Subprime Meets Wall Street, Investor Forced To Sell Yacht

Meet the subprime mortgage meltdown’s other victim, a millionaire mortgage investor who has been forced to put his yacht up for sale—for $23.5 million.

Investing in “mobile home loans” and “credit card debt” didn’t work out so well after all. Will we be seeing this guy on the infomercials soon?

From the NYT:

In April, The New York Times took a look at Mr. Devaney during a more prosperous period:

‘I personally hate subprime,” Mr. Devaney declared at an American Securitization Forum conference in late January, ”and I’m kind of hoping the whole thing explodes.”

As The Times reported, Mr. Devaney had counted on his contrarian instincts to serve him well at a time when big players swooped in to make a killing while cleaning up the mess. By the time of The Times article, Mr. Devaney had amassed a fortune of $250 million by becoming a major dealer in asset-backed bonds. His success in trading mobile home loans, credit card debt and airplane leases after the terrorist attacks of Sept. 11 helped him succeed by profiting when others had panicked.

His rewards could be counted by the Renoirs and Cezannes hanging in his South Florida home. One analyst told The Times: ”I don’t think there is anyone in the business who wouldn’t want to be John Devaney.”

How things have changed since April! Devaney has since been sunk by subprime.

Over at the Times they’re trying to think of some new names for Devaney’s sinking ship. It’s currently called “Positive Carry” which is a trading technique. Some suggestions from the NYT:

* Margin Call
* Sinking Ship
* No Doc Dinghy
* Sub-Merged
* Not so FICO

Oooh, that’s mean.

Subprime’s Other Victims: The Yacht-Owners [NYT]


Edit Your Comment

  1. axiom says:


  2. Cowboys_fan says:

    Am I supposed to feel bad?

  3. CumaeanSibyl says:

    Does he have enough money left to purchase the world’s smallest violin?

  4. Starfury says:

    If you play with fire you will get burned. I don’t feel sympathy for a super rich guy like this. Boo hoo poor me, I have to sell my yacht.

  5. Nemesis_Enforcer says:

    LOl sucka!!! serves you right…karma anyone?

  6. Snakeophelia says:

    Do we need to take up a collection to buy his wife a sandwich? I thought the camera ADDED pounds. You could grate cheese on that chest of hers.

  7. Anonymous says:

    25 million dollar toy, eh?

    Funny. If I had 25 million, I’d retire, buy a house on a lake in the trees, and make furniture at a nice gentle pace… forever.

    I have no sympathy for this man.

    Lots of envy, mind you, but no sympathy.

  8. lincolnparadox says:

    His net worth is probably still over $100 million. Just because he’s selling a stupidly expensive boat, it doesn’t mean that he’s looking into food stamps.

    @Snakeophelia: Granted, food stamps might be good for this lady…

  9. Havok154 says:

    I bet he’s selling it to pay off his 16th rolls royce. Poor him.

    When he has to scrounge up cash to pay for Chinese food, tell him to give me a call.

  10. swalve says:

    @Snakeophelia: What’s wrong with you?

  11. Mike626 says:

    > In April, The New York Times
    > took a look at Mr. Devaney during
    > a more prosperous period:

    I laughed, until I realized it read ‘prosperous period’ not ‘preposterous period’

  12. adrock75 says:

    Poor guy. I remember reading the original article and thinking “What a gigantic douche!” and then “He will soon be screwed!”

  13. Rusted says:

    @s0crates82: Not even much envy and less sympathy.

  14. ahwannabe says:

    In the words of the immortal Nelson Muntz: “HA-ha!”

  15. BillyMumphry says:

    While I have no sympathy for this man, I have even less for Tyrone Jackson, Billy Ray Jones, and Juan Garcia who got loans for homes they could not afford and are now screwed. This guy is at least intelligent.

  16. anita_job says:

    Cry me a river.

  17. Blueskylaw says:

    For somebody so smart it’s surprising this happened to him. When you hear of a guy pumping gas get a 500,000 loan for a house, you just know the sub-prime MUST collapse some day. Look at what happened to New Century(NEWCQ), their stock went from a high of $66.95 to a nice comfortable 27 cents. They have no problem raking in obscene profits by giving anyone that breathes a loan, but then crying uncle and help me when it tanks. They will get no sympathy from me.

  18. dantsea says:


    I have a purely selfish reason for giggling like a schoolgirl over the collapse of the subprime market. My upstairs neighbor is a mortgage broker specializing in this kind of product, working out of a home office.

    Said neighbor also has allergies from hell and refuses to take anything that might alleviate them, because only Benadryl works and he doesn’t like its sedative effect. This means that all of us who might want to enjoy a little fresh air have to take it with him making every disgusting sound one can make with a head, nose and throat for hours at a time. My particular favorite is that throat clearing CHHHHAAAAAK noise he makes, just in time for the dinner hour.

    He also thinks it’s fine to spit whatever nasty crap he can clear out of his throat onto my deck, and any time I hear the sound of a fingernail clipper I can be sure it means the trimmings will soon fall on top of the spit. Yes, he’s been told not to do it.

    Anyway, he’s moving. Can’t afford San Francisco rent anymore. He’s gone as of Friday. Couldn’t have happened to a more deserving guy. Farewell, Barfbag!