Dressing Up for Disaster
|Our Correspondent||Oct 17, 2008|
The formerly high-flying hedge fund industry, which is believed to have until recently managed US$2 trillion, is expected to shrink by half over the next few months. In September alone, investors pulled at least US$43 billion out of US hedge funds in September, and October is expected to be considerably worse. The Masters of the Universe who have been building houses as big as college campuses in the Hamptons in New York are starting to downsize.
An irreverent UK-based hedge fund blog, the Fintag Newsletter run by someone with the unlikely name of Finbar Taggit, has been chronicling the troubles for the industry, which just in the last couple of days has hit further shoals. Highland Capital Management Thursday said it was closing two funds and TPG-Axon, according to the Financial Times apparently has lost 26 percent of the US$16 billion it had under management at the beginning of the year. Citadel, one of the most prominent hedge fund managers, told investors September was the worst month in its history, with two of its funds down 26 to 30 percent during the first week of October.
Accordingly, the Fintag Newsletter published this picture of new apparel for the ambitious hedge fund manager: