Bailout

House Committee Grills Hedge Fund Billionaires

By Admin

Five of the most successful hedge fund managers of 2007 (each earned over $1 Billion) indulged the House Committee on Oversight and Government Reform this afternoon:

• Geroge Soros, 78, chairman of $19 billion Soros Fund Management, LLC in New York.
• John Paulson, 52, runs $36 billion Paulson & Co., New York.
• Philip Falcone, 46, runs $20 billion Capital Partners Fund, New York.
• James Simons, 70, runs $29 billion Renaissance Technologies, East Setauket, New York.
• Kenneth Griffin, 40, runs $16 billion Citadel Investment Group, Chicago.

But for Soros who is the only manager among the panel who has taken an active interest in public policy matters, the managers’ views on most matters overlapped significantly, but for minor differences.

• Hedge funds can pose systemic risk to the financial markets
• More disclosure about the activities of hedge funds is needed, though the disclosures should not be fully public
• There should be more oversight and restrictions on use of leverage

On the subject of tax loopholes for hedge fund managers, most of the panelists engaged in subterfuge to mask the true nature of taxation on carried interest, though Representative John Tierney of Massachusetts tried to his best to make Griffin fess up to the outrageously inequitable tax treatment afforded hedge fund managers on the incentive compensation which represents the lion’s share of their earnings.

Full post as published by Bailout Report on November 13, 2008 (boomark / email).