Sorry Miss, I left that $190 billion I owe you on the bus
The US hedge-fund industry is reeling from its worst ever crisis because bankers -- staggered by almost $190 billion of asset writedowns and credit losses caused by the collapse of the U.S. subprime-mortgage market -- are raising borrowing rates and demanding extra collateral for loans.
The dollar sank to the weakest ever against the euro and to a 12-year low versus the yen on speculation credit-market losses may widen after New York Federal Reserve and JPMorgan Chase & Co. stepped in to rescue Bear Stearns, and a Carlyle Group fund defaulted on $16.6 billion of debt. Two days ago, Drake Management LLC said it may shut it largest hedge fund.
Hedge-fund managers and other large speculators cut their net-long position in soybean futures by 8.8 percent to 115,796 contracts in the week ended March 11, the U.S. Commodity Futures Trading Commission said today after the close of trading. Net- long positions, or bets prices will climbed, reached a record 155,278 contracts on Dec. 11.
Funds that invest in baskets of commodities reduced net- long soybean positions 6.4 percent to 183,252 contracts on March 11. Index funds were net long a record 198,707 in the week ended Feb. 19.
"The fear now is how many other hedge funds and other investors have losses they cannot cover, and commodities are the most liquid asset to raise capital,'' said Alan Kluis, president of Northland Commodities LLC in Minneapolis.
"It's could get real ugly if these hedge funds decide to exit longs and get short,'' Kluis said. "I told clients this week that commodities are reaching an extreme high and equities may be at an extreme low.''
The dollar sank to the weakest ever against the euro and to a 12-year low versus the yen on speculation credit-market losses may widen after New York Federal Reserve and JPMorgan Chase & Co. stepped in to rescue Bear Stearns, and a Carlyle Group fund defaulted on $16.6 billion of debt. Two days ago, Drake Management LLC said it may shut it largest hedge fund.
Hedge-fund managers and other large speculators cut their net-long position in soybean futures by 8.8 percent to 115,796 contracts in the week ended March 11, the U.S. Commodity Futures Trading Commission said today after the close of trading. Net- long positions, or bets prices will climbed, reached a record 155,278 contracts on Dec. 11.
Funds that invest in baskets of commodities reduced net- long soybean positions 6.4 percent to 183,252 contracts on March 11. Index funds were net long a record 198,707 in the week ended Feb. 19.
"The fear now is how many other hedge funds and other investors have losses they cannot cover, and commodities are the most liquid asset to raise capital,'' said Alan Kluis, president of Northland Commodities LLC in Minneapolis.
"It's could get real ugly if these hedge funds decide to exit longs and get short,'' Kluis said. "I told clients this week that commodities are reaching an extreme high and equities may be at an extreme low.''
