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Vet67to82 (< 20)

Hedge Fund meltdowns



November 09, 2008 – Comments (1)

 *  I am simply amazed at the hedge fund cry babies.  *  The whole world financial melt down is on them and on the governments that allowed them to operate in secrecy, and the FORCED liquidation that excerbated a bad situation going to worse as their holders wanted OUT. I strongly believe all hedge funds must be ordered to be a publically traded stock, with ALL the reporting requirements, like closed end funds (CEFs), or ETFs. If you do not want people of limited means putting money in, then make the shares expensive like BRK/A and BRK/B, Warren Buffett's Berkshire Hathaway. By making the hedge funds publically traded, investors can place buy and sell orders, so if a holder wants to get out, the hedge funds don't have to liquidate positions to fund exits.
** Further more, hedge funds should NOT be buying, selling, hedging, or speculating in commodites that are needed to feed the global population, or crude, home heating oil, diesel, gasoline, etc ... If you are to trade in those commodities, you should have to show ownership of facilities capable of taking delivery of the commodities to be traded. Everyone without facilities, should be labeled as a speculator. If speculation trading in those basic commodities is to be allowed, it should be strictly limited.

1 Comments – Post Your Own

#1) On November 09, 2008 at 9:03 PM, jgseattle (26.22) wrote:

The real problem is that they are unregulated and the managers are payed 2 20.  So the more risk they take the more they collect on someone elses money.  I like that idea, anyone want to give me some money to invest?

When the investment banks were parternships they were leveraged at 10 times, when they became public they leveraged at 30 times, other peoples money.  And compensation based on returns not risk adjusted returns. 

There is a saying in managerial accounting "you get what you measure."  And that fits hedge funds to a tee.


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