Notes From SALT Conference Panel With Kyle Bass, Dmitry Balyasny & Steven Tananbaum ~ market folly

Thursday, May 10, 2012

Notes From SALT Conference Panel With Kyle Bass, Dmitry Balyasny & Steven Tananbaum

At the SALT Conference in Las Vegas today there was a panel called "From Crisis to Renewal: Uncovering Opportunities."  It featured Kyle Bass of Hayman Capital, Dmitry Balyasny of Balyasny Asset Management, Steven Tananbaum of GoldenTree Asset Management, as well as John Bader of Halcyon Asset Management.

Kyle Bass says that we are near the trough of the housing crisis and thinks the bottom could come in the next 12-18 months.  We posted up an excellent presentation on the housing market by Aaron Edelheit from the Value Investing Congress recently.

Talking about the generational balance in Japan, Bass says there's now more adult diapers being sold than baby diapers in that country.  He compared Japan to Bernie Madoff in that lying works until there isn't new money coming in - you can make promises and there won't be any issues as long as you don't have to follow through.

We've posted his Bass' presentation on Japan before as well.  At SALT he said that the country is already monetizing their debt so it's just a matter of time.

He admitted to making a mistake in 2009 by not anticipating all the printing by the sovereigns.  He focuses on the losses and forgets the gains, he says.

As to what the Hayman Capital man recommends now: long non-agency MBS credit while shorting Europe and Japan.  The hedge fund manager also said that Greece would be "ungovernable" in the near future.

Dmitry Balyasny talked about how he is 'neutral' on US companies but always hunting for quality picks.

Steven Tananbaum cited his propensity to favor corporate debt and mortgage backed securities (MBS) as longs in this environment.

John Bader pointed out that there are plenty of liquidation plays in this environment. He also advocated seeking out uncorrelated strategies.  Bader does not seem to be convinced the crisis is over.

For more notes from the SALT Conference, check out:

- Identifying opportunities in emerging markets with John Burbank

- Barry Rosenstein, Leon Cooperman & Joel Greenblatt's panel on stocks

- Risk panel with Phil Falcone and Eric Sprott

The above was compiled from notes sent in along with help from live tweets from: @ldelevingne , @pdmckenna@AttainCapital & @realrobcopeland

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