Monday, October 09, 2006

More On Hedge Fund Manipulation and Short Selling

Hedge Funds have been actively shorting the satellite radio sector. Here is further evidence of manipulation:

Hedge Funds Are Manipulating Mergers, Says NYSE - The Independent
(via www.briefing.com, In Play, Oct 9, 2006

The Independent reports long-term shareholders in the world's biggest stock exchanges should beware of being bounced into bad mergers by short-term hedge fund investors, the chief executive of the New York Stock Exchange (NYX), John Thain, has warned. Shareholders in Euronext have been told by the NYSE's brokers about suspicions that hedge funds may have been helping Deutsche Borse in an effort to flatter the price of the German bid for Euronext in comparison to that of the NYSE. A spike in short-selling, which pushed down NYSE shares in the summer, coincided with share buy-backs by Deutsche Borse which underpinned its own share price. And Mr Thain said the animus for a Deutsche Borse-Euronext deal was mainly coming from hedge funds, such as T.C.I., which hold stakes in both cos, with little thought for long-term value creation.