The legend that I heard is that "Fred" was this guy who would show up at the local fast group ride on an old beater bike, with tennis shoes on, ripped up shorts and knees scraped from his last crash, etc. No one really liked to have Fred around - he was a dork and he didn't shower often enough, but the really really frustrating thing about Fred was that he could hang with the A group without any problems.

So a "Fred" became a derogatory term for people who aren't cool - they don't have all the latest gear, fanciest bike, hairy legs, whatever, but watch out for Fred, cause he just might dust you.....

I've also heard chainring marks on the calf refered to as Freds