Each business day HedgeCo.Net keeps you informed with the top hedge fund industry news, opinion and insight from around the globe. From the latest hedge fund launches, to the impact of regulation, competition, and investor activism - we track the topics and people that make a difference to you.
Reuters – A U.S.-based trade group for hedge funds has urged the Bank of England to step in and speed up the freeing up of assets frozen in the collapse of Lehman Brothers Holdings Inc, saying it has become "an issue of very substantial systemic significance."
Richard Baker, a former U.S. congressman who heads the Managed Funds Association (MFA), said the lock-up of Lehman assets threatens British prime brokerage businesses and "will exacerbate systemic risks if not handled properly."
He made the plea in a letter dated Oct. 13, sent to the British central bank’s governor on the eve of a meeting between the administrators of Lehman Brothers International (Europe) (LBIE) and UK regulators.
Baker also said the current process is adding more uncertainty to global markets and that expediting the return of assets will give the market "a much needed boost of liquidity and confidence."
Forbes – Lobbyists for the $2 trillion hedge fund industry made a last ditch effort Wednesday to convince U.S. securities regulators to let an emergency order prohibiting short selling in more than 950 financial firms expire Thursday.
"The orders have not prevented price declines of financial institutions, volatility in the securities of these firms, or the failure of a financial institution," said Richard Baker, president of hedge fund lobby group Managed Funds Association.
Baker said the emergency orders have increased volatility, reduced liquidity and abruptly halted capital-raising, including through the issuance of convertible securities.
But a number of securities law experts expect the Securities and Exchange Commission to extend the ban beyond Thursday because of the current fragile state of the markets.
Under the SEC emergency measures, short selling in the U.S.-listed financial firms stocks has been prohibited for about two weeks.
Reuters – Hedge funds are unlikely to be among financial institutions clamoring to unload their bad debts under a proposed $700 billion Wall Street bailout plan, the chief of the funds’ lobbying group said on Tuesday.
"I think it’s unlikely that they would include us and I think it’s unlikely that we would ask to be included," said Richard Baker, president of the Managed Funds Association.
In an interview with Reuters, Baker said it was still unclear whether hedge funds are among financial institutions that would be allowed to participate in the massive Bush administration plan now being debated by Congress.
The former Louisiana congressman said one thing is crystal clear to hedge fund managers: "We understand that if you ask for benefits from the government, you generally get regulation, whether you like it or not."
