Hedge funds: Playing dice with the universe

In every decade, certain cultural archetypes arise to become the avatars of their time. In the 1950s, there was the corporate "organization man" in his gray flannel suit; in the '60s, the tie-dyed flower-power hippie. In the '70s, there was the polyester-leisure-suited big-lapeled "est" sensitivity trainer. In the '90s, we had the perpetually casual-Friday-looking 'Net entrepreneur.

And for this decade? It can be none other than the international hedge-fund manager, who "bestrides the world like a colossus" (as William Shakespeare's Cassius described Julius Caesar just before assassinating him), from offices looking out over Long Island Sound in Greenwich, Connecticut.

But has pride come before a very big fall? Recent events in the financial markets suggest that the answer could be yes. On the real-estate pages of the New York Times, any story about the latest outrageous selling price of some co-op on the Upper West Side, or on the beach in St Barts, or the slopes of Vail is bound to have some reference to a hot hedge-fund manager as the purchaser. A new off-Broadway play, Burleigh Grime$, celebrates the wild ways of the title character, a hedge-fund manager who, in one of his more legitimate profit-making schemes, has dead fish dumped on the beaches of California to try to profit from an El Nino market panic.

Perhaps most cheeky of all, early last month, a manor estate just north of London became the venue for "Hedgestock", a psychedelic '60s-themed hedge-fund networking event, complete with groovily painted Volkswagen vans, and millionaire hedge-fund managers dressing as penniless tie-dyed hippies. In contrast to the original Woodstock (whose famous moniker of "three days of peace, love and music" was morphed into Hedgestock's "three days of peace, love and money"), where commerce was limited to trading in home-made jug wine and bad grass, the Financial Times reported that attendees at Hedgestock had to be satisfied with equally intoxicating Moet and Breitlings.

http://www.atimes.com/atimes/Global_Economy/HG06Dj02.html