AQR’s Asness takes on Obama over Chrysler debt

Fri May 8, 2009




This week, AQR Capital Management co-founder Cliff Asness fired off a letter - circulated widely by hedge funds - responding to President Barack Obama's contention that some Chrysler stakeholders, among them hedge funds, had been unwilling to make "sacrifices" in order to allow a successful restructuring of the troubled automaker.

"While many stakeholders made sacrifices and worked constructively, I have to tell you, some did not," said Obama in late April. "In particular," the President said, "a group of investment firms and hedge funds decided to hold out for the prospect of an unjustified taxpayer-funded bailout. They were hoping that everybody else would make sacrifices and they would have to make none. Some demanded twice the return that other lenders were getting. I don't stand with them."

Asness' response, titled "Unafraid in Greenwich, Connecticut," shot back that if investment managers had made such so-called sacrifices, by accepting less than they...

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