Yesterday we pointed out that the freeze-up in auction-rate securities could lower demand for equities as many individual investors found their investment assets essentially locked into these suddenly illiquid bonds. But it’s not just the clients of brokerages who are facing a cash squeeze—the brokers and executives at investment banks are facing the squeeze as well
After the major accounting firms ruled that auction-rate securities were not cash-equivalents, many corporate investors began to reduce the use of these instruments for cash management purposes. But executives at banks such as Citi, Merrill Lynch and Goldman Sachs continued to use the auction-rate securities. For many, the extra two-dozen or so basis points they could earn by holding the securities rather than a true cash-equivalent made them irresistible. For the men and women who manage money and put together complex financial transactions for a living, achieving maximum returns in every part of their portfolio is often a point of pride.
Now that many of the auctions have begun to fail, they find themselves without access to their assets. Ironically, this pain for the professionals may wind up helping their clients. If the auction failures continue, executives on Wall Street may pressure the banks to take action to revive the market. It’s one thing if the clients cannot buy fuel for their yachts. It’s quite another if the broker cannot.
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Notice Citigroup banning withdrawals of your money in a hedge fund. What person in their right mind would do business with such a company?
As a long time reader of DB….I want to compliment your on the new face. I think it makes reading abundantly easier and faster. Thanks John, Bess and the Big guy with the suit. Watchmen.
This upgrade is too nice …. you scared me with this , good job
This upgrade is too nice …. you scared me with this , good job
Nice new look…good work!
Not too bad, not too bad. Carney we need a post pointing out all the cool new features! (or something like that)
One serious comment. Can we make the text real black and not this gray-ish color? It’s harder to read.
pictures? you realize this will lead to tremendous amounts of unintentional humor. anal_yst ganking JF Page has his own, im definitely taking Crabhands, etc etc.
Carney,
If you are selling ad space to Circuit City, make sure they pay you up front.
what the hell is going on db?
Will Bess still be funny in this new serious font?
Good look, bad font color, other username WAS NOT F’IN VALID for some reason. Like it.
Hate the new look w/the left justified text.
Good look, bad font color, other username WAS NOT F’IN VALID for some reason. Like it.
yeah my username was not valid either. i think it would not except the special character .
If you don’t need the liquidity, the auction fails create a real opportunity for investors… I just purchased 7.5% AA NYC muni bonds at par. The bonds will be refunded within a year. It’s a no-brainer.
10:23:
Famous last words….
Give it time kids, dont be so quick to judge
(however after “time”, judge to your heart’s content)
@10:23 dumb question but how did you even buy them? ameritrade is not being helpful in letting me find these securities to bid
This new serious format severly detracts from the site’s intended humor.
Guys, I think you should really consider to take off the italics font. It’s really hard to read.
Anyone have any trouble registering? It won’t send me a confirm email.
Help a brotha out if you know something.
1-2
maybe somebdy already registered your name
Don’t like the italics. Don’t like the left-side justification. Don’t like the login policy. I agree with the commenter who said he or she didn’t need more junk email. The old freewheeling system lead to plenty of merriment. Regular commenters, post your tag at the end of your comment!
Other than that, I like it.
Grey italics font is COVER-YOUR-EYES AWFUL.
I had 3 of my ARS auctioned yesterday, they all went off no problem. Crisis [mostly] averted.
Anal_yst, did you get a confirm email immediately?
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My eyes. If I wanted to read something in times new roman, I would have picked up a CIM
-Gin&Tonic
@ 10:41; I participated in an auction through my broker (my firm forces me to make all my trades through our high priced professionals). you probably have to call a broker-dealer if you want to get in.
dd thanks that is helpful
ps, who has registered the username anonymous! i will pay handsomely for it.
also, for keith hahn.