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Hedge Funds
- Thread starter BlasterBates
- Start date
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"One of the main problems experienced by hedge funds is the extent of leverage in the industry. The funds were able to take on huge amounts of debt, with little capital needed as security, to boost returns. One observer said some of the leveraged strategies were like "picking up pennies in front of a steamroller, and that only takes a turn in the market to cause severe problems"
These huge leverages should have been banned long time ago - in fact banks were unable to use those leverages because of capital requirements, so they offloaded them into hedge funds who were very poorly (if at all) regulated. Look at shady companies used by Northern Rock who held billions of debt papers while being located in offshores or outside of normal regulation. That's what was driving crazy asset bubble in the last decade - the most astonishing thing is that those people who run hedge funds thought of themselves like they were some kind of Buffets or something
These huge leverages should have been banned long time ago - in fact banks were unable to use those leverages because of capital requirements, so they offloaded them into hedge funds who were very poorly (if at all) regulated. Look at shady companies used by Northern Rock who held billions of debt papers while being located in offshores or outside of normal regulation. That's what was driving crazy asset bubble in the last decade - the most astonishing thing is that those people who run hedge funds thought of themselves like they were some kind of Buffets or something
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"One of the main problems experienced by hedge funds is the extent of leverage in the industry. The funds were able to take on huge amounts of debt, with little capital needed as security, to boost returns. One observer said some of the leveraged strategies were like "picking up pennies in front of a steamroller, and that only takes a turn in the market to cause severe problems"
These huge leverages should have been banned long time ago - in fact banks were unable to use those leverages because of capital requirements, so they offloaded them into hedge funds who were very poorly (if at all) regulated. Look at shady companies used by Northern Rock who held billions of debt papers while being located in offshores or outside of normal regulation. That's what was driving crazy asset bubble in the last decade - the most astonishing thing is that those people who run hedge funds thought of themselves like they were some kind of Buffets or something
AtW.
Give it a rest please, no one gives a toss what you think and newsflash - neither the financial markets or the FSA or anyone else for that matter either.
- Thanks received
- 1,318
- Thanks received
- 1,318
- Thanks received
- 1,318
