Do You Know Who Andrew J. Hall Is?

July 30, 2009

The Facts

Citigroup has a problem — under the terms of their contract with an energy trader, they owe Andrew J. Hall, the trader, $100 million. And with the current public relations environment with the financial industry, and with the energy traders, Citigroup is a little nervous over the matter.

According to this article by the Wall Street Journal, Hall is head of Citigroup’s energy-trading unit, Phibro. The WSJ article says Phibro is “a secretive operation, run from the site of a former Connecticut dairy farm, that occasionally accounts for a disproportionate chunk of Citigroup income”.

MoneyWeek says it is so secretive that there are no publicly available pictures of Hall (I guess that’s why I couldn’t find any). But he is a UK-born commodities trader who had personally made $250 million by 2008, and generated 10 percent of Citigroup’s 2007 total net income of $3.62 billion. That’s $362 million Hall made for them. That means Hall got nearly 28 percent of what he earned for Citi. The same referenced MoneyWeek article quotes an acquaintance as saying “when Hall locks in on an idea, he’ll take it to the extreme”.

My View

OK, tell me again — traders don’t run up the prices of commodities? If it was as simple as a “supply and demand” thing, anybody could make a $100 million in just one year. Also, please tell me once more how contracts don’t have to be honored where a government bailout is involved? —— Oh, hell! Stupid me! That’s only if it applies to the United Auto Workers. How could I possibly forget?

So, there goes another easy $100 million of the taxpayer’s dollars. No taxpayer dollars, no Citigroup — no Citigroup, no money for Hall. Ain’t a “free” (tax-payer-funded) market just wonderful!!??