Honestly I think your missing the point of the article. When...

Honestly I think your missing the point of the article.

When asked about accusations within Glaucus's report 11 weeks ago now, Blue Skys response was, no nothing is wrong here, we are all good Glaucus is wrong. When directly asked about their valuation process they responded, we have experts involved and major institutions have placed money with us, so there is nothing to worry about we got this. When directly asked about specific valuations / processes, they responded, large institutions are placing money with us, why are you worrying about these little side issues.

11 Weeks later, they have announced with a straight face oh, some of our valuations were wrong, oh and we have a nearly 60 million loss to announce (which is more than their total profit since they have been listed).

1 week ago there were asked directly is their role in the market was artificially impacting prices because of conerns in the hedge fund groups, they responded with no, we represent 10% to 20% of the trades no more than 25%. The AFR went, hang on 25% of the transactions is material and substantial, that could easily impact the market.

Now a week later, they respond with, we represent 2% of the total water market. We are all above board, our investors have achieved 17% pa returns. Leave us alone. It is right to question the integrity of their models. If Blue Sky step out of the market what happens (and BTW if they run out of money, they might have to wind up the fund and exit). If you remove Blue Sky from the who is left and what will they pay? Serious questions. Blue Sky is by far the dominant player in that space, they acknowledge it by saying that they have limited the size of their fund to reduce the impact on the market.

My read is that the issue the AFR have is that every time you ask Blue Sky a direct question, they respond with a misdirect. You ask, look at this how does it work, they say, look over there, what a pretty flower. They just come across as "magicians" of the financial world. Its a great show, but in the end its all smoke mirrors and misdirect. And the most amazing trick they have is making your money disappear - all within the rules of the law.