Back in January 2007, five years ago. And here comes The Economist with the results. "There is no doubt that hedge-fund managers have been good at making money for themselves. Many of America’s recently minted billionaires grew rich from hedge clippings. But as a new book by Simon Lack, who spent many years studying hedge funds at JPMorgan, points out, it is hard to think of any clients that have become rich by investing in hedge funds" with an average return since 1998 of 2.1% a year, "half the return they could have achieved by investing in boring old Treasury bills."
"Mr Lack’s book suggests the blind faith displayed by many institutional investors in hedge funds needs to be reconsidered…Investing in hedge funds will enable some lucky managers to enjoy an early retirement on their yachts. It will not enable pension funds to eliminate their deficits." It wasn't blind faith. It was just coming up with an excuse to project future returns to be higher than they would turn out to be, to back a false estimate of the cost of pension enrichments for the pension rich while providing more public money to the one percent.