Alan Quasha, CEO of Quadrant Asset Management, says that the United States is grossly over leveraged. The US has around $54 trillion of debt – this is over 3.5 times the size of our entire economy. Before  2008, Americans’ net worth was calculated at about $56 trillion, but this has dropped by $20 trillion in the half-year opening 2009. This is the largest decrease in wealth over the shortest time that the markets have ever witnessed.

In order to exit this crisis and be able to try and regain our losses we will need to make some drastic changes, says Quasha.

In an article that appeared in “The Daily Beast”, Alan Quasha, CEO of Quadrant Management, rhetorically asked whether we can “stimulate the economy short and long term in a way that ends the financial meltdown but does not mortgage the future of our children and grandchildren?”

His answer is an unequivocal “yes”, but it can only be accomplished through more investment and a reduction in consumption. This approach suggests that investments will stimulate job creation, but consumption will “sap our already depleted wealth.”

Since Quasha believes that a “new plan needs a new vocablulary”, Alan Quasha would like to refrain from referring to a “bailout” of banks, but rather a “reengineering” of America.

He would like to see an end to propping up values and the bad habit of “throwing good money after bad businesses.” Quasha believes we should begin to think outside “the Beltway box.”

Discussing the current financial crisis, Alan Quasha, in an article which appeared in “The Daily Beast” offers several concrete suggestions for an economic recovery which will not “mortgage our grandchildren’s future.”
Opening his article with a quote from Winston Churchill, “Americans can be trusted to do the right thing, but only after they had exhausted all the other alternatives”, Quasha continues with a description of the seriousness of our deepening recession.
“America is frighteningly overleveraged, saddled with $54 trillion of debt, or 360 percent of our $15 trillion economy. Americans’ pre-2008 $56 trillion of net worth has dropped $20 trillion in the last six months alone—the greatest loss of wealth in the shortest time in history.”
Quasha also suggests that recent actions taken by the new U.S. administration seem to be heading down the wrong course, as suggested by the financial markets.

Eric Beder, co-chairman with Alan Quasha of Brean Murray, Carret & Co, was interviewed on the April 27th edition of Closing Bell with Howard Davidowitz. Maria Bartiromo is seeking advice for her viewers about how investors can make sound investment decisions during turbulent economic times.  Lack of consumer confidence is seen as a temporary but significant concern.

Listen to the video below:

When Alan Quasha, now CEO of Quadrant Management, was a student at Harvard, he played on both the tennis and squash teams. Mr. Quasha was on three national championship teams while at Harvard, so the level of competition was quite high, and most likely helped to keep  him fit for years to come.

Alan went to Harvard Law and Business School simultaneously through a special joint program. When he graduated he started practicing law. Despite the fact that Mr. Quasha enjoyed working at his law firm, due to a proactive personality he decided to start his own firm.

At the age of 29, 30 years ago, Alan Quasha actually did one of the very first leveraged buyouts.

“I figured out a way to take a company private with essentially no capital. Then came the hard part: After the deal we had to make the company work. It was a very interesting experience, and I learned that there are a whole lot of things you can do to change even traditional businesses to make them more efficient and competitive, against incredible adversity, and turn them into leading companies.”

In a discussion of how Alan Quasha of Quadrant Management has had such consistent success in the restructuring business for many years, Mr. Quasha described his technique.

Explaining that Quadrant Management are principals, as opposed to being merely consultants or advisors, Mr. Quasha  points out that,

“We restructure companies with ownership in mind because the process often requires making fundamental changes to the business model and laying out a strategy for where the business can go.”

When Quadrant began restructuring companies over 30 years ago there was little incentive to doing it as an agent, since there was no money restructuring a company that way. It pretty much had to be done by the management company as a principal, and that is how they still do it today.

Restructuring is more common during times of economic adversity, so Quadrant Management has been quite active in recent months.  One of the leading entertainment distribution companies, Genius Products, is, according to Alan Quasha’s terminology,  “a leader in ‘non-Blockbuster’ titles”, meaning that it deals with most entertainment mediums. Since Genius is already strong in the movie and DVD business, Quadrant is helping to involve them more in the music and game business.

Genco Interactive, a subsidiary of Genco Media, will be releasing “Scratch:The Ultimate DJ”, in partnership with Genius Products, LLC. This state-of-the-art video game, developed by 7 Studios, combines amazing free-form DJ tricks with fabulous rhythm game-play. Featuring music from the superstars of the Hip-Hop world, “Scratch” is set in unique urban locales and is played like other popular rhythm games. Alan Quasha, President of Quadrant Management as well as the Chariman of Genco Media explains that “Genco is focused on providing content creators the means to fund the development of a range of entertainment related products, including video games. Scratch presents a great opportunity to work with some of the most talented people in the Hip Hop music industry and bring an exciting new game to market.”

Genco Media LLC has announced a partnership with Genius Products, Inc.  in which Genius will have the exclusive distribution rights to some entertainment products acquired by Genco Media, which will include ownership in films, video games and music.

Alan Quasha, President of Quadrant Management and Chairman of Genco Media remarked, “Genco Media is focused on adding to its library of entertainment properties through the acquisition and funding of valuable films, music and video games. Our goal is to provide content creators the means to fund the development of a range of exciting entertainment related products.” In addition Quasha said, “By partnering with Genius Products, which has significant expertise in the distribution of entertainment products, we will be able to more effectively bring products to market and expand the reach of artists’ work.”

For more information you can refer to the article on this new distribution agreement.

In August 2008, Genco Media LLC, which is an entertainment-based company that Alan Quasha’s Quadrant Management Inc. backs, announced the signing of a new agreement with Genius Products, Inc.

For information on this agreement, click here, or view the Reuters press release here.

More on this agreement to follow…

Vanterra Capital is new on the financial scene, yet it is already making its debut with a $152 million closing on its first fund. This is just the opening shot in its financial activities, and it projects a second closing totaling $300 million early in 2009.

The full news release appears here, and it speaks of Vanterra “Lower Middle Market Private Equity Platform Focused on Emerging Markets and U.S” as having proven their investment strategy in the face of very trying economic markets.

The news story states, “The cornerstone of the Vanterra business model is to establish longstanding relationships with our partners — both our underlying fund managers and our investors — and leverage their value both as a source of high quality deal flow and as a unique due diligence network,” said Alan Quasha, Principal at Vanterra and CEO of Quadrant Management.”