I'd actually like to see the citation for the poor performance of hedge fund managers, or are you just basing this comment on the recent media portrayal?

Here's one analysis, which while not all bad, is not particularly positive either: http://www.cfapubs.org/loi/doi/abs/10.2469/faj.v61.n6.2775

Thanks for pointing this one out. I'm looking forward to a year or two from now when someone can do a study of hedge fund performance net of fees vs. a benchmark such as S&P500 over the last 10-20 years including 2008 and 2009. I would expect hedge funds to outperform, and the last 2 years have been a once-in-a-generation event to check that hypothesis against.

hedge funds have gotten away with poor performance due to naivety and poor due diligence from investors. hedge funds managers are just following their incentives, it's up to investors to shape the right incentive