Wednesday, October 2, 2013

Keep the Fed?

 Reuters Reports:
Even with a smaller size, Highfields [Capital] will still rank among the $2.4 trillion hedge fund industry's biggest players in part because it is not alone in deciding it is better to be smaller and more maneuverable.
This is good because we want the rich people to spend more money. Wealth accumulation has reached a ceiling with current interest rates held in place by the Fed bond purchase program. Successful hedge funds are returning capital to investors to better accommodate current market rates in a way that doesn't sacrifice their fund's return potential. If rich people start spending their money again, the conspicuous consumption effect will shift tastes and preferences of consumers -- a determinate of demand. It's not class warfare if we are all on the same side, and we are all part of consumer demand.

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