John Paulson has had a tough year, and that’s probably a bit of an understatement. Ever since he made the prescient call that the housing market would collapse, and the sub-prime mortgage market would implode, everything he’s touched has turned to coal.
Paulson’s Advantage Plus hedge fund was down over 53% this past year and then there was his disastrous call on the Chinese timber company Sino-Forest, which over stated its timber holdings and Paulson’s hedge fund sold their entire stake at a $468 million loss. Most recently, Paulson sold his stakes in Bank of America and Citi, only to see the financial sector soar at the start of the year.
So, it was a relief and a sign that perhaps his luck had turned when he won the Mega Lotto this weekend. However, Muddy Waters, the same firm that investigated Sino-Forest, and said they were exaggerating some of their assets, now says Paulson’s lotto ticket is a fake. Paulson is fighting this allegation and says he bought the ticket at a 7-11 in Southampton along with a hot dog and a large Slurpee. Muddy Waters made this statement about Paulson and the ticket:
“We’ve had our forensic accounting analysts examine the lotto ticket and it’s blatantly clear that this is a forged ticket. To think that Paulson, who made billions of dollars years ago, would stoop to this level just shows how much he and his hedge fund are struggling. Plus, there’s no way that Paulson would ever buy a Slurpee at a 7-11.”