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Please explain how they were bailed out, which my comment was in reference to? Sounds like you have a problem with their fee structure - but not sure where the

by cascom 4y ago

Please explain how they were bailed out, which my comment was in reference to? Sounds like you have a problem with their fee structure - but not sure where the connection with a bailout is. Separately, you do realize that (generalizing) hedge funds typically charge fees annually and have high water marks, which mean if the fund declines in value they give back fees that have been accrued for that year, and that they don’t charge incentive fees again until they’ve recouped investor losses?

spaetzleesser 4y ago
"Please explain how they were bailed out, which my comment was in reference to?" Maybe they weren't directly bailed out but their counterparties got bailed which then saved them. For example, I bet if the AIG counterparties had had to accept a massive haircut (which they should have) then a lot of companies would have gotten in trouble. The whole mantra "creative destruction" got suspended when it reached the financial industry.