How a small Wisconsin town is making some hedge funds very nervous

After a century-old paper mill in Brokaw, Wisconsin, closed a few years ago, the town of 250 residents effectively went bankrupt.

Brokaw will soon be dissolved by its two neighboring towns. But it has found a new way to live on: through a federal bill named for it that would restrict Wall Street’s activist hedge-funds, the type of investing firms that were blamed for the town’s demise.

The Brokaw Act would require more disclosures by these hedge funds, which have been accused of promoting short-term gains over the long-term health of the companies they battle for change. Its sponsor, Sen. Tammy Baldwin (D-Wis.), plans to reintroduce the bill when the Senate is back in session after earlier attempts last year stalled.

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