US hedge fund fears explored

WASHINGTON, DC – Concerns about the risks that hedge funds pose to both national and the global financial system were the focus on a mid-May Senate hearing, The Role of Hedge Funds in our Capital Markets .

Randal Quarles, under-secretary for domestic finance at the Department of the Treasury, said that while "hedge funds as a group do not pose a greater operational risk to the OTC settlement and clearance systems than any other group of market participants" he feared that "operational risks can be posed by certain market conditions and certain technological conditions in certain products, particularly new products, where technological and legal infrastructures tend to lag product development and

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