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To: Bexar who wrote (21808)	10/16/1998 9:24:00 AM
From: Enigma	Read Replies (1) \| Respond to of 116764

Bexar - maybe it will pop and fizz! E

To: Bexar who wrote (21808)	10/16/1998 9:26:00 AM
From: Charliss	Read Replies (1) \| Respond to of 116764

Today's WSJ....I especially like the last paragraph. It makes me feel so secure that someone is on the lookout...... ******* Because hedge funds rely heavily on short-term capital gains, many such firms have structured their partners' investments to make them appear, for tax purposes, long-term instead. Rep. Barbara Kennelly, (D., Conn.) introduced legislation earlier this year aimed at limiting those practices. The proposal by Ms. Kennelly, who is leaving Congress to run for governor of Connecticut, didn't get very far. But Mr. Neal vowed to revive her efforts, writing that "the deal that the management of Long-Term Capital entered into with UBS is an example of a transaction that the Kennelly legislation would have shut down." It will be difficult, some investment lawyers and tax experts warn, for the government to effectively rein in such transactions, and that any attempt could backfire. One reason Congress didn't take up the Kennelly proposal "is that we were uncomfortable with the implications for liquidity in the market," said Kenneth Kies, who was chief of staff at Congress's Joint Tax Committee until the beginning of this year. Mr. Kies said his current employer, the accounting firm of PricewaterhouseCoopers, does some tax work for Long-Term Capital, but that he hasn't personally worked with them or any other hedge funds. "There's a lot at stake here," Mr. Kies said. "You could end up doing something with ramifications beyond what we understand."