February 23, 2007
Hedge Funds Dodge a Bullet!
The Bush Administration and Congress agree that US based Hedge funds do not need more oversight as originally recommended by Former SEC Chairman Donaldson recommended November, 2005.
Maybe with all the uproar about Sarbanes-Oxley Section 404, the Federal government does not have the stomach - going into an election year in 2008 - to enact investor protection legislation for Hedge funds.
Admittedly, these funds do not directly impact the average investor. However, their failures could have huge impact since banks and pension funds are investing in hedge funds in a big way. They are investing the average person's money into these highly speculative and risky funds. So the impact of failure of hedge funds is still a big issue in the market.
Let's hope there is not an Enron style or size failure in hedge funds that precipitates legislation too late and without a proper examination of the right cure.
"WASHINGTON, Feb. 22 — The Bush administration said Thursday that there was no need for greater government oversight of the rapidly growing hedge fund industry and other private investment groups to protect the nation’s financial system.
Instead, the administration, in an agreement it reached with the independent regulatory agencies, announced that investors, hedge fund companies and their lenders could adequately take care of themselves by adhering to a set of nonbinding principles."
Maybe with all the uproar about Sarbanes-Oxley Section 404, the Federal government does not have the stomach - going into an election year in 2008 - to enact investor protection legislation for Hedge funds.
Admittedly, these funds do not directly impact the average investor. However, their failures could have huge impact since banks and pension funds are investing in hedge funds in a big way. They are investing the average person's money into these highly speculative and risky funds. So the impact of failure of hedge funds is still a big issue in the market.
Let's hope there is not an Enron style or size failure in hedge funds that precipitates legislation too late and without a proper examination of the right cure.
"WASHINGTON, Feb. 22 — The Bush administration said Thursday that there was no need for greater government oversight of the rapidly growing hedge fund industry and other private investment groups to protect the nation’s financial system.
Instead, the administration, in an agreement it reached with the independent regulatory agencies, announced that investors, hedge fund companies and their lenders could adequately take care of themselves by adhering to a set of nonbinding principles."
