Hedge Fund Manager Tells All in New Book

The book is being marketed as a gripping John Grisham-style tale of Wall Street.

It is true that it takes place on Wall Street, but it could only be gripping for the most wonkish of investors. And it lacks the decisive ending of even the most rudimentary thriller, financial or otherwise. But Fooling Some of the People All of the Time (Wiley) is nonfiction -- and all active investors should read it.

The book's author, hedge fund manager David Einhorn, is emerging as the public face of an industry that is, by regulation and tradition, freakishly private. Writing this book -- about a years-long investment that hasn't worked out -- just might be the most bumptious thing I've ever seen a hedge fund manager do.

Hedge Fund Legend Writes Must-Read

Let me make clear that Einhorn's fund, Greenlight Capital (GLRE Quote), has been a top performer over the years, with big winners on the long side in addition to some highly successful shorts like Elan (ELN Quote), Boston Chicken and Samsonite (SAMC Quote). (Like anyone else with success, Einhorn is no pillar of perfection when it comes to recognizing trouble: He served on the board of subprime lender New Century (NCBC Quote), quite a demerit to slap on his record.)

It is Einhorn's Allied Capital (ALD Quote) short position that appears to be the sweat of his career. His obsessive, difficult experience with it began at a charity auction where several money managers were invited to introduce their best pick to the assembled donors. Einhorn spoke about shorting Allied, a private equity firm that, to Einhorn's eye, used fuzzy accounting. You can watch the speech at www.foolingsomepeople.com.