A closer look at the CSX/TCI and Bear Stearns cases
Jun 21st, 2008 | Filed under: Hedge Fund Industry Trends“In the Criminal Justice System the people are represented by two separate, yet equally important groups. The police who investigate crime and the District Attorneys who prosecute the offenders. These are their stories.”
Two recent court cases have captured the attention of hedge funds. One pits a corporate raider cum philanthropist (TCI) against the increasingly desperate management of a old-line 100,000-car railroad (CSX). The other accuses two average-Joe hedge fund managers as the ones who originally infected patient zero in the global credit pandemic (Bear Stearns’ High Grade Structured Credit Strategies Enhanced Leverage Fund or “BSHGSCSELF” for short)
Many of the facts surrounding each case have been obfuscated by sensational reporting. CNN’s Lou Dobb’s demanded, for example, that US legislators block the hostile take-over of CSX by London-based activist hedge fund TCI on national security grounds. Likewise, many mass media outlets seem to have bought into prosecutors’ arguments that the duo who ran Bear Stearns’ now infamous CDO fund were personally responsible for the entire global credit crunch.
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