"Yup, bite the hand that feeds you. Excellent plan."
I recall that hand giving us the finger about nine years ago, and it hasn't done a whole lot to make up for it since.
Given the number of pensions, trusts, endowments and other "essential" institutions that invest in venture funds, I don't think it's unreasonable or onerous to expect that they might have to report the identities of their investors to the eventual regulators of systemic risk. It's not like there isn't precedent for the VC sector to depress the economy.
They invest in very limited amounts, and the amount they are allowed to invest in VC is quite limited by existing regulation, isn't it? If this crisis shows us anything, its that real estate and stocks/bonds are not safe investments, and diversification into VC is nothing if not prudent.
As far as I know, there's no law that prevents a private endowment or a pension from investing heavily in venture funds. The point is not to look at what they do today, but what they might do tomorrow if the system is left unregulated.
Five years ago, the regulators didn't think that housing was a high-risk sector of the economy, either. How'd that turn out?
Five years ago, the regulators didn't think that housing was a high-risk sector of the economy, either.
Yes they did (here in the UK at least). That's why interest rates were kept artificially low, screwing savers (who outnumber borrowers 4:1 - you don't piss off that many voters unless you're worried).
The causes of the crisis are complex, but home building was driven by cheap money from low interest rates. Had it not been, the bubble would have burst long ago. The fed put the petal to the metal for a long time, and kept it there because they knew housing was saving us from recession.
I recall that hand giving us the finger about nine years ago, and it hasn't done a whole lot to make up for it since.
Given the number of pensions, trusts, endowments and other "essential" institutions that invest in venture funds, I don't think it's unreasonable or onerous to expect that they might have to report the identities of their investors to the eventual regulators of systemic risk. It's not like there isn't precedent for the VC sector to depress the economy.