Finance is more forgiving than politics. Dominique Strauss-Kahn is trying to raise $2 billion to launch a macro hedge fund. The first stop on the roadshow is China. But given current events, the former French finance minister and International Monetary Fund managing director may find that his best bet is to convince his many Russian friends that he can make them money.
When DSK, as Strauss-Kahn is widely known, was arrested for sexual assault in New York in May 2011, Vladimir Putin, then Russia's prime minister, went public with his scepticism and hinted at a dark conspiracy. After Strauss-Kahn quit his IMF job and, months later, prosecutors dropped the charges, he embarked on a low-profile career as an international consultant. He soon found work in Russia.
He now sits on the board of the bank owned by Rosneft, Russia's largest oil company, whose chief executive, Igor Sechin, narrowly avoided appearing on the list of individuals hit by Western sanctions, according to news reports. Strauss-Kahn is also a director of the Kremlin-sponsored fund designed to attract foreign investment to Russia, a task that will be arduous in the months ahead.
Moscow, though, is not the only place where a chequered past as a politician is no impediment to a lucrative present in business. Nicolas Sarkozy, whom Strauss-Kahn might have challenged in the last French presidential election had his career not taken its bizarre twist, recently explored launching a private equity fund with Qatari money. Big fund management firms routinely stuff their international advisory boards with retired or outcast politicians. The idea is to turn connections into profit.
DSK will try to make successful investments, not just collect generous consulting fees like some of his former peers. That could be a tough sell, even to his Russian circle. Macro funds have disappointed hedge fund investors lately, losing money on average in all of the last three years, according to Hedge Fund Research. Successful or not, his foray into the world of two-and 20 fees will add to general voter cynicism, as public service looks more and more like just a stepping stone towards the world of real money.
Source: Reuters
When DSK, as Strauss-Kahn is widely known, was arrested for sexual assault in New York in May 2011, Vladimir Putin, then Russia's prime minister, went public with his scepticism and hinted at a dark conspiracy. After Strauss-Kahn quit his IMF job and, months later, prosecutors dropped the charges, he embarked on a low-profile career as an international consultant. He soon found work in Russia.
He now sits on the board of the bank owned by Rosneft
Moscow, though, is not the only place where a chequered past as a politician is no impediment to a lucrative present in business. Nicolas Sarkozy, whom Strauss-Kahn might have challenged in the last French presidential election had his career not taken its bizarre twist, recently explored launching a private equity fund with Qatari money. Big fund management firms routinely stuff their international advisory boards with retired or outcast politicians. The idea is to turn connections into profit.
DSK will try to make successful investments, not just collect generous consulting fees like some of his former peers. That could be a tough sell, even to his Russian circle. Macro funds have disappointed hedge fund investors lately, losing money on average in all of the last three years, according to Hedge Fund Research. Successful or not, his foray into the world of two-and 20 fees will add to general voter cynicism, as public service looks more and more like just a stepping stone towards the world of real money.
