The aforementioned cuts at the House of Mack, which are said to have begun in part on Tuesday, are supposedly going down in equity derivatives circa now. We’ll keep you posted.
Update: Apparently it’s *all* divisions, not just equities. So that’s nice.
Archive for February 2009
And Don’t Think We Don’t Know What You Did To Those Thin Mints When You Thought The Cameras Weren’t Rolling, You Sick Sons Of B*tches
By Bess Levin
[via Daily Intel]
If one thing bears repeating from yesterday’s showdown on Capitol Hill, it’s this. Representative Michael Capuano’s insane (but awesome) tirade, an interpretive dance of righteous indignation that had even Maxine Waters gaping in awe, and making a mental note to approach MP after the hearing with a two-world plea: “teach me.” The only thing that could possibly–possibly– make this thing better would be to splice it together with this.
Did Bank of America change its IB bonus payout schedule? Maybe! According to one young man lucky enough to work under the tutelage of Ken Lewis (and in the reflected glow of Angelo Mozilo) Bank of Amerillwide will be “spreading bonuses for 2008 across six successive quarter-ends beginning this March.” The new plan will supposedly replace the previously announced multi-year one, which was surprisingly met with little support. This is the first we’ve heard of the thing, so if anyone has more information they’d like to get of his or her chest, let us know.
Bank of America, JPMorgan May Flee Bailout After Public Lashing (Bloomberg)
It’s almost jaw dropping that given the circumstances elected officials would act with such irresponsibility. In truth, at this point, I hope the banks can manage to pay off the debt in the next 60 days and refuse to shore liquidity across the board – to anyone. For anything.
“Eight chief executive officers of the biggest U.S. banks heard lawmakers in Washington criticize their bonuses, underwriting fees and perks. Rep. Emanuel Cleaver, a Missouri Democrat, read questions from angry constituents asking what banks had done with taxpayer money they’d taken from the $700 billion TARP fund, and Rep. Michael Capuano, a Massachusetts Democrat, said he “cannot believe no one has prosecuted you.”"
In related news the FT touches on how the banks have agreed to put a hold on foreclosures for the next three or so weeks so as to give Congress the time to come up with a plan, which is much, much more generous than I would have been.
Houston Based Firm Under Investigation (Bloomberg)
10:1 says not a Ponzi: the money is either invested in coca fields or cross breeding humans and fish to fight Somali Pirates. Not sure how the latter makes money (yet).
Futures Down On Likelihood Of Shitty Retail Numbers (MarketWatch)
“We expect today’s report to show that retail sales fell 0.4% in January, marking the seventh consecutive monthly decline and pushing the year-on-year growth rate to -10%,” said economists from Barclays Capital. “This would easily be the fastest pace of decrease in the 40-year history of the data. Part of this fall reflects the sharp drop in inflation, particularly commodity prices, which have depressed gasoline sales. ”
Bank Of China Not Bidding On AIG Unit (DJNewswire via CNN)
It looks like the either the FT story got it wrong, or the Chinese didn’t appreciate the information being leaked – either way, the company is still for sale (and I’m willing to bet Bank Of China bids.)
GM In Talks With Red Empire About Private Bailout (Reuters)
It’s almost comical that in todays push towards socialism China is stepping in to purchase a stake in our auto sector; I can’t imagine what our elected’s are going to say about the possibility of turning over a large part of the national defense clog to the Red Army (if anything).
Harvard Largely Bows Out Of The Market (WSJ)
“Harvard University’s endowment, the largest in higher education, cut by two-thirds its direct holdings of publicly traded stocks and funds during the market plunge in last year’s fourth quarter.
As of Dec. 31, Harvard Management Co., which oversees the endowment, held about 70 stocks and publicly traded funds that were valued at $571 million, according to a filing with the Securities and Exchange Commission. Three months before, the endowment held about 200 stocks and other vehicles valued at just under $2.9 billion.”
Fortis Investors Challenge The Fates (Reuters)
The mighty shareholders of Fortis have cast a ballet against the state led/sponsored deal to mate Fortis and BNP:
“Faced with heavy losses and the prospect of a share of toxic assets, they first voted against the Netherlands’ purchase of Fortis’ Dutch assets by a 57 percent majority.
Then, by a wafer-thin 50.3 percent, they rejected Belgium’s move to take control of banking unit Fortis Bank.”
$$$ The wardens that run this asylum would like you to please take this survey. If you don’t feel comfortable giving us your SSN, that’s cool though we will think less of you.
$$$ Dreier‘s luxury prison. [Cityfile]
$$$ What Congressman Gasparino would ask the CEOs. [Daily Beast]
From: Michael Moore
Sent: Wed, 11 Feb 2009 6:00 am
Subject: Will You Help Me With My Next Film? …a request from Michael Moore
February 11, 2009
Friends,
I am in the middle of shooting my next movie and I am looking for a few brave people who work on Wall Street or in the financial industry to come forward and share with me what they know. Based on those who have already contacted me, I believe there are a number of you who know “the real deal” about the abuses that have been happening. You have information that the American people need to hear. I am humbly asking you for a moment of courage, to be a hero and help me expose the biggest swindle in American history.
All correspondence with me will be kept confidential. Your identity will be protected and you will decide to what extent you wish to participate in telling the greatest crime story ever told.
The important thing here is for you to step up as an American and do your duty of shedding some light on this financial collapse. A few good people have already come forward, which leads me to believe there are many more of you out there who know what’s going on. Here’s your chance to let your fellow citizens in on the truth.
That’s you, not the CEOs, by the way.
Since CSPAN has gotten back on the ball, and therefore we don’t have to watch CNBC to follow it, we continue our snide coverage:
Ok guys, who believes nicotine is not addictiveyou will pay back the TARP money and need no more funds?
[Everyone]: Yes, but we have no clue what the Geithner plan is so…
Rep. Ellison: Hey, Bank of America- The Huffington Post claims that your employee at the Financial Services Roundtable was advocating opposition to the Employee Free Choice Act? Is that true?
Lewis: I don’t go the roundtable.
Rep. Ellison: You don’t think you should be opposing union organization with TARP funds do you?
KL: Huh?
Rep. Ellison: So, are you guys solvent?
VP: Oh yes.
Rep. Ellison: What about you Bank of America?
KL: Since we made money last year, I am simply amazed you would even ask that.
Rep. Ellison: So, are you going to collapse?
K “De Niro” L: Are you talking to me?
Rep. Ellison: Yeah, you.
KL: Absolutely not. I don’t even know what the hell you are talking about or why you’d ask me that question. And why don’t you just go out back and pound salt you bank run creating public menace. (Ok, maybe we made that last part up).
Rep. Wilson: Why don’t banks want TARP funds, Mr. Lewis?
KL: Simple, we don’t want your dirty paws on your business. Duh.
Rep. Perlmutter: You guys are just big bloated bombs waiting to go off and blow up the system, right?
JM: No. G’z. We sold the credit card morass, what more do you want?
JD: No.
Rep. Biggert: If you guys are so healthy, why are were here? How can you help restore consumer and investor confidence?
JD: Doing the best we can, lady.
JS: How about you guys whack Mark-to-Market so we can report our assets at the marks we prefer?
Rep. Biggert: Who wants to nuke Mark-to-Market?
[Only JS raises his hand]
JS: Ok, let me clarify. I only really want to do away with Mark-to-Market when it results in marks that I don’t likewhen the market is irrational.
Rep. Donnelly: Will it play in Peoria?
[Deer. Headlights.]
Rep. Foster: Given 11% unemployment a 25% decline in residential real estate and similar problems in commercial real estate who of you is going to survive? Don’t point or anything.
[Everyone]
Rep. Foster: Have you ever seen a compensation restriction you couldn’t circumvent?
[Deer. Headlights.]
Chairman Franks: I really don’t want to see the eight of you singing “I Will Survive.”
Rep. Speier: What was your exposure to AIG? And were you present at the Fed meetings during the AIG collapse discussions?
LB: We had very little actual exposure to AIG because (we were hedged/we offset our risk).
Rep. Himes: When are you going to start eating your own cooking? Who here is going to set up strong long-term compensation structures?
[Everyone]
Rep. Himes: Let me start with Mr. Pond-it. Why aren’t you taking top-loss tranches on these complex issues?
VP: That’s not very traditional.
And now the real fun begins:
Negotiators for Congress and the White House have agreed on a $789 billion economic stimulus bill, lawmakers announced. The compromise measure could get final approval by Friday.
The situation is fluid.
Pact on Economic Stimulus Is Reached In Congress [CNBC]
The Congresscrazies have finished voting, and we’re back.
Rep. Walter Jones has three points:
1. The image of the banking industry is as low as its ever been.
2. You people need to show some compassion.
3. FOR GOD’S SAKE, WHEN YOU LEAVE HERE TODAY.DO WHAT EVER YOU CAN TO FREE CREDIT.
Rep who’s name I missed: How many of you have performed community outreach?
Blankfein: We’re not an originator, we’re a servicer. Our servicer has reached out and been very forgiving.
Dimon: We work very hard to contact anyone who we think might have a problem; if i have to, I’ll go door to door.
Kelly: [smugly] We don’t do mortgages.
Lewis: We take 85k calls a day.
Logue: We are not in the mortgage biz.
Mack: We’re barely in the mortgage biz, but we do try to help.
Pandit: We’re in your homes, modifyin’ your mortgages. We’re not waiting for fire alarms to go off, we’ve installed mortgage detectors. Did we start the fire? I’d rather not say.
Stumpf: We talk to people early and often.
If you ever needed a clearer example why we don’t want e.g., the House of Representatives making investment decisions, this is it:
NBC has obtained a letter signed by six house Representatives from New York State sent to Timothy Geithner, asking the Treasury Secretary to disregard the call for Citigroup to break its 20-year, $400 million investment for the naming rights to the New York Mets stadium.
The letter comes in response to a note sent to Geithner two weeks ago by Representatives Ted Poe and Dennis Kucinich.
The note asked Geithner to recommend that the contract be dissolved in the best interest of public policy, given that Citigroup had received $45 billion in public funds from the Troubled Assets Relief Program (TARP).
“We believe this would set a terrible precedent of unfairly singling out a specific company and particular form of advertising for a politically popular reason,” the letter states. “This attack has broader implications on all sports marketing, and would certainly have a negative impact on all media outlets such as television, radio, cable, and newspapers.”
Of course, it is hard not to look hypocritical if you find this bemusingly offensive but have no problem with the likes of Maxine Waters deciding who gets a loan and who doesn’t.
NY Reps To Geithner: Don’t Kill Citi-Mets Stadium Deal [CNBC]
Here’s hoping, if you’re up to get down with some batshit-manifest! We’re a little late for round two; I’m okay with this but if we missed anything besides “When I say ‘b’ you say ‘lah’ ‘b!’ ‘lah!’ ‘b!’ ‘lah!’” let us know.
Rep. Dennis Moore: How much taxpayer money did your company receive in the last five months, and how much money did you personally steal from us in 2008?
Stumpf: Wells Fargo received $25 billion and I got $850,000 in comp, my bonus will be decided in February.
Pandit: $45 bn in TARP; my salary was a million, no bonus. And, like I said before, $1 in salary next year, no bonus.
Mack: $10 bn in TARP. My salary was $800,00, no bonus (just like last year).
Logue: $2 bn in TARP, one million in salary, no bonus.
Lewis: $15 bn in TARP (*for 2008*), $1.5 million salary, no incentives.
Kelly: $3 bn in TARP, my salary is $1 million, no bonus.
Dimon: $25 bn in TARP, my salary is $1 million, no bonus
Blankfein: $10 bn in TARP, $600,000 salary, no bonus.
Rep. Michael Capuano, Maxine Water’s brother from another mother: Are any of you lending money for credit default swaps? How many of you directly or indirectly engaged in CDOs? And how many of your banks had or currently have special investment vehicles, those off the books unregulated subsidiaries of the banks. So basically, all or most of you engaged in the fraud that caused this crisis. I CAN’T BELIEVE NO ONE’S PROSECUTED YOU. Oh, but we’ll find out…we’ll find out!…You’ll be answering these questions in court some day. You come to us on your bicycles, selling girl scout cookies, after helping Mother Theresa, and you’re saying we won’t do it again? And we’re supposed to believe you? Are we? You learned your lesson? Did you? And now you’re saying ‘sorry, trust us, we don’t want the money.’ INTERESTING. No one’s ever come to me and said you must take billions of dollars. NO ONE’S EVER SAID THAT TO ME!!! I don’t really have a question, but I was told I could have the five minutes.
