Barton Michael Biggs (November 26, 1932 – July 14, 2012) was a
money manager
Investment management is the professional asset management of various securities, including shareholdings, bonds, and other assets, such as real estate, to meet specified investment goals for the benefit of investors. Investors may be instituti ...
whose attention to
emerging markets
An emerging market (or an emerging country or an emerging economy) is a market that has some characteristics of a developed market, but does not fully meet its standards. This includes markets that may become developed markets in the future or were ...
marked him as one of the world's first and foremost global investment strategists, a position he held—after inventing it in 1985—at
Morgan Stanley
Morgan Stanley is an American multinational investment management and financial services company headquartered at 1585 Broadway in Midtown Manhattan, New York City. With offices in more than 41 countries and more than 75,000 employees, the fir ...
, where he worked as a
partner
Partner, Partners, The Partner, or, The Partners may refer to:
Books
* ''The Partner'' (Grisham novel), by John Grisham, 1997
* ''The Partner'' (Jenaro Prieto novel), 1928
* ''The Partners'' (book), a 1983 book by James B. Stewart
* ''Partner'' (m ...
for over 30 years. Following his retirement in 2003, he founded Traxis Partners, a multibillion-dollar
hedge fund
A hedge fund is a pooled investment fund that trades in relatively liquid assets and is able to make extensive use of more complex trading, portfolio-construction, and risk management techniques in an attempt to improve performance, such as sho ...
, based in
Greenwich, Connecticut
Greenwich (, ) is a New England town, town in southwestern Fairfield County, Connecticut, United States. At the 2020 United States Census, 2020 census, the town had a total population of 63,518. The largest town on Connecticut's Gold Coast (Conne ...
. He is best known for accurately predicting the
dot-com bubble
The dot-com bubble (dot-com boom, tech bubble, or the Internet bubble) was a stock market bubble in the late 1990s, a period of massive growth in the use and adoption of the Internet.
Between 1995 and its peak in March 2000, the Nasdaq Compo ...
in the late 1990s.
Early life and education
Biggs was born on November 26, 1932, in
New York City
New York, often called New York City or NYC, is the List of United States cities by population, most populous city in the United States. With a 2020 population of 8,804,190 distributed over , New York City is also the L ...
, named for his maternal grandmother, whose last name was Barton. He grew up on Manhattan's
Upper East Side
The Upper East Side, sometimes abbreviated UES, is a neighborhood in the borough of Manhattan in New York City, bounded by 96th Street to the north, the East River to the east, 59th Street to the south, and Central Park/Fifth Avenue to the wes ...
and in
Washington, D.C.
)
, image_skyline =
, image_caption = Clockwise from top left: the Washington Monument and Lincoln Memorial on the National Mall, United States Capitol, Logan Circle, Jefferson Memorial, White House, Adams Morgan, ...
His paternal grandfather,
Hermann M. Biggs, was the top public-health official in New York and instituted measures that contributed to the eradication of
tuberculosis
Tuberculosis (TB) is an infectious disease usually caused by '' Mycobacterium tuberculosis'' (MTB) bacteria. Tuberculosis generally affects the lungs, but it can also affect other parts of the body. Most infections show no symptoms, in ...
.
[ Biggs' father was the chief investment officer of ]Bank of New York
The Bank of New York Mellon Corporation, commonly known as BNY Mellon, is an American investment banking services holding company headquartered in New York City. BNY Mellon was formed from the merger of The Bank of New York and the Mellon Financ ...
, working at the company from 1931 until his death in 1974. He also renegotiated defense contracts for the U.S. government during World War II
World War II or the Second World War, often abbreviated as WWII or WW2, was a world war that lasted from 1939 to 1945. It involved the vast majority of the world's countries—including all of the great powers—forming two opposin ...
and was executive committee chairman of the Brookings Institution
The Brookings Institution, often stylized as simply Brookings, is an American research group founded in 1916. Located on Think Tank Row in Washington, D.C., the organization conducts research and education in the social sciences, primarily in ec ...
. He attended the Lawrenceville School in New Jersey and graduated in 1951.
Biggs enrolled at Yale University
Yale University is a private research university in New Haven, Connecticut. Established in 1701 as the Collegiate School, it is the third-oldest institution of higher education in the United States and among the most prestigious in the wo ...
, his father's alma mater. He studied under poet and novelist Robert Penn Warren
Robert Penn Warren (April 24, 1905 – September 15, 1989) was an American poet, novelist, and literary critic and was one of the founders of New Criticism. He was also a charter member of the Fellowship of Southern Writers. He founded the liter ...
as an English major
Hedge Funds," article by Lawrence C. Strauss, SmartMoney.com Web site, June 1, 2006, accessed August 18, 2006 and was a member of the Elihu (secret society), Elihu secret society. After graduating in 1955, Biggs served in the U.S. Marines for three years, taught English at the Landon School, a prep school in Bethesda, Maryland
Bethesda () is an unincorporated, census-designated place in southern Montgomery County, Maryland. It is located just northwest of Washington, D.C. It takes its name from a local church, the Bethesda Meeting House (1820, rebuilt 1849), which in ...
, played semiprofessional soccer
Association football, more commonly known as football or soccer, is a team sport played between two teams of 11 players who primarily use their feet to propel the ball around a rectangular field called a pitch. The objective of the game is ...
, and tried his hand at creative writing.
At age 18, Biggs was given a portfolio of 15 stock
In finance, stock (also capital stock) consists of all the shares by which ownership of a corporation or company is divided.Longman Business English Dictionary: "stock - ''especially AmE'' one of the shares into which ownership of a company ...
s worth about $150,000, but he showed little interest in finance and investing
Investment is the dedication of money to purchase of an asset to attain an increase in value over a period of time. Investment requires a sacrifice of some present asset, such as time, money, or effort.
In finance, the purpose of investing i ...
in his youth. He ended up choosing that career path after feeling left out from conversations between his father and younger brother, Jeremy, who worked at a pension fund
A pension fund, also known as a superannuation fund in some countries, is any plan, fund, or scheme which provides retirement income.
Pension funds typically have large amounts of money to invest and are the major investors in listed and priva ...
. He took his father's advice and read ''Security Analysis
Security analysis is the analysis of tradeable financial instruments called securities. It deals with finding the proper value of individual securities (i.e., stocks and bonds). These are usually classified into debt securities, equities, or som ...
'' by Benjamin Graham
Benjamin Graham (; né Grossbaum; May 9, 1894 – September 21, 1976) was a British-born American economist, professor and investor. He is widely known as the "father of value investing", and wrote two of the founding texts in neoclassical inves ...
and David Dodd
David LeFevre Dodd (August 23, 1895 – September 18, 1988) was an American educator, financial analyst, author, economist, and investor. In his student years, Dodd was a ' and colleague of Benjamin Graham at Columbia Business School.
The Wall ...
, first published in 1934. He graduated from NYU Stern School of Business
The New York University Leonard N. Stern School of Business (commonly referred to as NYU Stern, The Stern School of Business, or simply Stern) is the business school of New York University, a private research university based in New York City. I ...
with distinction.[
]
Career
Biggs joined E. F. Hutton upon graduation in 1961, with a starting salary of $7,200 a year.[ "Morgan Stanley's Biggs Shares Pain of Top Hedge-Fund Players," a review of Biggs' book ''Hedgehogging'' by Jeffrey Burke at Bloomberg News Web site, January 6, 2006, accessed August 18, 2006] In 1965, Biggs co-founded one of the industry's first hedge funds, Fairfield Partners. During his eight-year tenure there, the fund returned 133 percent; whereas the S&P 500 returned a mere 19 percent.[NBC News](_blank)
/ref>
Biggs joined Morgan Stanley
Morgan Stanley is an American multinational investment management and financial services company headquartered at 1585 Broadway in Midtown Manhattan, New York City. With offices in more than 41 countries and more than 75,000 employees, the fir ...
as a managing director and general partner in May 1973. As the firm's first research director, he established Morgan Stanley Investment Management in 1975.[ Biggs served on the bank's board until 1996 and retired from the company in 2003 at age 70. He claimed to have left Morgan Stanley partly because his job had evolved into managing people rather than formulating strategy.]
Barton Biggs Shines a Light on Hedge Funds" by Jim Zarroli, National Public Radio ''Morning Edition'', February 20, 2006, accessed August 18, 2006.
After leaving Morgan Stanley in 2003, Biggs founded hedge fund Traxis Partners, where he remained until his death. According to Madhav Dhar, Biggs' partner, he enjoyed the intellectual challenge of running a fund.[
]
Financial predictions
Dot-com bubble
He "sealed his fame" as an investor when he correctly identified the dot-com bubble
The dot-com bubble (dot-com boom, tech bubble, or the Internet bubble) was a stock market bubble in the late 1990s, a period of massive growth in the use and adoption of the Internet.
Between 1995 and its peak in March 2000, the Nasdaq Compo ...
at a time the Dow Jones Industrial Average
The Dow Jones Industrial Average (DJIA), Dow Jones, or simply the Dow (), is a stock market index of 30 prominent companies listed on stock exchanges in the United States.
The DJIA is one of the oldest and most commonly followed equity inde ...
was posting annual gains that had averaged 25 percent from 1995 to 1999. In a July 1999 interview in Bloomberg Television
Bloomberg Television (on-air as Bloomberg) is an American-based pay television network focusing on business and capital market programming, owned by Bloomberg L.P. It is distributed globally, reaching over 310 million homes worldwide. It is head ...
, Biggs called the U.S. stock market "the biggest bubble
Bubble, Bubbles or The Bubble may refer to:
Common uses
* Bubble (physics), a globule of one substance in another, usually gas in a liquid
** Soap bubble
* Economic bubble, a situation where asset prices are much higher than underlying fundame ...
in the history of the world", a view that was dismissed by the industry until March 2000, when the Nasdaq Composite Index dropped 78 percent.[
]
2007-2012 global financial crisis
Barton Biggs was blindsided by the 2007–2012 global financial crisis
7 (seven) is the natural number following 6 and preceding 8. It is the only prime number preceding a cube.
As an early prime number in the series of positive integers, the number seven has greatly symbolic associations in religion, mythology, ...
:
Barton Biggs's Traxis Fund LP tumbled 10 percent in the first half of the year, hurt by bets that U.S. shares would appreciate. As recently as May, Biggs, 75, said the U.S. economy will grow in the second half of 2008, the Standard & Poor's 500 Index may climb to a record and commodity prices will retreat as much as 30 percent.[ "Soros Successors Thiel, Howard Prove Global Bears Rule Markets," by Katherine Burton at Bloomberg News Web site, J August 1, 2008]
However, he correctly called the bottom in U.S. stocks in March 2009, and that year Traxis's flagship fund returned three times the industry average.[
]
Other predictions
He had predicted the bull market in U.S. stocks that began in 1982. He also predicted the bearish market in Japanese stocks in 1989, when the Nikkei 225 stock index was approaching its peak, from which it tumbled more than 77 percent.[ On the other hand, he was incorrectly bullish on ]Mexico
Mexico (Spanish: México), officially the United Mexican States, is a country in the southern portion of North America. It is bordered to the north by the United States; to the south and west by the Pacific Ocean; to the southeast by Guatema ...
shortly before the peso crashed in 1994.[ In March 2003, Biggs predicted that U.S.stocks would rise up to 50 percent, and more for emerging markets; the former climbed as much as 88 percent, while the MSCI Emerging Markets Index rose more than fourfold.][
]
Awards and accolades
His influence could be seen when, in 1996, some traders were surprised that India funds suddenly became popular. "Barton Biggs is there, having a look around", one trader said. "Do you need to know more?"
Web page titled "Pundit Watch: Barton Biggs" at the Web site of ''Smart Money'' magazine, no date, accessed August 18, 2006 Biggs was named by ''Institutional Investor'' magazine to its "All-America Research Team" ten times, and was voted the top global strategist and first in global asset allocation from 1996 to 2000 by the magazine's "Investor Global Research Team" poll.[ News release from Morgan Stanley, January 17, 2006, "Barton Biggs to Become a Consultant to Morgan Stanley after 30 Years with the Firm; Will Advise Morgan Stanley Hedge Fund as Founder of New Firm," accessed August 18, 2006] ''SmartMoney
''SmartMoney'' was ''The Wall Street Journal''s magazine of personal business. The finance magazine launched in 1992 by Hearst Corporation and Dow Jones & Company. Its first editor was Norman Pearlstine. In 2010, Hearst sold its stake to Dow Jone ...
'' magazine once called him "the ultimate big-picture man ... the premier prognosticator on the international scene and a mover of markets from Argentina to Hong Kong. It wouldn't be a stretch to say Biggs wrote the book on emerging-market investing".[
Biggs appeared numerous times on ]CNBC
CNBC (formerly Consumer News and Business Channel) is an American basic cable business news channel. It provides business news programming on weekdays from 5:00 a.m. to 7:00 p.m., Eastern Time, while broadcasting talk sho ...
and was a member of the Barron's Roundtable.
Personal life
Biggs and his wife, Judith Anne Lund had three children; the marriage ended in divorce
Divorce (also known as dissolution of marriage) is the process of terminating a marriage or marital union. Divorce usually entails the canceling or reorganizing of the legal duties and responsibilities of marriage, thus dissolving the ...
. At the time of his death, Biggs lived in Connecticut. He died from complications arising from a bacterial infection.[ His niece, Fiona Katharine Biggs, a ]Barnard College
Barnard College of Columbia University is a private women's liberal arts college in the borough of Manhattan in New York City. It was founded in 1889 by a group of women led by young student activist Annie Nathan Meyer, who petitioned Columbia ...
graduate, is married to the billionaire hedge fund manager Stanley Druckenmiller
Stanley Freeman Druckenmiller (born June 14, 1953) is an American investor, hedge fund manager and philanthropist. He is the former chairman and president of Duquesne Capital, which he founded in 1981. He closed the fund in August 2010. .
Author
Biggs was the author of ''Hedgehogging'', which came from a journal kept by the former creative writing major at Yale and chronicles some of the indignities of being in the hedge fund business as well as its "very brilliant and often eccentric and obsessive people".[ He wrote about quirks of hedge fund culture; he noted that ]golf
Golf is a club-and-ball sport in which players use various clubs to hit balls into a series of holes on a course in as few strokes as possible.
Golf, unlike most ball games, cannot and does not use a standardized playing area, and coping wi ...
was very popular, perhaps due to its "measurable" nature similar to investing. "Or", he wrote, "maybe it's because hedge-fund guys are so competitive and have such massive egos".[
Biggs was also author of the 2008 book ''Wealth, War and Wisdom''. He had a gloomy outlook for the economic future, and suggests that investors take survivalist measures, such as looking into "polar cities" as safe refuges for future survivors of ]global warming
In common usage, climate change describes global warming—the ongoing increase in global average temperature—and its effects on Earth's climate system. Climate change in a broader sense also includes previous long-term changes to E ...
. Biggs recommended that his readers should "assume the possibility of a breakdown of the civilized infrastructure". He went so far as to recommend planning adaptation strategies now and setting up survival retreats: "Your safe haven must be self-sufficient and capable of growing some kind of food", Mr. Biggs wrote. "It should be well-stocked with seed, fertilizer, canned food, wine, medicine, clothes, etc. Think Swiss Family Robinson
''The Swiss Family Robinson'' (German: ''Der Schweizerische Robinson'') is a novel by Johann David Wyss, first published in 1812, about a Swiss family of immigrants whose ship en route to Port Jackson, Australia, goes off course and is shipwreck ...
. Even in America and Europe there could be moments of riot and rebellion when law and order temporarily completely breaks down."
In 2010, Biggs published a novel
A novel is a relatively long work of narrative fiction, typically written in prose and published as a book. The present English word for a long work of prose fiction derives from the for "new", "news", or "short story of something new", itsel ...
about the stock market, ''A Hedge-Fund Tale''. In 2012, a final book, "Diary of a Hedgehog" was published posthumously on November 6.
References
External links
*
*
Collected news coverage
at '' Bloomberg''
Collected news coverage
at ''San Francisco Chronicle
The ''San Francisco Chronicle'' is a newspaper serving primarily the San Francisco Bay Area of Northern California. It was founded in 1865 as ''The Daily Dramatic Chronicle'' by teenage brothers Charles de Young and M. H. de Young, Michael H. de ...
''
"Barton Biggs’s Hedge-Fund Heroes Pile Up Zeroes in Gilded Fable,"
(Review of Biggs' novel A Hedge Fund Tale), Bloomberg, January 17, 2011
{{DEFAULTSORT:Biggs, Barton
1932 births
2012 deaths
American investors
American money managers
American financial analysts
American economics writers
American male non-fiction writers
American finance and investment writers
Businesspeople from New York City
People from Connecticut
Stock and commodity market managers
Yale College alumni
Survivalists
New York University Stern School of Business alumni
Infectious disease deaths in Connecticut
20th-century American businesspeople