john devaney yacht

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Devaney's fund has run into trouble lately. A spokesman for the firm told Reuters on July 3 that it had stopped honoring request from some of its investors for redemptions, or withdrawal, of investments.

The market for assets backed by subprime mortgages has taken a huge hit over the last two months, causing large losses by some top Wall Street firms, including Bear Stearns ( Charts , Fortune 500 ).

Devaney told Money magazine this spring that despite problems that the loans cause for borrowers, the assets backed by them provided a good return for his fund.

"The consumer has to be an idiot to take on those loans," he said . "But it has been one of our best-performing investments."

But with rising delinquency and default rates in the sector, investors have been scared away from the assets lately, hitting those like Devaney who made a big bet on the investment.

According to the yacht broker's listing, the yacht has accommodations for 10 passengers in its five staterooms, along with space for a crew of seven. Its amenities include his and her baths in the master suite, and four guest bathrooms with Jacuzzi tubs and showers and cherry wood interior throughout.

It has two 2,250-horsepower engines and a range of 3,500 nautical miles.

The New York Post reported Monday that Devaney is also seeking to sell a home in Aspen for $16.5 million.

The Aspen Times reported in November that he bought that house, for $16.25 million, and that property includes a 16,000-square-foot main house and carriage house which include 16 bedrooms, 18 full bathrooms, two fireplaces, three kitchens and two caretaker bedrooms with bathrooms.

But the sale of the yacht and the Aspen vacation home won't leave Devaney without any high-priced holdings.

The New York Times

Dealbook | subprime’s other victims: the yacht-owners.

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Subprime’s Other Victims: The Yacht-Owners

From DealBook colleagues Jenny Anderson and Julie Creswell:

You’ve gotta feel for him. John Devaney, United Capital ‘s chief executive and a one-time master of the mortgage market who has been taking it on the chin lately, has put his yacht up for sale — for $23.5 million. According to TheStreet.com, he is selling his 142-foot Trinity yacht , dubbed Positive Carry, and his $16.5 million second-home, named Sardy House and the home of the nation’s largest living Christmas tree.

Known as a hotshot trader, Mr. Devaney has become a powerhouse in South Florida, hiring the Counting Crows and Jay Leno for events and feting former Senator Bill Frist. But thanks to a wrong-way bet on the subprime mortgage market, his funds have gone underwater.

In April, The New York Times took a look at Mr. Devaney during a more prosperous period:

‘I personally hate subprime,” Mr. Devaney declared at an American Securitization Forum conference in late January, ”and I’m kind of hoping the whole thing explodes.”

As The Times reported, Mr. Devaney had counted on his contrarian instincts to serve him well at a time when big players swooped in to make a killing while cleaning up the mess. By the time of The Times article, Mr. Devaney had amassed a fortune of $250 million by becoming a major dealer in asset-backed bonds. His success in trading mobile home loans, credit card debt and airplane leases after the terrorist attacks of Sept. 11 helped him succeed by profiting when others had panicked.

His rewards could be counted by the Renoirs and Cezannes hanging in his South Florida home. One analyst told The Times: ”I don’t think there is anyone in the business who wouldn’t want to be John Devaney.”

But as with so many other investors, Mr. Devaney was sunk by subprime, and the Horizon ABS funds he manages suspended investor redemptions earlier this month. United Capital said at the time that it did not face margin calls and that it had $145 million in cash to meet any demands from its lenders.

He has now hired the law firm Morgan Lewis & Bockius in anticipation of potential litigation, TheStreet.com said.

Clearly, Positive Carry (a reference to an arbitrage-like trading technique) hasn’t brought Mr. Devaney any luck. So we’ve come up with a few suggestions for the new owners of Mr. Devaney’s boat.

• Margin Call
• Sinking Ship
• No Doc Dinghy
• Not so FICO

Vote on your favorite below, or feel free to propose your own name.

Comments are no longer being accepted.

My heart is bleeding $%^& for each and everyone of these guys.

How about: HOT WATER

Clearly, Sub-Merged is the best!

A golden oldie: “Where Are the Customers’ Yachts”?

sinking feeling

Sub-merged… if not now in the very near future! How about SWAP ME!

sub-merged is genius.

The new name? The Pequod

Julie and Jenny, I want to applaude this tabloid piece, it is filled with great information for your deal book audience, it even made it to the front page!!! Maybe you should send it to NY Post too.

This man is 50% what every investor wants to be and the other 50% what every investor is!

He saw value and opptiunty when all saw dirt and acted to exploit it, and won big- then he did what, what no one should bet the boat when he got soo big and lost!

but you gotta admit, we all want to be him, we all want to make that winning investment.

There is a GOD.

call it glory days

Victim? Not a chance. Casualty is a more apt description.

3 Hour Tour of appearing smart

Everything will change for the better.

Hope Springs Eternal

WHY NOT CALL IT “KRAKATUA” AFTER THE 18TH CENTURY INDONESIAN VOLCANIC ISLAND THAT ERUPTED AND THE SOUND WAS HEARD FAR AND BEYOND!!!!

I love sub merged, sinking feeling also has a nice ring. I have no sympathy

ON THE ROCKS, GROUNDED, ABANDON SHIP, WITHOUT STEARAGE, VESSEL NOT UNDER COMMAND

“I hate Sub-Prime, yet I was greedy enough to gamble my client’s life savings on it without batting an eye”

Niiiice Devaney. Guess you’ll be trading in that Trinity for a dinghy….they should put you in it, and tow it to the same shark-infested waters you came from…. Why don’t you name your new skiff the DINGH-BATT??

Why all the hatred? He made a bad bet, but he’s obviously talented and will likely rebound at a later date.

It’s not like he defrauded people…..

A lot of people happy here that his trades have gone sour. Including the article writers. Well atleast he had the balls to take the risk.

Anyone have some lipstick for this pig?… actually, I think it’s to late to dress up this pig… time to stick a fork in it.

This vessel has got to be named : Naked Call

What's Next

The Crash of the King of Liquidity

Key Biscayne’s high-flying hedge fund operator, John Devaney, once called “The King of Liquidity,” has crashed and burned.

I’ve been gawking at the Devaney hedge fund wreck for a long time. The festive charitable giving to needy causes (inoculation from scrutiny by the mainstream press). The entertaining of then Senate majority leader Bill Frist and other luminaries. The mysteries of making a few hundred million trading asset backed securities formed from junk aka “the ownership society.”

That turns out to be one of the signature phenomenon of the current market cycle that shows no signs of bottoming yet: what an excruciatingly long time it is taking to play out.

A year ago, the media began reporting the troubles afflicting the Key Biscayne hedge fund king: “A Miami-based hedge fund titan with a taste for the high life is getting a harsh lesson in humility as his fund racks up losses in the bond-market rout. … The fund’s portfolios are now said to be worth around $460 million, down from about $620 million.”  (New York Post, August 2, 2007)

But according to The Miami Herald, “On Thursday, Devaney said the fund had lost about 90 percent of its value by September 2007.” (Miami Herald, July 11, 2008)

So, which was it?  A year ago, was Devaney lying or not?

Investors are suddenly realizing that down markets are an especially bad time to question whether there is any difference between fraud, theft, and a worthless investment portfolio with John Devaney.

With hedge funds, there is no penalty for misrepresentation unless it is outright fraud and theft. The US Congress and White House have repeatedly blocked efforts to hold hedge funds to the same degree of accountability as other fiduciary agents.

Most mutual fund owners don’t have a clue how John Devaney made enough millions to hang Matisses on the walls of his Key Biscayne home. But they should, because what John Devaney does (did) along with 10,000 hedge funds is shaking the foundations of the world financial system.

It is no surprise that hedge fund risk is manifesting in the collapsed fortunes of a Miami trader. The political origins of the housing boom–that many hedge funds fed from– are right here, twined like a golden thread in the chain of campaign contributions links builders, lobbyists land speculators and Wall Street– still freely circulating and immune to criticism by the media.

If you are looking for particular scoundrels, start with key McCain economic advisor former Senator Phil Gramm, now vice chairman of the Swiss bank UBS, who helped speed the deregulation of the financial industries and who just lashed out at Americans as “a nation of whiners”.

That clunker dropped at the same moment Miami production homebuilders, like beleagured Lennar, and lobbyists like Sergio Pino and Rodney Barreto–Miami’s local power brokers– are begging for government bailouts of their own cratering investments in land outside the Urban Development Boundary.

“Help us, help us,” they cry, expecting their pockets to be lined by insider deals from big infrastructure “economic rescue plans”, including new zoning changes to put more sprawl in western suburbs edging the Everglades.

Never mind that the last tranche of buyers flushed out like dove, long ago, or, that critics used to be called “elitists”, who complained about the costs of unsustainable growth. You don’t hear that, anymore. But you also don’t hear the history of what happened, or, most any other relevant news except iterations of the spin machine.

Look no further of reason for investors shunning the US dollar.

Yesterday, the Herald reported: “Devaney himself has lost more than $100 million, he said. His losses amount to about half his net worth, he added. But he still has a 126-foot yacht, the Dorothy Ann — a present to his mother — moored behind his Key Biscayne home.” Devaney will never be forced out of his home like those foreclosed from ranch-style American dream homes sold by Lennar or Pino or Barreto.

Like Pino or Barreto, Devaney’s assets are happily shielded by laws and regulations they condemn when it comes to the accumulation of wealth in free markets, like inserting platted subdivisions in wetlands or polluting public lands with stormwater runoff into the Everglades.

It’s just the case that the pockets of wealth are drying down, like Everglades ponding in dry season. In a perverse way, that makes it easier for observers to see what is in them, or, what is just pretending to be there.

ALAN FARAGO lives in south Florida. He can be reached at: [email protected]

Alan Farago  is president of  Friends of the Everglades  and can be reached at  [email protected]

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Distressed bond trader Devaney ponders new fund

Editing by Padraic Cassidy

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The rise of the big, but not too big, McYachts

John Devaney bought his first boat,a dinghy, when he was 7 years old for $100 that he earned from cutting lawns. He acquired a 100-foot power yacht when he was 29. Now 36 and the owner of a Florida financial firm, he has a 142-footer, called Positive Carry, and he's beginning to think about something even bigger.

His reason: "I don't like golf."

For years, the one-upmanship at elite marinas has focused on 400-foot, $200-million-plus floating mansions. Now, thanks in part to a booming charter industry and easier financing, a new class of yachts is growing quickly. They are the nautical world's McYachts, luxurious 120- to 200-foot vessels costing $13-million to $80-million. With banks using yacht loans to lure high-end clients, the initial cash outlay can be $4-million or less.

The new entrants are changing some of the culture of this rarefied world. St. Barts harbormaster Jacques Greux says he's seeing younger owners and more late-night partying. Designers say they're equipping more yachts with gyms, playrooms for kids and technological wizardry such as underwater cameras and theaters for movie screenings. The boats are drawing a new class of owner who aren't Wall Street titans or Silicon Valley billionaires, but include a turkey farmer, coal mine owner and the head of a billboard company.

One of these boats is Chevy Toy, a 142-foot custom-designed yacht. The gleaming white vessel has three decks, including one with a "sky lounge" that has views on three sides, water scooters and two Vespa scooters on hand for speedy onshore excursions. Its owner is Gene Reed, who made his fortune building and selling a string of Chevrolet dealerships in the southern United States. Reed's tastes mirror new megayacht owners these days, as does his choice of builder: Trinity Yachts of New Orleans.

"I made my money in the U.S. and I want to spend it here," says Reed, who paid roughly $20-million for Chevy Toy.

As with many new owners of big yachts, Reed helps offset his costs by chartering it out. Chevy Toy costs $140,000 to charter for a week in the Caribbean or New England, not counting fuel, food and tips for the crew. Chartering up to three months a year, Reed can cover more than half of his annual operating costs, which builders say typically amount to 10 percent of the price, or $2-million in the case of Chevy Toy.

In 2005, 204 boats 120- to 200-feet long were under construction, up 28 percent from 2002, while the number of boats 200 feet and bigger was virtually flat in the same period, according to Yachts International Magazine, a publication that caters to owners of large motoryachts and tracks the construction of boats by polling builders, designers and subcontractors. At least 800 of these boats have been added to the global fleet in the past three years.

Another plus for this size boat, according to owners and builders, is that it's considered a relatively safe investment, with resale values that have been consistently good. By contrast, the very biggest boats, much like extraordinarily large mansions, might sit on the market for years until a buyer comes along. David Ross, chief executive of Burger Boat Co., a Manitowoc, Wis., builder, says when you get up to boats that cost more than $80-million, the market starts to shrink: "The number of people who can write a check for that kind of money for what is, let's face it, a toy, is very limited."

These boats are emerging as leaders in the industry for design reasons, too. Francois van Well, chief executive of Feadship America, a subsidiary of the Dutch company that builds about five custom megayachts a year, says starting at 140 feet in length, a boat can have three decks above the water level, including two with views on three sides, like Reed's "sky lounge." A minimum of 190 feet is necessary if you want a fourth deck with enough space for a large gym or a movie theater.

Boat designers have been offering new features to cater to the new generation of yacht owner. Designers say onboard offices tend to be a bigger priority, for example, because many owners are active businessmen, not retirees or beneficiaries of old money. The newest seafaring offices are equipped with satellite communications that enable owners to remain seamlessly connected to their terrestrial headquarters.

Demand for these boats has given new life to the U.S. boat-building business. Until recently, buyers of giant boats patronized legendary European companies such as Lurssen in Germany and Feadship in the Netherlands, in part because of their reputations for fine interior finishes, but also because they were the only boatyards capable of building large yachts. Today, Trinity Yachts pushes a different proposition: high-quality vessels for up to 35 percent cheaper when you factor the weak dollar going to European shipyards and less expensive labor costs in the United States.

Since it completed its first yacht in 1990, Trinity has turned out 26 for 21 customers. Similar growth is taking place at Seattle-based Delta Marine, which has been building boats since the 1960s. Jack Jones, one of the company's owners, says "most of the people who come to us want yachts that are bigger than 100 feet and smaller than 200." The company is launching four yachts during 2006: three that are between 123 and 164 feet long, and a 240-footer, the biggest yacht to be built on U.S. soil since the 1930s.

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As Subprime Market Implodes, a Contrarian Prospers

By Vikas Bajaj

• April 12, 2007

KEY BISCAYNE, Fla. — In a clubby market where securities based on risky mortgages, credit card debt and other financial assets are traded, John Devaney is known for making brash pronouncements — and for often being proved right.

“I personally hate subprime,” Mr. Devaney declared at an American Securitization Forum conference in late January, “and I’m kind of hoping the whole thing explodes.”

He certainly got his wish. Within a month of his remarks, several big lenders to people with weak credit — specialists in what is known as the subprime market — began collapsing. Now, as investors and policy makers ponder the wreckage, it is clear that asset-backed securities, or bonds, played an important role in subprime’s rapid rise and its messy fall.

And as a number of big players swoop in, hoping to make a killing while cleaning up the mess, Mr. Devaney is counting on his contrarian instincts to serve him well in the uncertain atmosphere.

Mr. Devaney, 36, has amassed a fortune he estimates at $250 million by becoming a major dealer in asset-backed bonds through his company, United Capital Markets. As the powerfully fickle market has gone through several giddy booms and wrenching shake-ups in the last decade, he and other nimble traders in a small fraternity of investors have been able to profit handsomely by taking advantage of the market’s wide swings.

“A lot of people would argue that markets are very efficient,” he said during an interview at his home here on the Intracoastal Waterway, where he keeps his 140-foot boat and has filled the walls of his mansion with paintings by Renoir, Cezanne and others. But “in these over-the-counter markets, fear and confidence hold completely equal weightings to driving prices up and down as do the fundamentals.”

Asset-backed securities have become an important source of capital for consumer and business debt, generating fortunes on Wall Street. But despite remaining a relative outsider, Mr. Devaney has done very well indeed.

His success over the last six years has made him prominent in Florida social, political and philanthropic circles, donating to a range of causes from literacy programs to the Republican Party.

Peers and colleagues describe him as both a court jester who entertains and shocks contemporaries at conferences and a visionary who stays up late to glean details from dense bond documents. They wonder, though, whether he can continue to stay ahead of the game.

“I don’t think there is anyone in the business who wouldn’t want to be John Devaney,” said Mark H. Adelson, a senior analyst with Nomura Securities in New York, “to have the insights and guts to do what he did, as well as the managerial skills, the analytic skills to pull it off.”

Mr. Devaney says he buys when others are selling in a panic. He sells when others are ready to buy, analysts and fellow traders say.

His experience trading mobile home loans, credit card debt and airplane leases after the terrorist attacks of Sept. 11 shows that while the secondary market for securitized assets has grown huge, it is still inefficient at gauging and pricing risk, especially for out-of-favor assets and in times of stress.

Mr. Devaney said he first realized he could profit from the market’s flaws in 1998, when investors rushed out of risky bonds after the hedge fund Long-Term Capital Management buckled and Russia defaulted on its debts. Unnerved by those crises, many investors dumped bonds backed by aggressive home equity loans made to people with good credit.

“It was just like it is now: ‘Oh! Oh! Another news tidbit of New Century news. Oh, my god!’ ” he said in a mockingly hysterical tone, referring to the mortgage company that has filed for bankruptcy protection.

From the prospectuses for those securities, Mr. Devaney divined that bondholders would get their money back even if 30 percent of the homeowners defaulted on their loans. He bought the bonds for 50 cents on the dollar for himself and for clients.

As the scare faded and it became apparent that homeowners would not default in big numbers, he sold for handsome profits. It was a formula he has used time and again ever since.

Mr. Devaney is filled with a frenetic energy as he speaks, his voice rising as he builds up his arguments. He gesticulates extensively and stands up several times, once to demonstrate with his hands the small size of the rented house where he started his firm in 1999. He long ago kicked off his shoes; his BlackBerry and its holster are strewn on the floor.

The packaging and selling of mortgages into bonds, a process known as securitization, is not new. It has been used for decades by Fannie Mae and Freddie Mac, the government-sponsored mortgage buyers, and it has helped lower the cost of mortgages.

Beginning in the 1990s, though, Wall Street started securitizing all manner of financial assets, including riskier mortgages that Fannie and Freddie could not buy. Last year, the industry issued $1.23 trillion in asset-backed bonds, nearly half being mortgage related. That is up from less than $300 billion in 1999.

With interest rates at historic lows in recent years, investors eagerly snapped up high-yielding asset-backed bonds, sometimes at a premium to their face value.

It now appears, though, that subprime lenders pumped up their business as the housing boom faded by not requiring down payments and, in many cases, not bothering to verify borrowers’ incomes. Those practices, coupled with weakening home prices, have led to a surge in defaults.

“People don’t know what is under the hood of these securities,” said Scott C. Syphax, president and chief executive of the Nehemiah Corporation of America, a nonprofit group that provides down-payment assistance to low-income borrowers.

Investors in subprime bonds believed they would be protected by losses because of how the securities were structured. So far, most have been, but Mr. Devaney and others believe that the holders of some bonds could be hurt as defaults rise further. He hopes to profit from their loss.

Asset-backed bonds are sliced into several segments, each with its own risk rating — AAA, BBB, BB and so on. Investors in the top grades earn a lower interest rate but are paid first. Those at the bottom earn a bigger return, but if too many homeowners miss payments, they are left holding an empty bag.

The AAA segment typically makes up the biggest portion of the securities, but it could not exist if enough investors were not willing to buy lower-quality portions.

It is in those subordinated segments that Mr. Devaney operates.

The son of a lawyer and a tutor, Mr. Devaney grew up in Key Biscayne. He showed an early aptitude for math that was encouraged by his mother, the tutor.

When he was a teenager, his parents divorced; his older brother dropped out of high school and struggled with drug addiction, leaving Mr. Devaney adrift. He was thrown out of a boarding school for sneaking off campus to attend parties. “I just didn’t care,” he said.

He started shaping up in college. Admitted under probation to Colorado State University, he studied finance and English. He bought a 2,500-square-foot house and made his monthly payments by renting out rooms to friends. During two summer vacations, he earned $60,000 by reviving a moribund bar at a hotel in Miami in exchange for a share of the profits.

In a sign of what was to come, he also made $120,000 trading options in the shares of Motorola. (He lost most of that money in a single bet on the options after he graduated.)

After returning to Florida, Mr. Devaney worked at two small investment firms selling and trading bonds before he started United Capital in 1999.

The firm now employs more than 80 people. Mr. Devaney owns the largest land holding here, including the house that was the setting for the Al Pacino movie “Scarface.”

He manages a hedge fund that has $620 million in assets and that had an estimated return of 40 percent last year. His nascent investment-banking business recently became the financial partner for a five-million-square-feet condominium project near Boca Raton.

His reputation was established, in part, from big parties on his yacht, Positive Carry, a term for borrowing at a lower rate than you earn from your investments, at industry conferences. At the meetings, he frequently sponsors performances by Jay Leno and bands like Counting Crows and the Doobie Brothers. His Gulfstream jet is outfitted with broadband Internet service, he says, so he can trade while he is traveling.

Joseph M. Donovan, who retired as the head of Credit Suisse’s asset-backed business in January, says Mr. Devaney, whom he likes, reminds him of a lot of successful strong-willed bond traders. “He is outspoken, and he is brash,” Mr. Donovan said. “He has a way of making his voice heard maybe louder than his resources would otherwise indicate.”

The image of the lavish and loud millionaire rankles Mr. Devaney, who said he had stopped drinking when his wife became pregnant with the first of their three children.

The plane, boat and parties save time, he said, help make a name for his company, and provide tax benefits.

“It’s not to be flamboyant; it’s for advertising,” he said. “We don’t have a huge sales force like Merrill Lynch or Morgan Stanley or Credit Suisse.”

Mr. Devaney’s ambitions are big. He hopes eventually to take United Capital public and raise money in a corporate bond offering so he can have a steady source of capital. Last year, the firm traded $29.9 billion in asset-backed securities and earned net income of $90 million.

But to take his firm to the next level, Mr. Devaney would have to delegate more responsibility and diversify away from the riskier segments of the financial markets.

“I can take less risk,” he said. “I have already arrived.”

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Hedge-Fund Manager John Devaney Is Just Such a Dork

Hedge-fund manager John Devaney is one of those terrible dorks who is just begging to be bullied. If he were on Mad Men , he would be Pete Campbell, only less likable . Devaney’s United Capital was, for about five minutes, very successful. But he just couldn’t be cool about it. He ended up buying this helicopter and a yacht he named “Positive Carry,” which was queer, but no one said anything to his face about it because he has all the money. Then he stupidly lost $600 million dollars on asset-backed securities last year and had to sell said plane and said yacht. He couldn’t be cool about that, either. “I am bleeding, personally,” he told the Times . Which is why we’re not exactly surprised to hear that last week at the conference for the asset-backed securities industry in Miami, Devaney was heckled off the stage. Or that afterward, in an attempt to make amends, he invited everyone back to his mom’s yacht for drinks. Or that, even though Momma D wasn’t actually there to show everyone the Hummel figurine collection, the party still sucked, so much so that according to the Post , two investors who had lost a total of $1.5 million decided they were going to steal some of the art hanging on the walls in order to recoup their losses. Because, really, Devaney kind of deserves it. Unfortunately, said investors then realized they were drunk and wimped out. But not before, we hope, giving him an Atomic Wedgie and leaving him tied naked to the   mast.

Devaney Booed OffStage [ NYP ]

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JOHN Devaney , who be came the poster-boy for hedge-fund blow-ups when his $600 million fund went belly-up earlier this year after a wrong-way bet on the direction of the asset-backed securities index, was heckled off the stage in Miami last week during the annual confab for the asset-backed securities industry.

Devaney, who made no friends after his United Capital Markets’ flame-out left investors with zero payout, began to speak during a Monday morning discussion at the conference but soon began a rant on why the markets were wrong and he was right.

The crowd began to boo and the microphone was taken away from him, according to several spies in attendance.

Devaney, whose taste for the high life was evident as he was often seen with his 124-foot yacht and Sikorsky helicopter, followed his morning performance with an invitation-only only party that night aboard a 125-foot yacht called Dorothy Ann – a boat he borrowed for the night from his mother!

He had to sell his yacht, called Positive Carry, and his chopper.

At this point, the day took another odd twist. Two invitees who spoke to The Post on condition of anonymity said they stopped by Devaney’s soiree for the free drinks and to see what the boat looked like.

During the night, two inves tors who had lost a total of $1.5 million continued to stew over their loss and, with the help of a few cocktails, cooked up a plan to steal some of the expensive art hanging on the walls of the yacht, our spies reported.

It was the only way they would ever see a dime’s return on their Devaney investments, they thought. After the party ended, the duo returned to the boat. But before they boarded, the thought of getting arrested for grand larceny got the better of them and they backed off.

Devaney said he still trades his own money, as much as $50 million, and recently bought $500 million of distressed bonds for between five cents and 10 cents on the dollar.

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Hedge fund manager devaney returns to subprime after yacht sale.

Bloomberg- Hedge fund manager John Devaney, who had to sell his yacht and jet plane last year after wrong-way bets on mortgage securities, says it’s time to buy bonds backed by subprime loans.

The chief executive officer of United Capital Markets Holdings Inc., who lost more than 35 percent for at least one client last year and prevented investors from withdrawing their cash, says bonds derived from subprime mortgages are a bargain after falling as low as 10 cents on the dollar. TCW Group Inc. and Pacific Investment Management Co. are also betting that prices will recover.

"Just because I lost money doesn’t mean I will quit, no way," Devaney, who sold his boat "Positive Carry" and Gulfstream IV, said in a telephone interview from Key Biscayne, Florida. “Prices have collapsed and this is the best opportunity I’ve seen in my career.”

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John Devaney Apparently Selling Everything Not Nailed Down

Page Six Magazine: John listed his Aspen mansion for $21.5 million in July 2007, when his hedge fund sank and he started stiffing investors for millions. "I'm totally devastated," he moaned after hemorrhaging more than $150 million of his own money. "I am bleeding, personally." Within the past 18 months he has hawked his 142-foot yacht, the Positive Carry ($23.5 million), a Sikorsky helicopter ($11 million) and a Renoir ($13.5 million). "Devaney may finally have to start living like a millionaire instead of a billionaire," sniped one detractor. "I'm sure it will be tough."

But things may be looking up...

"Instead of crawling under my desk," John says, "I'm holding my head up high." An insider reports he just bought a seaplane and still trades with the $50 million he has left.

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Cruising the Moskva River: A short guide to boat trips in Russia’s capital

There’s hardly a better way to absorb Moscow’s atmosphere than on a ship sailing up and down the Moskva River. While complicated ticketing, loud music and chilling winds might dampen the anticipated fun, this checklist will help you to enjoy the scenic views and not fall into common tourist traps.

How to find the right boat?

There are plenty of boats and selecting the right one might be challenging. The size of the boat should be your main criteria.

Plenty of small boats cruise the Moskva River, and the most vivid one is this yellow Lay’s-branded boat. Everyone who has ever visited Moscow probably has seen it.

This option might leave a passenger disembarking partially deaf as the merciless Russian pop music blasts onboard. A free spirit, however, will find partying on such a vessel to be an unforgettable and authentic experience that’s almost a metaphor for life in modern Russia: too loud, and sometimes too welcoming. Tickets start at $13 (800 rubles) per person.

Bigger boats offer smoother sailing and tend to attract foreign visitors because of their distinct Soviet aura. Indeed, many of the older vessels must have seen better days. They are still afloat, however, and getting aboard is a unique ‘cultural’ experience. Sometimes the crew might offer lunch or dinner to passengers, but this option must be purchased with the ticket. Here is one such  option  offering dinner for $24 (1,490 rubles).

If you want to travel in style, consider Flotilla Radisson. These large, modern vessels are quite posh, with a cozy restaurant and an attentive crew at your service. Even though the selection of wines and food is modest, these vessels are still much better than other boats.

Surprisingly, the luxurious boats are priced rather modestly, and a single ticket goes for $17-$32 (1,100-2,000 rubles); also expect a reasonable restaurant bill on top.

How to buy tickets?

Women holding photos of ships promise huge discounts to “the young and beautiful,” and give personal invitations for river tours. They sound and look nice, but there’s a small catch: their ticket prices are usually more than those purchased online.

“We bought tickets from street hawkers for 900 rubles each, only to later discover that the other passengers bought their tickets twice as cheap!”  wrote  (in Russian) a disappointed Rostislav on a travel company website.

Nevertheless, buying from street hawkers has one considerable advantage: they personally escort you to the vessel so that you don’t waste time looking for the boat on your own.

Prices start at $13 (800 rubles) for one ride, and for an additional $6.5 (400 rubles) you can purchase an unlimited number of tours on the same boat on any given day.

Flotilla Radisson has official ticket offices at Gorky Park and Hotel Ukraine, but they’re often sold out.

Buying online is an option that might save some cash. Websites such as  this   offer considerable discounts for tickets sold online. On a busy Friday night an online purchase might be the only chance to get a ticket on a Flotilla Radisson boat.

This  website  (in Russian) offers multiple options for short river cruises in and around the city center, including offbeat options such as ‘disco cruises’ and ‘children cruises.’ This other  website  sells tickets online, but doesn’t have an English version. The interface is intuitive, however.

Buying tickets online has its bad points, however. The most common is confusing which pier you should go to and missing your river tour.

“I once bought tickets online to save with the discount that the website offered,” said Igor Shvarkin from Moscow. “The pier was initially marked as ‘Park Kultury,’ but when I arrived it wasn’t easy to find my boat because there were too many there. My guests had to walk a considerable distance before I finally found the vessel that accepted my tickets purchased online,” said the man.

There are two main boarding piers in the city center:  Hotel Ukraine  and  Park Kultury . Always take note of your particular berth when buying tickets online.

Where to sit onboard?

Even on a warm day, the headwind might be chilly for passengers on deck. Make sure you have warm clothes, or that the crew has blankets ready upon request.

The glass-encased hold makes the tour much more comfortable, but not at the expense of having an enjoyable experience.

Getting off the boat requires preparation as well. Ideally, you should be able to disembark on any pier along the way. In reality, passengers never know where the boat’s captain will make the next stop. Street hawkers often tell passengers in advance where they’ll be able to disembark. If you buy tickets online then you’ll have to research it yourself.

There’s a chance that the captain won’t make any stops at all and will take you back to where the tour began, which is the case with Flotilla Radisson. The safest option is to automatically expect that you’ll return to the pier where you started.

If using any of Russia Beyond's content, partly or in full, always provide an active hyperlink to the original material.

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