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By Benedicte Gravrand, Opalesque London:

Fortis Prime Fund Solutions - the Dutch part of Fortis - hosted an event on Thursday last week in their City of London sky-high offices to discuss the consequences of the most challenging year for the hedge fund industry. Macro managers started with a discussion on 2008 and possible future developments:

Emergent: Beware of the debt burden Susan Payne, CEO of emerging market hedge funds house Emergent, said she believed the current transition cycle would last ten to twenty years - not two to three years. Whereas 2008 was defined by the market impacting on the economy, 2009 will be defined by the economy impacting on the market. The recession was founded in debt (consumer, company and government debt) and is contradictory because the capital losses of last year do not match the announced losses - so there is an issue of real disconnect here.

"These are very odd times," she said. "I have never in my 20 years seen such polarities as I see now between investment luminaries' views on the market." Some are talking of green shoots emerging, others are wondering if there are indeed any. She believes the next level of what will happen in the future is a debt crisis. This could be quite alarming over time and we must be aware of the debt burden.

Many investors, such as those from the Middle-East for example who have a lot of cash and who are buying equities, as well as a lot of short-covering activity (......................

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