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Post by unlawflcombatnt on May 3, 2007 13:18:57 GMT -6
Hedge funds now pose the biggest risk to a global financial crisis since the Long Term Capital Management meltdown in 1998. The LTCM crisis in 1998 was bailed out for $3.8 billion with funds from Wall Street and the Fed. Following the bailout, however, the hedge fund industry bounced back and has now increased to about $1.4 trillion. Many hedge funds operate in the derivatives market, which is currently estimated at around $17 trillion. (Many believe the derivatives market is many times this amount.) The very lightly regulated hedge funds are geared to wealthy investors. New York Fed President Timothy Geithner has issued a warning urging more cautious lending by hedge funds. The full story by Pedro Nicolaci da Costa can be found at Reuters.
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Post by oracelt on May 15, 2007 1:44:01 GMT -6
It gets worse. See my post today, Betting the Bank, and then some..... home-foreclosures.blogspot.com/2007/05/betting-bank-and-then-some.html....You start to get the flavor of the 'New Economy' on learning from Mackintosh, "As hedge funds move into the mainstream, managers are testing demand for ever-more exotic investments - and finding backers willing to stump up millions of dollars for funds putting cash into everything from football players, wine and art to aircraft leasing and carbon credits." .... Enter the multiplier, never far behind. Not to be outdone, Orthogonal Partners is launching a fund dedicated to - investing in exotic hedge funds. "There is a wall of money chasing every opportunity in the alternative scene so you really want to be targeting new niches where you still have a scarcity of capital and inefficiencies that can be exploited," says Dan Gore, Orthogonal's co-founder. DDGrant www.home-foreclosures.blogspot.com/
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Post by unlawflcombatnt on May 15, 2007 4:55:45 GMT -6
Very interesting.
I think the post was best summed up by the phrase: "Gangster Capitalism"
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