Money managers under the microscope
In the brown stuff
The unfolding crisis in British politics makes for fascinating viewing for the populace and great work for journalists, but it also of course has potentially far-reaching implications in the financial sector.
As cabinet ministers resign and Labour MPs call for Gordon Brown to step down, several outcomes now distrinctly possible — Brown stays, a new Labour prime minister emerges or a general election is called and (if polls are correct) the opposition Conservatives win. The future direction of UK government policy is far from clear.
And while it may not exactly be topping the main contenders’ manifestos or dominating the discussion on the doorsteps, the future regulation of the hedge fund industry is also likely to be affected by any change in leader.
This week executives from London’s top hedge funds met with Treasury officials and the Financial Services Authority to discuss the UK’s position on the (at least in Britain) widely-derided draft EU law on hedge funds and private equity.
However, privately, some hedge fund executives are already looking ahead to a possible change of government — an election must be called in Britain within the next year — and the change of policy and potentially greater willingness to fight the EU laws this may bring.
The hedge fund community has tended to have closer ties to the Conservatives than to Labour (ex-Man Group CEO Stanley Fink was earlier this year appointed election fundraiser for the Conservatives). If, as the opposition is now demanding, a general election is indeed called as Gordon Brown’s authority is shaken then London-based hedge funds could find new support for a fight with Brussels.