When a hedge fund manager tells the NYT that: “there hasn’t been one problem at all to global systemic risk in the U.S. and abroad from a hedge fund,” it would be appropriate to point out that Alan Greenspan thought otherwise. Greenspan intervened in the unraveling of the Long-Term Capital hedge fund precisely because he claimed that its collapse jeopardized the stability of the financial system. It's possible that Greenspan's assessment was wrong, but it would have been appropriate to note that the Fed had in fact intervened because it claimed that a hedge fund had imposed systematic risk.
--Dean Baker
