Take the "hedge" out of hedgefund

For the most part, it has been a terrible year for the financial markets. Hedgefunds came out a long time ago and it is suppose to target the high networth and institutional investors. The general strategy (for the most part) was suppose to sustain losses against the equity markets- hence "hedge". What happened? The equity market took a huge blow this year and it looks like there is more to go before we reached the bottom. In the alternative investment world, it looks similar. How did this happened? How can a fund that hedges against the market go down with the market? Apparently, many investment managers took the word "hedge" out of hedgefund and started to high correlate themselves with the equity markets and highly leverage themselves to inflate their portfolios which is one of the many reasons for our current economic crisis.
For 2009, I'm expecting a substantial shake-out in the hedgefund industry. I think most of the funds that lost the meaning of a "hedgefund" will close down, if they had not already done so. In the next several months, many funds will continue to close down. However, as a result, the funds that still stands at the end will prosper. In 2009, I'm expecting a new evolution in the hedgefund industry.