On the streets of London, few people who work
outside the financial sector speak fondly of hedge funds.
Occupy London is offering tours of Mayfair this month,
promising in its flyers that visitors will be able to "delve
into the murkiest corners of 'hedge fund alley.’"
In December, British poet Alice Oswald withdrew from her
nomination for the £15,000 T. S. Eliot prize because a
hedge fund, Aurum Fund Management, had agreed to sponsor the
prize when the British Arts Council withdrew its funding.
Oswald released a statement saying, "I think poetry should be
questioning and not endorsing such institutions."
"Hedge funds don’t do great job of
educating the greater public about what they do," concedes
Kevin Gundle, chief executive of Aurum.
But hedge funds do have at least one friendly
ambassador in London. Charles Barley, 47, has been driving a
taxi in the city for 11 years and some days finds himself
defending hedge funds against grousing passengers. "I had a
couple in my cab who asked me, 'What do you think of bankers
and hedge funds?’" says Barley. The man in his
taxi then opined that they were "the scum of the earth."
Another passenger said hedge fund managers should be burned at
"One chap was wearing a soccer shirt," Barley
recalls. "He said he was a season ticket holder. I asked how
much he paid for his tickets, and he said £800 a season.
I said, 'You pay this to watch soccer players earning
£20,000 a week and you’re getting something
out of it. From my side, I enjoy bankers and hedge funds giving
me their money.’"
"I told those passengers you’ve got to
realize that in France they farm, in Germany they manufacture,
and in Britain we have finance," says Barley. "If you lose your
finance what else have we got? If you get 40 miles outside of
London you’ll see that we’re in a
recession, but here in London it doesn’t look like
a recession, and that’s because of all the hedge
Barley knows a few hedge fund managers well and is
friends with Rus Newton, co-founder of the Jersey-based $300
million commodities hedge fund Global Advisors. "We come from
different walks of life but our wives are friends," says
Barley. "I’ve met some hedge fund guys
who’re very flashy. Rus is not, he’s
down to earth. I know plenty of hedge fund managers
who’re nice people."
"I don’t fully understand what hedge
funds are," he acknowledges, "but they’re making
money, and people who are against them really
don’t understand what they are either."