The hedge fund giants are beginning to topple...

Regards - VHF

From The Sunday Times March 2, 2008

Peloton’s crash fires fund fears

Iain Dey

FEARS of a hedge-fund meltdown are rippling through the City, with dozens more funds said to be close to following Peloton into collapse.

Peloton began to liquidate its $9 billion (£4.5 billion) credit portfolio on Friday after coming under pressure from its bankers.

It is understood that as many as 6 of its 14 lending banks have seized assets from the firm rather than face up to losses of about $1 billion.

All of the fund’s $2 billion of equity has been wiped out, sources said.

City sources fear the Peloton firesale will prompt banks to ask other funds to put up more cash to support their positions, forcing more to close.