Hedge-fund guy dips his snout in bailout trough

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World stocks tumble on credit worries

: Mark Gilbert uses this parody to look at the funny side of the dreary and scary days in the financial markets and also hit out at some of the characters

Dear investor,

It's that time of year again when we are obliged to update you on the performance of our hedge fund, Short-Term Capital Mismanagement LLP.

I apologise for the photocopied letterhead, the handwritten envelope and the fact that you had to pay the postage upon receipt of this missive. Austerity is the new black. We at Short- Term are committed to preserving your capital, so we're reusing teabags, stocking the bathroom with one-ply rolls, and Thor, the personal trainer and masseur, is working a three-day week.

First, a couple of legal niggles need addressing. Some of you have suggested that we are trading under false pretenses. Admittedly, it is very hard to be a Global Bottom-Up Long-Short Fund when short selling is as popular as a Florida real-estate agent.

We are sure the regulators had excellent reasons for defending such mainstays of the global economy as jewelry retailer Zale Corp. and freight company Ryder System Inc. They just haven't bothered to share that justification with anyone.

And we are, indeed, under investigation for spreading rumors that American International Group Inc. was too big to fail, that Fannie Mae and Freddie Mac would end up government- guaranteed, and that Goldman Sachs Group Inc. and Morgan Stanley could be entrusted with deposits.

Be assured, though, that we stocked up on the relevant securities before gossiping to our pals. The authorities are fine when we're buying stuff (unless it's oil); they get upset only when we sell (unless we dumps commodities).

Wall Street corpses

As I sit at my desk, resplendent in a Lehman Brothers Holdings Inc. souvenir T-shirt, a Lehman baseball cap and a pair of specially reinforced Lehman money-market trading shorts, I keep asking the same question: Why was Lehman the only lemming allowed off the cliff? We've spent the past few weeks trying to get our assets back from the Lehman administrators. The good news is that we have insurance. The bad news: We bought it from AIG.

We were nervous this week that Congress wasn't buying US Treasury Secretary Henry Paulson's "Rocky Horror Picture Show" cameo -- "It's just a jump to the left. And then a step to the left. Let's do the Timewarp again."