Germany’s HSH Nordbank plans to sue UBS over losses on a $500 million CDO portfolio, accusing Marcel Ospel’s bank of violating fiduciary responsibilities by selling, instead of low risk assets, shitty, high risk ones. The Krauts, crying into their steins, complained that “that the world’s largest asset manager…appears to have condoned actions which benefitted only itself,” which is something that hardly ever happens at these places. On the bright side, UBS shareholders can finally be pleased with management for making a decision that benefitted UBS.
HSH Nordbank sues UBS over exposure to sub-prime danger [Times Online]
Archive for February 2008
Barclays Plc second-half profit may have fallen twenty-one percent on asset writedowns but you needn’t pity the UK bank, which is about to acquire a controlling stake in Russian pin-up calendar manufacturer Expobank. Yes, for the bargain price of about £200million, Barclays will be the proud owner of the retail and commercial bank which has lately gotten into the business of peddling employee ass– the Russian lender has released a 2008 calendar featuring its female workers from top to bottom (by which I mean senior executives to secretaries, but also tits to toes). Senior chief economist Julia Kovyneva, senior manager Maria Guterman, network sales manager Yevgenia Trusilova, they’re all there, lounging on a bed, topless with cupcakes and bending over a kitchen counter, respectively.
Now I know what you’re thinking—the last time you posed for those sorts of photographs with the firm’s name stamped at the bottom, it didn’t go over so well with the higher-ups. Something about “embarrassing the company” with your trampy ass, yes? Are these girls going to get fired? No. The calendar was the brainchild of Expobank chairman Kirill Yakubovskiy, who wanted the pictures/slogans (“We work under your personal request,” “Expobank tries to find unusual and creative ways in everything,” “We’ll bend over backwards and forwards to make you happy,”etc) to reflect the bank’s dedication to “interacting with [its] clients.” I’m no client, but I think they got the job done. Judge February, March and April for yourself, after the jump. NSFW, unless you work in a whorehouse or a Russian bank.
The Wall Street Journal’s influential Heard on The Street column calls Goldman Sachs “pricey compared with other Wall Street securities firms” and predicts After that Goldman’s long run of climbing earnings may be coming to and end. The M&A slow down, so carefully documented in our weekly M&A wrap-up, should hurt revenues from fees while exposure to leveraged loans may drag down profits.
“Goldman could post in mid-March its smallest quarterly profit in three years,” HotS writes.
Analysts have been hammering away at Goldman for the last few weeks, predicting a climb down from its elevated status on Wall Street. While no-one thinks we’re going to have a surprise subprime write-down, many think the widening credit market crisis is finally about to take a piece out of the Goldman Sachs money mint.
So do the analysts and HotS have it right? Or does Goldman have yet another surprise up its sleeve, like when they revealed they had gone short subprime and made a bundle? Over to the right, at the top of the center column, we’ve created a poll for you to cast your vote. Goldman: long or short? You decide.
Goldman’s Profit Magic May Be Fading [Wall Street Journal]
$$$ We apologize for the paucity of posts today. The DealBreaker servers decided to take a snow-day. In fact, we have no idea when this edition of write-offs will show up. We’ll be back on at full speed on Monday. [John and Bess]
$$$ Chuck G says Wachovia, Citi and a consortium of other banks are thisclose to arriving at a deal—equity infusions and lines of credit—to bailout out the bond insurers. [CNBC]
$$$ Citigroup says more write-downs could be on the way: “There is a risk of a U.S. and/or global downturn in 2008. A U.S-led economic downturn could negatively impact other markets and economies around the world and could restrict the Company’s growth opportunities internationally. Should economic conditions further deteriorate, the Company could see revenue reductions across its businesses and increased costs of credit. In addition, continuing deterioration of the U.S. or global real estate markets could adversely impact the Company’s revenues, including additional write-downs of subprime and other exposures, additional write-downs of leveraged loan commitments and cost of credit, including increased credit losses in mortgage-related and other activities. Further adverse rating actions by credit rating agencies in respect of structured credit products or other credit-related exposures, or of monoline insurers could result in revenue reductions in those or similar securities.” [SEC]
$$$ Morgan Stanley: Market Hero? [Deal Journal]
$$$ There’s an old saying on Wall Street: “When a man retires, his wife gets twice the husband and half the salary.” Maybe at some point that just gets old.
We deserve some sort of prize for holding out a full five days to post about the nude pictures of Lindsay Lohan in New York Magazine. New York got some twenty million page views in the first two days, according to Jeff Bercovici. So much traffic that it crashed the website.
New York Magazine was started by writers and other disreputable literary types but soon fell into the hands of Rupert Murdoch thanks to a hostile takeover. When it happened, some were scandalized. Now it looks like a practice run for Murdoch’s takeover of the Wall Street Journal. Murdoch sold the magazine in 1990 to to K-III Communications, a partnership controlled by KKR’s Henry Kravis. The magazine did well for several years but Kravis was not exactly a hands-off owner. He reportedly fired an editor over the magazine’s coverage of his friends and Wall Street associates.
In 2003, New York was sold to Bruce Wasserstein, the Cravath attorney turned investment banker turned private equity baron. Wasserstein installed the best magazine editor alive, Adam Moss, to head the magazine. And that guy got Lindsay Lohan to pose naked for all of us, once again confirming his place at the top of the magazine editor heap. In short, we all have private equity to thank for bringing us this historic triumph.
Even better, there is an important tax lesson to be learned from all this. At least, that’s what we’re told by the folks at MainStreet.com, the money blog version of Parade magazine. How exactly are Lindsay’s assets taxable? We’re not quite sure we want to answer that question this early in the afternoon. But here’s how MainStreet.com gets there:
Unlike Hollywood starlets, most people are not stripping for the public, but there is a good chance that their financial records could undergo a shocking undressing. (Yes, we know it’s stretch, but go with it, dearest readers.) According to Surviving an IRS Tax Audit, nearly 50% of all taxpayers will be audited during their lifetime. While the initial notice in the mail can be cause for concern, an audit from the IRS doesn’t mean the worst as long as people know what to expect and are prepared.
At least they admit it’s a stretch. A-plus for effort, kids.
After the jump we bring private equity and Lindsay Lohan together in a much more intimate way. It’s NSFW, which is internet-speak for “totally awesome.”
Editor’s Note: That picture represents Lindsay on Portfolio, which seemed appropriate since Portfolio’s media writer was expounding on Lindsay. That’s our story and we’re sticking to it.
Lindsay Lohan Nude [New York]
Naked Lindsay a Web Home Run for ‘New York’ [Media Matters, Portfolio.com]
Naked Lohan Makes Us Think of Taxes [MainStreet.com]
The IRS says Nicolas Cage owes $3.3 million that he tried to write off as personal expenses (including meals, gifts, limos, costs associated with his Gulfstream 1159A, and, hilariously, “security needs”). Can’t say we didn’t see this coming. When career choices like “National Treasure” and the sequel to “National Treasure” mean the freebees don’t come to you, you get out there and you get the freebees yourself. The only question is, why go to the trouble of having to BS your way through tax paperwork when you could straight up just steal whatever you deem rightfully yours, a tactic I would think Cage would be all for (like Lon Varney, he fancies himself a badass, ‘cept Lon Varney’s actually had the gumption to get out there and do it, on several occasions). Anyway, next time. For now we think someone (Universal, The Weinstein Company, whatever) should make a movie with all tax evaders. Cage. Snipes. The rotting corpse of Lee Marvin. It’s how they pay their debt to society. A gay remake of “Steel Magnolias.” The RCOLM (rotting corpse of Lee Marvin) could be Olympia Dukakis. Loeb could finance. Marin could review. I’d pay $12 to see that. As would all of you.
Remake Of Con Air? [Forbes via Guardian]
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Now for something unrelated (though in my mind everything connects). The Guardian ran an item today that wondered aloud, “Can Rupert Murdoch’s nascent Fox Business network get any less classy?” and proceeded to mention two previous DealBreaker posts (“Art Cock, Sans Smock” and “Hot Sluts Are The One Thing Fox Business Can Do Right And They Can’t Even Do That“) in what appeared to be the G‘s effort to say “no.” While we appreciate the link love, we have to say that A. We don’t think FBN is class-less (apologies if we’ve given that impression) and B. Trying to prove that FBN is a whorehouse is like trying to nail down that J. Cayne smokes dope– wasn’t it obvious anyway? Plus, thing of it is and this relates back to point A., I think Fox’s problem is that it’s trying to be TOO classy. No need to gussy up a whorehouse. First off (and I don’t really have time for this but I’ll shoot off a few quick ideas and then it’s up to whoever’s running that place to implement), we can’t help but thinking the station needs a new name. No more “FBN.” From here on out, it’s Randy Rupert’s Chicken Ranch. There should be an orgy going on in the background of “Happy Hour” at all times, like in Caligula, and next week, Cody needs to have sex with a horse. I would also strongly encourage a Cavuto segment called “Business Bukkake.” And wouldn’t a recurring feature with “Business For Breakfast” guests called “Who Would You Do” (they pick among Wall Street leaders, dead or alive) just make sense?
Survey [DealBreaker]
A Dirty Business [The Guardian, last item]
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