Looks like a good way to make a living - but for WHAT?
For WHAT product or service that is useful to society are they paid this kind of money? For making your life better? For improving their country? For something good done for the world? None of these things. They are getting paid that much for successfully GAMBLING with wealthy people's money.
That the laws permit this kind of thing is one of the great mysteries of this universe. We would put a blank 99% income tax on those kinds of windfall profits for the good of the public treasury.
That would still leave the 25 managers $116 million to share = $4,640,000 annually per manager, which is a good years work and then some.
As written at the Wikipedia:
"Hedge funds are typically open only to a limited range of professional or wealthy investors. This provides them with an exemption in many jurisdictions from regulations governing short selling, derivative contracts, leverage, fee structures and the liquidity of interests in the fund. A hedge fund will typically commit itself to a particular investment strategy, investment types and leverage levels via statements in its offering documentation, thereby giving investors some indication of the nature of the fund.
The net asset value of a hedge fund can run into many billions of dollars, and this will usually be multiplied by leverage. Hedge funds dominate certain specialty markets such as trading within derivatives with high-yield ratings and distressed debt."
There is no reason in law or logic to give hedge funds these special privileges and to leverage money they do not have, giving them even more power than they already have with the pure cash at their disposal. These are the very same people who make billions by driving markets down, including the present market situation, and who then make billions by driving markets up, or did you think that last year's increase in the price of gasoline was the product of Ma and Pa buying oil shares down at the local five-and-dime stockbroker?
What will now happen is that these same hedge funds will be buying up "toxic assets" for a song, i.e. all of those default mortgages, and then, when the economy is moving again, make a gigantic profit from their investment. Fools and their money are easily parted. In the hands of the professionals of avarice, money breeds money.