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>Why are the rules not also applied to hedge funds? Because the idea is that people who have enough money to invest in a hedge fund have enough money to lose i
by selectodude 5y ago
>Why are the rules not also applied to hedge funds?
Because the idea is that people who have enough money to invest in a hedge fund have enough money to lose it all and not end up on welfare.
- endisneigh 5y agoI've heard this before, but you could argue that corporate welfare in the form of stimulus is a thing. Personally, I'd argue that if what you're saying is the actual position governments take, then there should be way more scrutiny towards organizations, given that they'll come screaming for help in the form of tax cuts or stimulus if they fail (either the failing organizations directly or those affected by the failing organization).
- samstave 5y agoWe talk about corporate welfare, but we never look at political welfare. All these politicians profiting off of every transaction, insidertrading, zero accountability or transparency and zero fucking term limits. The elephant in the data center is politicians and their grift.
- dnautics 5y agoPolitical welfare in the non-personal-profit sense is at least equally insidious. Possibly worse, because at least when a politician hides $70,000 in their freezer you can put a number on it and it's obviously shameful. A lot of political welfare is taking away from one group of people and giving to another group of people who were lucky enough to be under the auspices of someone more charismatic.
- selectodude 5y agoThat's fine, but you'd have to argue with somebody else. I don't work for the SEC.
- endisneigh 5y ago> That's fine, but you'd have to argue with somebody else. I don't work for the SEC. I never claimed you did, we're having a discussion, no? lol.
- selectodude 5y agoI wasn’t making a value judgement on the rationale behind why hedgies can lever tf up, just why the regulations are different depending on how much money you have to lever.
- xkjkls 5y agoWhen have hedge funders been bailed out?
- the_local_host 5y agoLong Term Capital Management was bailed out. https://en.wikipedia.org/wiki/Long-Term_Capital_Management https://en.wikipedia.org/wiki/Long-Term_Capital_Management
- selectodude 5y agoBy other banks. Not the taxpayer.
- Ericson2314 5y agoStill, ain't like the banks are going to bail out regular people for making some stupid investment.
- mason55 5y agoI'm not sure of the actual point of this whole thread, but regular people make bad investments and get bailed out all the time: it's called bankruptcy.
- Ericson2314 5y agoBankruptcy hurts more because no limited liability. And when the other bailouts are more like "refinancing" as the other reply points out, the institutional bailouts hurt even less.
- xkjkls 5y agoThey do all the time. Every mortgage refinance is a bailout by the same conception that you are using.
- 5y ago
- humanistbot 5y agoExcept when they are "too big to fail" and get massive government corporate welfare....
- LatteLazy 5y agoToo big to fail applies to banks not hedge funds. If the hedge fund goes bust no one bails them out.