By Michelle Celarier
While on his way to get his son at college, a friend was driving down the highway near Dayton, Ohio, and saw a couple - in their early 50s - hitchhiking. My friend (a veteran of an earlier era of hitching rides) stopped to pick them up and quickly learned their story. The husband, a carpenter, was out of work, and the couple could no longer pay the rent on their house. They had finally been forced to sell their car, so they were hitchhiking to Houston. They'd heard there was work there.
The tale seems eerily reminiscent of the Depression, when jobless men rode the rails west in search of work. It's tragic just how much desperation can be seen in our nation these days, despite improving news from the banks and the stock market.
Why do I recount this story to the readers of Absolute Return? For one thing, I can't get it out of my head. For another, this issue contains our annual ranking of hedge fund philanthropists, and we're pleased to report that despite the difficulties the industry has faced, many have continued to dip into their own pockets to fund a variety of causes, from curing disease to alleviating poverty. Never before in the history of hedge funds have their efforts been needed as much as they are today. To quote former President John F. Kennedy (and the Bible): "For of those to whom much is given, much is required."
Also in this issue, we look at the recent brouhaha with the Obama administration over the heated Chrysler bankruptcy negotiations, which led the President to admonish those he termed "speculators" (including hedge funds), for opposing the administration's proposal.
Hedge funds were only looking out for their investors, as they should. Their investment returns will help shore up the retirements of individuals, from the school teacher to the corporate executive, throughout our country. Unfortunately, some of these hedge funds did not serve their investors well as they miscalculated the political risk involved - and some did realize this, albeit belatedly.
As some of his most ardent supporters acknowledge, Obama overreacted. His posture might be considered a partisan one, meant to send a message to the nation that he's not concerned just with bailing out Wall Street. He's also going to stand behind the auto industry and the common man in Detroit - the type of person who might well end up on the highway hitchhiking in search of a job. In times like these, can we really expect anything else?
Hedge funds have a role to play in rebuilding our nation, and they (and their investors) will profit from it. Being less myopic will make the task easier.