John Meriwether
| John W. Meriwether | |
|---|---|
| Born |
August 10, 1947 Chicago, Illinois, United States |
| Occupation | Businessman Financier Racehorse owner |
John William Meriwether (born August 10, 1947) is an American hedge fund executive, seen as a pioneer of fixed income arbitrage.
Meriwether earned an undergraduate degree from Northwestern University and an MBA degree from the University of Chicago Booth School of Business.
After graduation, Meriwether moved to New York City, where he worked as a bond trader at Salomon Brothers. At Salomon, Meriwether rose to become the head of the domestic fixed income arbitrage group in the early 1980s and vice-chairman of the company in 1988. In 1991, Salomon was caught in a Treasury securities trading scandal perpetrated by a Meriwether subordinate, Paul Mozer. According to Roger Lowenstein's biography of Warren Buffett (at page 378), Mozer reportedly told Meriwether he had submitted a "single false bid" and described his effort to cover it up. Meriwether was "stunned" and inquired, "Is there anything else?" Mozer "lied" and "begged for another chance" according to Lowenstein. Meriwether then "huddled" with Salomon CEO John Gutfreund and Salomon's general counsel. They all agreed the firm should report it to the Treasury Department but nothing happened for four months as the partners, including Gutfreund, "belabored" issues of who should call whom, what to say, and when. Mozer was left at his desk and submitted another false bid, this time resulting in an SEC investigation, Gutfreund's resignation, Buffett's intervention, and (although Lowenstein does not discuss it in this book) Meriwether's $50,000 civil penalty. Meriwether decided to leave Salomon. Three years later he started LTCM, leading to Wall Street's next crisis and Roger Lowenstein's next book.
Meriwether founded the Long-Term Capital Management hedge fund in Greenwich, Connecticut in 1994. Long-Term Capital Management collapsed in 1998. The books When Genius Failed: The Rise and Fall of Long-Term Capital Management and Inventing Money: The story of Long-Term Capital Management and the legends behind it detail the events leading up to and following Long-Term Capital Management's demise.
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