Reuters – DE Shaw & Co, one of the world’s largest hedge fund managers, fired about 25 administrative and support staff on Tuesday and reassigned other employees in an effort to boost efficiency, people familiar with the situation said.

The job cuts represent a small portion of the New York-based firm’s 1,700 employees and do not affect the "front office," according to the sources, who were not authorized to speak on personnel matters by closely held Shaw.

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U.S. News & World Report – Andrew Lo, hedge fund manager and director of MIT’s Laboratory for Financial Engineering, is a long-time student of investor behavior, especially the sort that belies the notion that markets move with cool efficiency. Particularly today, he sees animal spirits lurching about in some worrisome ways that could have long-term consequences for markets and the economy. "The big message is that right now all, of us are in a state of emotional shell-shock," he says. That goes for investors, regulators, bankers, and anyone else unlucky enough to get caught up in the fear and uncertainty flowing through the current financial crisis.

In this two-part Q&A with U.S. News, Prof. Lo discusses the best way to build a robust regulatory system for the financial sector (part one is here.) Below, he considers what massive changes in the investment landscape over the past few years might mean for your investments:

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