Archive for October 2007

Write-Offs: 10.31.07

$$$ The League Tables [Deal Journal]
$$$ Keep muff brooms out of board rooms, By Jeff Skilling [NewsGroper]
$$$ Wallstrip Halloween [WallStrip]

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Closing Bell: 10.31.07

Sponsored by the Financial Times.
Investors began the morning warily. Trading volume was low and stocks climbed slowly and steadily. Last minute jitters before the Fed announcement sent the major indexes lower. But when the Fed revealed that even an economy growing faster than expected wouldn’t stop it from giving Wall Street the rate cut it was demanding, stocks soared once more. The Dow Jones Industrial Average flew up 137.54, or 1%, to 13930.01. The S&P 500 bounded 18.36, or 1.2%, to 1549.38. The Nasdaq Composite Index rocketed 42.41, or 1.5%, to 2859.12. Volume on the New York Stock Exchange was 1.6 billion shares, which is pretty much standard these days.
The Fed’s statement is largely being read as drawing a line in the sand. “This far we will cut and no further.” It remains to be seen whether they will be believed or whether the Punch Bowl caucus will be back demanding another swipe at the punch before the year is out.
Happy Halloween!

FT Alphaville
. Boo!

Aleksey Vayner Gets Back In The Saddle

vaynerinthenewyorktimes.jpgHe tried to get a job at an investment bank, failed and went into hiding for about a year but Aleksey Vayner is back, my bitches, and doing what, you might ask? Trying to find a job. Yes, even people who can bench press one billion pounds on sheer exaggeration alone need some sort of way to pay the rent, and take it from someone who knows, 2-bedroom realities of one’s own making do not come cheap. Mr. Vayner has been making the rounds and just last week interviewed at a fund in New York that would only speak about the life change experience if we promised not to reveal its name, because taking a meeting with this guy (or not knowing who he was in the first place) does not tend to be good for anyone’s reputation.
We’re going to get the most disappointing stuff out of the way first, starting with the fact that Vayner’s no longer sending his CV out in video form. Bull shit, I know. Equally upsetting: AV’s resume no longer makes mention of the book he previously claimed to have written, “Women’s Silent Tears: A Unique Gendered Perspective on the Holocaust.” As a woman and a fan on the Holocaust who often cries inaudibly, I have to say, this one stings, and I’m not really sure what the rationale was behind it. Additional letdowns—he’s now going by “Alex” and is said to have come off as “personable,” “chatty,” and “laid back.” It’s like, who the hell is this guy? Luckily, that only lasted for about five minutes, at which point he took off his normal person mask and became the monstrously arrogant and, dare we say it, sociopathic liar we all know and love.
Was the video he sent to UBS an error in judgment? No, was not an error in judgment, fuck you very much. It was just, in the words of the Maestro, “taken out of context.” Oh, and he’s got another book coming out (ETA, Summer 2008). It’s called the Millionaires’ Blueprint to Success , and is based on Aleksey’s experience with the rich people he met through tennis and skiing. He wrote it because, honestly, he’s read every professional development book out there, and they’re mostly full of crap. Obviously he could do better, so he did (that’s called initiative and the ability to do simple math, just two of the many qualities he offered the firm). Aleksey’s tome—a cross between a hard finance book and a self-help guide—works because it teaches you to “train your mind to have the right attitude toward money, and then shows you how to get it.” Seriously, just buy it, you’ll love it.
You’re probably wondering why Aleksey, who graduated in May, is just now looking for employment. Well wonder no longer—it’s because he was going to go pro in tennis, with a debut playing doubles in the US Open. Unfortunately, his partner hurt his wrist two hours before their match, and though he thought about playing as a single, Aleks just decided he might as well go into finance, at which he is equally if not more so adept.
Earlier: Everything we’ve ever written about Aleksey Vayner.

Aleksey Vayner’s Somewhat Toned-Down Resumé
[Word doc]

  • 31 Oct 2007 at 2:17 PM
  • Fed

Twenty-Five And Twenty-Five

Fed funds and discount rate cuts.
In our reader poll, 61% of respondents predicted a 25 basis point cut.
Too much? Too little? Goldilocks’ porridge? Leave your response in the comments section.
After the jump, the full release from the Fed.
October 31 Press Release [Federal Reserve]

Read more »

Insider Trading At Goldman?

When Goldman turned in it’s third-quarter earnings and revealed the the credit-crunch was its friend, several eyebrows were raised by market watchers. How could Goldman have made the kind of money it claimed to have made by shorting subprime mortgages, more than person we spoke with asked.
Apparently, the same question is being asked over at the Securities and Exchange Commission. Writing in today’s New York Post, John Crudele reports that the SEC is “curious” about whether Goldman’s traders were tipped off by the firm’s investment bankers, giving them an edge on the market. Interestingly, there seems to be some debate within the SEC about whether or not such tipping would constitute insider trading. We assume the crux of the matter is the technical legal question of whether the notoriously conflict-ridden Goldman could ever commit insider trading. If your clients already know you are on both sides of every trade, can you really be convicted of misappropriating from them?
We’d like to know a question Crudele doesn’t ask: what kind of non-public information could have led Goldman to take on those winning positions?

SEC Eyes Goldman Sachs’ Good Fortune
[New York Post]

hewould'vedoneit.jpgTomorrow is the first day of Movember, a charity event started in Australia that gets men to grow mustaches (and ‘stache supporters to sponsor their efforts) in order to raise money for prostate cancer research. In years past, Mo Bro participation from the Aussie branches of Citigroup, Goldman Sachs, Deloitte and PricewaterhouseCoopers has been huge, and nearly 25% of funds generated since the organization was started four years ago have come from finance professionals. With Thursday marking the first time the contest is being held in the U.S., you would think that top banks would be gung-ho about their employees growing hair, just to prove themselves better than one another in a category other than record losses, but, apparently, not so much. We placed some calls today to find out which firms will officially be sporting wool and let’s just say that you should all be performing regular self-exams for early detection, because a cure is not around the corner. When asked if their CEOs would be setting good examples for their minions by growing moustaches this month (and, obviously, contractually obligating the plebes to do so, as well), Bear Stearns, Lehman Brothers and Citigroup all said no, and Goldman Sachs said it’d get back to us but hasn’t (which is probably a no and besides the point: Blankfein promised himself he’d never go back to his hobo days a long time ago). A spokeswoman for Merrill Lynch told us that, like all the other pro-cancer banks in New York, hers would not be asking employees to take part in the event, and reminded us that, at the present time, MER has no CEO on which to grow a ‘stache. When we casually wondered aloud whether or not the last guy to run the company would’ve seen the same fate had he worn some fur, she responded, “maybe not.” And honestly? Girl didn’t sound like she was kidding.
Do you have the ability to grow facial hair and the balls to say corporate culture be damned, I am not down with this life-threatening disease? Send photographic updates on your progress here.
Growing Facial Hair for Charity [WSJ]

  • 31 Oct 2007 at 12:05 PM
  • Banks

The Cost of The Credit Crunch

In all the talk about losses at individual banks and brokerages, sometimes it’s easy to lose sight of the bigger picture. A report issued by the New York City comptroller yesterday nicely pointed to the forest made up by those trees. The collective profit loss at Goldman Sachs, Morgan Stanley, Merrill Lynch, Citigroup, Lehman Brothers, J.P. Morgan Chase and Bear Stearns was 65%, according to the report. And the damage would have been even worse if not for Goldman’s miraculous/evil genius performance.
New York City, State Budget Outlooks Dim as Wall Street Falters [Bloomberg]