Hedge Fund Follow-up

These two articles show opposite side of yesterday's fears.

First from Bloomberg:

``It's more rumors than fact,'' said Brett Barth, a partner at BBR Partners LLC in New York, which invests in hedge funds for its clients. ``There are a handful of trades not working, so people are worried that there are hedge funds being forced to liquidate their holdings to meet redemptions.''

Next the NYT:

Another large hedge fund manager, GLG Partners, which is based in London and is 20 percent owned by Lehman Brothers, had losses ranging from 2.5 percent to more than 8 percent as of last month on some of the portfolios it manages, according to a person briefed on the results. Officials at GLG did not return e-mail messages sent to their offices yesterday afternoon. A spokeswoman for Lehman declined to comment.

Yesterday's sell-off began on European markets amid a rumor that Deutsche Bank stood to suffer losses because of its exposure to a hedge fund that was caught wrong-footed by the recent cut in the credit rating of G.M.'s debt. Shares of Deutsche Bank fell 3 percent.

I still have a hard time seeing the correlations between assets as high enough to prevent new money from flowing into disrupted areas. Not doing anything on the news but watching.