WASHINGTON (Reuters) - Federal Reserve Chairman Alan
Greenspan on Monday warned that hedge funds had picked the
"low-hanging fruit" of easy profits and may be set for a fall
as they assume more risks in a quest for high returns. He said, however, that the financial system should escape
widespread damage from hedge fund woes as long as banks lending
to them managed risks effectively. "After its recent very rapid advance, the hedge fund
industry could temporarily shrink, and many wealthy fund
managers and investors could become less wealthy," the
influential Fed chief cautioned in remarks prepared for
delivery via satellite to a bankers conference in Beijing
