DIGG THIS On October 13, 2008 the heads of our nation's five largest hedge funds were summoned before a U.S. House committee headed by the inimitable Henry Waxman. Although it initially appeared to be a "show trial" in an almost Soviet sense of the term, the hearing surprisingly turned into a rather informative affair. A congressman asked each of the hedge fund managers how their investment portfolios could have thrived when most financial markets have been in total disarray. One of the managers replied that he had shorted subprime mortgage-backed securities after researching their underlying assets diligently for months. His … Continue reading The Bubble and the Future