Bear Stearns, the fund’s clearing broker, also took a strong interest in Long-Term’s losses. But in July, the fund recovered. “Since we could see the daily P&L [profit-and-loss statement], we knew in early July there was a significant recovery,” noted Bear’s Mike Alix. “The story was, they had gone back and retested all their models and come to the conclusion that June was an expected aberration. That was the party line.”
