Government hedges cause innovative capital flows

A $5.5 billion hedge fund is making a killing by stepping in to an area of business that European banks are pulling out of.Chenavari Investment Managers, a London-based hedge fund firm, says it is one of the main players buying loans from European banks.Those loans fund European businesses. After the financial crisis, European banks were forced to downsize their balance sheets and reduce lending. That has created a gap for asset managers to exploit.

Government monopoly central banks cause sharp changes in capital flows.  Most financial billionaires made their money watching and reacting to bank regulations.   Most of the Trumpster team made the do-re-mi using the technique, as did Soros.  Include Enron, Tesla and California. 

Hedge Hopping is  de facto permission for the sandbox to proceed, even in the face of government opposition.

The sandbox is essential if governments are to survive their accumulate losses. The sandbox autotrades the gaps,they are less easy to exploit. The same opportunism of the default process  is used to allow defaults. The autotrades spread the currency risk fairly, no more waiting in the government line while Soros gets the do-re-me.