The last few weeks have seen yet more shots fired in the fascinating
war of words between the Federal Reserve and hedge fund managers. Yet
this spectacle is essentially a sideshow. The real battle is elsewhere.
It relates to a Fed that is uncomfortably being boxed in by
highly-dependent markets.
For a few months now, quite a few hedge fund managers have complained loudly about the Fed. Their protests reflect the difficulties of investing in manipulated markets which, at times, can be quite "irrational" - at least according to their analytical, historical and mental models. They hate interacting in markets where central banks act both as competitors (with better visibility and information) and referees (seemingly happy to change the rules at a whim).
http://www.theatlantic.com/business/archive/2013/07/big-money-vs-bernanke-whos-right-about-the-economy/277548/
For a few months now, quite a few hedge fund managers have complained loudly about the Fed. Their protests reflect the difficulties of investing in manipulated markets which, at times, can be quite "irrational" - at least according to their analytical, historical and mental models. They hate interacting in markets where central banks act both as competitors (with better visibility and information) and referees (seemingly happy to change the rules at a whim).
http://www.theatlantic.com/business/archive/2013/07/big-money-vs-bernanke-whos-right-about-the-economy/277548/
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