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Strategies & Market Trends : Booms, Busts, and Recoveries

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To: Hawkmoon who wrote (5502)7/2/2001 8:12:22 PM
From: TobagoJack  Read Replies (2) of 74559
 
Hi Ron, when enough (and I think there are plenty already) hedge funds get funded by the likes of Calpers and GE Capital, and Lansing Firemen Association, the profit potential of cautious hedging will decrease, forcing the managers to take non-hedged bets with larger leverage, while sipping coconut juice from Bermuda. This is inevitable, because this human nature.

Intuitively, the yield realizable from fund management can only approximate the growth in the economy, in the aggregate. If some funds do better, it is that these funds focused on a sector growing faster than economy, or because of any number of special situations realized by many, sooner rather than later.

This game will blowup.

Chugs, Jay
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