Wednesday, November 30, 2011

Only In New York: Even If You Work On Wall Street, This Is NOT The Way To Get A Girlfriend

Sure, the New York dating seen can be rough, but BusinessInsider was a bit taken aback by this guy.

WANTED: Holiday Girlfriend - 23 (Lower East Side/SOHO)
Date: 2011-11-29, 4:26PM EST
Reply to:
Reply To This Post

Let me be clear. I want a girlfriend. But, I don't really want a girlfriend. I just want one for the holidays.

Let's recognize something. The holidays suck, especially for us single people. All of your coupled friends are going to be doing couple things: snuggling by the fire, going to dinner at each others' parents houses, blahblahbarf.

Let's recognize another thing. Deep down inside, you don't want to be alone for the holidays. You want someone to do all of those cute snuggly things with, someone to get fat and keep warm next to (let's also recognize that it's getting fucking cold here), and someone to accompany you to your friends' coupley holiday parties so they don't keep thinking you're a loser destined for permanent solo status.

But, you've spent all year working on your career / finishing school / getting drunk and haven't had the time or inclination to track down and capture a boyfriend. And even if you did, you're not really sure you'd want to keep him after the holidays are over, anyway.

The solution:
Be my girlfriend for the holidays. And only for the holidays.

How it works:
You reply with a picture and a brief bio (250 words max. To give you an idea, this posting is 499). If it seems like a good fit we'll set up a casual mini-date (coffee, beer, or whatever). If that's a success and we're both feeling it, we'll date until 11:59PM, January 2nd, 2012. After that we can still be friends (unless we hate each other, then we can downshift to the occasional drunken booty call).

Find out more at http://www.businessinsider.com/even-if-you-work-on-wall-street-this-is-not-the-way-not-to-get-a-girlfriend-2011-11

What Rumors? Hedgies Deny They Aren't Lottery Winners

Finalternatives writes: Did they or didn't they? Just days after three hedge fund managers claimed the largest lottery jackpot in Connecticut history, rumors abound that they are merely serving as a front for an even richer winner—with further rumors abounding about just who that might be. SAC Capital Advisors' Steven Cohen, anyone?

"To be clear, there are a total of three trustees and there is no anonymous fourth participant," Gary Lewi, a spokesman for Belpointe Asset Managements' Tim Davidson, Brandon Lacoff and Greg Skidmore told Bloomberg News. "Within the next 10 days, the trust will be distributing $1 million" to charities in the state.

But a man who describes himself as a family friend of one of the winners, Lacoff, told London's Daily Mail that "the person who really won it is anonymous."
Stoking a conspiracy stemming from the alleged winners' decision to have the $104 million lump-sum payment made to a trust, Tom Gladstone said, "They set up the trust so that Brandon and his two partners could claim they won it and that the real winner wouldn't get hassled." The real winner, Gladstone claims, is "a client of theirs."

Find out more at http://www.finalternatives.com/node/18844

Need Seed Money For Your Fund? Ask Goldman

BusinessInsider writes; the world of hedge funds is changing. There are more managers out there, it costs more money to start a fund, and because of the Volker Rule, banks are now limited in the amount of money they can invest or trade in hedge funds.
But Goldman Sachs is still going to make it work, says the Wall Street Journal, by starting its own fund of funds.

The bank has already raised about $600 million from clients to start 8 to 10 new hedge funds, and it's planning on handing new fund managers $75 million to $100 million to start their businesses….

Read more at http://www.businessinsider.com/goldman-sachs-to-begin-providing-seed-money-for-hedge-funds-2011-11

What income inequlity? Billionaire Steve Schwarzman Wants More Poor People To Pay Income Taxes


Billionaire private equity tycoon Stephen Schwarzman, CEO of Blackstone Group, told Bloomberg Television this morning that he wants more people to pay income taxes.
"We have a system today in the United States were 45% of Americans don't pay any income tax...You have to have skin in the game," he said.

That essentially means he wants more poor people in the U.S. to pony up and pay income taxes.However, he didn't specify the amount he wants them to pay.
"The issue isn't the amount, it's the concept that we are all in this together,….


Read more: http://www.businessinsider.com/billionaire-steve-schwarzman-wants-more-poor-to-pay-taxes-2011-11

P-s-s-t! Wanna own a piece of the Empire State Building?


Interested investors are one step closer. According to the NY Times' Dealbook the Malkin family disclosed plans to create a publicly traded real estate company that would include the 102-story skyscraper at Fifth Avenue and 34th Street, according to papers filed Tuesday with the Securities and Exchange Commission. The plans were first reported in April.

Two other buildings controlled by Anthony E. Malkin and his father, Peter L. Malkin — 1 Grand Central Place, a 55-story, 1.3-million-square-foot building across 42nd Street from Grand Central Terminal, and a 26-story building at 250 West 57th Street — would be part of the publicly traded real estate company.

The unusual S.E.C. filings were devoid of specific financial information but said that more detailed information was expected in about three months, setting the stage for an initial public offering of stock. Goldman Sachs is expected to be the lead underwriter on the deal, according to a person with direct knowledge of the potential offering who requested anonymity because he was not authorized to discuss it publicly.

A prominent I.P.O. of a company built with bricks and mortar would stand in stark contrast to the spate of Internet company stock offerings that have dominated headlines. After several tech I.P.O.’s this year, including those of Groupon and LinkedIn, the market is looking to an offering by Facebook sometime in 2012.

The I.P.O. would clean up the complex ownership structure of the Empire State Building and the other Malkin family assets…..

Read more at http://dealbook.nytimes.com/2011/11/29/empire-state-building-on-track-for-i-p-o/?

It's Going To Be Awkward For The Omaha World-Herald To Report On Omaha's Richest Man

The Omaha World-Herald company owns seven daily newspapers in Nebraska and Iowa, and by the end of next month, it will likely be owned by Warren Buffett's Berkshire Hathaway. Here’s the full press release. (This is all, of course, pending regulatory approvals as well as approval from the company's shareholders.)

“The World-Herald delivers solid profits and is one of the best-run newspapers in America, and we are pleased to have Terry Kroeger and his team join Berkshire Hathaway,” said Warren Buffett. “We are also delighted to report that the editorial independence that Nebraskans and Iowans have come to expect from the World-Herald will continue.”

Another part of Buffett's reasoning for buying the company was to ensure that remains locally owned. He also might be interested in that fact that it owns World Marketing, Inc., a direct marketing firm with operations in Omaha, Chicago, Atlanta, Dallas and Los Angeles….

Find out more at http://www.businessinsider.com/berkshire-hathaway-buying-omaha-world-herald-2011-11

Stocks surge thanks to good news on jobs, Europe and China


Stock markets surged around the world thanks to a quick succession of promising economic news announcements, including a new effort by central banks to help struggling European economies, the LA Times reports..

The Dow Jones industrial average rose 390.76, or 3.4% to 11,946.39 immediately after the opening bell. Leading indexes were up 4.2% in Germany and 3.3% in France. The good news began flowing in last night when China announced that it would lower the amount of money that banks have to hold in reserve. This should help stimulate the economy by making banks more willing to lend.

As European markets opened, the Federal Reserve, the European Central Bank and three other central banks unveiled a new program to increase access to dollars for struggling European banks. The move is designed to make it easier for European banks to access funds at a time when fears about the European debt crisis have led to a freeze in liquidity….

Read more at http://latimesblogs.latimes.com/money_co/2011/11/stocks-surge-good-news-jobs-europe-china.html

WARNING: There's A Bizarre Story Floating Around About A Big Euro Bank Almost Failing, But It Doesn't Make Any Sense

BusinessInsider writes that there's a lot of buzz about this post up at Forbes, which starts with this...

It appears that a big European bank got close to failure last night. European banks, especially French banks, rely heavily on funding in the wholesale money markets. It appears that a major bank was having difficulty funding its immediate liquidity needs.

The basis for this? Nothing, except the news today of the big central bank intervention.

Unless the author knows something he's not telling people, it appears the author has purely surmised this failure scenario from the fact that all the banks got in there to ease liquidity. Now, obviously liquidity is an issue for banks -- hence the action -- but it doesn't necessarily follow that last night a bank nearly failed.


Read more: http://www.businessinsider.com/forbes-article-on-large-bank-failure-2011-11#ixzz1fCpWRCwa

Wow! Stocks Extend Biggest 3-Day Gain Since ’09


Bloomberg reports that stocks surged, extending the biggest three-day rally in global equities since 2009, and the euro strengthened after six central banks acted together to make additional funds available to ease strains from Europe’s debt crisis. Treasuries fell while commodities surged.

The MSCI All-Country World Index climbed 3.1 percent at 10:23 a.m. in New York and is up 7 percent in three sessions. The Standard & Poor’s 500 Index gained 3.2 percent to 1,233.78 as only six stocks retreated. The euro strengthened 1.1 percent to $1.3465. The three-month cross-currency basis swap, the rate banks pay to convert euro payments into dollars, was 133 basis points below the euro interbank offered rate after earlier reaching a three-year high of 163. Oil jumped above $101 a barrel and copper rallied 5.6 percent.

The central banks of the U.S., the euro region, Canada, the U.K., Japan and Switzerland agreed to cut the cost of providing dollar funding via swap arrangements, the Federal Reserve said, and agreed to make other currencies available as needed. China said earlier today it will cut the reserve requirement ratio for banks by 0.5 percentage points from Dec. 5, while data on U.S. business activity and the employment and housing markets topped economists’ estimates….

Occupy Harvard Targets Goldman Sachs

The Harvard Crimson reports that Occupy Harvard went head-to-head with Wall Street on Monday when protesters attempted to interrupt a Goldman Sachs recruiting event hosted by the Office of Career Services.

Nearly three weeks after protesters descended upon Harvard Yard to set up the Occupy Harvard camp, the group joined forces with Occupy Boston and other local students in a “Rally to Defend Freedom of Speech” on Monday afternoon, which eventually led to a confrontation with OCS.

About half of the 50 protesters broke off from the rally to visit a Goldman Sachs recruiting session, held at the On-Campus Interview Facility on Mass Ave. When the group reached the OCS offices, ralliers stood outside the building for a few minutes, yelling, “Goldman Sachs, you can’t hide. We can see your greedy side.”

Read more at http://www.thecrimson.com/article/2011/11/29/occupy-protest-goldman-sachs/

So Sorry: Paulson Apologizes for His Hedge Funds' Performance


According to the Wall St Journal hedge-fund manager John Paulson apologized to his investors, saying performance at his funds this year is "the worst in the firm's 17-year history." In his third-quarter letter dated Oct. 28 to investors, Mr. Paulson, who won fame for reaping billions of dollars by betting against the U.S. housing market, said "we are disappointed and apologize." Two of Paulson & Co.'s largest funds—Advantage Fund and Advantage Plus Fund—posted declines of 29% and 44% this year through October, according to a person familiar with the funds.

Mr. Paulson said performance of funds were affected by the European sovereign-debt crisis, slowing economic growth and disagreement over the debt ceiling in the U.S.

"As the year progressed our assumptions proved overly optimistic and net equity exposure too great," he said in the letter, which was seen by a person close to the funds.

At this rate, Mr. Paulson and his staff aren't likely to earn incentive fees or a cut of profits….

Don't stop reading now. There's more at http://online.wsj.com/article/SB10001424052970204262304577068651052082184.html?mod=googlenews_wsj

The face of Wall Street arrogance


According to NY Post’s John Carney Jon Corzine’s unbelievably swift fall is a classic story of Wall Street arrogance. Just a few months ago, the Obama administration was considering Corzine as a possible successor to Treasury Secretary Timothy Geithner. Investors in the bonds of his firm, MF Global, demanded the right to an extra percentage point of interest if he left as its CEO and chairman.

Nobody else on Wall Street makes a promise like that to buyers of its bonds. Not even JPMorgan Chase, run by Jamie “King of Wall Street” Dimon. Corzine had come to be regarded as a demigod, a divinity in the mortal world. Hercules with a trading desk.

And no one believed the myth of Corzine as much as Corzine himself. When explaining to associates and investors that he wasn’t preparing to leave to become treasury secretary, he never for a moment let on that he had any doubts that he could — and probably should — be running the highest economic office in the land.

Meanwhile, Hercules was pushing his firm to take on more Euro-debt risk — even as most Wall Street firms were shrinking their exposure to the sovereign bonds of troubled nations on Europe’s periphery. In filings with the Securities and Exchange Commission, MF Global claimed that the market was wrong about Europe — and MF Global knew better.

Read more at http://www.nypost.com/f/print/news/opinion/opedcolumnists/the_face_of_wall_street_arrogance_8XAZ7crBF3ZbQFUEr5SyPK

Occupy L.A.: Police seal off Civic Center; protesters launch fireworks


LA Times reports that Los Angeles police were moving into the Civic Center Tuesday night, closing off a large area around the Occupy L.A. encampment. The LAPD has closed off an area from Temple Street on the north to 3rd Street on the south and Alameda Street on the east and Broadway on the west.

An LAPD helicopter announced the commencement of the department's action, swooping down low and incessantly circling the City Hall steps on which hundreds of protesters had gathered. It flooded the camp with light from its high-powered search light and the din from its propellers threatened to drown out a chant of "occupy LA, all day, all night!" by the protesters. Someone then launched fireworks over the camp.

Officials also issued a citywide tactical alert. Los Angeles police have not said when they will evict the protesters. An LAPD email alert said the tactical alert was "due to unusual occurrence in downtown L.A." The LAPD was beginning to put up traffic barriers along streets around City Hall….

Find out the rest at http://latimesblogs.latimes.com/lanow/2011/11/occupy-la-lapd-seals-off-civic-center-protesters-launch-fireworks.html

Bankrupt Billionaire Ordered To Repay $2.8 Billion

According to Forbes, Sean Quinn, once the wealthiest man in Ireland with a fortune of $6 billion, has been ordered by Dublin’s commercial court to repay $2.26 billion (€1.7 billion) in debts to Irish Bank Resolution Corporation, the nationalized reincarnation of Anglo Irish Bank. The amount represents the largest judgment ever levied against an individual by an Irish court, and comes in addition to a separate judgment brought against Quinn by the court last Wednesday which found him liable for another $554 million (€416 million). Quinn, who declared bankruptcy in Northern Ireland on November 11 and was not present at Monday’s court proceedings in Dublin, called the action “totally pointless,” stressing the fact that he has already been declared bankrupt in the United Kingdom…

Read more at http://www.forbes.com/sites/edwindurgy/2011/11/29/bankrupt-billionaire-ordered-to-repay-2-8-billion-to-bank/

Tuesday, November 29, 2011

KPMG Recovers $500 Million Of MF Global Client Money

MF Global UK administrator KPMG said it had recovered about $500 million of client assets frozen at the defunct broker and planned to make significant returns to customers before the March 2012 claims deadline, HuffPo reports.

Former MF Global UK clients will be relieved their cash is starting to return to the administrator, via exchanges, clearing houses and banks, as they prepare to start filing their applications to claim back their monies.

KPMG said on Monday the failed futures broker's clients will be able to formally claim from early next month and have to the end of March next year to make their submissions….

Read more at http://www.huffingtonpost.com/2011/11/29/kpmg-mf-global_n_1119106.html?ref=business

Rating Downgrade Of Banks Now Slams Financial Stocks


The Wall St Journal writes that Asian stock markets were mostly lower Wednesday with financial stocks coming under pressure in many markets after Standard & Poor's Ratings Services downgraded its ratings for several global banks, while the backdrop of Europe's debt crisis hurt exporters.

"Although S&P began warning the markets more than a year ago that it was revising its ratings, the announcement comes at a time when the markets for bank debts are fragile," said Stan Shamu, strategist at IG Markets in Melbourne. "Traders will continue to monitor the situation in Europe closely, with this week's bond auctions remaining the highlight."

Japan's Nikkei Stock Average fell 1.2%, Australia's S&P/ASX 200 eased 0.1% and South Korea's Kospi Composite was off 0.7%. Hong Kong's Hang Seng Index slumped 1.9%, China's Shanghai Composite gave up 2.3%, while India's Sensex lost 0.7%. Dow Jones Industrial Average futures were down 62 points in screen trade...

Find out more at http://online.wsj.com/article/SB10001424052970204262304577069091535148230.html

S&P Smacks Major Banks With Downgrades

S&P just struck a number of big banks with downgrades, including Bank of America, Goldman Sachs and Citi, according to the folks at Forbes. The downgrades were a part of S&P’s overhaul of its rating system. Last week it was noted that the updates in the way S&P rates banks’ could mean lower ratings for some.

Turns out it meant lower ratings for a lot of banks. Just about every major U.S. bank was downgraded under the new methodology: BofA, Citigroup, Morgan Stanley, Goldman Sachs, Wells Fargo, JPMorgan Chase, Bank of New York Mellon.

“All in, while not a good thing and the banks remain on negative watch, we think these changes have been well telegraphed by now and we don’t expect much of a reaction in the equity or debt markets,” writes Nomura bank analyst Glenn Schorr…

Read more at http://www.forbes.com/sites/halahtouryalai/2011/11/29/sp-smacks-dozens-of-banks-with-downgrades

10 reasons the crisis isn’t over (dead car bounce?)


MarketWatch writes: Boom! Stock markets around the world soared yesterday. The Dow jumped more than 300 points. News out of Europe says they’re working on a fix to resolve the crisis there. Reports here say the holiday season may be off to a strong start. Sales on “Black Friday” may have hit a record.

So, is that it? Is the crisis over? Is it time to ramp up your equity exposure, take on more risk? Heavens. Anything can happen. And, OK, there are stocks out there that look pretty decent value. But here are ten reasons to be skeptical. This so looks like a dead cat bounce.

1. The market was due a rally. The Standard & Poor’s 500 index SPX +0.42% had fallen seven days in a row. But equity markets never fall in a straight line. After a long run of down days, people who’ve been betting against stocks by selling short get tempted to lock in some of their profits by buying stocks back. Others who want to buy stocks see sharp falls and get tempted to “bargain hunt.” This inevitably produces quick, sharp rallies. This one may last a day, a week, a month or more. That doesn’t mean a thing about long-term trends.

2. The report from Italy, one of the items sparking bullish sentiment, has already proven a crock. A news report there over the weekend said the International Monetary Fund was working on plans to step into the European debt crisis with a gigantic $600 billion bailout. The report has been dismissed, on the record, by an IMF spokesman.

3. The reports from northern Europe are absurd. Markets are excited by reports that Germany, France and Brussels are working on a new “bailout” plan. But look at the details! Under the proposals, the European Union will help insure the debts of countries in crisis, but in return it will be given veto powers over the budgets of the countries in question. This idea can’t survive 10 seconds of serious thought. The Greeks are rioting over budget cuts proposed by their own governments. What possible chance is there that they — or the Italians, or the Spanish — would accept austerity measures imposed by Brussels...

Wait, wait…there’s more at http://www.marketwatch.com/story/10-reasons-the-crisis-isnt-over-2011-11-29?link=MW_story_popular

You Won't Believe What Hank Paulson Revealed To Hedge Funders Right Before The Height Of The Financial Crisis


Bloomberg reports that Treasury Secretary Henry Paulson stepped off the elevator into the Third Avenue offices of hedge fund Eton Park Capital Management LP in Manhattan. It was July 21, 2008, and market fears were mounting. Four months earlier, Bear Stearns Cos. had sold itself for just $10 a share to JPMorgan Chase & Co. (JPM)
Now, amid tumbling home prices and near-record foreclosures, attention was focused on a new source of contagion: Fannie Mae (FNMA) and Freddie Mac, which together had more than $5 trillion in mortgage-backed securities and other debt outstanding, Bloomberg Markets reports in its January issue.

Paulson had been pushing a plan in Congress to open lines of credit to the two struggling firms and to grant authority for the Treasury Department to buy equity in them. Yet he had told reporters on July 13 that the firms must remain shareholder owned and had testified at a Senate hearing two days later that giving the government new power to intervene made actual intervention improbable.

“If you have a bazooka, and people know you have it, you’re not likely to take it out,” he said.

Read more at http://www.bloomberg.com/news/2011-11-29/how-henry-paulson-gave-hedge-funds-advance-word-of-2008-fannie-mae-rescue.html

Money Found in Britain May Belong to MF Global

Dealbook reports that about $200 million in customer money that vanished from MF Global is believed to have surfaced at JPMorgan Chase in Britain, according to people briefed on the matter. The discovery could be the most significant breakthrough in a monthlong hunt for the missing funds.

During MF Global’s last chaotic days, the brokerage firm overdrew an account at JPMorgan, according to another person who is close to the matter. Some investigators now believe the firm used customer funds to patch at least some of the hole, which would have been a significant breach of federal law.

MF Global transferred the roughly $200 million in the days before the firm filed for bankruptcy, said the people, who requested anonymity because the investigation was incomplete…..

Learn more about it at http://dealbook.nytimes.com/2011/11/28/money-found-in-britain-may-belong-to-mf-global/

Dr. Doom: Government Gridlock ‘Ensures’ 2012 Recession


If you thought the economy was starting to pick up and perhaps was even off to the races after months of positive GDP growth and much better than expected consumer health, Yahoo writes, think again. That's according to, Nouriel Roubini, professor of economics at New York University, who says the U.S. economy is destined for another recession in 2012 on account of partisan politics in Washington.
On Monday, after the bipartisan 12-member super committee announced its failure to agree upon $1.2 trillion in cuts over the next 10 years, Roubini, also known as Dr. Doom, tweeted the following: "Super-Committee: Super-Failure, Super-Pathetic, Super-Gridlock, Super-GOP-Lunacy on Taxes, Super-Fiscal Drag in 2012 that ensures double dip."

But his prediction goes beyond the partisan bickering of the committee tasked to cut the country's budget deficits. His point rests upon the inability of ALL Republicans and Democrats in Washington to work together on any economic issue that would benefit the good of the country. He does note that more blame should be laid at the feet of Republicans for their unwillingness to compromise....

Find out more at http://finance.yahoo.com/blogs/daily-ticker/nouriel-roubini-government-gridlock-ensures-2012-recession-134053788.html

Jim Rogers: Gold Due for Big Correction; Owns Bucks


Go figure. The price of gold is due for a correction and this could be used as an entry point by investors eager to get exposure to the precious metal, while the dollar is likely to strengthen as there has been too much pessimism about it, famous investor Jim Rogers told CNBC Tuesday.

Gold hit record after record high this year as investors scared by central banks printing money around the world and by the protracted debt crisis in the euro zone sought refuge in precious metals.

"I own gold and I'm not selling my gold," Rogers said, but pointed out that the price of the commodity has been up for 11 years in a row. He advised that a drop in price wouldn’t be such a bad thing. "Somewhere down the line gold will have a correction. Gold will continue to do what gold does best. Just give it a chance." If the gold price retreats towards $1,200 per ounce, Rogers said he would get "extremely excited."

Read more at http://www.cnbc.com/id/45472311

K.K.R.’s Frackin’ Billionaires Club

Dealbook reports that Which of the following individuals is an oil-and-gas magnate who has made billions of dollars through a deal with Kohlberg Kravis Roberts in the last three years?

(A) Jeffrey Hildebrand
(B) Terry Pegula
(C) Stacy Schusterman
(D) All of the above
If you answered (D), you are correct!

The private equity firm K.K.R. has had extraordinary success investing in so-called shale plays. Starting in 2009, the firm has placed three consecutive bets on the business of extracting natural gas from shale rock formations through hydraulic fracturing technology, or fracking.

It had previously sold two of those investments, flipping them to large energy companies and making billions of dollars for the firm and its investors. It further….

Read more at http://dealbook.nytimes.com/2011/11/25/k-k-r-s-energy-billionaires-club/

Rajaratnam Seeks to Stay Free While Appealing Wiretap


Raj Rajaratnam, the Galleon Group LLC hedge fund co-founder convicted of directing the biggest insider trading scheme in a generation, said the use of wiretapped calls by the U.S. raises “substantial” issues of law that should allow him to remain free during his appeal, according to the good people at Bloomberg

Rajaratnam, 54, who is scheduled to report to prison on Dec. 5, is seeking to remain free pending the outcome of his appeal, according a letter his lawyers sent today to Catherine O’Hagan Wolfe, clerk of the U.S. Court of Appeals in Manhattan.
“Raj Rajaratnam respectfully moves this court to stay his surrender date and to grant release pending appeal of his criminal conviction and sentence,” his lawyers said in court papers. They said the evidence they submitted “establishes the substantiality of Mr. Rajaratnam’s appeal.”

Find out more at http://www.bloomberg.com/news/2011-11-28/rajaratnam-to-challenge-wiretaps-in-appeal.html

How Paulson Gave Hedge Funds Advance Word

Bloomberg reports that Treasury Secretary Henry Paulson stepped off the elevator into the Third Avenue offices of hedge fund Eton Park Capital Management LP in Manhattan. It was July 21, 2008, and market fears were mounting. Four months earlier, Bear Stearns Cos. had sold itself for just $10 a share to JPMorgan Chase & Co. (JPM)
Now, amid tumbling home prices and near-record foreclosures, attention was focused on a new source of contagion: Fannie Mae (FNMA) and Freddie Mac, which together had more than $5 trillion in mortgage-backed securities and other debt outstanding, Bloomberg Markets reports in its January issue.

Paulson had been pushing a plan in Congress to open lines of credit to the two struggling firms and to grant authority for the Treasury Department to buy equity in them. Yet he had told reporters on July 13 that the firms must remain shareholder owned and had testified at a Senate hearing two days later that giving the government new power to intervene made actual intervention improbable.
“If you have a bazooka, and people know you have it, you’re not likely to take it out,” he said.

Read more at http://www.bloomberg.com/news/2011-11-29/how-henry-paulson-gave-hedge-funds-advance-word-of-2008-fannie-mae-rescue.html

Monday, November 28, 2011

Lies and the lying liars who tell them, (Big-bank bailout edition)

Bloomberg has a long article up on its site about its latest findings on the Fed’s lending programs. And the bottom line is everybody close to the process lied like crazy. For instance:

Banks lied during the crisis. The big banks said they were in really good shape even as they were sucking tons of credit from the Fed. The ones that arguably were healthier, like JP Morgan, tried the “they threw me in the br’er patch, I really didn’t want all that money,” in fact stayed in the program well beyond the acute phase of the crisis because it liked getting all that cheap funding. Now this sort of misrepresentation is a securities law violation, but since the regulators presumably winked and nodded and it would be hard to prove damages, no bank executive will be held to account.

Bloomberg also performs the useful task of trying to ascertain how much benefit the banks derived from the cheap funding. They come up with $13 billion, or roughly 23% of profit (they assume typical margins, when it would take a good deal of internal data to make more refined estimates). This is actually a very narrow definition of profit impact. The Fed stepping into the markets to shore up the banks by design stabilized and boosted asset prices, which surely had a significant profit impact.

Regulators lied to Congress. Bernanke in an April 2009 speech said that the Fed provided emergency loans only to “sound institutions,” even though its internal assessments described at least one of the biggest borrowers, Citigroup, as “marginal.”….

Judd Gregg, a former New Hampshire senator who was a lead Republican negotiator on TARP, and Barney Frank, a Massachusetts Democrat who chaired the House Financial Services Committee, both say they were kept in the dark.


Lawmakers knew none of this. They had no clue that one bank, New York-based Morgan Stanley (MS), took $107 billion in Fed loans in September 2008, enough to pay off one-tenth of the country’s delinquent mortgages. The firm’s peak borrowing occurred the same day Congress rejected the proposed TARP bill, triggering the biggest point drop ever in the Dow Jones Industrial Average. (INDU) The bill later passed, and Morgan Stanley got $10 billion of TARP funds, though Paulson said only “healthy institutions” were eligible…

Find out more at http://www.nakedcapitalism.com/2011/11/quelle-surprise-banks-lied-about-bailout-funds-and-got-13-billion-in-profit-from-them.html

Facebook Targets Huge IPO

Offering Next Year Could Raise $10 Billion, Valuing Company at $100 Billion

Facebook Inc. is inching closer to an initial public offering that it hopes will value the company at more than $100 billion, according to the Wall St Journal and people familiar with the matter.

The social networking firm is now targeting a time frame of April to June 2012 for an initial public offering, said people familiar with the matter. The company is exploring raising $10 billion in its IPO—what would be one of the largest offerings ever—in a deal that might assign Facebook a $100 billion valuation, a number greater than twice that of such stalwarts as Hewlett-Packard Co. and 3M Co….

Read more at http://online.wsj.com/article/SB10001424052970203935604577066773790883672.html?mod=WSJ_hp_LEFTTopStories

Pump And Dump King Seeks Queen


Dealbreaker’s Bess Levin wants to know are you a lady looking for love? Have you found relationships with men who haven’t done time in federal prison to be lacking a certain je ne sais quoi? Does the idea of being with a guy who has an elastic view of securities laws do anything for you? Then girlfriends, you are in for a treat. Roy Ageloff, a “former millionaire trader” who is finishing up an 11 year sentence for running a “vast pump and dump manipulation,” is schedule to be sprung free on Dec. 11, 2013 and he hopes you’ll be waiting for him. Interested? Here’s Roy, in his own words.

Believe it or not, I was once on top of the world. Unfortunately, I’ve temporarily been dethroned of my crown. But rest assured, I will be king of the mountain again soon. Are you up for the journey back to the top with me? What good is it to be king if you have no queen?

Read more at http://dealbreaker.com/2011/11/pump-and-dump-king-seeks-queen/

Wall Streeters in Danger of Falling Into the Bottom 99%


As Gawker sees it the writing, so to speak, was on the wall, and now, it seems, what we all feared most shall, in fact, come to pass: our brothers and sisters on Wall Street—from the 18th floor to the 80th floor, from the fixed income desk to the investment banking division, from Goldman Sachs to Lehman... no, Lehman is dead... to WaMu... no, I mean, you know what we mean—well, they're all suffering, that's all. Just like the rest of us. It won't be a pretty Christmas this year on Wall Street. Not with paychecks projected to drop (*scary music*) as much as thirty percent!! From the WSJ:

An investment-grade-bond trader who is a managing director at a top securities firm is likely to make $1.7 million to $1.8 million in 2011, according to the study. That is down from $2.9 million, said Options Group managing partner Michael Karp.

And bro, in wealth management divisions pay is only expected to rise 8%, which is practically like a 30% decline, by wealth management standards. Face it, clamorous sign-wavers: Wall Street is sacrificing more than you. In absolute dollar terms. This could even cause a handful to slip into the 99%.

Get out your hankies before going to http://gawker.com/5862984/wall-streeters-in-danger-of-falling-into-the-bottom-99

European Doomtowns: Euro Debt Crisis May Cause Global Economy To 'Face The Worst'


According to HuffPo’s report the Organization for Economic Cooperation and Development said Monday policy makers around the world must "be prepared to face the worst," as the economic impact of Europe's debt crisis threatens to spread around the developed world. The Paris-based OECD said in its latest Economic Outlook that continued failure by EU leaders to stem the debt crisis that has spread from Greece to much-bigger Italy "could massively escalate economic disruption" and end in "highly devastating outcomes.

The half-yearly update also recommended urgently boosting the EU bailout fund and called on Europe's central bank to do more to stem the crisis….
Many think the ECB is the only institution capable of calming frayed market nerves and Merkel's continued dismissal of a greater ECB role knocked market sentiment and stocks all round Europe fell again after a morning rebound.

Potentially, the ECB has unlimited financial firepower through its ability to print money. However, Germany finds the idea of monetizing debts unappealing, warning that it lets the more profligate countries off the hook for their bad practices. In addition, it conjures up bad memories of the hyperinflation in Germany in the 1920s that brought Hitler to power….

Learn more at http://www.huffingtonpost.com/2011/11/28/oecd-euro-debt-crisis-may-global-economy-face-worst_n_1116055.html?ref=business

AMERICA’S PROBLEM IN A NUTSHELL: Apple's Huge New Data Center In North Carolina Created Only 50 Jobs

Optimists argue that the solution to the US's sky-high unemployment and income inequality is more companies like Apple--the resurgent tech company that has revolutionized the digital industry and become one of the most valuable companies in the world.

Apple has not not only created amazing, beloved products. It has created enormous profits, vast shareholder wealth, and more than 60,000 jobs. If only America produced more companies like Apple (and Amazon, and Google, and Facebook, et al), the story goes, the country's problems would be fixed. America could retrain its vast, idle construction-and-manufacturing workforce, and our unemployment and inequality problems would be solved.

It is true that having more companies like Apple would certainly help the US. But we would need a lot more companies like Apple to make a dent in our unemployment and inequality problems. Why? Because Apple also actually exemplifies some of the reasons why we have such huge unemployment and inequality problems: "Digital" businesses like Apple employ far fewer people (per profit) than traditional manufacturing businesses.

Apple's 60,000+ jobs are not just in the US--they're spread around the world. Apple's extraordinary ~25% profit margin means that the benefits of its success accrue primarily to a relatively small group of (rich) shareholders rather than a broad base of (middle-class) employees… To put this in context, the Economist recently noted that Apple, Amazon, and Google together employ 113,000 people--which is less than 1/3rd as many as a single American success-story from the prior generation, GM, employed in 1980.

wAIT, WAIT...There's more. Find it at: http://www.businessinsider.com/apple-new-data-center-north-carolina-created-50-jobs-2011-11

Citi's $285 million fraud settlement tossed


Citigroup has been ordered to face trial over alleged securities fraud in July of next year. A judge rejected a proposed $285 million mortgage securities fraud settlement between Citigroup and the Securities and Exchange Commission on Monday, saying the deal was "neither fair, nor reasonable, nor adequate, nor in the public interest," CNN reports.

Judge Jed Rakoff said that the settlement announced last month, under which Citi neither admitted nor denied the SEC's allegations, deprived the public "of ever knowing the truth in a matter of obvious public importance." He instead ordered Citi to face trial over the allegations in July 2012.

The SEC has alleged that in 2007, Citi created and sold a mortgage-related collatarized debt obligation, or CDO, called Class V Funding III. According to the SEC complaint, one CDO trader characterized the asset group in internal communications as "a collection of dogshit" and "possibly the best short EVER!"

Find out more at http://money.cnn.com/2011/11/28/news/companies/citigroup_settlement_rejected/

Jon Corzine Could Be Subpoenaed By Congress After Failing to Respond To Hearing Request


Charlie Gasparino at Fox Business News reports that the men who ran MF Global before its demise have yet to inform a U.S. House subcommittee about whether they will voluntarily agree to testify in upcoming hearings investigating the firm's demise.

Staffers for the House Financial Services Committee's subcommittee on Oversight and Investigations were working late Sunday afternoon in preparation for their Dec.15 hearing, but have yet to hear from representatives of former MF Global Chief Executive Jon Corzine and the firm's President Bradley Abelow about whether they will voluntarily agree to testify, people close to the subcommittee say.

The men had until 10 a.m. EDT Monday to respond, according to a letter the subcommittee sent requesting their public testimony. If they ultimately refuse, it will raise the political stakes for the subcommittee as it prepares for the hearing. Corzine, a long-time Democrat dating back to his days as chief executive at Goldman Sachs, is also a former New Jersey governor and major Wall Street supporter of President Obama…..

Read more: http://www.foxbusiness.com/industries/2011/11/27/corzine-abelow-will-testify-on-capitol-hill/#ixzz1f1VKBr1S

Barney Frank to retire

CNN reports that U.S. Rep. Barney Frank, a prominent 16-term liberal Democrat from Massachusetts and arch-enemy of political conservatives nationwide, will announce Monday he does not intend to seek re-election in 2012, according to a statement from his office. Frank, 71, will hold a news conference in his district to discuss the decision at 1 p.m. ET.

The reasons for Frank's largely unexpected decision to retire from Congress were not immediately clear, though some analysts speculated they may be tied to changed boundaries for his 4th Congressional District after Massachusetts' recent redistricting process.

Frank, first elected to the U.S. House of Representatives in 1980, is the top Democrat on the powerful House Financial Services Committee. Among other things, he co-authored the 2010 Dodd-Frank financial regulatory reform bill. The measure, designed to rein in Wall Street excesses after the 2008 financial collapse, passed the House without any GOP support. The veteran congressman made headlines earlier in his career by becoming one of the first openly gay members of Congress...

A Weird³ word to the wise: in case you thought Barney was bad news, just wait to you get a load of his replacement…

Read more at http://www.cnn.com/2011/11/28/politics/barney-frank/index.html

Here's Why Cyber Monday Will CREAM Black Friday

According to BusinessInsider although Black Friday saw an unprecedented 7 percent rise in sales compared to last year, IBIS World predicts that Cyber Monday will really steal the show.

The study forecasts sales will rise 12.5 percent from last year.
It's impressive considering from 2010 to 2009 Cyber Monday sales already jumped by 20 percent and topped $1 billion for the first time.

For 2011, online sales were up 14 percent in November compared with 2010, and rose from $8.47 billion to $9.67 billion in the same 20-day period.....

Read more: http://www.businessinsider.com/cyber-monday-is-trouncing-black-friday-2011-11#ixzz1f1QLDbhT

Bombshell: Strauss-Kahn probably was framed!


According to Edward Jay Epstein’s article that has everybody rethinking the whole scandal: May 14, 2011, was a horrendous day for Dominique Strauss-Kahn, then head of the International Monetary Fund and leading contender to unseat Nicolas Sarkozy as president of France in the April 2012 elections. Waking up in the presidential suite of the Sofitel New York hotel that morning, he was supposed to be soon enroute to Paris and then to Berlin where he had a meeting the following day with German Chancellor Angela Merkel….

He knew he had a serious problem with one of his BlackBerry cell phones—which he called his IMF BlackBerry. This was the phone he used to send and receive texts and e-mails—including for both personal and IMF business. According to several sources who are close to DSK, he had received a text message that morning from Paris from a woman friend temporarily working as a researcher at the Paris offices of the UMP, Sarkozy’s center-right political party. She warned DSK, who was then pulling ahead of Sarkozy in the polls, that at least one private e-mail he had recently sent from his BlackBerry to his wife, Anne Sinclair, had been read at the UMP offices in Paris.1 It is unclear how the UMP offices might have received this e-mail, but if it had come from his IMF BlackBerry, he had reason to suspect he might be under electronic surveillance in New York. He had already been warned by a friend in the French diplomatic corps that an effort would be made to embarrass him with a scandal. The warning that his BlackBerry might have been hacked was therefore all the more alarming...

There’s more, much more. Find out at http://media.nybooks.com/strauss.html

Switcheroo: Schwarzman Backs Romney as Wall Street Turns

Stephen Schwarzman, chairman of the world’s largest private-equity firm, will host a fundraiser for Mitt Romney at his Park Avenue apartment next month, a sign that Romney is closing the sale with Wall Street’s wealthiest donors, Bloomberg writes.

The event marks Schwarzman’s inaugural step to help Romney secure the Republican presidential nomination, according to a person familiar with Schwarzman’s plans who spoke on condition of anonymity. He will follow up with efforts to persuade colleagues in the financial industry to get behind Romney’s presidential bid, the person said..

“Steve Schwarzman is one of the top fundraisers on Wall Street, and this will help the Romney campaign, not only for the actual fundraising he will do, but the signal it sends to other fundraisers that Wall Street leaders believe Romney is very likely to be the nominee,” said Steve Duprey, who was a senior adviser to Republican John McCain’s presidential campaign in 2008….

Read more at http://www.bloomberg.com/news/2011-11-28/schwarzman-backs-romney-as-wall-street-turns-away-from-obama.html

Sign of the Times: Need cash? Pawn shops edge into mainstream

Pawn shops are beckoning from the shadows. At a time when banks have shut their doors on those with bad credit, a growing number of borrowers are pawning their jewelry, electronics and other valuables to make ends meet. msnbc reports.
Consumer advocates say the development is concerning because the interest rates on loans from pawn shops can be as high as 20 percent a month. But pawn shop operators say they provide a critical lifeline to a group with few other options.
A common misconception is that pawn shops simply buy the various knickknacks that customers bring in. But the more lucrative aspect of the industry is issuing loans against those belongings. Customers often prefer borrowing over selling as well because it lets them hold onto what may be their only tickets to cash in the future.
What's key about loans from pawn shops is the lack of judgment; a credit check isn't required and they don't have an impact on credit scores. The transaction takes just a few minutes in many cases.

A pawn shop owner simply eyeballs the merchandise a customer brings in and offers a loan amount on the spot. If the customer repays the loan within 30 days, the belongings can be reclaimed. The customer can also opt to extend the loan; many borrow against the same items over and over….

Read more at http://www.msnbc.msn.com/id/45421460/ns/business-retail/#.TtNRIGPNlIc

Secret Fed Loans Gave Banks Undisclosed $13B


The Federal Reserve and the big banks fought for more than two years to keep details of the largest bailout in U.S. history a secret. Now, according to Bloomberg’s Best, the rest of the world can see what it was missing.

The Fed didn’t tell anyone which banks were in trouble so deep they required a combined $1.2 trillion on Dec. 5, 2008, their single neediest day. Bankers didn’t mention that they took tens of billions of dollars in emergency loans at the same time they were assuring investors their firms were healthy. And no one calculated until now that banks reaped an estimated $13 billion of income by taking advantage of the Fed’s below-market rates, Bloomberg Markets magazine reports in its January issue….

Wait, wait…there’s even more good stuff at http://www.bloomberg.com/news/2011-11-28/secret-fed-loans-undisclosed-to-congress-gave-banks-13-billion-in-income.html

Black Friday Story of the Week: Friday Shoppers Step Over Man Who Lay Dying on the Floor

Joy to the world; good will toward man? Not while there is a good sale on. Black Friday shoppers at a West Virginia Target did not allow collapsed-and-dying man Walter Vance to disturb their holiday shopping experience. They simply walked around or stepped over him, before somebody else swept up all those cheap towels and soap dishes.

Vance, 61, was a pharmacist and reputed all-around nice man who suffered from heart problems. According to his wife Lynn, He'd had a stent inserted about two weeks ago, which may or may not have contributed to his death. Witnesses assert that, after Vance collapsed, most shoppers ignored or avoided him, keeping their eyes on the prize (fabulous deals!). However, Lynn told the Charleston Gazette that "about six" nurses who had been shopping at Target came to his aide, which suggests that nurses are the only caring people left in Charleston. One of the helpful nurses and a paramedic administered CPR, and Target employees called an ambulance. Eventually Vance died at a local hospital.

Should all the Target shoppers who failed to help Vance feel like wicked psychopathic monsters now? Well, walking over a dying man during your quest for discount bathrobes, as though he were simply a fallen tree branch in the road, in one's way, certainly takes a special kind of person. That said, under U.S. tort laws, there is no legal duty to rescue anyone—only a moral one…

Read more at http://gawker.com/5862831/black-friday-shoppers-step-over-man-who-lay-dying-on-the-floor

Sunday, November 27, 2011

Wall Street Layoffs Top 200,000, Driving Young People to Hit the (Champagne) Bottle


NY Magazine writes: Of the more than 200,000 jobs lost in the financial services industry this year, one former investment bank head remarked to Bloomberg, "This is a structural change. The industry is shrinking." Banks around the world have been hit hard, and one economist guesses that Wall Street won't regain jobs "until about 2023." Bonuses will definitely be down from last year's $128,530 average; as one guy put it, "My Fidelity account looks like my bar tab from just a week ago."

The dark economic climate is especially hard on the youth, who, coming from Harvard and Penn, had dreams of lobster, bottle service, and proud parents. This year is a nightmare. DealBook reports that jobs at investment banks and brokerage firms for people between the age of 20 and 34 have fallen by 25 percent since this time in 2008, a loss of 110,000 jobs. Overall, it's more like 17 percent, but old people are safer, with employees over the age of 55 only decreasing by 11 percent in the same period.

It is noted, though, that any sympathy for Wall Street’s huddled masses yearning to get rich should be tempered by the fact that financial sector recessions often deal a soft blow plus laid-off financial workers typically get large severance packages, including the use of outplacement services. During their job hunt, many can draw on substantial savings built off past bonuses, on top of collecting unemployment….

Read more at http://nymag.com/daily/intel/2011/11/wall-st-layoffs-driving-young-people-to-drink.html

Holy Moly! Forex Market Preps for Euro Breakup


Wall St Journal reports that companies that provide the plumbing for the $4 trillion-a-day foreign-exchange market are testing systems that could handle trading of previously shelved European currencies.

ICAP PLC, which operates the biggest system for enabling currency trades between banks, said Sunday that it is prepping electronic-trading systems for a possible exit by Greece from the euro zone and a return of the drachma, the country's previous currency.

CLS Bank International, whose platform enables banks to settle their currency trades, is running "stress tests" to prepare for a dissolution of the euro, people familiar with the matter said…

Find out more at http://online.wsj.com/article/SB10001424052970204753404577064511566509918.html

Wall Street Pay Hits a Wall

Financial-services workers are bracing for an icy dive into a shallow year-end bonus pool.

Employees at big Wall Street firms could see annual compensation sink 27% to 30% from a year earlier to the lowest level since the 2008 financial crisis, according to a closely watched compensation study due out Monday, the Wall St Journal reports..

Bonuses, which constitute a substantial part of many finance workers' pay, are on track to plunge 35% to 40%, on average, according to the forecast by Options Group, an executive search and consulting firm. Pay is likely to be hardest hit in areas such as fixed income, which comprises….

Read more at http://online.wsj.com/article/SB10001424052970203764804577060652927268624.html?mod=WSJ_hp_LEFTWhatsNewsCollection

Woman Surrenders In Black Friday Pepper Spray Incident

According to a CNN report a southern California woman turned herself in to authorities as the person who pepper sprayed video-game shoppers in a Walmart during Black Friday's shopping frenzy, Los Angeles police said Saturday.

The woman has not been charged because detectives are continuing their investigation into the incident that required firefighters to treat 10 people for exposure to pepper spray, authorities said. The woman's name wasn't released Saturday, police said.
"We have her identity and we know who she is and where she is at. When appropriate action needs to be taken, we know where to find her," said Officer Bruce Borihanh, a police spokesman. "She's a suspect, but she's not booked or anything, so we're not releasing her name….

Read more: http://www.ksbw.com/news/29862695/detail.html#ixzz1evyGcRXm

What Sales Record? Obviously, Black Friday was a flop

According to WallStreet Examiner’s Lee Adler, disposable household income is down. House values are down. Stock values are down. Net worth, at least by any honest measurement is down. Savings return no income, and have no prospect of doing so. Government employees are in some danger of losing their jobs and, unless they have cognitive problems, should know that their pensions will start later and return far less. Europe is about to fail. China has a trustworthiness factor of approximately zero. And then there's the minor detail that the world is drowning in debt and there's no prospect for growth, so there's no hope for any of this to improve without a reset, and the politicians aren't going to let that happen.

Mentioning things like “increased traffic” or “items purchased” and avoiding mention of actual profits, we know Black Friday failed. How will they spin it….

Read more at http://forums.wallstreetexaminer.com/topic/1020059-how-will-msm-spin-a-failed-black-friday/

9 Oversold Large-Caps Hedge Fund Favorites

Seekingalpha writes: If you like following the “smart money,” you may be interested in this list. Analysts follow what institutional investors like hedge fund managers buy because they have access to sophisticated research and have a lot of experience in choosing investments – when they buy a stock, it’s a signal to take a second look….

1. The Mosaic Company (MOS): Engages in the production and marketing of concentrated phosphate- and potash-based crop nutrients for the agriculture industry worldwide. Market cap of $23.74B. RSI(14) at 39.41. Net institutional shares purchased over the current quarter at 22.4M, which is 5.02% of the company's 446.15M share float. It's been a rough couple of days for the stock, losing 6.46% over the last week.

2. Whole Foods Market, Inc. (WFM): Engages in the ownership and operation of natural and organic food supermarkets. Market cap of $11.30B. RSI(14) at 39.10. Net institutional shares purchased over the current quarter at 7.5M, which is 4.61% of the company's 162.68M share float. It's been a rough couple of days for the stock, losing 5.66% over the last week….

3. Oracle Corporation (ORCL): Develops, manufactures, markets, distributes, and services database and middleware software, applications software, and hardware systems worldwide. Market cap of $150.88B. RSI(14) at 38.59. Net institutional shares purchased over the current quarter at 176.4M, which is 4.48% of the company's 3.94B share float. It's been a rough couple of days for the stock, losing 7.4% over the last week...

We're not in the business of offering investment advice but there's nothing stopping you from finding out about the rest at http://seekingalpha.com/article/310299-9-oversold-large-caps-being-bought-up-by-hedge-funds

Saturday, November 26, 2011

Weird³’s Deep Thoughts (Saturday Afternoon Edition) 8 signs you should think about quitting


According to Anne Fisher, Fortune contributor: Daunting as a job search is, it's sometimes a smarter choice than staying put. Here's how to tell when enough is enough The most common culprit, according to the report: A bad cultural fit -- that is, an employee's sense that he or she just doesn't belong, and consequently can't get ahead. Sound familiar?

Kate Wendleton, president of national career-counseling network The Five O'Clock Club, has identified eight specific symptoms of a bad fit. "If you've noticed three or more of these warning signs," she says, "it's time to update your resume and launch a job search."

1. Your values don't match those of your coworkers or higher-ups. Wendleton has seen many instances of employees who don't fit in because they won't go along with unethical (or even illegal) practices, but a clash in values can take many other forms. Your description of your company as "bureaucratic and stifling" suggests the culture isn't right for you.

2. Your boss doesn't like you. This probably applies if "you don't support his approach or agenda, or she never solicits your opinion," says Wendleton, adding, "If you've ever done or said anything to undermine your boss, you might as well get out now."

3. Your peers don't like you. Being treated like an "outsider" is a clue. "If you feel isolated, gossiped about, and excluded from the inner workings of the organization, and if you have no sense of camaraderie at work," Wendleton says, "it's time to start planning to move on."

4. You don't get assignments that make the best use of your abilities…

Read about the rest at http://management.fortune.cnn.com/2011/11/23/8-signs-you-should-think-about-quitting/?iid=SF_F_River

European Banks Frantically Trying To Dump $7 Trillion Of Crap Assets (But No One’s Buying)

The balance sheets of European banks are piled high with legacy assets -- mortgages, real-estate, and other loans--that are tying up precious capital and constricting the banks' ability to make new, more productive loans BusinessInsider’s Henry Blodget writes.

At the same time, the banks' traditional sources of funding--other banks and institutional investors--have begun drying up as the European crisis intensifies.
This leaves the banks desperately needing to raise cash to survive.
The first plan was to sell off the crap assets, but…..

Read more at http://www.businessinsider.com/european-banks-frantically-trying-to-dump-7-trillion-of-crap-assets-but-no-one-will-buy-them-2011-11

Are MF Global Customer Funds Being Looted to This Day (With the Same Risky Trading That Sunk the Firm)?


From Zerohedge: As MF Global customers approach the one month anniversary of the cluster-circus that has become the liquidation proceedings, replete with unnecessary delays, half-measures, and outright deceptive statements by Trustee James W. Giddens (that will only ensure the proliferation of hours billable at $890 each), we wish to highlight an order entered just days after the bankruptcy that gave MF Global Holdings and its affiliates carte blanche to continue the very risky and suspicious trading that led to its demise. A hearing is set for Wednesday, November 30, 2011 at 3:00 pm on this and other germane matters, including the super priority status of JP Morgan Chase (the conflicted first-lien holder) afforded to it ahead of the customers whose segregated accounts were putatively to have been held sacrosanct.

On November 2, 2011, the bankruptcy judge entered a seemingly innocuous order that granted an extension of time to the Debtors (MF Global Holdings Ltd. and MF Global Finance USA Inc.) to comply with the requirements of Section 345(b) of the Bankruptcy Code and an authorization of the continuation of intercompany transactions among the Debtors and non-Debtor affiliates. Detailed arguments were provided in the 19 page Motion of the Debtors filed the day of their October 31, 2011 bankruptcy.

Of particular interest are the arguments for allowance of the continuation of extant investment practices…

Read more at http://www.zerohedge.com/contributed/are-mf-global-customer-funds-being-looted-day-through-same-risky-trading-sunk-firm

Ex-Goldman star has tough debut year

Reuters reports that Pierre-Henri Flamand, the star trader who left Goldman Sachs to launch one of the most eagerly-awaited hedge funds of 2010, is having a tough debut year as volatile markets rock the M&A dealflow his strategy trades on to make money.

His $2.1 billion event-driven Edoma Partners fund, which makes money by taking positions on corporate events like mergers, bankruptcies and restructurings, is down 3.79 percent in 2011 to the end of last week, one investor in the fund said. This leaves the fund down just under 2 percent since its Nov. 1 launch last year, the source said….

Read more at http://www.reuters.com/article/2011/11/25/edoma-hedge-fund-idUSL5E7MP1G820111125

REVEALED: What It's Like Working Inside The World's Biggest Hedge Fund

According to NY Magazine, Bridgewater Associates, the $94 billion human behavioral experiment that doubles as a Connecticut-based hedge fund, has given its public image a shine in the wake of several articles — including one in this week's New York — about its hard-driving culture. The company's website now features a dozen videos of Bridgewater employees praising founder Ray Dalio and his doctrine of radical transparency — because nothing says "not a cult" like gushing confession-cam testimonials…..

Go ahead. Check out the videos at http://www.bwater.com/home/culture--principles/culture-videos.aspx

Friday, November 25, 2011

More Black Friday violence at Wal-Mart: One shot in San Leandro


Forget the liberals and idealists at Occupy Wall Street. The LA Times reveals the real America. Hours after a woman attacked fellow shoppers with pepper spray inside a Wal-Mart in Porter Ranch, another shopper was shot in an attempted robbery outside another of the store’s chains in the East Bay suburb of San Leandro.

The victim, along with family members, was walking to the parking lot between 1 and 2 a.m. when three or four suspects confronted the group and demanded that they turn over their purchases, Sgt. Mike Sobek of the San Leandro Police Department told Bay City News Service.

When the family refused, a fight broke out and one of the suspects pulled out a gun and shot the victim, police said. Family members wrestled one of the suspects to the ground while the rest fled. The victim was taken to the hospital in critical but stable condition, while the detained suspect -- a man in his mid-20s -- was arrested, police said.

The Wal-Mart had opened at 10 p.m. to offer Black Friday bargains.

Read more at http://latimesblogs.latimes.com/money_co/2011/11/black-friday-wal-mart-san-leandro-shooting.html

Madoff Associate Kohn Has Assets Frozen


At last! A U.K. court froze the assets of Bernard Madoff associate Sonja Kohn, the former chairwoman of Bank Medici AG, who a judge said made at least $56 million introducing clients to the convicted fraudster, Bloomberg reports,

Liquidators of Madoff’s estate are pursuing Kohn and the directors of Madoff Securities International Ltd., the company’s English unit, for the return of assets.
Kohn, 63, met Madoff in the 1980s and introduced him to investors who put billions of dollars into his Ponzi fraud. She is accused of billing Madoff companies for research, analysis and consulting services while in reality the payments were “secret kickbacks” for introducing money into the scheme, Justice Julian Flaux said in a ruling today….

Read the rest at http://www.bloomberg.com/news/2011-11-25/madoff-associate-kohn-has-assets-frozen.html

Only in America: Violence Erupts as Shoppers Rush for Black Friday Deals


According to the AP a few violent incidents broke out across the country on Black Friday as millions of shoppers rushed into stores that opened their doors several hours earlier than usual on the most anticipated shopping day of the year.


Early signs point to bigger crowds at the nation's malls and stores as retailers like Macy's and Target opened their doors at midnight. Toys R Us and a few stores other stores that opened on Thanksgiving Day also were filled with shoppers. The early morning crowds were mostly peaceful, but Los Angeles authorities say 20 people at a local Walmart store suffered minor injuries when a woman used pepper spray to gain a "competitive" shopping advantage shortly after the store opened on Thursday evening. In Fayetteville, N.C., police are looking for two suspects after gunfire erupted early Friday at Cross Creek Mall. And police say two women have been injured and a man charged after a fight broke out at an upstate New York Walmart.

Later in the morning, a Phoenix television station KSAZ reported that a grandfather in a Walmart in Buckeye, Ariz., was roughed up by police after the man allegedly put a game in his waistband so that he could lift his grandson out of the crowd. Witnesses told the station that police slammed the man to the ground — possibly thinking he was stealing the game….

Adding to that, some Occupy Wall Street protesters, which turned up for the Macy's midnight opening, are expected to plan flash mobs and other events later in the day in places like Chicago, Washington, D.C. and Boise, Idaho to urge people to reconsider shopping at national chains on Black Friday….

Wait, wait...there's more good stuff at http://www.cnbc.com/id/45428383

Bank Commodity Staff Exodus Grows


Bloomberg reports that the world’s biggest investment banks have greater staff turnover in commodities than in fixed-income and currencies because of tightening regulations on trading, according to Coalition, a London-based research company.
That reflects “general market confidence and demand from non-banking competitors including trading firms, which do not have the same levels of regulatory constraints,” Coalition said in an e-mail, without giving figures. Coalition, founded in 2002, uses company announcements, its own research, media articles and information from people in the market.

JPMorgan Chase and Bank of America Corp. are among banks that shut units trading the banks’ money in commodities before the implementation of the Volcker rule in 2012 that will limit such practices. The Commodity Futures Trading Commission is curbing the size of positions any one party can take in U.S. raw-material derivatives. Revenue from banks’ commodity units is still growing faster than overall sales, Coalition said.

Read more at http://www.bloomberg.com/news/2011-11-25/commodity-staff-turnover-at-banks-seen-increasing-as-trading-rules-toughen.html

…And Another One Bites the Dust: Fraudster hedge fund adviser and owner charged

The Securities and Exchange Commission has filed a civil injunctive action against Patrick G Rooney, a resident of Oakbrook, Illinois, and his company, Solaris Management, LLC, the investment adviser to the Solaris Opportunity Fund, LP, for the fraudulent misuse of the fund’s assets and other illegal conduct.

According to the SEC’s complaint, the Solaris Fund is purportedly a non-directional hedge fund with approximately 30 investors and reported assets of USD16,277,780 as of December 2008. Contrary to the Solaris Fund’s offering documents and marketing materials, Rooney and Solaris Management allegedly made a radical change in the Solaris Fund’s investment strategy by becoming wholly invested in Positron Corp. (“Positron”), a financially troubled microcap company of which Rooney has been Chairman since 2004. Rooney, who has received compensation from Positron since September 2005, allegedly misused the Solaris Fund’s money by investing over USD3.6 million in Positron through both private transactions and market purchases…

Find out more at http://www.hedgeweek.com/2011/11/23/158469/sec-charges-hedge-fund-adviser-and-owner-over-fraudulent-conduct

Hedge funds’ 10 most popular stocks

According to Ms. Krishnamsetty, editor and co-founder of Insider Monkey, a finance website that provides free insider trading and hedge-fund stock-holdings data, here are the 10 most popular stocks among hedge funds at the end of September:

1. Apple AAPL +0.29% More hedge funds - in fact, 103- owned Apple than any other stock at the end of last quarter. Apple was also the most popular stock at the end of 2010. It was the third most popular stock at the end of the first quarter and it passed Citigroup and Microsoft to reclaim the top spot at the end of June. Billionaires Ken Griffin and David E. Shaw had the largest positions in Apple at the end of third quarter among the nearly 300 hedge funds we analyzed. Griffin bet around $3 billion on stock and call options.

2. Google GOOG +0.27% Seventy nine hedge funds had Google in their portfolios at the end of Q3. This is the first time this year Google is this popular among hedge funds. Billionaire Tom Steyer , Jeffrey Tannenbaum , Alan Fournier , and Curtis Macnguyen are among the hedge fund managers who initiated brand new positions in Google during the third quarter.

3. Microsoft MSFT +0.33% Microsoft slipped one spot to number three during the third quarter. Seventy six hedge funds are bullish about Microsoft. Value investors Boykin Curry , David Einhorn , and Seth Klarman have large positions in MSFT….

Find out more at http://www.marketwatch.com/story/hate-financials-hedge-funds-love-em-2011-11-25?link=MW_latest_news

Dr. Doom: Europe’s Contagion “Has Now Gone Viral…and Global”


On Tuesday, the IMF announced a new set of measures designed to provide short-term liquidity to ailing nations, the latest in a series of measures aimed at stemming Europe's sovereign debt crisis.

But "money alone is not going to resolve the problems" in Europe, where the "contagion is spreading" far beyond the so-called periphery, according to New York economics professor Nouriel Roubini.

"The contagion has now gone viral, cross Atlantic and global." In Europe, the problems of Greece, Italy and Portugal have now spread to Italy, Spain and beyond. "Most ominously," Roubini notes, credit spreads are widening on the sovereign debts of France and Belgian among other "core" nations.


Read more: http://finance.yahoo.com/blogs/daily-ticker/roubini-europe-contagion-now-gone-viral-global-141320419.html#ixzz1ehoLFJXG

Fear of Apple iTV has manufacturers scrambling

The LA Times asks: could any company other than Apple could be leaving its competitors in the dust in an industry it hasn't even entered yet?

TV makers, tune in. The industry your boxes have dominated for decades may be about to get shaken, stirred, and twisted around by Apple Inc., the market disruptor extraordinaire. Apple is already building production facilities for an "iTV," according to Peter Misek, an Apple analyst at Jefferies who has been issuing bold projections lately about Apple's secret television plans.

Observers expect that an Apple television would combine Apple's knack for making easy-to-use, visually appealing software with its electronics engineering muscle, resulting in a new kind of device that would push forward the TV industry the way Apple has done with music, phones and tablets.

Misek says he has indications that Apple may be working on the TVs with Osaka-based electronics manufacturer Sharp Corp., even now setting up factory space at a site in Japan to mass produce customized Apple televisions.

"We believe retooling of the [production] line has begun or is about to begin at the facility with February as a preliminary time frame for commercial production," Misek writes. "This would put an iTV launch as early as the middle of 2012." He believes that the prospect of an Apple television set is now sending leading TV manufacturers on "a scrambling search to identify what iTV will be and do" so that they don't get "caught flat footed by Apple."

Find out more at http://latimesblogs.latimes.com/technology/2011/11/apple-itv-manufacturers-scrambling.html

Thursday, November 24, 2011

'The Sky Will Fall In' for Europe…”


The debt situation on either side of the Atlantic is unlikely to improve for some time, Anthony Fry, UK Chairman of Espirito Santo Investment Bank told CNBC. But Fry stressed that the economic difficulties of the US could not be compared to the sovereign debt crisis in Europe because the Federal Reserve still retains control over monetary policy, the dollar remains the reserve currency of the world and the US is the nation with the best prospects for growth in the Western — and wider — world.

"There is no doubt that the US economy remains the most powerful engine for growth, certainly in the Western world and I would argue, given the totality of the opportunity it has… the world generally," Fry told CNBC.

On the debt crisis within the euro zone, Fry was pessimistic, saying he believed a resolution was still a long way off and while European policymakers failed to make decisions, global markets would remain volatile and eventually "the sky would fall in".

"The market is reflecting the uncertainty within the European Union, that's what's going on here, the market is saying: 'Do you know what? We're going to feel good or bad, day-by-day, depending on what's going on, there needs to be a resolution," Fry said.

He added: "I wish I was saying it's going to happen soon… this is the longest running crisis in which people have been giving false dates, people turning up for summits saying it has to be resolved, nothing happens and people go away and the sky doesn't fall in… sooner or later the sky will fall in, I'm just not clever enough to know when it's going to be."

Read more at http://www.cnbc.com/id/45398839

God Bless Black Friday 2011: Retailers Use Early Openings To Lure Shoppers Concerned About Economy

Move over turkey: Black Friday began in earnest as Target, Abercrombie & Fitch and other stores opened their doors at midnight – a few hours earlier than they normally do on the most anticipated shopping day of the year HuffPo reports. A few retailers even had lines of shoppers when they opened on Thanksgiving Day.

Herald Square in New York was bustling at 6 p.m. with shoppers looking to snag discounts at Old Navy and other stores that were open on the Thanksgiving. By 9:45 p.m., more than 300 people were waiting outside a Best Buy in New York before it opened at midnight. An hour later, nearly 2,000 were in line at another Best Buy in St. Petersburg, Fla., ahead of its midnight opening.

Roberto Rubi, 24, of Seminole, Fla., had been standing in line since 1 a.m. on Thanksgiving morning and hoped to score a cheap TV and laptop. He ate dinner with his family at home while three of his buddies took his place in line. "It's hard times," Rubi says. "So, any discount helps….”

Read more at http://www.huffingtonpost.com/2011/11/25/black-friday-2011-_n_1112482.html?ref=business

MF Global clients burned 2X

Folks who got stuck with bum checks from Jon Corzine’s defunct brokerage firm MF Global are getting bounced a second time, the NY Post reports. This time, it’s by the MF Global trustee’s claims process — set in motion yesterday to help burned customers get their money back.

The claims process allows those with accounts to recover 60 percent of the $5.5 billion in MF’s accounts frozen after it emerged that $1.2 billion was missing from accounts that should have been segregated, and therefore safe.
But folks who cashed out of their MF brokerage accounts leading up to the Wall Street firm’s Halloween collapse — and received checks from MF for their account balance, only to see them bounce — are not addressed by the claims process, The NY Post has learned.

Potentially hundreds of people with an estimated $50 million in claims are in this limbo.


Read more: http://www.nypost.com/p/news/business/mf_claims_go_missing_JjJOyx2yBXc25XTeKN9sJI

Nervous Traders Watch Europe on Thanksgiving Holiday

As Americans give thanks over the holiday table Thursday, nervous traders will be watching the developments overseas and will continue to do so in Friday's half day stock market session, according to cnbc.

There are no U.S. economic reports of note Friday, so Europe will dominate. On Thursday, German Chancellor Angela Merkel and French President Nicolas Sarkozy meet with newly named Italian Prime Minister Mario Monti.

"I don't see any magic coming out of it," said Art Cashin, director of floor operations at UBS. "The problem is they don't have a plan. This is like a town that has no fire department. When something catches ablaze, we're all in it together."

Read more at http://www.cnbc.com/id/45423039

Wait…wait…Your Holiday Survival vs. The Secret Tricks of Retailers


The good people at Bloomberg write: Martin Lindstrom leads a double life: As chairman of consulting firm Buyology, Inc., he helps large companies market brands better. As an author, he calls himself a consumer advocate, arguing that companies go “too far [pulling] money out of the pockets of consumers at a time when they can’t really afford it.”

In an interview with Bloomberg.com’s Ben Steverman, Lindstrom explains some of retailers’ canniest techniques, including why stores suddenly smell like cinnamon during the holidays and what online retailers and casinos have in common. Edited excerpts of the interview follow.

Q: How are retailers trying to get shoppers to spend more this holiday season?
A: The most obvious thing is the whole play on nostalgia. Our brains are built in such a way that as we’re taken back in time, we see the past as being much more positive than the present. We are willing to pay more to get that sense of belonging. That warm, fuzzy feeling is activated not just by sound but by sight and smell. That’s why more stores are spraying in pine, cinnamon and particularly vanilla. A study we conducted shows that when people smell cinnamon, they’re immediately taken back to Christmas. They also feel an obligation to be a better parent during Christmas. Therefore they’ll buy more.

Retailers are also adopting techniques to make you feel younger. They play music from when you were young -- say from the 1980s. The size of the clothes is larger, with pants typically one or two numbers too large. So you feel you can actually fit the clothes you wore when you were young. They’re also changing the colors in the mirrors and in the spotlights for a warmer color, so you look slightly more suntanned than you normally would.

Combine that with compliments from staff and people feel that sense of satisfaction and self-confidence. You actually want to buy that feeling….

There's more at http://www.bloomberg.com/news/2011-11-23/holiday-survival-secret-tricks-of-retailers.html

Hedge-Fund Titan Cohen Plans Bid for Dodgers

Wall St Journal reports that hedge-fund titan Steven A. Cohen is planning a bid for the Los Angeles Dodgers, according to three people involved with the bankruptcy sale of the storied baseball team.

In a move that shows how serious Mr. Cohen is about bidding for the team, the billionaire founder of SAC Capital Advisors has been discussing the bid with Steve Greenberg of Allen & Co., the people familiar with the matter said. The veteran investment banker has close ties to the leaders of Major League Baseball….

Find out more at http://online.wsj.com/article/SB10001424052970204630904577056630119259676.html

What BofA Default? Swaps Soar to Record as U.S. Company Credit Risk Increases

The cost to protect Bank of America Corp. debt surged to a record and a benchmark gauge of U.S. corporate credit risk climbed to a seven-week high as Europe’s sovereign fiscal crisis intensified, BusinessWeek reports.

The Markit CDX North America Investment Grade Index of credit default swaps, which investors use to hedge against losses on company debt or to speculate on creditworthiness, added 5.9 basis points to a mid-price of 146.4 at 4:57 p.m. in New York, the highest since Oct. 4, according to Markit Group Ltd.

Investors pushed the gauge higher on concern that Europe’s bond market turmoil, which began more than two years ago in Greece, now risks engulfing the region’s biggest economy. Germany failed to get bids for 35 percent of 10-year bonds offered for sale today, sending its borrowing costs higher and the euro lower. French and Belgian bonds fell as the cost to protect European government debt against default rose to a record.

Find out more at http://www.businessweek.com/news/2011-11-24/bofa-swaps-soar-to-record-as-u-s-company-credit-risk-increases.html

El-Erian: U.S. Economic Conditions Are 'Terrifying'

Mohamed El-Erian, chief executive officer and co-chief investment officer at Pacific Investment Management Co. told Bloomberg TV:

'I am worried. We've had two bits of unfavorable news in the last 24 hours. One you reported this morning, which is that we have less economic momentum than we thought we had - 2% growth as opposed to 2.5%. The second is that yesterday we had no policy momentum. We're worried about the concept of stall speed, that 2% growth may not be enough for an economy that still has to de-lever. We put the chance of a recession at one-third to one half, which is really high given initial conditions'….

Read more about this at http://www.businessweek.com/news/2011-11-23/pimco-s-el-erian-says-u-s-economic-setting-terrifying-.html

Wednesday, November 23, 2011

The Fed's Black Sky Scenario Revealed


The dark clouds in the Federal Reserve's 2012 annual stress test are keeping bankers up at night, as banks are being asked to imagine their balance sheet situation under some horrible economic scenarios.

Under the Fed's bleakest black sky scenario, financial institutions will have to weather 13.1% unemployment, the Dow at 5,600, and Europe in severe recession.
The test, known as the Comprehensive Capital Analysis and Review, includes 12 other metrics for the U.S. market….

Read more: http://www.businessinsider.com/the-feds-black-sky-scenario-revealed-2011-11

Slumping China manufacturing data stokes fears of global recession

Global stocks fell again Wednesday after yet more downbeat economic figures and the surprising news that Germany failed to raise as much money as it was looking for in an auction of its supposedly top-rated debt, Boston.com reports.

Following figures Tuesday that showed the U.S. economy grew less than anticipated in the third quarter, the bad news has piled up for investors. With China's economy suffering a fall in manufacturing activity as well, there are clear signs that the eurozone economy is heading back into recession and that's knocked sentiment in stock markets again.

...The grim round of news came amid ongoing stresses in Europe's debt crisis and mounting speculation that the U.S. may see its credit rating downgraded again in the not-too-distant future following lawmakers' failure to agree on a deficit reduction plan...

Read more at http://www.boston.com/business/markets/articles/2011/11/23/world_stocks_hit_by_signs_of_slowdown_in_china_us/

Groupon's Nosedive An Ominous Sign For Web IPOs

According to Forbes in an ominous development for the Internet IPO market generally and the daily deals sector generally, investors are walking away from the company’s shares. Groupon went public earlier this month at $20 a share, closing at $26.11 on the first of trading after briefly trading as high as $31.14. The stock stabilized in the $24 range for a few days, before hitting a new closing high last Friday at $26.19. But this week, Groupon holders have no reasons to be thankful; the company’s stock is looking like a turkey.

Today, the stock is down $2.84, or $14.2%, to $17.23, and has traded as low as $17. For the week, the stock is down about 35%.

So, why the big sell-off? Maybe because the company has an unprofitable, largely non-proprietary business model with a zillion competitors? But we all knew that before the IPO… didn’t we?

Find out more at http://www.forbes.com/sites/ericsavitz/2011/11/23/groupon-shrs-falling-apart-off-35-in-3-days/

BLACK SWAN ALERT: German Bond Auction Flops, Yields Jump

It has come to this...
According to BusinessInsider, when measured by demand, Germany apparently just had one of its worst bond auctions ever. The rock of Europe is seeing less enthusiasm for its debt. Specifically, according to Nomura, total bids at the auction came to 3.9 billion EUR vs. 6 billion EUR issued.

It's a very rare day, when markets are in risk off mode, but German bund yields are actually going higher.

Much like US Treasuries, German bund yields almost always go lower on risk off days.
This is actually something that's been in development for awhile. Morgan Stanley noted on November 17, that while peripheral yields were jumping, German bund yields had stopped falling, signifying a shift in investor behavior: Rather than moving money around intra-Europe, money was fleeing Europe altogether.

Holy cow readers, it looks like we're going to have a historic December!


Don't take our word for it. Check out the charts at: http://www.businessinsider.com/german-bond-auction-weak-2011-11#ixzz1eYEpn21t

When Traders Aren't Reading About The Markets, They're Likely Reading…


...stories like "What’s worse than snakes on a plane? Porn"

When you’re cramped in an airplane for hours, entertainment options are limited. You can a) catch the latest Angelina Jolie dud, b) read with earplugs to block the sound of screaming kids, c) ponder Swarovski knickknacks in the seat-back magazine or d) make multiple bathroom trips in hopes of meeting the hottie in aisle 24.

“Hotels around the world have it, so why wouldn’t we?” Ryanair’s CEO, Michael O’Leary, told the U.K. newspaper The Sun. Mr. O’Leary was quick to clarify that passengers would pay for smut using an Ryanair app and view it on their iPads or smartphones. “I’m not talking about having it on screens on the back of seats for everyone to see. It would be on handheld devices.”

Clearly, Mr. O’Leary isn’t worried that kids might sneak a peek, or that devout passengers might be offended by all the heaving breathing...
….
Read more at http://www.theglobeandmail.com/life/the-hot-button/whats-worse-than-snakes-on-a-plane-porn/article2230052/