I remember the event as if it were yesterday. The date was December 8, 2010. I was attending the surprise retirement party for a friend and client, Stan Druckenmiller, the most successful financial investor of his generation with the best record of returns in the business. At age 57, he had announced several months earlier that he would retire from managing other people's money.
As I walked into the dimly lit restaurant's lobby, I thought of the near quarter-century I had spent as an adviser to the lead trading strategists of a number of large, macroeconomics-oriented hedge funds. This was a world in the midst of dramatic change as a result of the financial crisis that had exploded onto the scene two years earlier. For the hedge fund world in particular, and for financial markets in general, nothing would be the same. The same is true for the economy. The massive financial leverage of previous years was now a faint memory. At one time, the Wall Street banks funneled what seemed like unlimited loans to the hedge funds to take trading positions in various global financial instruments. Not anymore.
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