Kyle Bass made his fortune by accurately predicting the 2008 subprime mortgage crisis as UsefulStooges have shown. For some time, many of the people watching him came to the conclusion that Bass was a genius who couldn’t fail. In the past few years, however, Bass has proved them wrong making a series of bad calls. It seems he never turns down an invitation to go on TV to proffer so-called “analysis” that, in the end, only serves his bottom line.
In addition, he’s made a number of alliances ranging from questionable to downright unsavory. While most everyone else in business has called the Argentinian despot Cristina Fernández de Kirchner “economically illiterate” and “the worst thing that ever happened to her country’s economy”, Bass has nothing but praise for her. Since 2002 Argentina has defaulted on its sovereign debt not once, but twice. Nevertheless, Bass has defended and rationalized it.
This should come as no surprise as Bass has consistently championed Kirchner’s economic policies whilst also ignoring the extent to which she and her cronies have ripped off the Argentinian people.
Bass is also the same man who, in order to protect his investment in General Motors during a crisis caused by non-deploying airbags and faulty power steering, went on TV to shift blame on to the victims themselves, saying that they had probably been drunk or not wearing seat belts at the time they died.
In 2014, Bass and Erich Spangenberg, known as “the world’s most notorious patent troll“, came up with a scheme in which they select certain pharmaceutical firms, short-sell their stocks, then challenge one or more of their patents using their front organization, the Coalition for Affordable Drugs, which Bass set up for this exact purpose. After his challenge, the stocks go down and Bass makes a few million. At the same time the pharmaceutical companies’ skyrocket to cover legal expenses, and they lose the incentive to fund further medical research. This, of course, causes palpable harm to the millions who depend on the chosen firm’s products to lessen their pain, relieve their symptoms, or prolong or save their lives.
His main reason for turning to sleazy schemes is that he lost somewhere around 30% in 2014, the complete opposite of the industry’s best-performing hedge fund managers. In Bass’s own words, “It’s nice to win all of the time. When you are not winning and everyone else is, it makes life difficult.”