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Hedge fund managers, who rank among some of the world's shrewdest dealmakers, told Congress the U.S. government's bank capital injection program did not have enough strings attached. "The current terms are overly generous to recipients," said John Paulson, president of hedge fund Paulson & Co. He was among five hedge fund managers questioned on Thursday by the U.S. House Oversight and Government Reform Committee about Treasury Secretary Henry Paulson's management of a $700 billion bailout program to unfreeze credit markets through taxpayer investments in financial firms. John Paulson -- whose attack on the plan was dubbed "Paulson versus Paulson" by...

Abstract: Five of the world's richest hedge fund managers, including George Soros, the man who the broke the Bank of England, have been called to account by US politicians for their role in the collapse of the global financial system. The quintet – including John Paulson, who made $3.7bn (£2.49bn) last year betting against the US mortgage market – were grilled over their roles in buying unregulated derivatives products, which some politicians believe contributed to the financial markets' meltdown. The men, who each earned more than $1bn each last year, were called to account by Democratic Congressman Henry Waxman, who...

It took only 36 hours for President-elect Barack Obama to take the off ramp from the Change We Can Believe In Highway and slam his foot on the gas in the express lanes of the Chicago Way. Because with his first official act, Obama selected a Chicago Daley machine guy for his chief of staff, U.S. Rep. Rahm Emanuel (D-Tomczak). *snip* "And no one I know is better at getting things done than Rahm Emanuel." Among Chicago politicians, the Emanuel announcement was treated with enthusiasm. But it was enthusiasm of the political salivary gland at the prospect of federal pork...

SAN FRANCISCO (MarketWatch) -- Berkshire Hathaway reported a 77% drop in third-quarter net income late Friday as the insurance-focused conglomerate recognized more than $1 billion of unrealized derivative losses and paid hurricane claims. Operating earnings, which exclude net realized investment gains and losses, were $2.07 billion, or $1,335 per Class A share, down 19% from the same period in 2007. Berkshire's large insurance businesses generated an underwriting profit of $81 million in the latest third quarter, down from $486 million last year. Hurricanes Gustav and Ike left Berkshire's insurance businesses with estimated losses of roughly $1.05 billion in the third...

<p>Hedge funds around the world absorbed a punishing blow Tuesday, as soaring shares in Germany's Volkswagen AG created one of the biggest losses from a single bet in recent memory.</p> <p>The funds are expected to face billions of dollars in losses, according to prime brokers familiar with the positions, because they were wagering that VW shares would fall. Instead, shares of the big German auto maker soared 82% Tuesday to €945 ($1,185) in trading in Frankfurt after fellow German car maker Porsche Automobil Holding SE said it had boosted its VW stake.</p>

Yet another profile of wind crusader T. Boone Pickens aired Sunday night — this time on 60 Minutes — and it had the usual details about the 80-year-old former oil baron’s plan to get the U.S. off its addiction to foreign oil. But 60 Minutes did score an interesting tidbit about how much Pickens and his investment firm BP Capital have lost since oil and natural gas prices started dropping in July: $2 billion! The steep drop in oil and gas prices since July has cut the value of Pickens’ hedge fund in half. . . Overall, Pickens and BP...

Washington is pushing measures to help hard-pressed homeowners, but some Wall Street investors are pushing back. Hedge funds are fighting proposals to ease the terms of home mortgages, arguing that such a move would hurt their investments. Two funds recently warned mortgage companies that they might take action if the companies participated in government-backed plans to renegotiate delinquent loans in a way that undercut the funds’ interests. The saber-rattling highlights the conflicting interests of various players in the mortgage arena and suggests that tensions are likely to intensify as government intervention in the market widens. The two funds — Greenwich...

Several Democratic lawmakers lashed out Friday at hedge funds that have threatened to block attempts to renegotiate mortgages for struggling homeowners. At least two funds, Greenwich Financial Services and Braddock Financial, have told banks that they may take legal action if loans are renegotiated in a way that hurts the funds’ financial interests. Many hedge funds have purchased securities backed by mortgages. The New York Times reported Friday that Greenwich Financial and Braddock Financial, and possibly other funds, were resisting attempts to renegotiate the loans. Several Democratic lawmakers, including Representative Barney Frank of Massachusetts, sent a letter to William Frey,...

Stock futures freeze as tumble worsens Fri Oct 24, 2008 7:17am EDT LONDON (Reuters) - Stock index futures tumbled so sharply in European trade on Friday, they had to be frozen at several points in the morning. By 6:27 a.m. EDT December Dow Jones futures were down 6.2 percent, Standard & Poor's 500 futures were off 6.6 percent and Nasdaq 100 futures were down 6.6 percent. All three contracts lost the maximum amount permissible before the start of futures trading in the United States. "We are in a panic mode, I don't know how else to describe it and when...

From NBC/NJ's Athena Jones RICHMOND, Va. -- It seems that Joe the Plumber has earned a permanent spot in 2008 campaign lore. In the final weeks of the 2008 election both candidates are mentioning his name on the stump almost daily. Obama even invoked him during a press conference this morning and added a new quip to his speech at a rally here. “I had a nice conversation the other day with Joe the Plumber,” he told an audience of nearly 20,000 people. “Joe's cool, I got no problems with Joe, all I want to do is give Joe a...

The boss of a successful US hedge fund has quit the industry with an extraordinary farewell letter dismissing his rivals as over-privileged "idiots" and thanking "stupid" traders for making him rich. Andrew Lahde's $80m Los Angeles-based firm Lahde Capital Management in Los Angeles made a huge return last year by betting against subprime mortgages. "The low-hanging fruit, ie idiots whose parents paid for prep school, Yale and then the Harvard MBA, was there for the taking," he wrote. "These people who were (often) truly not worthy of the education they received (or supposedly received) rose to the top of companies...

A group of the largest US hedge funds has called on the Bank of England to intervene to free an estimated $65bn (£38bn) in assets frozen in London in the collapse of Lehman Brothers, warning that delays “could be disastrous for UK plc”. The funds, through the Managed Funds Association, said the scale of the problem was so great that it could undermine bank rescue plans as tens of billions of dollars would be kept out of the market. It was also likely to lead to the failure of some fund managers, said Richard Baker, chief executive of the MFA....

Hedge funds prey on rivals By Henny Sender in New York Published: October 2 2008 23:34 | Last updated: October 2 2008 23:34 Hedge funds are embracing trading strategies designed to profit from the unwinding of large positions by their competitors, market participants say. The increasingly cannibalistic activity stems from the wave of redemptions hitting hedge funds. Because so many firms hold similar positions, forced selling by one in response to redemptions can have ripple effects, forcing other funds to sell. More nimble hedge funds have sought to profit from the dynamic by taking short positions in securities known to...

One thousand hedge funds scramble for new prime brokers David Walker 01 Oct 2008 At least 1000 hedge funds, one in eight of the worldwide total, are trying to unwind investments held by their prime brokers amid moves today by investment firm Olivant to recover its 2.78% holding in UBS, which was held in accounts managed by Lehman Brothers in Europe.

Folks, heads up...Anyone listening?Parts of the Bill are not good. Section 103, it allows Municpalities and Union Pensions to be absorbed. Hedge funds, the 30th is a key date for them and this needs to be finished before they unrap.Both Glenn and Mr. Newt talked with Wealthy people out of the market this weekedn and noted how critical this is.Correct me if I heard them wrong.

Financial crisis: Hedge funds flee Morgan Stanley PTI | September 26, 2008 | 17:42 IST Worried that global financial services provider Morgan Stanley may land into financial troubles like Lehman Brothers, several hedge funds fled the bank resulting in a loss of billions of dollars in its prime brokerage business last week, a media report says. "Many of the world's biggest hedge funds moved their assets to commercial banks regarded as safer last week, as they and their investors worried that Morgan Stanley could follow Lehman into trouble," the Financial Times said. Quoting people familiar with the business Financial Times...

SHORT SHRIFT: CRITICS BLAST SEC TRADING BAN By KAJA WHITEHOUSE Posted: 3:26 am September 20, 2008 The Securities and Exchange Commission's temporary ban on short-selling took down the good with the bad. Several groups yesterday said they took a beating as a result of the ban, which forbids short-selling of 799 financial stocks. Among those sideswiped by the ban were hedge funds and traders who legally shorted financial stocks, as well as businesses that deal in so-called stock options, that saw trading dry up yesterday as a result of the SEC rule. Prices were so out of control yesterday that...

Hedge funds scramble on shorting ban By Joanna Chung in Washington, Henny Sender in New York and James Mackintosh in London Published: September 19 2008 19:40 | Last updated: September 19 2008 19:40 Hedge funds were forced to scramble to unwind trading positions on Friday after a massive assault by global regulators on short selling aimed at calming the turmoil in global markets. The US Securities and Exchange Commission joined top market watchdogs in the UK, France, Portugal and Ireland to temporarily ban short-selling and other investors from engaging in trades allowing them to profit from falling share prices of...

September 7, 2008, the 10th anniversary of the Federal Reserve arranged bailout of the infamous hedge fund Long-Term Capital, is now a more infamous date. This is the day that our government chose socialism over free market capitalism. Our elected leaders increased the national debt from $9.6 trillion to $15 trillion, a 56 percent increase in one weekend. Hank Paulson, the U.S. Treasury Secretary, seems to have a penchant for committing U.S. taxpayer dollars on weekends. On one weekend he engineered the bailout of Bear Stearns. Just this last weekend he oversaw the forced sale of Merrill Lynch, a desperate...

LONDON (Reuters) - The bankruptcy filing of Lehman Brothers (LEH.N) is another blow for the hedge fund industry, though the writing has been on the wall long enough for many to have reduced their exposure to the U.S. investment bank. Legendary fund manager George Soros, who runs around $18 billion in assets, looks likely to have had his fingers burned after raising his stake in Lehman to 9.5 million shares in the second quarter. A spokesman for Soros Fund Management declined to comment on the composition of their portfolio. British activist hedge fund Algebris will also probably have taken a...

Hedge Funds Get Rattled As Investors Seek Exits Friday September 5, 11:44 pm ET By Gregory Zuckerman and Craig Karmin With anxiety about hedge-fund woes gripping the market, funds have their own fear: their investors. Some investors, particularly what are known as "funds of funds," are demanding their money back and may ramp up requests in the weeks ahead. That has prompted hedge-fund managers to sell securities to raise cash. "As the hedge fund investor base broadens, hedge fund portfolio management...slips out of the hands of the portfolio managers and into the hands of the investors," wrote , who runs...

Hedge funds face struggle for survival LORI McLEOD AND ANDREW WILLIS Monday, September 01, 2008 Black clouds have been building over the hedge fund industry for much of the year, and a storm could break in coming weeks as investors receive their second set of lousy monthly results from funds that are meant to do well in good markets and bad. A series of challenges, some unrelated to the hedge funds' investment strategies, have combined to create lower returns and investor redemptions. Industry experts expect some funds will be forced to close down as clients walk away. The single biggest...

Hedge funds at a loss to cope with mood swing Patrick Hosking and Clare Harrison The hedge fund group that took a huge bet on Northern Rock as it was imploding last autumn has reportedly lost 85 per cent of its investors' money, amid evidence of a terrible spell this summer for many hedge funds. SRM, the Monaco-based group that raised $3 billion from investors in September 2006, is down by 85 per cent, according to The Wall Street Journal, including a minus 77 per cent performance in the past year. Tight lock-up terms prevent investors from withdrawing their money....

Cayman Hedge Funds Break 10,000 Barrier, by Amanda Banks, Tax-News.com, London Last updated 30 hours ago | Monday, August 11, 2008 Recent second quarter figures from the Cayman Islands Monetary Authority (CIMA), have confirmed the achievement of a key milestone by the Cayman Islands financial services industry, with more than 10,000 investment funds currently registered in the jurisdiction. At the end of June 2008 there were 10,037 funds on CIMA's register, compared with 9,681 at the end of the previous quarter and 8,972 at the mid point of 2007. The current annual growth rate of 12% in net new hedge...

NEW YORK (Reuters) - A Deutsche Bank executive is suing a son and a brother of Delaware Sen. Joe Biden for at least $10 million over a deal they had to buy into a hedge fund, according to court documents. Stephane Farouze, who is global head of fund derivatives for Deutsche Bank and lives in London, claimed that Biden's son Hunter and brother James broke a May 2006 contract and defrauded him after agreeing to buy his membership interests in New York-based Paradigm Companies LLC. The lawsuit filed in New York State Supreme Court in Manhattan in June names Washington...

Recent Twin Ports elevator sales may bode well for grain trade Peter Passi Duluth News Tribune Published Wednesday, August 06, 2008 W.B. Duluth Storage LLC purchased AGP’s Duluth grain terminal at the beginning of this month, completing its second local elevator acquisition this year. The company, an offshoot of Twin Cities-based hedge fund Whitebox Advisors LLC, bought Cargill’s Duluth elevator in January. . . . Ojard said nontraditional grain market players who previously dealt with futures, such as Whitebox, recently have turned to buying physical assets.

The Securities and Exchange Commission voted to extend the temporary rules it put in place to restrict short-selling of a handful of financial stocks. The SEC commissioners didn't take additional steps opposed by Wall Street to expand the number of stocks affected by the rules or make them permanent. The temporary rules were set to expire Tuesday, and the SEC extended the order on the 19 stocks until Aug. 12. It won't be extended beyond then. In a short sale, a trader sells borrowed stock in a bet the price will decline and the stock can be profitably repurchased at...

Wall Street executives expect the Securities and Exchange Commission to extend the temporary limits it has placed on short-selling and expand them to cover additional stocks beyond the 19 financial companies it targeted two weeks ago. The limits are set to expire Tuesday, and executives, lobbyists and hedge-fund representatives of the Managed Funds Association, the biggest hedge-fund industry group, have been talking throughout the weekend, trying to come up with possible approaches to asking the SEC to reconsider expanding the rules, according to people familiar with the talks. A call with regulators on Friday gave the funds group "a fair...

Sgt. Frank Lugo leads a double life. In the United States, he was a successful hedge fund trader with condos in New York and South Beach, Fla. Now he is in an unlikely spot -- Iraq, where he lives in the sprawling slum of Sadr City. "My lifestyle's obviously drastically different back home than it is here," Lugo said. "But there are things that can't be replicated back home that are here. This belief that we're trying to accomplish something that's greater than oneself." Lugo is an Army reservist. At 36, he has re-enlisted four times, swapping fast cars and...

Commodities analysts leaving Wall Street By Francesco Guerrera and Deborah Brewster in New York Published: June 18 2008 02:10 | Last updated: June 18 2008 02:10 Wall Street is witnessing an exodus of analysts covering oil, gas and other commodities as the credit crunch and lucrative offers from hedge funds drive research experts away from investment banks. Over the past few months, highly regarded oil analysts such as Citigroup’s Doug Leggate and Geoff Kieburtz, Morgan Stanley’s Douglas Terreson and Bank of America’s Robert Morris have left. Recruitment experts say the moves are prompted partly by investment banks’ need to slash...

What's Up With Oil? The price of a barrel of oil was up $16 in the last two days, to $138.54, a violent 13% move. Is it those nasty speculators? Are fundamentals at work? Is the world worried about Israel bombing Iran? There are numerous factors involved, but the combination produced a kind of perfect storm in the trading pits. Let's look at several items and see if we can find a connection. First, there is a real connection between the price of dollar and the price of oil. In dollar terms, oil rises as the dollar falls and vice...

German leaders are to propose a worldwide ban on oil trading by speculators, blaming the latest spike in crude prices on manipulation by hedge funds. It is the most drastic proposal to date amid escalating calls from Europe, the US and Asia for controls on market forces, underscoring the profound shift in the political climate since the credit crunch began. India has already suspended futures trading of five commodities. Car lights are seen streaking past an oil rig extracting petroleum Speculators are split, with some betting that oil will fall Uwe Beckmeyer, transport chief for Germany's Social Democrats, said his...

Investing in commodities has been a brilliant move in this decade -- so brilliant that the strategy has attracted untold numbers of large and small players, particularly in the last few years. What do you suppose all of their buying has done to the price of oil? Pushed it down? With crude surging above $130 a barrel this week for the first time, a long-simmering issue is threatening to boil over: the role these new investors, often derided as rank speculators, have had in stoking the prices of oil and other commodities. Their standard line has been, "It's not our...

The other day I opined in Who Has More Level 3 Assets Than Capital? that there were an exorbitant amount of Level 3 assets on the books of dealers and banks. I actually wouldn’t be surprised if the Federal Reserve has some after they took a load of stuff off the hands of their broker/dealer buddies. My comments, frankly, were greeted by some cheers and some jeers. Either is OK by me, as my opinion remains the same. If there are no observable inputs to even mark your bonds to a model, good luck selling them. For example, I saw...

Berkshire Hathaway Inc.'s first-quarter net income dropped 64% as underwriting income wilted and the giant conglomerate reported $1.7 billion in unrealized derivatives losses. Last quarter, Chairman Warren Buffett told investors that "the party is over," saying he expects insurance earnings to fall off significantly in 2008. Though Berkshire owns businesses ranging from See's Candy to Benjamin Moore paint, its various insurance companies still generate the bulk of Berkshire's results. Mr. Buffett's sprawling conglomerate posted net income of $940 million, or $607 per Class A share, compared with $2.21 billion, or $1,682 a share a year earlier. Excluding investments derivatives, which...

Banks, hedge funds and other financial institutions could find their investment strategies curtailed by the Federal Reserve to reduce the risk to the economy from asset bubbles, the US Treasury said on Tuesday. David Nason, the assistant secretary for financial institutions, said the US central bank should use its proposed new powers as a stability regulator to “lean against the wind” by forcing institutions to change their investment strategy if it judged they threatened the wider economy.

If you were a member of the Wall Street aristocracy, one of those hedge fund hot shots who makes half a billion dollars a year, which horse would you bet on in the race for the White House? Senator John McCain seems like the natural choice for the rich who are voting their wallets. After all, Mr. McCain, the presumptive Republican nominee, might help the wealthy keep more of their supersize incomes by making the Bush tax cuts permanent. Senator Hillary Rodham Clinton and Senator Barack Obama, the two Democratic contenders, talk about getting tough on the rich. But at...

Hedge Funds Make It Hard To Say Goodbye Thursday April 10, 2:58 am ET By Gregory Zuckerman If you thought getting into a hedge fund was tough, try getting out of one. With the markets sputtering, some high-profile hedge funds are rejecting withdrawal requests, with some telling investors that it could be years before they will see all their cash again. And it isn't just big institutions and the wealthy that are getting rebuffed. Some smaller investors who took advantage of lower minimum investments by putting their cash into so-called funds of funds, which invest in numerous hedge funds, are...

UPDATE 1-Pardus $2 billion hedge fund suspends withdrawals Mon Mar 31, 2008 1:12pm EDT (Adds details, byline) By Dane Hamilton NEW YORK, March 31 (Reuters) - Pardus Capital Management, a global activist hedge fund with over $2 billion in assets, said on Monday it suspended investor withdrawals in the face of slumping values of some of its holdings and demands for capital return. Pardus -- which holds positions in both Delta Air Lines Inc (DAL.N: Quote, Profile, Research) and United Air Lines parent UAL Corp (UAUA.O: Quote, Profile, Research) and has urged the companies to merge -- said it suspended...

Hamstrung by the lack of liquidity and savaged by increasing redemptions, Griffin has had to negotiate new terms with his prime brokers, beg for patience from investors and offered his business for sale to bigger rivals, including GLG Partners. One insider said: "Tisbury has gone from darling to disaster is a short space of time. Griffin is losing staff and probably won't get much for the sale. It's been amazing turn of fortunes." Griffin is not alone. Some of the most successful players in the industry also have serious problems. The past month has been littered with high-profile calamities. At...

Hedge funds claim bank knew about wrongdoing Charlotte Business Journal - by Will Boye Staff writer A group of hedge funds and a state retirement system have filed suit against Wachovia Corp.'s investment-banking unit, claiming Wachovia knew a now-bankrupt beverage company was committing fraud when the bank underwrote $285 million in debt for the company in 2006. The amended complaint, filed in federal court in New York, contends Wachovia knew LeNature's Inc. was reporting sales figures that couldn't be accurate and had been unable to make interest payments on its existing loans. The bank fronted the payments for the troubled...

Graduate of Brentwood Academy and brother of school board member is dragged into Spitzer controversy....it was revealed that New York Gov. Eliot Spitzer was involved in a "high-end prostitution ring." It turns out that he in turn involved a Nashville native in an attempt to cover his tracks, though the Nashvillian was unaware of it at the time. George Fox, 48, a graduate of Brentwood Academy and the brother of Metropolitan Board of Education member David A. Fox – a former editor and current director of NashvillePost.com – was the name Spitzer used when checking into hotels for his...

The high-priced hooker who sunk Gov. Spitzer's political career was a party pal of one of his top financial backers, boozing it up with him at clubs and his palatial Hamptons mansion. James Chanos, 50, a billionaire hedge fund manager who runs Kynikos Associates in Manhattan, says he met Ashley Alexandra Dupre - the girl at center of the gov love scandal - at a nightclub several years ago and often invited her to parties, But he denied introducing her to Spitzer.

Phil Goldstein, the hedge fund manager who derailed the Securities and Exchange Commission’s attempt to require hedge fund registration, will sue the regulator to lift its ban on hedge fund marketing and advertising. The long-standing ban on funds’ soliciting money from the public has been interpreted to mean a hedge fund should release only very limited information about itself. This interpretation has come under pressure as hedge funds have grown rapidly and become widely covered in the media. Mr Goldstein told the Financial Times: “We want to be able to have a website like any other business. The only websites...

Gold and dollar to gain in a financial meltdown This Wednesday arguably the most pessimistic economist in the world, Professor Nouriel Roubini, Chairman of Roubini Global Economics, will address the Hedge Funds World Middle East 2008 conference in Dubai. He says the global economy is heading for a $1 trillion financial meltdown. Sunday, March 02 - 2008 In an article last month entitled 'The Rising Risk of a Systemic Financial Meltdown', he claimed that there is now 'a rising probability of a catastrophic financial and economic outcome'. This he sums up as: 'A vicious circle where a deep recession makes...

NEW YORK (AP) - A dissident investor stepped up pressure on The New York Times Co. Friday, formally proposing its own slate of four directors and saying the company needs to take more drastic action to compete online. Harbinger Capital, an investment firm that now owns about 19 percent of the company, filed its own proxy statement with the Securities and Exchange Commission listing its nominees for directors to be elected at the Times' annual meeting April 22. The Times has already filed its own full slate of director nominees, but has said it was still considering whether to...

We recently pulled the most recent 13-F of the Bill and Melinda Gates Foundation to track its holdings and recent performance. Due to Warren Buffett's generous donation, the Foundation is loaded with Berkshire shares. At the end of 2007, BRK/B made up 46% of the Foundation's equity holdings. Because of Berkshire, the Foundation is heavily overweight the Financials sector at 46.93% (vs 17.58% for the S&P 500). It is also overweight Healthcare, Consumer Staples and Industrials. The Foundation is underweight Telecom, Consumer Discretionary and Energy, and it has a 0% weight in Technology, Utilities and Materials. We're guessing that the...

BOSTON (Reuters) - Hedge funds shifted bets in the hotly contested U.S. presidential race in January when they wrote bigger checks to Democratic contender Barack Obama after favoring his Democratic rival Hillary Clinton in 2007. The $1.8 trillion hedge fund industry donated $50,450 to Obama last month when the Illinois senator won wide support among voters in early caucuses and primaries, new data show. Clinton, who lost Iowa but defied pollsters by winning the New Hampshire primary, took in $18,800, the lowest donated to either party's front runners. In comparison, hedge funds gave $26,400 to Republican front-runner Sen. John McCain...

BC News' Jennifer Parker and Eloise Harper Report: Sen. Hillary Clinton took a swipe at her daughter's profession today at an economic roundtable discussion at a restaurant in Parma, Ohio, suggesting wealthy investment bankers and hedge fund managers on Wall Street aren't doing real 'work.' The former first lady's daughter, Chelsea Clinton, works for New York-based hedge fund Avenue Capital Group. She previously worked in New York for McKinsey & Company, her first job after graduating with her master's degree from Oxford University.

Citigroup has barred investors in one of its hedge funds from withdrawing their money, and a new leveraged fund lost 52 percent in its first three months, the Wall Street Journal reported Friday. Citigroup Headquarters The largest U.S. bank suspended redemptions in CSO Partners, a fund specializing in corporate debt, after investors tried to pull more than 30 percent of its roughly $500 million of assets, the newspaper said. Citigroup injected $100 million to stabilize the fund, which lost 10.9 percent last year, the newspaper said. The fund's manager, John Pickett, left following a dispute with Citigroup executives and complaints...