Daniel Loeb Opalesque Industry Update – Hedge fund manager Daniel Loeb, founder of the $7.1bn Third Point LLC, has criticized U.S. President Barack Obama, accusing him of “fiddling away” time and “stirring up class warfare,” over his alleged obsession in the “redistribution of wealth.”
Ironically, the scathing remarks were a complete turn around coming from the man who is a registered Democrat and who heavily supported Obama in his 2008 presidential bid. Now Loeb’s statement is seen by many as support of the Republican party.
In his letter to investors, Loeb said: “It is increasingly difficult to avoid the conclusion that while Washington burns, President Obama is fiddling away by insisting that the only solution to the nation’s problems — whether unemployment, the debt ceiling or deficit reductions — lies in redistribution of wealth. Perhaps a plan that led the way forward by expanding opportunities rather than redistributing outcomes and emphasized growth and prosperity for all would be met with less political resistance.”
In another report, Loeb condemns what he termed as the “absence of leadership” in Washington that is creating a horrible business environment. He cited the budget deficit as well as the lack of concrete framework on how “businesses can conduct business, investors can invest, and consumers can consume without a high degree of uncertainty and fear.”
He addressed Obama: “It's increasingly difficult to avoid that conclusion that while Washington burns, President Obama is fiddling away by insisting that the only solution to the nation's problems -- whether unemployment, the debt ceiling or deficit reductions -- lies in redistribution of wealth.
“Perhaps the difference between President Obama and many Americans is that the President sees prosperity as a sign of "unfairness" that needs to be corrected by government via higher taxes and increased regulation. Perhaps a plan that led the way forward by expanding opportunities rather than redistributing incomes and emphasizing growth and prosperity for all would be met with less political resistance.”
Loeb has a reason to be angry. His company has been slipping over the past few months and has hinted it is taking a more bearish stance moving forward.
His two key hedge funds, Third Point Partners LP and Third Point Ultra Ltd, declined -2.5% and -2.6%, respectively, in the last three months, fortunately, the two funds were up 6.3% and 8.9% year to date halfway through 2011.