Now, the Anglican Church's lineage I've always treated with some disdain as one which was bolstered so Henry VIII could divorce Catherine of Aragon and marry Anne Boleyn. (Don't worry; I'm offending few when I characterize it as a church of convenience since mass British interest in religion approaches nil.) It was thus with some curiosity that I've followed how the Anglican Church has reacted to the credit crisis. Despite railing against financial chicanery during last year's meltdown, it was revealed that Anglican funds have lent out shares to short sellers:
The Church of England was facing charges of hypocrisy yesterday over its leaders’ attack on short selling and debt trading after hedge funds pointed out it uses some of the same practices when investing its own assets. Rowan Williams, the archbishop of Canterbury and head of the Anglican Church, said it was right to ban short selling, while John Sentamu, archbishop of York, called traders who cashed in on falling prices “bank robbers and asset strippers”.Not very ethical, eh? But hold on, there is worse. The Financial Times is now reporting that the Church of England is expressing concern over proposed EU directives mandating greater hedge fund accountability. (You can also see their letter.) It can certainly be said that hedge funds didn't play a major role in fomenting the crisis, but they are nonetheless overdue for better regulation, comparatively speaking:
Hedge funds pointed to the willingness of the Church commissioners to lend foreign stock from their £5.5bn ($10.2bn) of investments – an essential support for short selling – and derided the pair for not understanding shorting.
“They are trying to shoot the messenger and ... deflecting attention away from the dramatic incompetence of bank executives,” said Hugh Hendry of Eclectica Asset Management, a London hedge fund. “Short selling is the pursuit of truth.” Andreas Whittam-Smith, who as First Church Estates Commissioner oversees the Church’s assets, said the commisioners yesterday referred the practice of stock lending back to their ethical advisory group, which had previously approved it.
In a letter to the House of Lord’s EU select committee, the church commissioners – the custodians of its ancient wealth – raised “serious concerns” about plans from the European Union to regulate hedge funds...“We are concerned that the directive as currently drafted will significantly restrict our ability to generate funds to pursue our charitable missions and thus reduce our impact for public good,” said the letter...Everyone's a dyspeptic Euroskeptic. So much for the bank robbers and asset strippers bit. The gist of their argument is that doing God's works requires maximizing returns on portfolio investments. It is then implied that EU-style overregulation may force the institution to invest elsewhere in a race-to-the-bottom fashion. Do I see some inconsistency here? The FT makes an interesting allusion to the story of Jesus and the money changers in the synoptic Gospels that seems to place these erstwhile people of the book in a bad light. Ah well, maybe more of them should follow the lead of EuroBlair. Heaven knows, Benedict XVI certainly displays a high level of sophistication in discussing global concerns. And some people wonder why the Anglican Church is in decline -
“Maximising the returns on our investment portfolios is an essential part of delivering our foundations’ missions, for the benefit of society,” said the letter. “The draft directive, while well-intentioned, threatens this goal.”
The foundations singled out three areas of concern: proposals to limit EU investors to investing in EU-domiciled funds, requirements for funds to use EU-registered depository banks, and limits on funds’ use of leverage. Instead of “imposing restrictions” which would “reduce our freedom”, said the foundations, the EU should concentrate on enforcing transparency, in order to enable investors to “make a judgment”.
My house will be called a house of prayer for all nations
But you have made it a den of thieves