Stilltitled

Institutional investors remained frozen from the end of 2008 through the first three quarters of last year. There was very little hedge fund activity. But investment began to ramp up again in the fourth quarter. And the partial 2010 first-quarter data show that the investment trend remains strong. I think there is going to be an absolute tsunami of institutional money going into hedge funds. Many investors and their consultants and advisers now consider hedge funds the preferred alpha delivery system.

—Stephen Nesbitt, CEO Cliffwater, an alternative investment consultant, speculating on resurgent demand by institutions for hedge fund products. HF inflows totaled $21.5b in 2009, which was down 40% from 2008, 68% from 2007, and 10% from 2004’s previous low of $23.8b. Figures through March 19th suggest $12.3b in inflows, and some argue that 2010 will see $49b in net inflows. Though smaller than 2007’s banner year of $66.1, it would be the second-best year for fundraising, according to Pensions & Investments data: via P&I Online.

IMAGINE that for $33 a month you could buy Internet service twice as fast as what you get from Verizon or Comcast, bundled with digital high-definition television, unlimited long distance and international calling to 70 countries and wireless Internet connectivity for your laptop or smartphone throughout much of the country.

—Yochai Benkler: via NYT op-ed. He would go on to say, without a major policy shift to increase competition, broadband service in the United States will continue to lag far behind the rest of the developed world. But, lobbying from the monopolies is too strong even to begin exploring open access right now.

From the Berkman Center Broadband Report, an example of a competitive service in an open-access environment in France:

The best bundle currently available from Iliad’s “Free” service includes 100Mbps service to the home, digital TV with HD and the ability to create your own private television channel for others to watch on their TV sets, unlimited voice telephony throughout France and to 70 other countries, including the U.S., and secure nomadic Wi-Fi access wherever one’s laptop or Wi-Fi-enabled phone is within range of the Freebox of any other Free subscriber in the country (24% of the French market), for USD32.59 PPP a month.

The survey of literature on competitiveness, returns, and effects within open-systems would yield the following, singular observation:

It’s a slap upside the head of the government. It could be the moment where hopefully you realize that risk is beginning to creep into your credit profile and the costs associated with that can be pretty scary.

—Mitchell Stapley, chief fixed-income officer, Fifth Third Asset Management, $22b AUM, on the 3.5 BP spread to two-year treasuries from Berkshire bonds, in the wrong direction: via Bloomberg

It’s the luck factor that seduces everyone into believing that they are good, that they can actually win, but that’s just wishful thinking

—Tim Holland, master backgammon player, on the seductions of overconfidence bias: via NYT.

It doesn’t seem like policy makers are currently afraid of the bond market, and I wish that weren’t the case.

—Peter Orszag: via NYT Economic Scene