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Msg  7147 of 130519  at  9/25/2010 5:19:22 PM  by

jlongacre

The following message was updated on 9/25/2010 9:06:15 PM.

Disturbing Conflict of Interest - FDA's Hamburg and the Medallion Fund

   The Facts:
 
1) The FDA's Commisioner, Margaret Hamburg, is married to Peter Brown.
2) Peter Brown is co-CEO of Renaissance Technologies.
3) Renaissance Technologies runs four hedge funds.
4) The Medallion Fund is their "private fund"; it's is the only RT fund that is closed to outside investors, owned only by employees of RT.
5) Congress did not require that Dr. Hamburg and her husband divest themselves of their involvement in the Medallion Fund, as it is a quant fund, with human input only given "in rare instances".  (Rare? Maybe, but human "input" is still possible.)  http://online.wsj.com/article/SB124328188115551961.html
6) The Medallion Fund FAR outperforms not only the other Renaissance funds, but most funds overall; in 2008, the Medallion Fund returned 80%, while the other funds struggled or crumbled. 
 
"Astonishingly, out of the 148 months that elapsed between January 1993 and April 2005, Medallion only had 17 monthly losses. Out of 49 quarters in the same time period, Medallion only posted three quarterly losses. Additionally, it has seen a yearly Sharpe ratio of 1.68. In twelve plus years of trading, Rentec's Medallion Fund has never had a down year."
 
http://www.marketfolly.com/2010/06/renaissance-technologies-medallion-fund.html 
 
Now, does this look suspicious or what?  A private fund, run by the husband of the FDA's Commissioner, posts returns that far exceed other funds run by the same company, and virtually all other hedge funds.
 
Any chance the Medallion Fund is trading on "information asymmetry"?
Any chance they know of (or have input into) FDA decisions before anyone else and trade on that info?
Might they have been short going into the AC panel, and now covering/going long in advance of approval?  (Doing so would be an easy 10X from here, on top of the gains made shorting.)
 
After what happened with DNDN a few years ago, I wouldn't doubt any of the above. 
 
Couldn't Obama find a competent physician who didn't have ties to hedge funds to run the FDA?  So much for "change".
 
The corruption, or at least the perception thereof, continues in Washington. 
 
 


 
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Msg # Subject Author Recs Date Posted
7162 Re: Disturbing Conflict of Interest - FDA's Hamburg and the Medallion Fund keahou 4 9/26/2010 12:41:30 AM


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