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Title: Blog by Novelist William S. Frankl, MD

Revolt of The Hedge Funds

It appears that “buyer’s remorse” has hit some financial movers and shakers. Hedge fund managers supported Barack Obama and the Democrats in 2008 in a most dramatic fashion. However, now that 2012 is on the horizon and two years of Obama economics are a reality, a number of prominent fund managers have turned overwhelmingly to the Republicans. These hedge fund managers who have as their clients institutions and the truly wealthy, have recoiled at Obama’s attacks on Wall Street and his determination to raise taxes on the so-called “wealthy.” In 2006 and 2008 many of these fund managers believed that their support of Democrats and Obama would immunize them against such tax assaults. However, many of them see their efforts as a grand mistake, despite the fact that from 1990 to 2008 these fund managers and their employees contributed about $40 million to congressional candidates, and about two thirds of that amount went to Democrats. So, things have changed. In the 2010 election cycle 53% of contributions went to Republicans (hedge fund managers and their employee contributions totaled $11 million).
What effect this apparent switch will have on the 2012 reelection efforts of Barack Obama and the Congressional Democrats is still unknown. Stay tuned.

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