Kyle Bass at Hayman Advisorsis just not an equities guy.That much has been known for a while.
So when he seems to be shifting up his asset allocation—and taking long positions in financial stocks—it makes you wonder why.
Courtney Comstock over at Clusterstock dug out two very interesting equities positions from Hayman Advisors 13f filing for the third quarter of 2010 .
- Citigroup — ~$16 million (4 million shares)
- Bank of America —~$13 million (1 million shares)
In fact, based on my reading of the statement, it appears as if Citigroup is now his largest single position Let's add some context..
In addition to showing away from stocks in favor of bonds Kyle Bass is also something of a cynic:
"Unfortunately, our elected officials are on the hamster wheel of electoral cycles and are not able to make tough decisions like this as they would likely not be re-elected without a "sea change" in public opinion towards government spending and deficits. We are therefore on the path to significant currency devaluation around the world that will likely result in significant inflation."
(The above quote comes from a newsletter to Haman advisor clients. More can be found here, on the MarketFolly website.)
My point is this: It makes you wonder if perhaps Mr. Bass believes that Citi & BofA have been battered by the market down to levels below which our "hamster wheel" elected officials cannot let them fall.
If it is not a too big to fail play, what else could it be?___________________________________________________
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