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ICI Wields Government Club

Posted: October 4, 2013

Author: Jonathan Hoenig

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“The hallmark of collectivists is their deep-rooted distrust of freedom and of the free-market processes; but it is their advocacy of so-called “consumer protection” that exposes the nature of their basic premises with particular clarity.  By preferring force and fear to incentive and reward as a means of human motivation,  they confess their view of man as a mindless brute functioning on the range of the moment,  whose actual self-interest lies in “flying-by-night” and making “quick kills…They confess their inability to grasp the crucial importance of the moral values which are the motive power of capitalism.”  

From The Assault on IntegrityAyn Rand’s Capitalism: The Unknown Ideal (1966)

The Investment Company Institute, a mutual fund industry lobbying group, is highlighting me in their campaign to use government force, including limiting freedom of speech, to hurt the competition.  My firm’s historic ads, the first in modern hedge fund history, are their top example of why government must continue to restrict hedge funds’ speech.


From Financial Times Ignites, October 4, 2013

“Capitalistpig Hedge Fund Ad Shows Need for Safeguards: ICI”

To make its case, the ICI points to an ad by the Capitalistpig hedge fund that appeared in the fall 2013 issue of The Objective Standard. According to its website, The Objective Standard publishes articles from writers at the Ayn Rand Institute, although the two organizations are separate.

“An actively managed hedge fund that’s beaten market returns for over 13 years,” states the ad, which includes a photo of a glittering cityscape. The ad also notes that the fund is for accredited investors only.

“The fund’s performance claims may be factually correct, but they lack material information necessary to put them in context — something that the additional disclosures proposed in [the SEC’s rules] would not provide,” the ICI says…

Jonathan Hoenig, manager of the $20 million Capitalistpig hedge fund, says the ICI’s highlighting of his fund’s ad is “pretty pathetic.”

“I see this as the ICI trying to use the government to squelch out legitimate competition,” he says, adding that he would object to an SEC rule that requires standardized performance reporting for private funds.

“Government regulation doesn’t make products more stable or any better. It just makes participating in the marketplace more cumbersome and expensive,” Hoenig says.

Read the entire article at Ignites here (registration required) 

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