After noting that most hedge funds are tanking and face the prospect of massive redemptions from investors prompting liquidity issues and the need to sell off equities to pay out leading to massive bloodletting as the markts spiral further downwards, the Wall Street Journal writes astonishingly
Hedge-fund managers face a basic problem: Many won’t get paid much this year and will have trouble retaining key employees. The reason: Few funds have made positive returns, so they can’t dole out “performance fees,” hefty cuts of trading profits.
Do I need to spell this out? The geniuses who navigated us all into this mess may decide to quit because their “performance fees” for destroying the economy may not meet their usual expectations? I think I read about this in Good Fucking Riddance magazine. You get performance fees when you perform well. Or that is the way it works outside the Financial Services industry.
The hammerheads who ran out of ideas for investing your money and so started creating “funds of funds” to leverage the leverage will leave en masse if their bonuses are less than stellar. And go where? Is there really that great a demand for their services elsewhere?
The absurdity of this is that most of what these people do is not that special. The trading strategies are based on mathematical models developed by nuclear physicists left jobless by the end of the cold war. And these guys are typically paid a lot less than the suspender wearing, WhartonHarvardYale tied Gordon Gekko wannabes who now threaten to take their ball and go home.
Fine. Fuck off. Go home. Who needs you? And while I don’t generally favour the populist “give back some of your past performance fees” maybe they should give back some of the fucking money. Because they didn’t earn it in the first place. They demanded it as extortion to remain manning the decks of the Titanic. The captain of the sinking ocean liner probably ought not to worry too much about paying extra to bribe crewmembers to stick around. Especially when their first instinct is going to be to take all the lifeboats while the passengers are locked downstairs.
I mean it’s not like the Carpathia is right next door and hiring incompetent sailors at top dollar.
In a kinder gentler age these guys would have become snake oil salesmen or personal injury lawyers and been understandably shunned by decent people. Here’s a tip for the Investment Banking refugees: maybe the folks at Dr. McFraudy’s Miracle Restorative Tonic are hiring.
And oh yeah, fuck off.