New York (HedgeCo.Net) – Five billionaire hedge fund managers stood up before Congress yesterday and shared their differing views on the hedge fund industry.

George Soros, Philip Falcone, John Paulson, James Simons and Ken Griffin all took turns defending hedge funds at the House hearing yesterday, though they clearly weren’t on the same page regarding opinions on regulation.

The hearing was called by democratic committee Chairman Henry Waxman of California, as part of a much larger attempt by Congress to delve deeper into the cause of the credit crisis and to see whether or not hedge funds have had a hand in driving down the values of certain markets.

While Harbinger Capital head Falcone was all about greater regulations, saying that investors "have a right to know what assets companies have an interest in," Soros disagreed. The founder of Soros Fund Management warned against "ill-considered" rules and guidelines if they were merely a product of the recent turmoil in the economy.

Griffin of Citadel Investments agreed saying, "We do not need greater regulation of hedge funds. We’ve not seen hedge funds as a focal point of the carnage."

The issue of taxes was also raised, with a slew democratic representatives firing accusations that the fund managers enjoy special tax breaks.

Paulson & Co. head John Paulson came to the defense saying, "If your constituents, whether a plumber or a teacher, bought a stock and if they held that stock for more than a year they would pay a long-term capital gains rate."

Waxman suggested the hedge fund industry faces increased regulation and transparency when President-elect Barack Obama, who has also been vocal on wanting to raise the capital gains tax, takes office in Janary.

All five hedge fund managers who testified have enjoyed extreme success in the hedge fund industry. George Soros, who is best known for his infamous bet against the British Pound in which he pocketed $1 billion overnight, manages over $19 billion through his company.

Phil Falcone and John Paulson both predicted the subprime crisis before it happened. Paulson took home an estimated $3 billion in 2007, the largest single-year profit by a fund manager to date.

Julie Scuderi
Senior Editor for HedgeCo.Net
Email: julie@hedgeco.net

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The Australian- The SEC’s decision to take a hard line on the illegal practice of naked short-selling is a band-aid attempt to fix a problem that is plaguing most stock markets in various guises, but at least it is having a go.

The order lasts 30 days and covers 19 stocks, including the Wall Street jockeys Merrill Lynch, Lehman Brothers and troubled mortgage giants Fannie Mae and Freddie Mac.

In sharp contrast, the Australian Government has dragged its heels on short-selling abuses and isn’t expected to make any announcements until the second quarter of the year.

Meanwhile, stocks are being bludgeoned on the ASX as hedge funds borrow stocks from our super funds to attack companies. They are doing it with ease because there is little buyer support in the market, little transparency on covered short-selling, no capital gains tax and small fees charged on share lending.

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Accountancy Age- Thames River Capital has introduced new realisation shares on its £276m Thames River hedge fund, run by Ken Kinsey Quick, to give investors an alternative source of tax-efficient income following the government’s changes to the Capital Gains Tax  (CGT).

At board discretion investors will be able to elect to redeem (or have placed) realisation shares in June and December. At the outset their redemption rate is expected to be the equivalent of 5% a year of the starting net asset value, to be paid in two approximately equal distributions.

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