'Casualties of War:' Lousy Returns, Madoff Scandal Spell Doom for Hedge Funds

WELCOME TO THE GREAT RECESSION! Deleverage NOW... as the greatest transfer of wealth in our history takes place. If you can invest now you'll be among the wealthy of the next generation! This is OUR TIME.

It is a well known facts...............Goodbye to them......It is last year factor............It will not be an issue today and this year.......Put it in the bin baksket.......more whisky please....The better this winter.....Bye.....Cheer....

I lost in Wall Vegas.Have nothing--nada.

Any class of financial instrument, and its marketplace, that has the ability to undermine overall financial stability, ought to be subject to federal regulation and rigorous oversight. It was only two years ago, long before today's crisis, that the Fed opted to prop up a big hedge fund (I can't recall its name) because its impending failure would have caused a panic. Regulation and oversight doesn't have to be stifling; but it sure needs to be far more extensive, and have much stronger enforcement teeth than in recent decades.

If the regulators can't catch the $50B ponzi schemes, how can they be trusted to catch anyone?

Hedge Funds, Ponzi Scammers, Madoff, two out of three have crashed will the third? Honest Americans how have lost their retirement savings should celebrate when short selling hedge funds come crumbling down.

Corporate Greed at its best. While the average Joe get stuck with his retirement flushed down the toilet, the fat cats roll in govt. money and get a few good lawyer to get them Club Med Prison. Nice. Heck for 2 billion bucks, I would spend 3 years in a low security prison.

SEC IS A USLESS NEEDS TO BE REPLACE AND DISMISSED..... FROM TOP TO BOTTOM.......NO NERCY....FIRE....THEM ALL......

Wha

And Wall Street not publicly calling for his immidate imprisonment does little to build confidence... HE IS JUST A MEMBER OF THE INVESTMENT CLUB.... Wall Steet and the Lawyers thinking this guy should be out waiting trial is just wrong... GREED GREED GREED....

Put 80% of your savings in credit union insured CD's. 20% you can gamble with in the Stock Casino. Why give it to a fund manager that may or may not be honest and is going to charge fees for losing your money? The experts don't know any more than the guy on the street.

Let's have a complete institutional audit of all hedge funds and see how many are Ponzi schemes. Many, I would guess. Warren Buffett: "When the tide goes out we find out who has been swimming naked."

Madoff stole union pension funds. Madoff will be "swimming with the fishies" soon. Bye Bye Madoff.

No Nercy, Johnny Ike?

This guy is sharp, keep bringing him back

Regulatory scrutiny. What a joke the S.E.C is. Isn't it obvious the fat cat's at the S.E.C are on the take. They themselve's need oversight and are thieve's. Alll of a sudden they are finding more ponzi scams. they are opening up old cases. Because they are feeling some heat. It's a farce and I as an American am embarassed and ashamed. But the truly sad thing is no one here should be or is not suprised as most of us know GREED is king on waal st. and in the halls of government

Regulatory scrutiny. What a joke the S.E.C is. Isn't it obvious the fat cat's at the S.E.C are on the take. They themselve's need oversight and are thieve's. Alll of a sudden they are finding more ponzi scams. they are opening up old cases. Because they are feeling some heat. It's a farce and I as an American am embarassed and ashamed. But the truly sad thing is no one here should be or is not suprised as most of us know GREED is king on waal st. and in the halls of government

Let's let the mob take care of Madoff. I bet he had their money too.

batman37rcd (Thursday January 08, 2009 01:49PM EST) is right in the mark here. Hedges were created to ameliorate risk. In that respect, they are nothing more than insurance policies that tempt people to take more and more risk because they are "insured" against loss. But hedges cannot guarantee that underlying assets will not crash and burn. Hedges simply promise to reimburse (partial payments computed via some complex mathematical schema) asset holders in the event of unforeseen destruction. Hedge funds invest in companies and/or packaged policies that attempt to minimize investment risk, but hedges do not and cannot vanquish risk to underlying assets. If underlying assets crash and burn, the hedge issuers, or the current owners, have to pay. As we all learned in Biz 101, insurance companies are in the business of collecting premiums (revenue source) not paying out claims (liability). A run on an asset class, e.g. mortgage backed hedges, will quickly exhaust liquidity and leave the hedge issuer/owner belly-up in the fish bowl. So, following and agreeing with batman37rcd, there has to be some way of insuring (i.e. regulation) that an asset run will not break the bank.

Wall Street, with the blessings, wink-wink, etc. of incompetent Washington bureaucrats, is always happy to take investor's cash in return for the financial investments they peddle whose value is always suspect! If not, Wall Street money changers would hold onto some of the crap they sell to main street as opposed to just looking for opportunities to distribute to holdings. Rothchild said to make money investing is like taking a cold shower, in quick and out quick. Beware Bernanke, Blankenfeld, Paulson and the rest of their cronies! What's yours is theirs and what's theirs is theirs.