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40-100 hedge funds set to implode

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March 30, 2008 – Comments (3)

Naked Captialism has a piece on hedge funds in London.  Apparently London is hedge fund capital of the world, and they are having the most outlandish parties with all the money they've been paid for those short term paper profits.

There seems to be 300 point down days when these hedge funds blow up...  

3 Comments – Post Your Own

#1) On March 30, 2008 at 9:07 AM, dwot (65.40) wrote:

The Collection Agency has a good piece on moral hazard.

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#2) On March 30, 2008 at 1:04 PM, abitare (88.82) wrote:

Hedge fund implode meter: 

http://hf-implode.com/about.html

dwot,

How come you do not make a few plays in the market. You have been very accurate with your calls.

I really think women, who have the "knack" for finance can do very well, 

because they are not affected as much as men by ego, testostrone 

and the need for "juice" given by placing taking positions in the market. 

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#3) On March 30, 2008 at 1:32 PM, dwot (65.40) wrote:

Lol abitarecatania.  I have taken so many hits in my life, way, way, way too many.  I just see no point in setting myself up for another. 

I am comfortable now and I'm not going to blow it when I think the risks are too high and too hidden.

That story on the oil company -- oil is good, but them putting their funds into the ABCP, well, what I've been saying about this whole thing is you just can't predict where you'll step on a bomb. 

What happened in the depression was that good businesses got sucked under as the bad stuff trickled through the economy.  You are reading about the same kinds of stories daily.  There was a housing one yesterday.  The guy put $2 million of his personal money into the business before going bankrupt.  There were a whole string of people affected.  It talked about a contractor out $100,000 and they had been friends.  This guy didn't just cut it off and walk away and protect his $2 million, he really tried to save the business and people's lives.  Now that the contractor is out $100k, who and how does that affect his interests?  There are going to be good people all over the place having things happen to them that they'd have never thought possible just 2-3 years ago. 

I was going play about 25% of my portfolio, but I simply took the inablity of my brokerage to move some of my money as a big time red flag.  And then I do figure the investment banks are not a safe place for your money.  I trust their insurance like I trust the mortgage insurance.  Self regulation has continuously proved to be negligent. 

I am ok with 4% in this market, which is what I'm guaranteed to get.  Well, interest isn't guaranteed, but I did mangage to set some of my deposits to pay monthly. 

I did pretty well with my calls when I was in the market, but I've seen a few sink like I'd have never expected. 

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