Billion-dollar returns? Not good enough for NBC. The network attacked rich hedge fund managers for taking high-risks, greed, and for trying to do business with the “upper-middle class.”
“Over chilled cocktails and spirited conversation this investment club in
According to NBC “Nightly News” anchor Brian Williams, “[a hedge fund] is high-risk and potentially very high reward.”
“They [hedge funds] have posted strong returns,” said CNBC reporter Carl Quintanilla. “And the people who run them buy mansions, art – paying themselves salaries of over a billion dollars in just the past year.”
But is there anything wrong with that? According to Quintanilla, they’re run by greedy people and too risky for “a new more vulnerable audience.”
“They are beginning to target the upper middle class – the reasonably wealthy professional rather than the millionaire or the super-rich,” said Columbia University Law Professor John Coffee.
But Coffee’s expertise isn’t investing, it’s in the legal elements of corporate
Apparently hedge fund investing is meant for the crème de la crème exclusively. To emphasize the point that ordinary rich people shouldn’t invest in hedge funds, Quintanilla quoted billionaire and media darling Berkshire Hathaway CEO Warren Buffett who has called hedge funds a “fool’s game.”
What Quintanilla didn’t report is that Buffett himself once invested $620 million in a hedge fund.
NBC also mentioned successful hedge fund manager, Tim Seymour, and drew comparisons to a fictional villain played by Michael Douglas in the 1987 movie “Wall Street.”
“Even Gordon Gekko, the villain from the movie ‘Wall Street’ is returning in a sequel as, yes, a hedge fund manager,” Quintanilla said.
“Nightly News” then played a scene from the movie where Gekko says, “Greed, for a lack of a better word, is good.” Then Quintanilla added, “That attitude shared by more hedge fund millionaires playing a risky game and for the moment, winning,” as the screen flashed back to
A textbook definition of a hedge fund, according to the Web site Investopedia, is “portfolio of investments that uses advanced investment strategies … with the goal of generating high returns.” Hedge funds also “hedge against risk,” hence the name hedge fund.
Hedge fund investing and hedge fund managers have also been criticized by the media because of the wealth they can generate – something the media have used to fuel the flames of class warfare.
