Tuesday, May 31, 2005

"There Was Something Really Missing With This Guy"

He liked publicity, he liked the limelight, and, most of all, he liked seeing his name on things.

He was a charismatic, well-spoken man with an interesting and oft-told personal story (“I happen to be a Cuban refuge,” he would say, even though his father had been a Cuban businessman who settled in New Jersey—not exactly the strap-the-Chevy-to-some-inner-tubes-and-row-through-the-shark-schools variety “Cuban refuge”).

Nevertheless, he made his fortune in technology stocks, and it was that money he used to fund his favorite cultural institution—specifically, the opera.

He spoke freely and often about his own generosity. It was, he said, about leaving a “moral and intellectual legacy.” Those high ideals prompted him to encourage others to be as generous as he: “My goal is to keep this extraordinary part of my culture alive.”

Despite the high profile he himself maintained, he had a thin skin when openly criticized:

“They said I only give money to people I like,” he grumbles [in an interview]. “You want me to give to people I hate?”

In fact, at times, if you ignored the expensive suits and the money and listened to what he actually said, Alberto Vilar, the world-famous, globe-trotting, recently-arrested-for-alleged-fraud co-founder of Amerindo Investment Advisors, sounded like a good case study for some doctors in Vienna.

He “liked his name writ large,” as one opera buff put it, slapping his name not only on Opera House halls but on the tiers inside the halls. He even suggested—I am not making this up—that opera donors should get bigger program billing than composers.

He also complained vocally about others not as generous as he: “I cannot do everything myself,” he once wearily proclaimed. He called Bill Gates “hopeless” and said Gordon Getty “gives peanuts.”

As Donald Trump put it more perceptively than anyone, in today's New York Times, “there was something really missing with this guy.”

Vilar always insisted the dot-com implosion had not crimped his style, despite slow-paying some of the more visible gifts he had made, and the beneficiaries of his largess tended to believe him, because they wanted to. “He reckons he can give away $50 million a year without feeling the pinch,” one opera magazine interviewer reported in 2001. Ominously, the Denver Post reported he was behind on mortgage payments for three Vail-area vacation homes, and facing foreclosure, in 2003.

Nevertheless, investors trusted Alberto Vilar. So they gave him their money—$8 billion worth, at the peak. They liked his story, they liked his early success in technology stocks, and many stayed with him way too long.

He was arrested at Newark Airport on Thursday, after returning from giving a speech at an investment conference, and is being held at the Metropolitan Correction Center in Manhattan, because the man who could “give away $50 million a year without feeling the pinch” could not make his $10 million bail.

It is yet another cautionary tale, in a world full of them, about the dangers of believing what we want to believe, and ignoring the reality behind the words.

Jeff Matthews
I Am Not Making This Up

The content contained in this blog represents the opinions of Mr. Matthews. Mr. Matthews also acts as an advisor and clients advised by Mr. Matthews may hold either long or short positions in securities of various companies discussed in the blog based upon Mr. Matthews' recommendations.


The Unknown Broker said...

Funny line on CNBC this morning. Noting how he liked his name prominently displayed -- the Vilar Section of the Opera, the Vilar Building, the Vilar this, the Vilar that -- perhaps his new digs will be known as the Vilar Manhattan Correctional Facility.

ikedim said...

These stories are fascinating to me, mainly because I can't figure out how these guy's brains work - Villar, Robert Maxwell, even Ponzi himself. They must be aware of what they're doing on some level, yet they generally seem to act as though they really believe in their own BS.

I'm actually reading a great book now about a similar case, though in a different field (AIDS research) - John Crewdson's bio of Robert Gallo, Science Fictions. It's hard to generalize, but it does seem that one red flag in these cases is a tremendous need for recognition and ego gratification. Of course this is not uncommon in legit business types as well ...

Its_strange said...

Empty words....nothing new. Wallstreet , Washington , TV . ....Words have no real meaning anymore. ..ghost words.

Its_strange said...

Even with Castro gone i have a hard time thinking Cuba wants Trump around. ...He seems to enjoy his empty words as well

tahoe kid said...

Yet another example of "Those whom the Wall Street Gods destroy, they first make glamorous."