I've seen this many times, and it's a very interesting tactic. When hedgies are talking about how wonderful hedge funds are, it's all about the category as a whole. Notice Ted's initial post: nothing at all about "a wide array of strategies and asset classes," only about "the terrific performance of hedge funds" as an entire category. But when others start criticizing hedge fund managers--and especially when they produce data showing that hedge funds haven't actually performed well in the real world--suddenly the hedge fund world is "a wide array of strategies and asset classes," meaning it must be somebody else who's performing poorly.
You're right, Ted, nothing in investing is that black or white. For example, you were crowing about how great hedge funds did in 2000, 2001, and 2002 while the S&P 500 lost ground all three years. Well, no investor needed hedge funds to protect against losses in large-cap stocks in those years, and they certainly didn't need to pay hedge fund fees. The U.S. bond market outperformed hedge funds in all three years, even before fees and other investment costs: the BC US Agg gained 11.6%, 8.4%, and 10.3% (for a total gain of 33%), while the "terrific performance by hedge funds" amounted to a piddling 5.0%, 4.6%, and -1.4% (for a total gain of 8%) according to your data.
The U.S. real estate market did even better: the FTSE NAREIT All REITs gained 25.9%, 15.5%, and 5.2% for a total gain of 53%. So did the global real estate market (+13%). So did non-U.S. bonds (+13%). So did TIPS (+42%). So did commodities (+35%). So did mid-cap value stocks (+10%). So did small-cap value stocks (+24%).
There's nothing wrong with saying that some hedge funds, some of the time, may be suitable for some investors, IF "implemented effectively." That's sort of like saying that heroin may be suitable for some patients if implemented effectively. Still, it's way better to stay away from it.