Stratfor Article: Hedge Fund Quits Because of Political Economy - How Does It Affect

[bankroll]

The full title: Stratfor Article: Hedge Fund Quits Because of Political Economy - How Does It Affect Your Trading?

 

The Article:

http://www.stratfor.com/weekly/financial-markets-politics-and-new-reality

Money quote, 1st paragraph:

Louis M. Bacon is the head of Moore Capital Management, one of the largest and most influential hedge funds in the world. Last week, he announced that he was returning one quarter of his largest fund, about $2 billion, to his investors. The reason he gave to The New York Times was that he had found it difficult to invest given the impossibility of predicting the European situation. He was quoted as saying, "The political involvement is so extreme -- we have not seen this since the postwar era. What they are doing is trying to thwart natural market outcomes. It is amazing how important the decision-making of one person, Angela Merkel, has become to world markets."

 

Other interesting related reading:

http://www.stratfor.com/weekly/20100503_global_crisis_legitimacy
http://www.investorsinsight.com/blogs/john_mauldins_outside_the_box/archive/2008/10/16/the-international-economic-crisis-and-stratfor-s-methodology.aspx

 

Oh, and don't forget this video:

www.youtube.com/watch?v=p_KKN_jltI8

[kurtS]

Financial panics are an integral part of capitalism. So are economic recessions. The system generates them and it becomes stronger because of them. Like forest fires, they are painful when they occur, yet without them, the forest could not survive. They impose discipline, punishing the reckless, rewarding the cautious. They do so imperfectly, of course, as at times the reckless are rewarded and the cautious penalized. Political crises -- as opposed to normal financial panics -- emerge when the reckless appear to be the beneficiaries of the crisis they have caused, while the rest of society bears the burdens of their recklessness. At that point, the crisis ceases to be financial or economic. It becomes political.

[Edward25]

Thank you guys, well explained analysis, and also for the link about the video.

[osaze]

He seems to be a fundamental based investor. Alot of hedge funds invest strictly based on the technicals and they still make a headway.