In today's Times http://www.timesonline.co.uk/tol/comment/columnists/guest_contributors/article4805311.ece Oliver Kamm, a former hedge fund manager, argues that short sellers are not the cause of the chaos and have ensured that bad news is reflected quickly in market prices. Too much debt, he says, coupled with failure by banks and politicians to constrain the credit bubble, are largely to blame.
At last some sensible defence of hedge funds who were last week reviled publically as spivs, speculators and sharks. Lone voices in their defence will not be enough however. The hedge fund industry now needs a concerted effort to help correct misperceptions about its role in the current crisis. Unless it moves quickly to mend its shattered reputation, it will soon have to contend with another negative descriptor: scapegoat.
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several attempts by the hedge fund community to find a common voice have not been particularly effective although their reputation must be seen as increasingly important..
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