Fortedei

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    • ON: Wed Mar 26th 17:30 PM
      Commented on:
      In the Wake of Bear: I-Bank Regulation Now in Fed's Hands
      The main thing which will change is the availability of financing to hedge funds. Hedge funds have skirted the Fed margin requirements for years, with the I banks, as prime brokers, lending two, three, five and ten times the equity in the fund. Leverage is a double edge sword and we've seen the downside. If the Fed is the lender of last resort, it will be able to reign in excessive lending to funds. The game is over.
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