Socialist Hedge Funds
I am not here as a political commentator but I do take note of the daily battering of the industry in the mainstream news outlets. Late last week and early this week I published a few posts on Obama and his blasting of hedge funds for looking out for their investors. You may read these posts here and here and here.Today we have a hedge fund professional standing up for hedge funds in the same way I have tried to here on this blog, here is an excerpt:
Asness of AQR Capital (who says he is speaking for himself and not his company) says the hedge funds are acting as they should act. "It is the job and obligation of all investment managers, including hedge fund managers, to get their clients the most return they can. They are allowed to be charitable with their own money--and many are spectacularly so--but if they give away their clients' money to share in the "sacrifice," they are stealing," he says in the letter.
Hedge funds haven't received a bailout, Asness notes, and haven't asked for one. "The hedge funds were singled out only because they are unpopular, not because they behaved any differently from any other ethical manager of other people's money." source
1 comment:
I really couldn't agree more. The government is attempting to bully these hedge funds into submission, but at the end of the day they are being treated unfairly, to suggest that a senior debt holder should be subordinated to a junior equity holder is absolutely ridiculous and changes the rules of the game. What faith can investors have in the capital structure of a company, how can they accurately evaluate risk if the rules are being changed on them, it will make matters worse and keep investors from these types of securities, which will only increase the financial burden on the tax payer. It absolutely ridiculous!
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