Sam Jones reports for the FT:
Pharo Management is becoming the first hedge fund manager to offer shares in its investment vehicles denominated in renminbi.
The move for its flagship fund underscored the extent to which the future of the US dollar and the rising power of the Chinese currency are becoming concerns for the markets’ most sophisticated investors.
To give this an alternative interpretation, rapid economic growth in China is creating the largest pool of suckers the world has ever seen. Real world individuals exhibit bounded rationality, and lots of Chinese people who may have been extremely smart at getting rich in China’s industrial revolution may be quite foolish about their decisionmaking regarding complicated western financial products. American rich people are much better-positioned than Chinese rich people to avoid getting ripped off, and yet a large number of people were taken in by Bernie Madoff’s rather crude fraud. China is a treasure trove of potential marks and Pharo is getting in on the game.