Key Takeaways
- Hedge fund investments propel many small businesses.
- Private funds raise over half a trillion for capital-intensive businesses.
- Hedge funds help protect small and medium-sized businesses from market volatility.
Private funds provide $716 billion in credit for American businesses, helping them grow, create opportunities for workers, and benefit local communities. James Coston, the co-founder and executive chairman of Corridor Rail Development Chicago, explains how hedge funds help support the American economy.
“Hedge funds are a critical component in maintaining a strong economy. Hedge funds help grow investments made by pensions, foundations, and nonprofits, allowing these organizations to support retirees, college students on scholarships, and vulnerable populations. This value proposition is well documented, but little is understood regarding hedge funds’ role in supporting businesses and our overall economy. In addition to helping everyday Americans, hedge funds help capital-intensive companies grow by providing financing necessary for expansion and growth. As these businesses grow, the public reaps the rewards.
“My business, Corridor Rail Development Chicago, relies on hedge funds for our business development needs. Hedge funds have helped grow my company into the market leader it is today. And it’s not just my company. Private funds provide $716 billion in credit for American businesses, helping them grow, create opportunities for workers, and benefit local communities. Unfortunately, some of our elected officials don’t understand the nature of hedge funds and the value they provide for pensions, foundations, nonprofits, and capital-intensive businesses like mine. If these officials push forward misguided regulations targeting hedge funds, everyday Americans will end up footing the bill.
“As the Executive Chairman and Founder of Corridor Rail Development Chicago (CRDC), I have firsthand experience interacting with hedge funds and have come to rely on their services for my own business. CRDC provides passenger rail development, management, and financial services – ensuring the people of Illinois and Americans across the country with dependable rail travel. In my efforts to scale up CRDC and provide our services on both a regional and national level, hedge funds have been an essential partner in the never-ending quest to secure funding to support our long-term objectives. The injection of private capital allows my company to hire talent, invest in projects, and innovate. By working with hedge funds, CRDC has become an industry leader, possessing the only stainless steel bi-level intercity corridor fleet in North America and an extensive commuter and regional stainless steel rail fleet.
“I take pride in CRDC’s acquisition and growth of refurbished rail cars since it saves municipalities and transit authorities a significant amount of money. They don’t need to buy direct from foreign rail car manufacturers as their only rail car acquisition option; CRDC provides a domestic outlet for obtaining rail cars and the resources required to operate a transit system. I’ve worked hard to establish CRDC as a value provider for public transit, and hedge funds have helped support our growth.
“Hedge funds are vital to our financial services system, serving public institutions and private enterprises. The protection they offer against volatility, the instruments they utilize to grow investments, and the opportunity they provide for capital-intensive businesses such as CRDC are all ways the hedge funds provide value to our economy. We must resist policies that unnecessarily target hedge funds and instead allow them to do what they do best: support the American economy.”
