Hedge Funds Skeptical of Uncle Sam

According to Reuters, many hedge fund managers are leery of US intervention in the capital markets, from banking bailouts to Chrysler and the automakers.

According to Sean Mathis of New Centurion Capital Partners,"When you have government intervention at the scale we have, you do something the markets abhor: you create uncertainty. We have uncertainty where markets are going and what the rules of the road will be."

Even more drastic are statements like those of Gary Kaminsky, former Managing Director at Neuberger Berman "You have to assume the government will be involved. You have to assume the free market is not as free as it was in the past and won't be for the next 20 years," Kaminsky said.

Of course what is not being said is that hedge funds have benefited from the bailout in countless ways. Many of the prime brokers to hedge funds could have been at risk had large financial institutions not received bailout money. Most hedge funds with a long-bias have also benefited from the massive injection of money into the system and the support of the financial sector.

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