From the article:
“Luckily, the people managing it have years of experience in managing massive portfolios, dealing with illiquidity, and trading markets… oh wait!”
– Name The Hedge Fund (ZeroHedge, Oct 8, 2014):
Back in 2007, the issue of leverage in the investment banking community (which hadn’t mattered to anybody for many years) suddenly mattered to everybody and for the usual reason in such cases: people started to worry about losing money. Amazingly, having financial institutions levered 30x became something to fear seemingly overnight; and, of course, whilst things like that can go on for a long time, as soon as the fear takes hold, it’s game over…
NAME THIS HEDGE FUND
Its leverage is extreme to say the least…
And it’s been building for 7 years…
Today, in 2014, after the massive expansion of its balance sheet in the name of peacekeeping, the Fed’s leverage far exceeds what was enough to cripple the world financial system back in 2008.
* * *
Luckily, the people managing it have years of experience in managing massive portfolios, dealing with illiquidity, and trading markets… oh wait!
Source: Grant Williams