Anecdote Inflation

Wilbur Ross, talking to the FT in April:

Anecdotally we syndicated a loan for one of our companies recently, and I noticed that one of the hedge funds had bought it, bought a small piece, a $10 million piece, but never came to any of the due diligence meetings. So I called the fellow who runs the hedge fund, because I know him, and said: thank you for participating, but I was surprised nobody came for diligence. He said: for a $10m loan, it is not worth sending someone to a meeting. Makes you wonder how many $10m pieces are in that portfolio without any due diligence.

Wilbur Ross, talking to Reuters in June:

Ross gave an anecdote of one hedge fund who took a $20 million stake in one of his portfolio companies. “I called him to thank him, but I told him that nobody from his fund came to due diligence. He said ‘I know that.’ I was surprised, and he said ‘we’re only going to put $20 million in we didn’t think it was worth sending anyone.’ So it makes me wonder, how many of these fellows are buying the things without due diligence.”