These hedge funders are dismayed at the presidential race

There’s much talk of politics at the Milken Institute’s annual gathering of business leaders in Beverly Hills. And a lot of head-scratching about the state of the presidential race, especially the surprise success of the leading Republican presidential candidate, Donald Trump.

“I’m a little confused,” hedge fund titan Steven Cohen of Point 72 Asset Management responded when asked on a panel discussion what he thought of the presidential campaign. “I’m not sure what to do and as the campaign goes on, I’m hoping it maybe reveals itself in one direction or another.”

Cohen donated a small amount of money to Chris Christie’s campaign, but like many members of the business establishment, he now finds himself in the perplexing position of having no pro-business candidate to support. Business leaders typically prefer Republicans, of course, and former Florida Gov. Jeb Bush was corporate America’s early favorite, raising more than $150 million before he dropped out.

Florida Sen. Marco Rubio then became the candidate of big business, but he dropped out too, after raising $110 million. Scott Walker, Chris Christie and Carly Fiorina all had a smattering of business support – and they’re all gone, as well. In total, those five pro-business candidates raised more than $300 million, all for naught.

You might think Trump, a billionaire developer, would enjoy Wall Street backing. But he has said hedge fund managers are “getting away with murder” on account of favorable tax breaks, and has pledged to roll back at least one loophole that lowers the tax bite for private-equity funds and other financiers. As for Democrats, Hillary Clinton used to represent the financial industry’s interests as a senator from New York, but her rival Bernie Sanders’ relentless bashing of big banks has drawn Clinton to the left and prompted her to insist that she, too, will clamp down on Wall Street.

The black hole into which millions in campaign donations has disappeared this year has led some big donors – most notably, Republican casino magnate Sheldon Adelson – to sit on their money until the general election. Some may sit on it all the way through November. Cliff Asness, co-founder of the hedge fund AQR Capital Management, gave more than $1 million to Rubio’s campaign, but when asked at the Milken conference whether he would support Trump or Clinton in the general election, he answered, “Hashtag neveranyofthem. I’m deeply disappointed with what are the likely two choices. I think I’m flipping a coin.”

The uproarious presidential race has even seeped into hedge fund dealings with overseas clients. “The world’s watching,” said Neil Chriss, founder of Hutchin Hill Capital, who has donated small amounts to Hillary Clinton’s campaign. “One investor asked me – I was shocked – who I’m voting for. Really? Do I have to answer this? I never heard such a thing.”

While policies may differ, there’s one thing the Democratic and Republican nominees seem likely to agree on. “At least they have a bipartisan hate of hedge funds,” said Asness. If not loved, maybe hedge funds can be feared.

Rick Newman’s latest book is Liberty for All: A Manifesto for Reclaiming Financial and Political Freedom. Follow him on Twitter: @rickjnewman.