[gampy]

More trouble ahead, more yo-yo markets, I guess.

Will be interesting to see next weeks market activity.

[roccman]

A RAFT of European hedge funds have been forced to introduce emergency measures to protect their businesses from collapsing in the wake of the turmoil in financial markets.
$this->bbcode_second_pass_quote('', 'U')p to 10 European hedge funds have suspended redemptions after investors clamoured for their cash when the managers made severe losses.

[I_Like_Plants]

good catch Rocc.

There's a lot of really scary shit going on financially, and most of it's being covered up, "nothing to see here, move along" etc.

Tomorrow (Monday) should be interesting.

[lateStarter]

Thanks for the update Roc. My only question is how many of these:

$this->bbcode_second_pass_quote('', 'F')unds with heavy losses reportedly include Corin, Phylon, Addax FX1, Henderson Global Currency, Odey Treasury, Sector ERV, Kinetic Special Situations, Systeia Alternative Risk Trading and Polar Technology, according to Eurohedge, which monitors the industry

[Twilight]

$this->bbcode_second_pass_quote('lateStarter', 'M')y only question is how many of these:

$this->bbcode_second_pass_quote('', 'F')unds with heavy losses reportedly include Corin, Phylon, Addax FX1, Henderson Global Currency, Odey Treasury, Sector ERV, Kinetic Special Situations, Systeia Alternative Risk Trading and Polar Technology, according to Eurohedge, which monitors the industry

[Ferretlover]

Oops! Somebody is not happy......

St Paul Pioneer Press 1 Feb 2008 p 5C:
"Investors attempted to draw out 70 percent of capital. By staff
Investor dissatisfaction and a decline in leveraged buyouts in the US have prompted Deephaven Capital Management, one of Minnesota's biggest and best-known hedge fund managers, to liquidate one of its six funds.
Deephaven, based in Minnetonka, will sell the $780 million in assets in its Deephaven Event Fund and return the cash to investors, according to a document filed Thursday with the Securitiesand Exchange Commission. Deephaven also froze redemptions from the fund after investors tried to withdraw 70 of capital, CEO Colin Smith said in a letter sent to clients the same day. Fund Manager Andrew Greenberg left the company. "

[DantesPeak]

Well so many, even here, have stated that hedge fund speculation has pushed up oil prices. I said prove it - and also while your at it show me that hedge funds didn't push down prices. Now the Wall Street Journal says that hedge funds weren't investing in oil futures contracts - and they missed the boat on the big upmove. What say you - all of you who have constantly stated that hedge funds were pushing prices higher?
$this->bbcode_second_pass_quote('', '[')b]Energy Hedge Funds Missing Oil Boom Returns Lag Even as Futures Prices Soar,
Undermining Fears of Speculators' Clout By GREGORY ZUCKERMAN and ERIC BAUM, 9 Jun 2008:
If speculators are responsible for driving up energy prices, some of them haven't been doing a good job of profiting from the surge.

Hedge funds that focus on energy failed to cash in on huge moves in oil, natural gas, coal and other parts of the energy patch this year. Some were too cautious, bet against crude oil to protect other holdings or bought stocks of oil refiners and producers, many of which have struggled. Exxon Mobil Corp., for example, is down more than 7% this year.

Hedge funds generally take both bullish and bearish stances on an investment sector, so they don't usually keep up when a market soars.

Some of the hedge funds having difficulties may have been among those that bet against the price of long-term oil-futures contracts, while at the same time buying near-term oil futures, says Mary Ann Bartels, an analyst at Merrill Lynch. That strategy backfired in recent weeks when long-term energy-futures prices did better than near-term prices.

The strength in crude this year has caught some veteran traders by surprise, in part because oil inventories have been relatively full. "People seemed to get too scared when it neared $100 a barrel that a pullback was possible and have been gun shy getting back in ever since," said one hedge-fund manager.

[roccman]

Yep...

The coming global economic meltdown will have zero to do with speculation.

Nice find Dantes.

[mmasters]

Since when did the WSJ become the beacon of truth?

[copious.abundance]

Ummmm . . . some people aren't reading very carefully. The article isn't saying that hedge funds didn't invest in oil, it just says that many didn't make money doing so.

$this->bbcode_second_pass_quote('', 'H')edge funds that focus on energy failed to cash in on huge moves in oil, natural gas, coal and other parts of the energy patch this year. Some were too cautious, bet against crude oil to protect other holdings or bought stocks of oil refiners and producers, many of which have struggled. Exxon Mobil Corp., for example, is down more than 7% this year.

Hedge funds generally take both bullish and bearish stances on an investment sector, so they don't usually keep up when a market soars.

Some of the hedge funds having difficulties may have been among those that bet against the price of long-term oil-futures contracts, while at the same time buying near-term oil futures, says Mary Ann Bartels, an analyst at Merrill Lynch. That strategy backfired in recent weeks when long-term energy-futures prices did better than near-term prices.

[cube]

*calling JohnDenver*

[americandream]

$this->bbcode_second_pass_quote('OilFinder2', 'U')mmmm . . . some people aren't reading very carefully. The article isn't saying that hedge funds didn't invest in oil, it just says that many didn't make money doing so.

$this->bbcode_second_pass_quote('', 'H')edge funds that focus on energy failed to cash in on huge moves in oil, natural gas, coal and other parts of the energy patch this year. Some were too cautious, bet against crude oil to protect other holdings or bought stocks of oil refiners and producers, many of which have struggled. Exxon Mobil Corp., for example, is down more than 7% this year.

Hedge funds generally take both bullish and bearish stances on an investment sector, so they don't usually keep up when a market soars.

Some of the hedge funds having difficulties may have been among those that bet against the price of long-term oil-futures contracts, while at the same time buying near-term oil futures, says Mary Ann Bartels, an analyst at Merrill Lynch. That strategy backfired in recent weeks when long-term energy-futures prices did better than near-term prices.

[MonteQuest]

$this->bbcode_second_pass_quote('OilFinder2', 'U')mmmm . . . some people aren't reading very carefully. The article isn't saying that hedge funds didn't invest in oil, it just says that many didn't make money doing so.

$this->bbcode_second_pass_quote('americandream', 'I') think the inference in this thread and its WSJ link was that they (hedge funds in case u think I'm talking about little green men) weren't the investment drivers behind the oil price hike...talk about bein a dimwit!

[americandream]

$this->bbcode_second_pass_quote('OilFinder2', '')$this->bbcode_second_pass_quote('americandream', 'I') think the inference in this thread and its WSJ link was that they (hedge funds in case u think I'm talking about little green men) weren't the investment drivers behind the oil price hike...talk about bein a dimwit!

[mefistofeles]

Hedge funds usually invest in directionality, in other words most of the time they follow popular trends except with far more leverage. In other words they tend to follow the pack.

The vast majority of oil experts at the start of the year were predicting lower oil prices.

If hedge funds did bet on energy I would imagine that the vast majority probably bet against energy. Think of most of the people you know in the investment world, they certainly didn't think oil would have this spectacular run up.

Alot of people were saying that oil was overpriced,blah, blah.

In this kind of environment what would most hedge fund managers do? Invest in oil. Probably not, especially with all the "experts" saying that oil had topped out.

[kublikhan]

$this->bbcode_second_pass_quote('DantesPeak', 'W')hat say you - all of you who have constantly stated that hedge funds were pushing prices higher?

[mefistofeles]

$this->bbcode_second_pass_quote('', 'Y')ou called? I answer. Index speculators have been pumping up the price of oil. Check out this graph of the increasing amounts of index investment money pouring into commodities

[mefistofeles]

I think the key to stopping this tide of inflation would be super high interest rates. We need 12-14% rates here in the US. People need to save, conversely we need extreme fiscal discipline in order to insure that Congress doesn't bankrupt the US during such a high interest rate period.

Of course some would argue that sort of cure would be far worse than the disease,maybe. But the situation in the world is extreme and drastic steps need to be taken in order to take the wind of the economy and create a nice 30's style depression to contain the situation. Anything else will result in hyperinflation.

As I said in my last post, we haven't even seen the begining of the great commodities boom if the Fed doesn't act quickly and drastically.

[kublikhan]

$this->bbcode_second_pass_quote('mefistofeles', 'A') few hundred billion in the commodities markets. I think you're really looking at comparatively minimal inflows.
Look at the mortgage markets:
FHLB Bank loan to Countrywide.
So what you're saying is that between Microsoft's take over bid for Yahoo and single loan to FHLB Bank loan to Countrywide you have 40% of the commodities market covered. If anything the commodities market is dwarfed by much larger capital market. The market for mortgage backed securities is roughly 6.1 trillon or about 17.4 times as large the total commodities index.
Then of course you have foreign central banks holding Four Trillion Dollars worth of reserves.
Is there a bubble maybe, but there is ALOT of hot money in the world only a small fraction has gone into the commodities markets. Compared to other financial markets and what foreign central banks are holding the commodities market are comparatively undercapitalized, considering how important commodities are.