Some key sentences, translated:
The preliminary estimates show there is effectively no value left for the investors in the Enhanced Leverage Fund and very little value left for the investors in the High-Grade Fund as of June 30 2007.
Translation: You’re screwed.
At this time approximately $1.4 billion remains outstanding on this [$1.6 billion] line and we continue to believe there are sufficient assets available in the High-Grade fund to fully collateralize the repo facility.
Translation: We’re not.
In the past weeks, Bear Stearns has taken action to restore investor confidence [blah blah blah] extra layer of oversight [blah blah blah] hedge fund risk management function [blah blah blah]...
Translation: We faxed Ralphi Cioffi’s resume to (403) 217-2470.†
Our highest priority is to continue to earn your trust and confidence each and every day, consistent with the Firm’s proud history of achievement.
Translation: Thanks for playing. Please enjoy the rest of your evening.
Loadzaluvvly links, including the letter in full, after the margin call.
'Dear Client of Bear, Stearns & Co Inc
Courtesy The Wall Street Journal
Subprime Uncertainty Fans Out [$$]
By Kate Kelly, Serena Ng And Michael Hudson
The Wall Street Journal Jul. 18 2007
Bear Stearns Warns Hedge Fund Investors of Total Loss
by Yalman Onaran
Bloomberg Jul. 17 2007
And pretty much all over the place.
† Reader competition: The usual free lifetime subscription to NakedShorts for the first reader to identify the significance of the number to which Cioffi’s resume was faxed.