). "Kyle Bass - Hayman Capital". Octafinance
  10. ↑ Daniel Fisher (January 21, 2010). "The Global Debt Bomb". Forbes.

External links

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