"Investors will withdraw $500bn – a quarter of the asset base – from hedge funds in the next year, leading to the collapse of a "large number" of hedge funds.

So spredicts Giles Conway-Gordon, managing partner of Cogo Wolf, a San Francisco-based fund of hedge funds, who believes investors are increasingly dissatisfied with industry performance, and that computer-driven quantitative hedge funds now simply run too much money to make healthy returns."

"Run too much money"? Sure. But how about the fact that the majority of them are little more than positively correlated to credit growth -- which is why the vast majority (including Goldman's) do horribly when credit contracts.

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