May 16, 2009
Hedge Fund Haters: Read Joe Nocera Today in the NYTs
Joe Nocera, in today's NYT business section, interviews a hedge fund manager, Neil Barsky, who is hanging it up. What a wonderful column. All critics of hedge funds should read this. The interview makes several points: hedge funds were not the cause of the current financial mess, hedge funds were and are a healty part of the financial system; hedge fund managers are -- well -- human and compassionate. The column does show two common missteps, however, the canards that hedge fund managers made too much money and that hedge funds "drain" our best minds away from more socially useful pursuits. The interview itself contradicts both propositions -- first, hedge fund managers were paid on real success not on phony measures of success (beating a market or industry index) and second- hedge fund managers, like Barsky, can change careers once they succeed (and do "good works"). In other words, the argument is for career focus -- when a manager focus on profits, when done, focus on social causes -- do not, do not mix the two in either capacity. Most hedge funds managers are not managers for life (Icahn, excluded). They make some money and change professional goals -- it is all good -- both parts, the making money and the change. You cannot have one without the other perhaps. Great piece, Joe, one of your best. Makes me want to subsidize the NYTs.
May 16, 2009 | Permalink
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Here's the article:
Posted by: Jimmy | May 16, 2009 5:15:04 PM
No one should hate all hedge funds or hedge fund managers, however...
I do not think we have compiled the full cost of the damages, as college endowments and charities and pension plans graudally realize how much of the hedge fund money is never coming back.
Not to mention the hazard of a large chunk of the financial markets being less than transparent (Jim Cramer (ugh) still insists the hedgies can manipulate stock easily and without direct contact with each other).
Posted by: save_the_rustbelt | May 18, 2009 11:34:18 AM