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Deregulated Hedge funds under George Bush:

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The Backlash Cometh Donating Member (1000+ posts) Send PM | Profile | Ignore Fri Feb-23-07 06:19 AM
Original message
Deregulated Hedge funds under George Bush:
It sounds like we're going in the wrong direction with Hedge Funds. Any one want to explain the many ways that someone can cheat or be cheated with one of these babies:

Officials Reject More Oversight of Hedge Funds

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 nations 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.

The principles, many already being followed by the sharpest investors and best-run companies, say that investors should not take risks they cannot tolerate and should carefully evaluate the strategies and management skills of hedge funds. They also call for funds to make clear and meaningful disclosures to investors.

The decision came after months of study by a presidential working group of top officials and regulators. They looked at both the hedge fund industry, which has more than $1 trillion in assets, and the management of private equity firms, which take direct control and ownership of companies rather than relying on large numbers of outside stockholders.
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bluerum Donating Member (1000+ posts) Send PM | Profile | Ignore Fri Feb-23-07 06:47 AM
Response to Original message
1. Just laying the groundwork for social security reform.
Americans still have their 401k's and IRA's.

These assets can be mined by investment companies to stimulate the economy, provide more tax cuts for the wealthy, and fund more international military terror.
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The Backlash Cometh Donating Member (1000+ posts) Send PM | Profile | Ignore Fri Feb-23-07 06:54 AM
Response to Reply #1
2. It's all about leverage, isn't it?
It's all about using other people's money to fuel the ambitions of selected corporations, and to minimize financial risks for a few selected investors, isn't it?

This is a Republican style distribution of wealth.
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dapper Donating Member (755 posts) Send PM | Profile | Ignore Fri Feb-23-07 07:22 AM
Response to Original message
3. Fox guarding the hen house.
investors, hedge fund companies and their lenders could adequately take care of themselves by adhering to a set of nonbinding principles

we know when it comes to money, "principles" go out the window. So it will be totally legel for them to stretch the rules when they see fit.

Dapper
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izzie Donating Member (1000+ posts) Send PM | Profile | Ignore Fri Feb-23-07 07:27 AM
Response to Original message
4. When things are done in the dark there is always a bad smell
You can count on it. Just having this WH say it is OK makes ones eyes roll. Stay way from them is all I can say.
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The Backlash Cometh Donating Member (1000+ posts) Send PM | Profile | Ignore Fri Feb-23-07 07:59 AM
Response to Reply #4
5. Did you just come up with that?
That's a phrase I never heard before, but it certainly sounds like a soundbite of our times:

"When things are done in the dark there is always a bad smell"
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izzie Donating Member (1000+ posts) Send PM | Profile | Ignore Fri Feb-23-07 08:20 AM
Response to Reply #5
7. I am sure I did not as I read a lot. It must have stuck in my mind.
But you can always count on it. All crooks like to work in the dark in the true dark or undercover in some way. It is like a septic tank when you open it and give it light. Since so few people vote we seem to have let a lot of slime move into power every place.
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KoKo Donating Member (1000+ posts) Send PM | Profile | Ignore Fri Feb-23-07 08:17 AM
Response to Original message
6. CNBC "analyst" said yesterday that regulating the Hedges would take liquidity
out of the "economy" that is needed to support growth. Note he said "economy," and my read is the implication that the Hedges are proping up the whole thing to cover up other things like Housing Bubble gassing out and downsizing, outsourcing and all the rest of the ills we know are the reality.

If they don't want to regulate it....with these folks one has to assume there's lot's of stuff going on in those Hedges that no one wants to come to light.
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Beer Snob-50 Donating Member (1000+ posts) Send PM | Profile | Ignore Fri Feb-23-07 08:27 AM
Response to Original message
8. I agree with these nonbinding principals
especially clear and meaningful disclosures, however, companies should have to be audited by accounting firms that follow the strict rules that I remember from my early days in accounting.
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