Hedge Funds don't have clean handsReader comment on: New Yorker on Ray Dalio Submitted by Fast Eddie (United States), Jul 18, 2011 08:51 All you say may be true, nevertheless, there are more than a few hedge funds actively screwing up the commodities (e.g. oil) markets and stock markets (e.g. NYSE, NASDAQ). The incredible run up in oil prices in 2008, from $80/barrel to $140/barrel and then to $32/barrel, all in less than a year, was certainly not driven primarily by supply and demand. And the 'flash crash' is directly attributable to the machinations of so-called 'high frequency traders' who have succeeded in distorting the price discovery mechanisms of the NYSE and others to the point where 'real' traders and investors have complained strenuously, all to no avail because the exchanges are making way too much money from selling what amounts to 'frontrunning' data to the HFTers. Both of these travesties continue to occur due to 'regulatory capture' by the hedge funds. For oil and other commodities, they have the CFTC in their pocket. In stock markets, its the SEC that has rolled over and played dead. I don't care how much money the hedge funds make honestly, but I do mind all the damage they've done and continue to do while co-opting (bribing might be a better word) the regulators who are supposed to be minding the store. Note: Comments are moderated by the editor and are subject to editing. Submit a comment on this article Other reader comments on this item
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