Here’s our good news / bad news post of the day. Today’s Wall Street Journal features a profile writeup on John Paulson, a hedge fund manager who decided to bet against the housing market at the height of the bubble.
It was a risky move, but the ensuing subprime meltdown netted some $14 billion for his clients’ funds. Paulson’s personal take is estimated at $3 – $4 billion, according to the article.
Mr. Paulson has tried to keep a low profile, saying he’s reluctant to celebrate while housing causes others pain. He has told friends he’ll increase his charitable giving. In October, he gave $15 million to the Center for Responsible Lending to fund legal assistance to families facing foreclosure. The center lobbies for a law that would let bankruptcy judges restructure some mortgages.
“While we never made a subprime loan and are not predatory lenders, we think a lot of homeowners have been victimized,” Mr. Paulson says. “Bankruptcy is the best way to keep homeowners in the home without costing the government any money.”