It seems that hedge funds being less leveraged than they used to be will be good for the upward trend of the stock market. Less money sloshing around in hedge fund coffers means less CDO's and SIV's will be bought at inflated prices. The real values, as we have seen ,are not those made up by MBA's computer models from bad input data, and blessed by the rating agencies, but what investors will pay in the market place.

With the SEC starting to do its job after 8 years of ignoring Wall Street fraud right under its nose, with massive shorting, some of the naked variety, destroying many young, OTC or pink sheet companies, maybe hedge funds just might find some long-term value in  U.S. stocks, ,many which have languished since 2004, despite steady earnings growth.

Hedge funds have been net short for years, so to imply that with less money they will have less to invest on the long side is erroneous. They just might stop and think before they take a larger short positions than they can located shares for, or think twice about spreading rumors after taking their short positions. Not a bad thing.

I seriously believe that banks and (to a lesser degree) hedge funds should get and should stay conservative.  Wild-eyed, throw-money-everywhere investing should be left to drunken tourists at Las Vegas and Atlantic City.

Bookfield's management has for the past quarter century run the company for the benefit of management, not the shareholders.  They showed their true colours back in the 80's with the Bell Canada Realty bonds fiasco.  They are very shrewd businessmen, as their cherry picking of the bankrupt O&Y Manhattan portfolio showed in the early 90's.  There's always the promise of jam tomorrow, but somehow between now and then, the very best assets get moved over to joint ventures where management owns most of the equity and the lemons get left with joe public.

Jon---

I'd had some BAM, but sold on realestate concerns. I still have 2 shares of BIP,

their spin off. Could you address the value of BIP ? Thanks

Gerald Williams is 100% right in his comments.  They could be elaborated on but suffice it to say that management has an established and exemplary track record over several decades and in many areas of activity of seeing that 'the lemons get left with joe public'.  And I bet that they will continue to do so.

lol earl,

You have 2 shares of BIP?  Nobody cares what the value of it is if you only have 2 shares.  Are you hoping for a  huge capital gains so you can go to starbucks and splurge on a coffee?  I'm sure John has more important matters to attend to than $40 worth of BIP.

I know that the stock Market will crash like the one in the 30's for the reasons that I will mention. 1. There are many con artests out their. 2. If the money stops flowing from the foreigns or they take their money out of it, the stock market will crash. 3. There is so much dishonesty now compared to years ago, that it will fail. 4. The times are right for a crash because of less money on hand, the laws favor the rich over the middle class and the poor. 5. The policies of this administration has bankrupt this country for many years to come.

hedge funds, investment banks and  brokerage firms should/must be held accountable to the same margin rules as the individual investor.  Laws were passed in the 1030's to regulate dangerous speculation relative to margin.  A significant factor leading to the crash in 1929 was the ability to by with only 5% margin.  The above investment companies played by rules that were outlawed long ago.  This is criminal!  The regulators are equally responsible for allowing this to happen.

bozo: there will be no crash, foriegners will not abandon this market because its

the best. slow banks will probably cause a longer, slower growth period.

more money is made by giving advice

than by taking advice