Given the influence they now have over the markets, who thinks hedge funds should be regulated?
Answers
115 points
robertooroark answered 8 months ago …
I think that "Hedge Funds" are being operated as instruments of destruction, and should be highly regulated.....Daily arbitrage and short term raids are not condusive to market stability, and the concintrated attacks on great companies really skew market sentiment, to the point where the fear of Hedge fund involvment is moving sectors that aren't even in their portfolios. The Big money is driving down the prices on the best companies and will be taking over most of the world's resources at bargin basement levels, this will consoladate the strangle hold that the super rich have on the rest of the people, and lead to a facist system that is determined to of reduce "excess" population, with starvation and desease, (not to mention the occasional war)...the "bailouts" are designed to "save" the same people who are planning on your demise. rr bambooisgrass.com
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2185 points
readytoretire answered 8 months ago …
When you or I short a stock, it is bet. When a hedge fund does it, it is just making money, as they normally have sufficient resources to drive the stock down, so it is not a wager. As they have very little regulation, they can use whatever leverage they want to ensure that the sale makes money. Driving companies into the ground so you make money does no-one any good (except the people in that hedge fund). The argument for not regulating them when the dollar amount they controlled was small doesn't apply now. Sort of like Credit Default Swaps, where you buy insurance on a company going broke, but you have nothing at risk. When the government let Lehmen go under, they insured that AIG would run into trouble, as they had written B$ of CDS on Lehmen.
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3680 points
MNSL answered 8 months ago …
I think if we want to stop market mess like today policy makers should take steps to regulate not only hedge funds, but also investment banks, some irresponsible funds etc.
Otherwise money will be evaporated in the future as well. Finally we will see bailouts in the future as well and world economy will stagnate for ever. We will see inflation, recession almost everyday. Every body will lose at the end.
They should take some social responsibility in managing other people money. Some sections in the society such as retirement groups will hit hard in the future.
This is the time to take some firm decisions before it becomes too late.
474 points
spider348 answered 8 months ago …
Regulation NO. Hedge funds provide the investing public an alternative investment vehicle. They are a product of our free markets in a capitalistic society. Everyone seems to forget the immense wealth hedges have created for investors over the years. The media is looking for scapegoats and hedge funds are an easy target because they are not understood or accessible by the average investor. The power of hedge funds provides the markets liquidity and price direction both positive and negative for the small investor. So next time you buy 100 shares of "XYZ" and it goes up, you might be able to thank the hedge funds for the price appreciation. It goes both ways.
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seyobnats answered 8 months ago …
Hedge funds MUST be regulated! Their abuse of the market has made this necessary. These new regulations must include ivestment banks which ruined the REIT marketst!
Nobody doubts that the ruinous runup in oil ptices during the past year and the effect it has had on the nation,s economy is not proof of this need for regulation. Their manipulation of traditonal American equity markets has made the stock market nothing but a gambling casino. The players are intent on only making their million each day by shorting the market for everything in sight. They have destroyed the public confidence. I hope that one day soon their shorts are hung out to dry and they have no more shorts to replace their dirty ones.
Hedge funds have become a destructive force in the market to the point where all the retirees like me have lost 40% of my investment in the last 2 months. I am too old to make any more by working so what are we to do...... Go on welfare when the money is gone? The stocks in my mutual funds have withered under the hedge fund onslaught. No wonder we who were born in the depression of the 30's have fled the market to take refuge in Treasuries. Most of us will not live long enough to see the recovery the optimists predict.
3680 points
MNSL answered 8 months ago …
I agree with some of the comments made by Seyobnats.
We have to accept that some hedge funds are very destructive in nature. Especially in small markets they can manipulate stocks for their advantage.
Retirement group is the most affected groups in the current crisis. Some people have lost entire retirement through out the world. Those who wrote reports, e-mails, published articles also should take responsibility for the current mess.
Actually some irresponsible market players gave impression that bullish market for assets including commodities going to last for the next 20 years. Now prices of almost all types assets are falling rapidly.
In today’s financial world you have to learn not only fundamental, technical and momentum analysis but also about market players.
Some players are not only destroying financial market but also capital system.
If you want to survive in this game do not rely on reports, forecast of some players in the future. You must be able to identity trends yourself in advance.
731 points
thinker70 answered 8 months ago …
Hedge Funds are only the latest innovation added to an already corrupt system that began with the Federal Reserve Act of 1913! Unfortunately there is no cure for human GREED and any laws passed are usually obsolete before they ever get enacted, and then poorly enforced if at all. New loopholes to bypass the intent of the law are quickly developed to circumvent the intent of the new laws. Hedge funds will destroy themselves through their greed and abuses of leverage. It has already happened and is in the process of happening again with devestating results for the stock market. There is so much greed baked into the system more regulation will be like trying to lock the barndoor after the horse has been stolen.
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