$$$ U.S. House Passes Bill Allowing Ban on Incentive Pay [Bloomberg]

$$$ Andres Piedrahita denies responsibility in Madoff fraud [CR via clusterstock]

$$$ Hiring: Goldman Sachs, Fifth Third, Wells Fargo [The Deal]

$$$ Job of the Week: UBS Needs an associate director of investment banking. You. [DB Career Center]

$$$ We have not heard a single update about this morning’s bull rider. Bull rider, if you’re reading this, get in touch.

$$$ Programming note: I’ll be on vacation next week through the 12th. Equity Private will be subbing, and of course Greg will be here with the topless photos.

When asked today about whether GS acutally had better people which helped them avoid a Lehman-like end, Taibbi spelled it out in crystal clear terms by saying,”they’re not smarter than other people” and then launched into his government consipracy theory to explain the firm’s profitability.

If you’ve got half an hour to kill, you can listen to the Mad Max Tour warm up music in its entirety

At left is the sculpture Richard Perry and his wife, man-purse designer Lisa had installed on their terrace at 1 Sutton Place South in 2007. Nobody had much of a problem with the piece— a Jeff Koons, worth a few million or so— back then but lately the garish display has started to stick in the craw of Perry’s neighbs, for two reasons. First, they think it’s hideous. “I think it’s as ugly as it comes,” said Juergen Thieme, who lives across the street at 2 Sutton Place. And second? It’s freaking blinding them.

Neighbors who live across the street in a penthouse at 14 Sutton Place complained that the light reflecting off it was burning like lasers through their windows, and workmen had to adjust the diamond’s positioning, a source said.

It was one thing when a certain art loving hedge fund manager had a crane dump a diamond encrusted money sign the size of a football field on the roof of his Greenwich-area manse, disrupting gravitational pulls and distracting planes flying overhead. But this? This is quite another.

Diamond In The Roof [NYP via Daily Intel]

The ass-bleeding stops and every wants a piece of his shit.

To: DealBreaker

From: [redacted at Citadel]

Subject: not cool

Also there’s no Chris Theoharis at Citadel. Dude’s not listed in our directory. They should check IDs at that fucking FMF party.

Earlier: Real Goldman Sachs Employees Demand Accountability At Fashion Meets Finance

Add this to the list of green shoots. With unemployment flirting with 10%, the degree of lying about academic credentials on resumes has remained in line with prior years according to an executive search firm run by Jude Werra that produces a Liars Index twice a year. According to the index, approximately 16% of job seekers gave themselves an academic upgrade during the first half of 2009 which is right in line with the four year average of 15.8%. The 4th of July appears to be the inflection point for telling the truth as the level of academic fiction drops to 11.8% in the second half of the year.

“The important issue here is less about an apparent pattern of seasonal volatility and more about our warning employers that about one in every seven résumés they receive is likely to have misrepresented academic credentials, whether falsified majors, graduation dates or outright invented degrees,” Werra said in a statement.

Only time will tell if somebody tries to explain this away as ‘Intensive Summer Coursework in Financial Markets’.

The Senator has “been diagnosed with early-stage prostate cancer.” Dodd, who will be operated on soon, told reporters that he has no plans to quit his job and that he feels fine (and, as a warning, noted that one out of every six men you know will be afflicted with a similar condition, so watch out). We wish him a speedy recovery, and on the off chance the Senator needs a little pick me up, we’ll be dispatching one to Connecticut this afternoon, once a candy striper outfit is procured.

In case anybody at GS is having a rough Friday, there is a concerned individual on Craigslist who wants to help you out.

Hi. I am a receptionist in the Financial District and I totally suck at pool (happy Courtney?). LOL. But let it be known that I am a girl who pays her debts if she loses a bet. So with that, let me just say — Happy Flash Friday to everyone, especially all the guys at GS. I hope these pics give you a smile and help jump start a great weekend. You all deserve it. xxoo

It starts with

And ramps up to the NSFW category after the jump

With the scrutiny on high frequency trading increasing every moment Chuck Schumer is awake, the head of electronic trading at GS, Greg Tusar, is calling out regulators to bring it on.

“The reality is our inter-market routing has become highly technical and highly complex and it’s not a bad idea to step back and take a look at it. We need to find out if there is anything we should change and where the gaps in regulation should be closed.”

With Goldman being one of the leaders in the nanosecond timing market, it appears they’ve become tired of having others come up the regulation gaming learning curve and nipping at their heels. Given the thorough, air-tight history of trading regulation, finding a way around whatever electronic trading plans make Schumer sleep better at night should take GS about as long as executing one of their trades.

The photographer writes: “I just took this ten minutes ago as I was about to walk into my
office…I think it came out pretty well but that’s a kid 100% passed out/maybe dead, on the bull, in his briefs. Two news reporters were just pulling up when I snapped this.”

In all seriousness: WTF? If anyone has anything to get off their chests, please do so at this time.

By now it’s been pretty well established that the RSVP list to this year’s meet up of the worst people on earth is riddled with lies. We assumed everyone would be over it by now, but no— a lot of you are beside yourselves, this idea that people might be fucking with you (“They’re trying to mess with us? They thought they could mess with us?!?”), and need to work through the shock/pain/grief. As always, we’re (begrudgingly) here for you.

To: DealBreaker

From: [redacted at Goldman Sachs]

Subject: FMF shenanigans con’t

Bess—

Also writing from Goldman here, re: FMF. I checked out the directory to cross-reference the names of people allegedly attending the event from GS and as was pointed out yesterday, there are maybe three people listed who actually work here, the rest are shams. Among those telling the truth, I’m being honest when I tell you that I snorted to myself upon noting their actual titles compared to the inflated ones submitted to FMF. I can tell you with a level of certainty that their salaries are NOT what they say they are. It’s rather absurd that they/the GS imposters are being allowed to get away with this, and I hope they’re stopped at the door.

Earlier: Fashion Meets Finance: The Hits Just Keep On Coming

Regulators Are Getting Tougher On Banks (WSJ)
The Federal Reserve and the Office of the Comptroller of the Currency have issued more “memorandums of understanding” than in the past, telling banks to do stuff like suck less, which the “targets” think is way harsh. “It’s frustrating and aggravating,” said Pat Sheaffer, chairman and chief executive officer of Riverview Bancorp Inc. Bank of America, on notice as well, doesn’t like it much either.

‘Teachable’ Moment Observed With Beer (WSJ)
The president drank Bud Light. Mr. Gates drank Sam Adams Light while Mr. Crowley had a Blue Moon. Mr. Biden, a surprise addition to the session, had a Bucklers, a low-alcohol beer.

US Limits On Bank Pay, Bonuses Face Senate, Obama Skepticism (Bloomberg)
“Hedge funds and other money managers should be exempt from limits because if you think you are paying too much you can take your money out,” said Phillip Goldstein. “It’s the same thing with baseball. You see the price on the tickets and if you think it’s too much, don’t go to the game. I can’t believe anybody who took Econ 101 could support this.”

After Rescue, New Weakness Seen at A.I.G. (NYT)
If A.I.G.’s incoming premiums shrink, W. O. Myrick, a retired chief insurance examiner warned, “the whole thing’s going to collapse in on itself.”

The Risk Mirage At Goldman Sachs (BusinessWeek)
Down with VaR! says one guy: “Whatever your opinion of Goldman’s fortunes and market forays in this recession, the fact is that a VaR-based analysis of any firm’s riskiness is useless. VaR lies. Big time. As a predictor of risk, it’s an impostor. It should be consigned to the dustbin. Firms should stop reporting it. Analysts and regulators should stop using it.”

HSBC May Post Loss on $15 Billion Bad Loan Provisions (Bloomberg)
Sad trombones all around.

US Administration Working to Keep ‘Clunkers’ Program (CNBC)
Even though it’s basically out of money, etc, etc, etc.

Bernanke’s Popularity (FT)
Do you hate the Fed Chairman because he has a facial hair? Is that it?

$$$ Matt Goldstein: Wall Street meets The Matrix [Reuters via ZH]

$$$ Liz Peek, wife of CIT CEO Jeff, is pro-bonuses. [HuffPo]

$$$ Sickness scare at Bank of America office, strong perfume the culprit [TMT]

$$$ Merrill Lynch Paid More Than $3 Billion Bonuses After Suffering $27 Billion In Losses [clusterstock]

$$$ Sheila Bair shot down for Vogue photoshoot [Cityfile]

Nomi Prins, a former MD from that boutique firm headquartered at 85 Broad St. added another line item to Mad Max’s ‘they will so pay for this’ list. When asked about whether GS knew what they were really doing when pumping out billion after billion of MBS, the ex-Goldmanite replied that they certainly did and were just carrying out “business as usual”. But as for finding the firm in a S&P ‘it could be structured by cows and we would rate it’ moment, that is a game of catch-me-if-you-can that the MBS Senate panel may find very hard to win.

Losing patience with California’s 4-6 week processing time for her IOUs, Nancy Baird is carrying on the time-honored American tradition of the frivolous lawsuit and suing the state. The embroidery and printing business owner contends that if she doesn’t get her $27k in greenbacks for some polo shirts and uniforms she supplied to a state-run youth camp, she is going to have to close down. Her lawyer, William M. Audet, who presumably either accepts IOUs or works pro bono, is outraged at the state’s haphazard solution to the budget crisis.

“I’ve never seen a state behave in such a cavalier manner to the people that provide goods and services that enable it to operate”

He clearly wasn’t paying attention when Calpers pinned the fortunes of $1.3 billion in pension money on AAA-rated CMBS.

Bankrupt Doubledown Media, the former publisher of Trader Monthly magazine, is up for auction August 20th. Yes, auction, because apparently some people think it’s actually worth something— court documents state the bidding starts at $50,000. The real question is…what the hell is anyone buying? A brand name magazine title that epitomized the “greed is good” ethos of Wall Street, is likely a toxic brand right now.

When asked about the auction price Dan Ryan, former head of DDM’s capital markets ad sales, laughed, saying, “No one in the U.S. is going to pay anywhere near $50k for that title now. They’re dreaming.”

To borrow one of Mad Max’s recent favorite sayings, the chickens are coming home to roost in the State of New York. As the collected works of Ken Feinberg, Andrew Cuomo and the angry mob of legislators without anything better to do continue to clamp down on bonuses, the state coffers are starting to look a little empty. Of the $2.1 billion hole that needs to be filled, $584 million comes from income taxes that fell short of April projections. If California is any guide, the New York bonus death squad may soon have to mull over which is the most reprehensible to them- getting their pay checks in IOU format, watching Jimmy Cayne (legally) fire up a joint in Central Park, or allowing people to get paid.

Oh hell no.

To: DealBreaker

From: [redacted at JPMorgan]

Subject: More FMF identity theft

I scanned the Fashion Meets Finance RVSP list for Dimonites and looked them up in the JPM phonebook (yeah, I have nothing to do). Anyway, many people are wildly overstating their positions and salaries. For example, [redacted] is not an investment manager, but rather “marketing support” (probably helps write the monthly employee newsletter) and likely doesn’t make $200k-$300k as he claims. What a fraud.

What the? But you said? I thought? So…so we can’t trust anything these shmucks tell us afterall?

Update:

To: DealBreaker

From: [redacted at Goldman Sachs]

Subject: FMF identity theft Goldman edition

Bess, i scanned the Goldman directory for these FMF people. Only two people from that list actually work for the firm, both of which overstated their salaries drastically.

This is a little warning to those of you who took a gander at the RVSP list for next week’s event celebrating the supposed end of the recession and decided, “I like what I see.” You’re probably being taken for a ride. From a very breathless mailbag:

Hello,

I noticed that you covered the last Fashion meets Finance event in January. I wanted to let you know about their current fashion identity theft scandal!

On the FMF page, there is a link to “see who’s coming.” I figured I might know some people in my industry attending so I scrolled down to see if there was anyone I recognized…turns out there was!

As I scrolled down I noticed Shelley Abrahmson, a location scout for American Apparel who makes under $50,000 (yes, they list salaries). Her photo looked strangely familiar so I clicked to enlarge and find a photo OF MY FACE!!! Obviously I am not Shelley Abrahmson, I am a fashion publicist who is outraged that they stole my photo (probably from Facebook) and are using it to make their deceivingly fake list look elevated. I hope that you will expose this to your readers.

Thanks,
Jennifer

Of course, this isn’t the first time someone used a picture that wasn’t them when signing up for a FMF night to remember but it’s upsetting nonetheless. As for the pissant who RSVP’ed for a certain someone in Stamford— check yourself. Big Poppa showed up to last year’s event, told his wingman, “If I wanted to tap a bunch of low-hanging fruit I’d lay siege to my trading floor,” left after five minutes, and vowed he’d never come back to one of these things again. What’s more, he signed up for a mixer at Hula Hanks happening the same day like, weeks ago, and couldn’t make it even if he wanted to.

If it turns out Chris Dodd did jump the velvet rope at Countrywide with Kent Conrad, it might be a case of genetics in action. Former radio host Tom Scott, who coincidentally lost his job shortly after grilling Dodd last fall on whether A-Moz had something special for the good senator, says Dodd’s father, former CT senator Thomas Dodd had some mortgage-related issues of his own. The small matter of papa Dodd using campaign funds to pay his mortgage led him to join the elite club of six individuals censured by the US Senate in the 20th century.

The Attorney General does so in a new book report entitled “No Rhyme Or Reason: The ‘Heads I Win, Tails You Lose’ Bank Bonus Culture,” which he and his team have been slaving away at for months. I think I’m picking up what he’s throwing down here, but it’s hard to say for sure.

Larry Kudlow’s “trouble” with coke finally referenced (“I quit drinking and doing some other things to help America”). We are not being insensitive to substance abuse problems, etc, when we say, how much better would CNBC be if we could get at least an hour of stories from the vault each day? Call it “Tales of Rails With Uncle Larry,” or something better, whatever. Did it all start with Jimmy Cayne summoning the big guy to “Step into my office. Let’s do some blow” one fateful afternoon? These are the things we need to know, as well as what LK was up to when he missed the “important client presentation” that led to his (total bull shit) firing.

As the CFTC gets ready to issue a report next month to finalize the flip-flopping on their position on who and what was responsible for the massive swings in oil prices last year, the FSA will conduct its own meeting next week of oil market participants as it continues to maintain that economic uncertainty was the primary reason for the volatility. Last year, the CFTC cited supply and demand considerations, not speculators, for the ride up to $150/barrel and subsequent crash. Having reached the opposite conclusion they were aiming for, CFTC commissioner Bart Chilton has now decried those analyses as “deeply flawed” and has apparently done enough data mining to issue a report that is more in line with what the CFTC wanted to prove initially. Next up for the CFTC- why all commodity profits are inherently illicit.

Speaking of dying in an electrical fire, the third “Fashion Meets Finance” event is coming up. This one, thrown in celebration of the recession supposedly being over, is taking place at Nikki Beach on August 6th. For those who buried the memory of just what this gathering entails, FMF is based on the idea that “women in fashion need men who can facilitate their pre-30 marriage/retirement plan, and men in finance need women who will allow them to leverage their career in their dating equity.” Does the pressing issue of $0-ish bonuses throw a wrench in things? The rètards who organized the event say no.

2008 was a confusing time, but we are here to announce the balance is restoring itself to the ecosystem of the New York dating community. We fear that news of shrinking bonuses, banks closing and the Dow plummeting confused the gorgeous women of the city who understood that their shelf life is quick and fleeting like a senator’s South American love affair. The uncertainty caused panic which caused irrational decisions - there’s going to be a two year blip in the system where a hot fashion girl might commit to a pharmaceutical salesman (this is so much worse than the expected guy selling mortgages at JP Morgan Chase convincing a fashion girl he’s actually in finance).

Fashion Meets Finance has returned to let the women of fashion know that the recession is officially over. It might be a year before bonuses start inflating themselves again, but it will happen. Invest in the future; feel confident in your destiny. Hold on. It will only be a couple more years until you can quit your job and become a tennis mom.

Who can you expect to be in attendance? Dennis Kneale, for one, who enjoys attending conferences of like-minded tail. The rest of the RSVP list is here. A lot of (alleged) JPMorgan employees, a Morgan Stanley MD, and a Citadel “associate” playing it fast and loose with the top buttons.

Actually it could be anyone who works downtown but we only care about the safety of the Masters. There are IMs from 15 year-olds going unanswered as we type.

Live electrical wires are stalling a 5 subway train at the Wall Street station in the heart of Manhattan’s Financial District.

No injuries have been reported.

Transit officials say the live wires are next to a subway and that they are awaiting power removal to evacuate the train’s passengers.

Fire officials say there was lots of smoke and loud popping noises but no fire in the station.

Frightened commuters ran from the station, some crying and others calling on their cell phones.

Live Wires Stall Subway Train At Wall Street [NY1 via Daily Intel]

So that story about Andrés Piedrahita, husband of Corina, son-in-law of Walter, and Fairfield Greenwich exec recently buying a $22 million boat and “cruising the Adriatic” with his wife and friends, appearing to not have a care in the world, while ripped off FFG investors get a crash course in dumpster diving? You got it all wrong! Here’s the deal, according to a lawyer for the the worst feeder fund on earth: Piedrahita had already ordered the yacht before the shit hit the fan, and couldn’t cancel it. Now, the only reason he’s on the thing, is because he’s showing it to prospective buyers. You can’t expect someone to plunk down 22 mill without going for a test drive, can you? Once someone makes an offer, Piedrahita will turn the money over to Irving Picard, who will distribute it to Madoff/Noel victims. To reiterate, for the Colombian’s reading, who want the guy dead: Andrés is not living it up. He cares about your problems, he cares deeply, and if one were a fly on the wall of the boat, it would not be typical around cocktail hour to see him handing his glass to Corina and going “watch this,” before doing the worm across the deck to the delight of all passengers. He is heartbroken over what’s happened, and in an emotional hole so deep there’s few things that could pull him out of it, save for some fresh investor cash or a couple lines of your people’s finest. Help him help you.

T. Boone’s favorite piece of concrete was on the move again. The well-traveled section of driveway is back at its place of origin, Holdenville, OK as the fight for TBP’s signature heats up and is heading to the courts. On the one hand, the house’s current owner David McCart contends its his because the driveway provides access to his property. On the other hand, the City of Holdenville contends that they have a right to it because the slab was on city easement. As mentioned earlier, TBP’s claim on the property stems from his status as a common thief who answers to a different set of rules.

Listen. We’ve talked about Tim Geithner’s housing troubles at length. The elfin Treasury Secretary and his wife Carole bought the Larchmont Tudor in 2004 for $1.602 million. Then buddy boy got a gig in DC and they tried to sell it March for $1.635 million. When that didn’t take, the price was dropped to $1.575 million. No dice. T. Geith was reduced to renting the place out for $7,500/month, which many have helpfully pointed out probably doesn’t even cover the li’l fella’s mortgage payments. So does he really need some hussy in a pantsuit going on TV and shouting it out that this thing is never gonna happen? No, he doesn’t, and dollars to donuts the first thing he thought while watching this segment on TDS last night was, “Lady, I’d like to tie you to the back of a fucking truck.” The pity from Shiller is nice, but a little embarrassing and likely caused the tips of TG’s ears to turn red, as they’re prone to do when he’s just been humiliated. Let’s just give the monumental failure (at house slinging) some room to breathe, okay? (And time to re-tile the bathroom, which Shiller notes is absolutely ghastly, and probably the reason no one will buy the place.)

Senate Probes Banks For Meltdown Fraud (WSJ)
Among others, Goldman Sachs and Deutsche Bank have been subpoenaed to see if bankers “had private doubts about whether mortgage-related securities they were putting together were as financially sound as their public pronouncements suggested.” What do we think the answer is to that one, gang?

Tax Evaders Flock To IRS To Confess Their Sins (WSJ)
Tim Geithner, you are not alone! “Last week we had 400 [applicants] — four times as many as in all of last year,” said IRS spokesman Frank Keith.

UBS and US Government Disagree On Progress Of Case (NYT)
Speaking of not paying taxes: A lawyer for UBS told Judge Alan S. Gold of United States District Court in Miami during a conference call that the Swiss are nearing a settlement out of court; a lawyer for the Justice Department asked, watchu talking about Willis, and said he wants to go ahead with a scheduled minitrial on Monday.

Citigroup ‘Moving Extremely Fast’ on Asset Sales (Bloomberg)
“Our costs are down by about 25 percent, our assets are down by close to 25 percent, our risk is down more than that and so we continue to turn the company around,” Pandit said. “We are moving our asses on fixing this thing like you wouldn’t believe.”

Goldman Sachs Hatred Might Cost You Your Bonus (Bloomberg)
Apparently all the bitching about 85 Broad got Barney Frank to crack some skulls?

Congress Aims For More Accountable Corporate Boards (Reuters)
“There are far too many cases recently where boards of directors, not just regulators, were asleep at the wheel, or even complicit in practices that caused great harm to our economy,” Schumer said at the hearing, before running out to wage war on texting while driving.

Judging High Frequency Trading (Reuters)
“Is HFT a good thing or a bad thing, from a liquidity perspective?”

And You Thought The Days Of Golden Parachutes Were Over (NYDN)
Incoming MTA chairman Jay Walder could get a $850,000 golden parachute if he quickly gets ousted from his post.

Central Park Tree Tragedy (NYP)
A Google engineer is in a coma after a branch snapped and hit him on the head yesterday.

$$$ Heidi Moore wants every to shut up about Goldman Sachs already. [The Big Money]

$$$ Brazilian Soccer Star Romario Proves that Hating Taxes is a World-Wide Institution [Going Concern]

$$$ Janet Tavakoli has bones to pick with Meredith Whitney, Nassim Taleb and Charlie Gasparino. [PDF]

$$$ AIG Not the Resume-Killer You Expected It to Be [Cityfile]

$$$ As to the eternal question of whether it’s faster to take Third Avenue or Park Avenue uptown, the former having staggered lights, the latter not, the former RenTec employee equivocated: “It depends on your nature. If you want speed right now, you take Park. If you like to understand a system and maximize it, you take Third. I’m a system guy.” [New Yorker]

Emergency mailbag:

About 40 Barclays S&T first years, all wearing Barclays T-shirts, are stuck in a broken down bus in the middle lane of an expressway somewhere in the vicinity of the Brooklyn bridge. They were on their way back from an end-of-training community service trip. Barclays has dispatched 15 black cars to pick up the Barclettes but the resulting traffic jam is so severe that none are getting through. The poor Barclettes are sweating it out Sanford style in a metal box with no air conditioning.

You know, you think you’ve met a nice, classy lady on Ashleymadison.com, a website who’s tagline is “life is short, have an affair,” and the next thing you she’s selling you out and you’re being convicted on six counts of securities fraud. James Gansman knows what we’re talking about, as he and his ho, Donna Murdoch, are the subject of a Wall Street Journal story along those lines. Gansman, an Ernst and Young partner who advised companies doing mergers about how to combine work forces before he got fired, met Murdoch in 2004. They would meet up in hotels in Philadelphia, New York and California (and when they weren’t together, exchanged 7,000 phone calls over the course of two years), but what really got Big D going was this kinky little game they’d play, which went something like this:

Eventually the two settled into a comfortable day-to-day routine in their respective offices in New York and Philadelphia, staring at the same Yahoo Finance screen. Mr. Gansman led Ms. Murdoch in a guessing game about which deals he was working on, she said.

“The game was that I wouldn’t be looking and he would give me hints: The market cap of two billion or market cap of 400 billion, and here’s what they do, and he’d read it to me, and ultimately make sure I guessed,” Ms. Murdoch testified. Before long, the guessing game fell away. Mr. Gansman told her more directly about upcoming deals of Ernst clients, she said.

Oh, but that wasn’t enough for Donna. She wasn’t satisfied. She needed more (money), so she met another dude who could get the job done (monetarily) and started two-timing Gansman.

The information wasn’t enough to pull off an insider-trading plan. Ms. Murdoch was in such financial difficulty — she and her husband owed $1.45 million on a subprime home mortgage — that she needed money to make trades.

She said she found the financial support of another man she met on Ashleymadison.com. According to her, he was Richard Hansen, currently listed as the chairman of an Oaks, Pa., broker-dealer called Keystone Equities Group. Ms. Murdoch became an employee of Keystone, and she shared Mr. Gansman’s stock tips with Mr. Hansen, she testified. She didn’t tell either man about her relationship with the other, she said.

Names like Bernard Madoff Investment Securities and Stanford Financial Group can understandably sneak under the SEC’s radar. But you might think that an outfit that goes by the name of Radical Bunny whose business model is strikingly similar to loan sharking might get a little bit of attention. The SEC’s watchful eye allowed over 900 investors to kick in just short of $200 million based, in part, on the claim that Bunnymen investments were not subject to securities laws. For anybody else who decided to turn over their cash to magic bean salesmen working at places called Fraudulent Monkey and the like, the SEC is waiting for your call.

And your money! Matthew Goldstein reports that the Allen Stanford court-appointed is seeking to clawback almost a billion from former employees and investors of Sir Stan, including Mr. Damon. Also: the Libyan government. And Kevin Bacon. No, just fucking— that one’s all B-boy, who always bags the best bitches.

015 20090728 Appendix in Support of Recs Amended Complaint Naming Relief Defendants

Fed up with the Senate Ethics Committee dragging their heels and delaying decisions which may never come or amount to anything, Senate Banking Committee Chairman Chris Dodd went on the record again that he was no special friend of Countrywide when he went to A-Moz for a refi back in 2003. Distraught that “allegations hurt” and that the tendency of people is to believe those allegations, Dodd may have finally found himself in the same situation that every Wall St. CEO who received a special invite from him over the past year has had to suffer through when explaining their own actions.

Brokers recently suffered the indignity of being “cattle-called” into the house that lies like “you can trust me with your money” built to assess what the sale of 133 East 64th Street might fetch. What kind of figure are we looking at? Talkin’ Neverland Ranch numbers? Apparently not, for three reasons. A. taint of the scam 2. the place is a shithole D. no nudie shots of Ruth left behind (I’m serious about that one).

“Tell us something specific that you learned” “No, I’m going to tell you something generic”

“Wait a second buddy, your publicist told us this was going to be a big story”

“Unbelievable, this guy”

While Kenneth Feinberg tries to come up with some way to misrepresent a $100 million payout to a trader as egregious or unwarranted given the circumstances, it appears Washington isn’t taking any chances. With Citi starting to run low on pieces it can pawn to remain profitable quarter after quarter, the government’s adopted bank may have to look to DC to open its wallet to help pay up. This $100 million may not have been contemplated in the earlier series of Citi bailouts but a new government initiative curiously seeks to clear out just enough space to pay a certain energy trader.

The White House announced a list of 77 spending cuts as part of its “100 million savings challenge”. Thanks to such initiatives as agencies printing documents on both sides of the paper, cramming in more soldiers on certain flights, and disbanding the agency in charge of enforcing workplace regulation and workers’ rights rules (the Employment Standards Administration), it looks like enough pennies will be collected should Andrew Hall threaten Citi’s viability.

If Irving Picard has anything to say about it. The trustee liquidating Ponzi Nation has filed suit against Bernie’s woman, seeking to claw back the $2.3 million she was left to live on, saying she was in on the whole thing. In related news, Lady MacMadoff, whose lawyers are calling the suit “totally unjustified” and “wrong as a matter of law,” was allegedly seen “tooling around in a white Mercedes SL 500 convertible” over the weekend in Lawrence, NY.

Update: Just messing about the $2.3— Picard wants $44.8 million.

Earlier: Ruth Madoff Spanish Harlem Bound?

Faced with mounting lawsuits, the government is taking a page out of the Russian model and putting the screws on mortgage lenders to pick up the modification pace. As we are way past the time when the likes of Citi and BAC should have be looking at things like a borrower’s ability to repay a loan, the White House figures it might as well get some political bonus points out of its stakes in firms that would have a tombstone next to Lehman’s were it not for the Washington safety net. Throwing caution to the wind, the administration’s bogey is for lenders to produce 500,000 trial loan modifications by November 1st- which will likely convert soon after into full-blown losses and pave the way for TARP version 2.0.

First off, let’s just get it out there that we think the seventy year old Maxine Waters is a sexy, sexy lady. But: her placement, in the top five no less, on The Hill’s annual list of the most doable people in the district seems suspect. With a couple exceptions (Senator John Warner, 81 and the 19 year old daughter of Representative Zach Wamp made the cut), everyone is mostly in their 20’s and considered “government employee hot.” Is this some sort of attempt on Lloyd Blankfein’s part to butter the girl up? Make her feel good about herself? Get M-dubs to consider a late-in life career change that would remove her from 85B’s ass? We already know GS has been trying out some new tactics on opponents, and with mounting evidence that Waters is planning to physically assault LB next time she sees him, it wouldn’t be that crazy to assume they had a hand in this. Anyway, in case you were wondering:

As you’re aware, the PR department over at 85 Broad has been working overtime to get people to stop talking trash about how the bank owns the government, would screw a hobo for a nickel, and could just generally buy your life. All of that is for the most part true, but the bad press is starting to grate, so attempts are being made to ingratiate the Masters of the Universe to the peasants like yourselves. Demonstrate that they’re just regular guys with regular problems. So even though, in reality, anyone with a GS ID could get any woman they want, they’ve started to do stuff like pay for sex, and troll for underage tail on the internet, like a common man/Citi employee:

A lawyer for Wall Street powerhouse Goldman Sachs was caught in a sting operation aimed at perverts who solicit young girls for sex, officials said Tuesday.

Todd Genger, 33, is accused of trying to lure an underage teen with explicit chat on the Internet and then traveling to Westchester to consummate the cyber-affair.

In reality, the “girl” Genger was chasing was an undercover investigator posing as a teen in the chat room, the Westchester County district attorney’s office said.

You could probably hear the thoughts going through the head of Goldman’s #1 groupie when she got wind of GS commodity index risk management head, Don Casturo’s, take on curbing speculation. A nice mixture of ‘see- I told you they were evil’, ‘why am I the only person who knows what’s up with those guys’ and ‘I really need to borrow that rat’ has probably been on constant repeat.

Casturo threw gallons of fuel onto Mad Max’s fire by telling the CFTC that curbing speculation could wind up doing more harm than good.

“Some of the courses of action that have been proposed not only will fail to address the perceived harms but also will have unintended consequences that may be disruptive to liquidity and the markets generally”

It looks like Lloyd & Co. are itching for a fight and that rat is going to be very busy in August,

It’s been almost a year since Nomura acquired Lehman’s international operations, and while some fumbling and a lot “where does this go” among personnel on either side is to be expected, things remain quite awkward, with the children of Dick Fuld all but refusing to submit to their new employer’s way of doing things.

Like start the day in verse.

Lehman bankers encountered a different work culture at Nomura. One team of Nomura traders, for instance, sang a company song at morning meetings.

And be followed around by a guy with a notepad who doesn’t say much but constantly judges.

Nomura set up a transition team that fanned out around the globe to help with integration. Senior investment bankers from the Lehman side started to complain about their “shadows,” bankers from the Nomura side who would accompany them to client meetings and report back to other executives, according to Lehman-side bankers. The Nomura spokeswoman says those bankers were helping with the integration.

And just accept that women are there to serve, okay? Why is this a cause for getting one’s panties in a bunch?

Nomura kicked off a training session for new hires in April by separating the men and women. The women, including Harvard graduates hired by Lehman Brothers before it collapsed, were taught how to wear their hair, serve tea and choose their wardrobes according to the season, say executives who fielded a complaint about the session.

Asked about the training sessions for new hires, a Nomura spokeswoman said that both sexes were taught business etiquette, and the men and women were trained separately for logistical reasons.

It’s not like they’re being asked to slut it up. In fact, the females are being expressly told: do not dress like a harlot, or you’re out on your ass. This is a place of business. We can’t have bitches running wild.

And here’s what they’re doing about it! Setting up one of those giant inflatable rodents in front of 60 Wall Street this morning. No word if this is a union airing grievances (the rat-blocking-entrance is their calling card, though we’ve never seen one blinged out like this) or if the shareholder who got spied on is just blowing off some steam. If you passed by the thing this morning and took two to find out more, let us know.

Phibro Mum After White House Slams Reported $100 Million Payday (Reuters)
‘Cause there’s nothing to say. Just give Andrew Hall his bag of money, and nobody gets hurt.

Bernie: SEC Was Asleep (NYP)
Ponzi Boy cannot stress enough just how easy it was to pull this thing off.

Goldman Disputes ‘Evil’ Tag (NYP)
Here’s what the delightfully British Lucas van Praag had to say about this article: “garbled nonsense,” “shoddy journalism,” and “The mistakes are so egregious that one has to question Mr. Hagan’s motives.”

UBS Sued over 77-Year-Old Lady’s $26 Million Loss (AP)
Awkward: “Chan Wai-yee, who was born in mainland China, filed a lawsuit Tuesday saying UBS bankers never spelled out the risk and potential losses of investing in leveraged derivative products, known as accumulators, that bet on Hong Kong stocks.

Chan also says the bank led her to sign several documents in English — including one that made her a “professional investor” under local securities regulations — even though she doesn’t speak the language and never finished primary school.”

Inquiry Widens as UBS Client Pleads Guilty (NYT)
This is the thanks the Swiss get for such hard work and creativity? “Mr. Chernick’s private banker and a Swiss lawyer would dress as tourists when meeting Mr. Chernick at New York hotels, with the executive lying to customs officials by saying he was there to visit his brother. They mailed, rather than hand-carried, Mr. Chernick’s bank statements, for fear that customs officials would seize hard copies. They also cut out Mr. Chernick’s name and address from printed statements.”

A Comprehensive View On Bank Profits (WSJ)
The “secret” to Wells Fargo’s success: FASB.

Michael Milken’s New Business Advice Site (Bits)
Bizmore is only backed, and not edited, by Milken but that doesn’t mean he can’t pop in every now and then to dispense pearls of wisdom re: doing time.

Should You Invest In Mortgage-Backed Securities? (WSJ)
The BlackRock Legacy Securities Public-Private Trust says yes.

$$$ House Panel Approves Letting Regulators Ban Bonuses [Bloomberg]

$$$ Ex-Countrywide exec sows trouble, reaps profit [The Deal]

$$$ Bernanke Takes Hit On Investments [AP]

$$$ Touching Money Makes Pain Go Away [Cityfile]

Bernie has apparently been working out to make sure the sisters don’t have their way with him. In his first interview since he relocated from the UES to Butner, North Carolina, King Ponz told Joseph Cotchett, a San Francisco lawyer threatening to sue the other Madoffs currently running free, that he was astonished that he got away with his fraud for as long as he did even though “There were several times that I met with the SEC and thought ‘they got me”. While Cotchett was undoubtedly interested in Bernie’s thoughts on the nuances of his Ponzi scheme, he was truly mesmerized at the work Ponzarelli had done to his biceps and chest.

“He looked pretty good and seems to be working out,” said Cotchett. “He looked a lot better than he has in some months since I’ve seen photographs of him.”

As for the remaining Madoffs currently not behind bars, Bernie made it very clear which of them should be looking over their shoulder for the Feds.

“He cares about Ruth,” said Cotchett, “but he doesn’t give a —— about his two sons, Mark and Andrew.”

DB is hearing that an intern in the Natural Resources IB Group at JPM, having likely pulled consecutive all-nighters to complete a “Homework Project” that was in addition to the intern’s daily duties, collapsed into a seizure last week. We hope the intern in question is OK and are awaiting further details.

Update I: The intern is reportedly OK and has provided a good excuse for the House of Dimon to launch another investigation into the general work/life balance of summer neophytes. JPM will look to improve on their prior upgrades which included adding more healthy snacks in the vending machines- which were later removed because they posed a fire hazard.

Update II: The intern had apparently been working for 3 days straight before the convulsions began. Those not seizing were given last weekend off in light of their fallen comrade.

This is probably not the type of response the Obama administration was aiming for when it set up the Home Affordable Modification Program. While the program aims to keep risky borrowers in their homes, a loan modification advocacy group, the Foreclosure Law Relief Project, is less than pleased that lenders are still rejecting modification applicants and going after everybody involved in the process. The current list of defendants in their lawsuit includes the Treasury Department, the Federal Housing Finance Agency, Fannie Mae, and Freddie Mac. It seems the real culprit that Tim Geithner may have to answer for is why modification decisions are made “under a cloak of secrecy”. If the government hadn’t been so slow working out an agreement with CNBC to provide constant coverage from inside the credit committee room of each lender so they could break headlines like ‘Jones family just misses keeping their house’, this never would have been a problem.

There are a lot of reasons to love* Paul Tudor Jones, the adorable scamp of a hedge fund manager who doesn’t want anyone to see footage of him from back in the day. One of them is that he keeps his employees well-fed, with artery-clogging fast food. Once a month— and apparently the event is happening next week, for those of you who just started at Tudor— PTJ sends out a company-wide email inviting everyone “for a southern-style BBQ, though it’s actually just KFC, ‘cause he’s a huge fan.” Someone is dispatched to go pick it up** (“which can sometimes take almost an hour door to door, so you know he wants it bad”), and then they sit around and shoot the shit. Sure, a lot of firms offer their staffs tasty treats every now and then. SAC is big on individual chocolate fountains. AQR likes Ziplocks of whatever it takes to get people up to Biff Bassness’s speed. And so on and so forth. But no else actually makes it rain buckets of chicken. Jones does, and that is why he is better than everyone else.

In related P to the T to the J news, as previously speculated, he was the one who directed the filmmakers to invoke a copyright claim this afternoon. According to Teri Buhl, when he asked for the documentary to be taken out of circulation back in the 90s, PTJ told producers he’d pay “considerably more” (double or an asston unclear) than whatever they’d make distributing the thing.

*And since sometimes you twits don’t get it when we’re actually being sincere, on the rare occasions it occurs: we mean it!
**Supposedly in Darien, even though there’s a Stamford location, because PTJ thinks it’s cleaner.

It seems inexcusable that after all the IOU issuance and bickering about how to solve California’s budget mess, the solutions were there the entire time. Had Arnold tuned into a seemingly innocent city council meeting in Santa Cruz last year, he would have found the magic bullets for problems such as agricultural reform and commercial real estate. He would have also been clued into the disparities between the slave-based East Coast economy and the more union-centric West Coast economy.

So, okay. Here’s the employment history for Robin Katz, the down on her luck Chase financial adviser/pastry chef who’s currently waiting for someone to bail her out of Riker’s, where she’s been hanging since JPMorgan turned her over to the cops, for the minor transgression of creating an ATM in a client’s name (who is still claiming to have no idea what any of this is about), and helping herself to $100,000 or so. Apparently prior gigs include a stint at N.A.S.A. (which overlapped attending Smith College, in Massachusetts, and working for something called TL Advertising, in California). Also, HSBC, for a month, book-ended by Chase.

Ahead of Amanda Drury’s scheduled two week visit to Englewood Cliffs this August, Michelle Caruso-Cabrera has declared an all-out war, starting today. Who will emerge victorious? On the one hand Amanda and the Druries take no prisoners. On the other, as evidence in the first thirty seconds of the clip above, CC is tipping the camera guys to linger on her good side.

As a few of you have emailed: yes, Trader: The Documentary has been pulled from YouTube. Those who listened to us at the time and checked it out yesterday should not be too broken up about it, since you got a glimpse of a vintage PTJ, though, yes, it is upsetting to not be able to watch it every night before bed. Those who failed to do so— you fucked up, big time. It’s unlikely that this thing will make it back to the ‘Tube any time soon, as Jones bought up all remaining copies in the mid-90s in an effort to keep it under wraps, and was probably instrumental in getting it yanked today. Nevertheless: we will attempt to get our hands on it, not matter the cost. Then: DB Movie Night.

Update: The original uploader speaks:

At first I had no idea how sought after this piece of material was. I had heard anecdotally about Ebay listing in the $1,000’s but I chalked it up to urban legend. Then late Sunday night I was talking with a colleague about an obscure blogger/marketer who had for months talked about posting the Trader doc. I figured it was just a ploy to build a marketing site and thought it was kind of backwards to encourage this shadowy cottage industry/exchange of VHS tapes. Given the historical relevance, the position of both PTJ and Borish in the industry today and the fact that this aired at some point on public television - I thought posting the videos on YouTube would be educational for other traders and finance professionals. I embedded the videos on the Elite Trader message boards only after John’s seeing John’s site was having “technical difficulties” as the WordPress structure was exposed.

By Monday morning Dealbreaker, zerohedge and influential personalities on Twitter picked up the videos. My email Inbox exploded with messages and comment notifications from YouTube all day long. Some of the commentary, observations and quotes were priceless, I felt like I had given new credence to yuppie culture- often reserved for citations of “American Psycho” and Gordon Gekko. Monday was very distracting and hard to get work done, so I turned off the email notifications and put my head to work. This morning I was reading the Financial Times Alphaville section and saw my YouTube video embedded and knew things had really caught fire. I logged into YouTube to discover in less than 24 hours each video had been watched some than 30,000 times.

It’s becoming tougher and tougher to even dream up a series of events which would officially qualify the SEC as having violated its duty to vigorously pursue alleged frauds. Taking some guy named Harry’s word is one thing; doing nothing with your own investigation is another. Back in 2005, the SEC were, for once, on the right track to getting at the root cause of the formerly well air conditioned Sir Allen’s super-CD offerings. However, the fact that the guy accused of running the whole scheme didn’t offer up his ‘Here’s How I Pulled Off A $5 Billion Fraud’ manuscript to investigators was enough for a SEC inspector general to rule that the agency did not breach its pinky swear promise to give it their all in fraud investigations. Apparently the SEC qualifies as too big to fail.

I sincerely hope no Bank of America employees are not reading the internet today because really? The blows are going fast, hard and low. If Ken Lewis and Co were already feeling a bit bad about themselves, if they were starting to think, “maybe it’s true, maybe we really do suck,” if they were beginning to take the trash talk that they can’t do anything right to heart, the absurdly catty critique of the Bryant Park building over at Bloomberg will not do wonders for the ego. First off, according to architecture critic James S. Russell, the place is a constant reminder that before Ken Lewis came up with the genius idea to buy Countrywide and Merrill Lynch, BAC wasn’t in the toilet.

The building was touted as costing $1 billion in 2004, and the bank has declined to update the figure. After the 64 percent slump in the bank’s shares since September, this glinting bundle of shards, nearing completion across from Bryant Park, could be considered a monument to bonus-coddled, overindulgent, corporate excess.

And that stuff about it being the antidote to global warming? Bull.

Cook & Fox touts One Bryant Park as “the world’s most environmentally responsible high-rise office building.”

This is an overstatement. Around the world, eco-buildings have moved far beyond this design.

Okay, but besides the greed and green stuff, is she doable? No. Russel wouldn’t fuck her with Angelo Mozilo’s dick.

The 54-story result is among the most ungainly forms on the skyline, like a matron who swathes herself in thick layers of fabric in a vain attempt to slim her burgeoning silhouette.

What the? And after that thinly veiled shot at KL’s cankles? Anything else you wanna say? Yes. Jimmy would like to get one more thing off his chest.

…dumpy.

OH NO, SHE DI’INT. On the bright side! Russell does slip in one thing that, if they’re smart, BAC execs will use to their benefit on the off-chance the next few quarters don’t go their way. How can anyone be expected to make money money take take money money when they can’t even see due to an environment that fosters 24/7 squinting?

Though bands of white ceramic dots fused onto the glass are designed to cut unwanted sun, a bank official said the company had regretted not investing in shades that would automatically lower when the sun beats in.

Bank of America’s Earnest Eco-Tower Rises From New York Slump [Bloomberg via DI]

Typically Mad Max’s response to any question starting with,”who is responsible for trying to defeat this piece of legislation which will save our country” includes some variation on ‘current Goldman employee’, ‘ex-Goldman employee’, or ‘friend of a current or ex-Goldman employee’. But not this time. Maxie was after Rahm-bo this morning for recruiting a few too may right leaning Democrats when he was in the Congressional leadership and now the Blue Dogs are to blame for holding up health care reform. After unloading on the Dogs, Maxine did find the time to neatly summarize how to solve the housing crisis by focusing on abrogating contracts and the need for negative interest rates.

Eliot Spitzer says no, and reiterates that the entire operation in a Ponzi scheme. While we’re on the subject, know who else can’t be trusted? You think you’re paying top dollar for them to keep quiet and then they run their mouth to anyone who’ll listen. You can bet I’ve learned my lesson. Port Authority, no names, only way to do it.

A “new” article-by-numbers is out today discussing the fact that the recession is affecting people’s love lives. Naturally, John Carney would like to know if that translates to less on the job fucking. Carney’s conducting an actual survey, not just fact-finding for his personal amusement, so let’s do him a solid with some hard data. If the matter of getting things going isn’t an issue, are you more likely to err on the side of caution these days, out of fear that security tapes of you fornicating on the desk might put your job security at risk? Or are you more likely to say, fuck it, let’s do this? The dearly departed Keith Hahn loves to regale me with tales of a former colleague of his who “used to take down people in the JPM trading floor bathroom like nobody’s business.” But that was circa 2005 when you could do practically anything. For the Dimonettes in the group is that venue still fair game? Is there less on-site banging but more one-man QT in the handicapped stall, especially around bonus time? Are our favorite southern CT shemales f-blasting each other on big money days? Are there any firms where this sort of behavior is a-okay, as long as no one’s getting hurt (possibly one of the more outside the box thinking hedge funds)? In these difficult times, are some employers going to so far as to facilitate interoffice action, with mood lighting and aphrodisiacs? Or is it pretty much explicitly frowned upon? Let’s get into this.

Always at the leading edge of making an illicit buck, Sin City’s home state is doing its part to make the story of stimulus spending even more comical. Nevada governor Jim Gibbons is considering raiding a state contingency fund for $500,000 to appoint a “stimulus czar” to oversee the $2b or so in freshly printed Monopoly money headed out west. In a place that built its fortunes on knowing the location of every last dollar well enough that only Danny Ocean & Co. can make them disappear, shelling out half a mil for somebody to keep a journal of where the money is going can only be viewed as Nevada’s homage to handling stimulus funds the Washington way.

At some point over the weekend, Trader: The Documentary made its way on to YouTube, after it went out of circulation in the 90s and Paul Tudor Jones bought up all remaining copies. Those of you who listen to every damn word we have to say watched it yesterday, and probably got a kick out of PTJ’s vintage shades and pet turkey who Jones thought of as a dog. But it wasn’t just entertaining— it was educational. For the more observant ones in the bunch who were paying close attention, the flick was filled with tips on how to get a competitive edge that, when put to use, could make you a mult-billionaire one day, too. For example, start every trading session with a couple Buds. And also, prominently display pics of scantily clad/nude ladies in your domain. Whoever tickles your fancy should do just fine, though if you want to do it “just like PTJ,” someone please identify the lady above at this time. She looks familiar, but we’re having difficulty putting our finger on it, and Jones has yet to return calls for comment.

To the dismay of several hedge funds and many private investors, the value of at least one failed institution is still zero. SRM Global and RAB Capital Plc, which own 11.5% and 8.2% of the outstanding shares of the charter member of the UK’s nationalized portfolio, Northern Rock, lost an appeal today to get a valuation that looks like something other than a bagel for their collective 82 million shares. The same savvy investors that refused to sell their shares as N-Rock’s stock plunged during the second half of 2007 now contend that, according to their valuation models, they deserve more than £4/share for the government funded rescue. RBS shareholders finally have a group of people that can make them feel good about themselves.

Are you among the happy 46 percent? What will you be doing to celebrate? Not as lucky? Feeling like you just threw away the last four to six months of your life? Want to get angry? Want to make someone pay? Let it out, here.

Earlier: Let’s Get Together And Have A Good Cry, Courtesy Of The CFA Institute

Every so often we like to check in and see how the victims of the greatest Ponzi scheme of all time are coping in the aftermath. Bernie’s doing great, making friends and earning the respect of his fellow criminals on the cell block. Ruth is house hunting. Mark is being a dick on Nantucket. Kevin Bacon is hurting, but will likely dance again one day soon. And how ‘bout those Noels? Walter, Monica and the five girls, all of whom were pretty negatively affected by the scam, owing to the fact that 4/5 of their husbands went to work for daddy, so when the bitch went down it went down hard. Are they hiding out in some undisclosed southern Connecticut bunker? Are they sitting around a 1-bedroom apartment over a pizza place they all moved into cursing the day Bernie Madoff came into their lives? Are they filling out applications at Beamers? No! They’re partaying on a yacht. Vicky Ward reports that Andrés Piedrahita, husband of Corina, and the FFG exec responsible for bringing in all that sweet Colombian cash recently bought himself a boat and has never been better.

Look no further than the website of luxury yacht sellers Camper and Nicholsons to see pictures of “Oxygen” the new €22,000,000.00 custom-made boat that Piedrahita, took possession of in June. He is now cruising the Adriatic with wife Corina Noel and their children. I am told he has plans to cruise around the Dalmatian coast and Corfu.

Congress Debates Onus For Goldman Bonus (NYP)
A bunch of Representatives wrote a letter to the Federal Reserve yesterday wondering why Goldman’s been allowed to take on more risk over the past few quarters. “The company and its employees have taken full advantage of its new government subsidies, and the retained ability to bet big,” Alan Grayson, Walter Jones, Ron Paul and Maxine Waters, who kept it cool for the most for the most part but got her freak on in the footnotes, asked.

Michael Lewis Dispels Several False And Insidious Rumors About Goldman (Bloomberg)
You don’t have to be bald to make it to the c-suite, they just prefer it that way.

Traders Blamed For Oil Spike (WSJ)
CFTC to issue a report next month pinning not one but several iotas of blame on speculators for wild swings in prices.

High-Frequency Traders Say Speed Works to Everyone’s Advantage (Bloomberg)
Ya hear that Chuck Schumer?

US Issues New Rules On Short-Selling (WSJ)
Also, Mary Schapiro is looking fantabulous in her new headcut, which takes about 15-20 years off the girl.

Kerviel Lawyer Says Societe Generale Managers Knew About Trading Positions (Bloomberg)
‘member this guy? Jerome’s lawyer said today that he can count at least 300 people who knew exactly what his client was up to. “In 2007, he was making money and they let him go on,” Olivier Metzner said. “In 2008, it all went bad, the machine was exposed, they unwound the positions in a panic and they created losses.”

What Citigroup Should Say To Us, Its New Shareholders (BV)
Contrary to popular belief, Vikram Pandit does not have to ask Tim Geithner for permission every time he wants to take a leak. I don’t know where you got that from but it’s just not true.

BofA Plans To Cut 10% Of Branches (WSJ)
Ken Lewis discussed the plans during a meeting with investors last Thursday. Liam McGee, president of Bank of America’s consumer and small-business bank, also said branch closures are in the works but refused offer any specifics.

Diamond company LifeGem turning lock of Michael Jackson’s hair into jewels (NYDN)
Yes: “Founder Dean VandenBiesen said his company will extract carbon from the King of Pop’s hair and turn it into crystals, which can be refined into diamonds.”

$$$ IRS agents tailing UBS banker visits. What, like there’s something wrong with that? [NYP]

$$$ Attention budding white collar criminals: Canada is the place you want to be. [CBC]

$$$ FINRA: Sucks at managing money, great at investor letters:
While returns from FINRA’s investments were quite positive for the four years prior to 2008, the losses incurred in 2008 erased almost all of those gains. [Reuters]

$$$ Killing it in China [Dealbook]

$$$ It’s already been widely reported that Tim Geither couldn’t sell his house and is now renting it out, so what TG would like to know is why some pissant feels the need to ask “what will happen if he can’t find a tenant next time around?” Does he really need this now? [ABC]

$$$Harry Markopolos was recently named CFE of the Year by the Association of Certified Fraud Examiners at the group’s annual Fraud Conference in Vegas. Naturally Marks was expected to give a speech, which would one might expect to strike some serious notes, given the subject matter, but still remain fairly light. You always want to throw in a few jokes when accepting an award, you know? So what sort of humor do think you’d get from a financial fraud investigator? Borscht Belt? Morbid? Scatological? [Going Concern]

$$$ Ron Insana On High Frequency Trading [ZH]

Timmy G scored a small victory today by not being openly laughed at by the Chinese when he declared, “”We are committed to taking measures to maintaining greater personal saving and to reducing the federal deficit to a sustainable level by 2013”. To their credit, the Obama administration is being very forthcoming about the game plan to “sustainable” deficit levels by saying, “As Americans save more and Chinese are able to spend more, we can put growth on a more sustainable foundation”.

However, what may be lost in translation for the Chinese is that our blueprint to health is to tag the collective 1,3 billion of them as ‘it’ in the game of which nation will allow its citizens to become punch drunk with leverage and spend outside their means. No doubt China will get a harsh lesson in American euphemisms as they digest the true meaning of TG’s statement that, “the crisis has also highlighted the need for a different global growth path going forward”.

You try and send 14 pounds of weed in the mail and what happens? The bastards at FedEx stick their noses where they don’t belong and rat you out to the cops. You’d think that they wouldn’t be too good for any sort of business, be it drug-related or otherwise but apparently you’d think wrong. For future reference, move your shit with UPS, which will collect a finder’s fee but get the job done without calling attention.

In an interesting twist on curbing complex products that the average investor does not have a prayer of understanding, BlackRock is answering the Obama administration’s call for offering the general public the opportunity to invest in RMBS and CMBS. The BlackRock Legacy Securities Public-Private Trust will give investors who believe that only Wall St. can benefit from bailout-related programs the chance to show off their mastery of distressed mortgage markets by paying BlackRock their usual fees to play alongside the big boys. Potential RMBS and CMBS investors should rest easy knowing that the fund will limit its distressed appetite to securities that were rated AAA by at least two agencies prior to the start of this year.

As you’re aware, one of the benefits of a financial crisis like the one we’re in now is that it’s designed to extinguish, or severely curb, the amount of self-important douchebags in your direct line of vision. Unfortunately, the mechanism of change doesn’t work quite as well in the Hamptons, where mostly everyone S’s D, save for some of the very special residents Further Lane. Now, those who have “survived” the recession (*on their own terms or on the generosity of others, the example below presumably being the latter) to make it out for another season are congratulating themselves for the accomplishment, and also asking for someone to casually walk by and drop a hand-grenade on where they’ve been hanging, wiping out all the “certain kinds of people” assembled in one fell swoop.

“Whatever you want to say about the economy, the fact is, it’s more selective in the Hamptons this summer,” says one young lady at Day & Night who asked to be named. “It’s only a certain kind of person coming out here now, and honestly, that is the kind of person I want to be around.”

Seasons Tidings [NYP via Daily Intel]

Apparently a “large number of JPM senior macro prop traders” have just left the House of Dimon. No word, yet, on where they’re headed or how JD took it.

Update: Supposedly the defectors are BarCap bound.

It seems the Warren Buffet was doing a lot more than just taking in $650k for a lunch meeting during 2007; he was feeling out unknowing candidates to take the other side of his trades. Two years ago, Mohnish Pabrai, Managing Partner of Pabrai Investment Funds, shelled out around $10,000/minute to thank Buffet personally for his publicly disseminated investing advice. Some of the pearls of wisdom that the Oracle imparted on the fund manager were the benefits of keeping an empty calendar, not scheduling any meetings, ditching the Blackberry, losing the email account and attempting to maintain a general state of information blackout. These helpful hints paid impressive dividends in 2008 when Pabrai’s fund finished the year down 60%.

The fun begins immediately after the jump

Trader: The Documentary, which Jones requested be pulled out of circulation at some point in the 90s (and bought up all the remaining copies he could find), is now available in 7 parts on YouTube. Take the next hour to watch a 32 year old PTJ get psyched over a $5 million day, chill with a huge turkey who he think of as a pet dog, discuss his start as “a glorified secretary,” trade while kicking back with some Buds, use a huge ass cell phone and put it out there that “if I make the mark I want to make, I’ll stop, I’ll retire.” (No word on whether he’s yet to achieve that mark or if it had to be reset when he decided to start funding the greatest show on earth, which will cost you.)

It wasn’t one of the names suggested last week but supposedly Josh Brolin will be offered the role turned down by Javier Bardem at some point today. If JB says no to working with Shia LaBeouf, it will next go to Tommy Lee Jones, and then Woody Harrelson until producers run out of names from the No Country For Old Men IMDB page, at which time, you might get your wish (Stephen Baldwin, who probably can’t do it anyway, on account of the bug bites).

For those concerned that Switzerland’s recent epiphany on taxes was going to invigorate the global campaign against frauds of all colors, former Swiss grey list partner, Luxembourg, offered some soothing words. When asked about how the damage from King Ponz’s scheme was going to alter the local financial landscape, the director-general of the Commission de Surveillance du Secteur Financier, Jean Guill, likened the impact from the $50 billion fraud to a mosquito bite.

“I don’t think it has really damaged in any measurable way the fund industry here in Luxembourg … You have to start from the fact that this was fraud and there will always be fraud

One can only admire the tiny tax haven for taking a leading role in disclosure advocacy with its ‘there will always be fraud’ campaign.

We very much enjoyed Joe Hagan’s New York cover story on Goldman Sachs, the take-away being that the Masters of the Universe just do not care what anyone says about them, so long as you step out of the way when the dump trucks of money pull up to the building. One thing we would like to know, however, and this is an actual question, is who said the following (we don’t imagine Hagan will give up his source, but perhaps one of you could identify the man or woman being cited):

As another Wall Street veteran familiar with the firm’s mores puts it: “The god is Goldman. You subjugate yourself to that god, and in return we will make you a gazillionaire.”

We’re not debating the substance of the quote, but the word choice. What Wall Street veteran would actually use the term “gazillionaire”? A veteran summer analyst? A veteran stoner? And if one is going to throw “gazillionaire” out there, why not go a bit further? Was “kajillionaire” deemed too much? Did “in return we will make you a metric-asston-aire” seem silly? But “gazillionaire” worked?

This is probably going to come as a shock but making questionable calls, flipping the fuck out and just acting like a crazy person in general is not something Cramer simply picked when he started doing TV. Sure, he’s perfected things over the last few years (Bear, Dykstra, what what) but the JC you see today is a craft Uncle Jim has been honing since his days at Cramer Berkowitz, the hedge fund he founded after leaving Goldman Sachs. Memoirs of a Minyan, new book by Todd Harrison, who served as head trader and president at the firm, devotes five chapters (out of eighteen) to reflecting on the harrowing experience that was working alongside Jimbo, now that he’s several years removed and is ready to start the healing process.

“He would haphazardly make trades…We’d go from hugging each other to screaming at each other,” Harrison recalls. “It was so intense every day.”

Harrison writes about a memorable Cramer meltdown after one tech-sector buy, on Brocade Communications, resulted in the hedge fund losing a modest amount of money.

Keyboards were being smashed, “keys were flying, spit was flying,” and Cramer was yelling like a madman, said Harrison. Efforts to calm him down only resulted in more aggression, including Cramer accusing Harrison of not caring whether the firm made money, he said.

Fed up, Harrison got up to leave, which prompted Cramer to throw a water bottle at him.

Love them. Hate them. Lob somewhat imaginative insults in the general direction of 85 Broad. Suck on their gold-plated scrots. When it comes down to it, Goldman Sachs could really honestly care less. Sure, they’re not thrilled by this new (or if not new, intensified) trend in which everyone hates their guts, which would explain why the bank has begun allowing basically anyone into the building in an attempt to combat the bad press, the conspiracy theories, and the websites popping up daily claiming to have evidence that Lloyd Blankfein has been trafficking human fetuses created with the sole intent of one day putting grass on that field. They’re not idiots. They do want to at least make a vague effort to show they’re not “oblivious to public opinion,” and, seriously, if you mention the AIG thing one more time, or suggest there was some impropriety there, someone will be dispatched to go circus freak crazy on your ass, but really? So long as no one stands in the way of makin’ it rain? You can say or think whatever you want. Yes, even you, you hooker loving dick.*

The idea that things might just go back to the way they’ve always been on Wall Street is, of course, infuriating to those who had hoped the financial meltdown would be an opportunity for reform. A few days after Goldman reported its second-quarter profits, Eliot Spitzer, a critic of the AIG bailout, tells me: “If all we are getting are newly empowered and capital-rich hedge funds that benefit from market volatility, then we are not only rebuilding the same edifice, but we’re contributing to the underlying rot in our economy.”

In the end, Goldman’s reputation is a luxury they may well be able to do without. Robert Rubin has been privately critical of how the firm has handled the threats to its prestige, and Rogers recently addressed the firm’s reputation in seminars with Goldman staff. But a person who frequently talks to senior executives at Goldman sums up the company’s attitude this way: “If we can push the envelope without D.C. punishing us, we don’t care about our Main Street reputation.” Blankfein in particular is said to be dismissive of the firm’s critics. According to a person close to him, the CEO believes Goldman’s internal problems will disappear once compensation comes back. In other words, money will solve everything.

Is Goldman Sachs Evil? Or Just Too Good? [NYM]

*Goldman’s words, not mine.

Sir Allen is having a little trouble acclimating to his surroundings. Stanford’s attempts to reminisce about how much fun it was to be a billionaire have been interrupted recently by episodes of profuse sweating due to the Texas heat. The knight’s lawyer, Dick DeGuerin, is outraged that a member of royalty is being treated to the indignity of residing in a cell with 8 to 10 peasants without air conditioning (in addition to other insufferable conditions) and is demanding a room upgrade for his client.

“For part of the time last week, they were in total darkness,” DeGuerin wrote. “The cell has been without air conditioning for at least a week. There are no windows for light or ventilation and the conditions are intolerable.”

It looks like the guy who said,”I’ll die and go to hell if it’s a Ponzi scheme” is getting a sneak preview of what’s to come.

Things have been going pretty, pretty, pretty well for JPMorgan lately. Unlike the so-called devil worshipers at 85 Broad, the bank was allowed to enjoy the success of the second quarter. Its pin-up CEO he has to beat off the press, the people, and the president with a stick. And security has finally successfully gotten Jimmy Cayne to stop loitering in the alley behind 383 Madison Avenue where he was accosting SeamlessWeb delivery guys during munchie runs. Things couldn’t float on effortlessly forever, though, and last week, the Dimonettes’ good luck streak hit a bit of a snag. And by snag, I mean flesh-eating beasts.

The House of Dimon has been hit with a bedbug infestation on the 8th floor. A sales person had the problem at home and a week later the critters were spotted on the trading desk. Now JPM is bringing a specialist into the building and employees’ homes.

The Catch-22 game of lending in this economic environment is starting to get on the nerves of British Treasury Chief Alistair Darling. With the exception of the Russian solution, most global policymakers remain torn between the two worlds they live in: the one where banks are publicly crucified for reckless and deceptive lending; and the one where banks are publicly crucified for raising lending standards and reducing credit lines. As the British economy continues to contract amid rising unemployment, Darling is not amused by a mysterious phenomenon preying on small and medium size loan applicants.

“I am extremely concerned at what the banks are doing for the small- and medium-sized companies,” Mr. Darling said on BBC television on Sunday. “What companies are being charged does seem to have gone up relative to what banks are actually having to pay because of the fact that we have very low interest rates.”

And with that declaration, the concept of credit risk finally made its way to yet another global financial leader.

That we should offer to buy him a drink so he can tell us off the record how he really feels about the bailouts? This is what he said while (presumably) sober last night during a town hall hosted by Jim Lehrer at the Federal Reserve Bank of Kansas City. Imagine what would slip after we got him sufficiently lathered up? (About the bailouts, that “hayseed” at Bank of America,* and his predecessor, who, post two or three—I can’t decide which— scotches neat or Mai Tais with an umbrella, would be referred to as “that backpack of dicks. He’s not standing right behind me is he? Christ, you scared the piss out me.”):

“I had to hold my nose and stop those firms from failing. I’m as disgusted about it as you are.”

Also: “The Federal Reserve has been putting the pedal to the metal.”

*“I told Hank, fuck the threats, let’s end this guy now. One bullet, boom. Done. He’s going to cause trouble otherwise. And I was right. Beer wench, another round for my friends here.”

Citi In $100 Million Pay Clash (WSJ)
Andrew Hall, the top Phibro trader who (sometimes) lives in a castle (it’s his vacation home in Germany) is still fighting hard to get the hundred mill owed to him for heading up the bank’s energy trading unit which “occasionally accounts for a disproportionate chunk of Citigroup income.” This obviously puts Vikram and Co in an awkward position, in the face of the whole being owned by the government situation, though it’s not even like it’s really up to them anyway. Comp Cop Feinberg will ultimately decide whether or not the ballet practicing Hall gets his money.

US Pay Czar To Rework Contracts Deemed High (WSJ)
Speaking of! Technically, Feinberg can’t rip up anyone’s contract, but he can apply pressure to their employer to do so, and, if that doesn’t work, can do stuff like subtract whatever they’re getting for a bonus from their base pay and/or next year’s pay.

High-Frequency Trading Faces Challenge as Schumer Presses SEC (Bloomberg)
Chucky wants it banned: “This kind of unfair access seriously compromises the integrity of our markets and creates a two-tiered system, where a privileged group of insiders receives preferential treatment,” Schumer wrote. “If allowed to continue, these practices will undermine the confidence of ordinary investors, and drive them away from our capital markets.”

The Great Preventer, by Nouriel Roubini (NYT)
Dr. Doom endorses The Beard: “Mr. Bernanke deserves to be reappointed so that he can manage the Fed’s exit from its most radical economic intervention since its creation in 1913.”

Ryanair Stock Drops on Outlook for Fares, Earnings (Bloomberg)
Sounds like it’s time to implement O’Leary’s revolutionary idea.

Kuwait Financier Facing U.S. Fraud Suit Found Dead (Reuters)
Hazem Al-Braikan, chief executive of Al Raya Investment, believed to have shot himself.

Citi ‘milestone’ as Washington takes 34% stake (FT)
Vikram is apparently super excited about the bank’s newfound “financial strength.”

Citi Shares May Rebound, Could Double By 2012 (Reuters)
Don’t get too excited: “the bank will be ‘hard-pressed’ to approach $10 in coming years,” but beggars can’t be choosers and over five bucks would be nice!

Is Goldman Sachs Evil? (NYM)
Or just that damn good?

$$$ Dow 10,000? [The Atlantic]

$$$ Jim Dolan To Kill The Rockettes? [Cityfile]

$$$ Don’t Mess With Goldman [Reuters]

$$$ Job of the Week: Morgan Stanley needs a VP of mergers and acquisitions. You. [DB Career Center]

$$$ American Psycho Remix, Now With Lydia Hearst Getting Killed [YouTube]

The above spread of cured meats and cheese was placed in front of a Barclays trader in a test of gastrointestinal fortitude this afternoon. 90 minute time limit, water allowed, puking a dealbreaker. He got halfway through and is now in the bathroom throwing it up. According to an on-looker, “apparently the cheeses were particularly aromatic and the whole thing smelled like vomit before he even started.”

Not so great news for the Queen’s bitches:

Numbers out today for Global Banking and Markets. All bonuses are 100% deferred- over 3 years, subject to clawbacks. Terms still not defined.

Bonus Ranges:
1st year: $40k-$50k
2nd year: $50k-$60k
3rd year: $60k- $70k

If LB thought last week’s dinner at Barbone was going to be the start of a standing Thursday night date with Jamie Dimon, girlfriend thought wrong. While the Goldman Sachs CEO spent last night washing his hair, JD was wining and dining with Melissa Francis (and JPMorgan vice-chairman Jimmy Lee) at Rao’s. Was it as special as the ex-TARP babies’ time together? Hard to say. Things did start out a bit rocky, on account of the restaurant being unable to fill J to the D’s Tanqueray martini order (they were out of gin,* and, for reasons lost on us, no one thought to move their ass to a liquor store in what would’ve been not that much of an effort to keep our favorite boy-toy CEO happy), but drastically improved after several bottles of red were consumed. I don’t want to upset Li’l Blanks too much, but it was a pretty late night, with everyone leaving sufficiently hammered. Want to get a competitive edge? A suggestion: start filling out your bra.

Earlier: Jamie Dimon Beating Men, Women and Presidents Off With A Stick

*The picture is not from last night/Rao’s, but another restaurant, where management has its shit together.

As a “very rough guess” for how many lucky firms will be branded with the too-big-to-fail cattle iron, the Beard thinks 25 sounds about right. While there are 19 clear candidates from the stress test earlier this year, any firm that might be in the remaining six that has even hinted at support for Lethargic Larry better be preparing peace offerings of Damascene Razors right now to avoid hosting routine regulatory circuses.

The question is why, since it kind of makes them sound insane (or at least seriously lacking in judgment) when in fact their boss is the shady motherfucker but we’ll get to that in a sec. At left, Danielle Pecile and Cristina Culicea, former assistants at the Titan Capital Group. They’re suing boss their boss, Russell Abrams, who asked Danielle to print out some photos he took of his wife, Sandra, on their honeymoon. Sandra is posing on yacht in the pics, with her rack on full display, which apparently made Danielle uncomfortable, as did the smirk Abrams gave his underling as she handed pics over, and when he asked “You liked them, didn’t you?”

Oh no she di’int.

You can add ‘World’s Largest Jigsaw Puzzle Creator’ to the list of Allen Stanford’s accomplishments. Federal prosecutors have indicated that they will be reassembling three bags of shredded documents over the next two months as they continue with their case against Sir Allen and banking regulators in Antigua. Potentially sensing that this arts & crafts exercise is going to spell financial doom for tiny Caribbean nation, Antigua has apparently already conceded that American colonization is inevitable and is currently planning on renaming their highest peak Mount Obama next month.

The noted hooker fucker told Ratigan this morning he’s had “enough of this.”

Sorry for the all-caps but guess what I’m not sorry because this is the one we’ve been waiting for. In an interview with Dan Patrick, L-Dykes says that after turning down twenty offers, he’s finally decided to follow in the footsteps of the greats (The Buse, Stephen Baldwin, Haim and Feldman) and give us what we want: an all-access pass to Lenny town. What will the show be about? “Reality,” Nails says. “Life man. Living the dream.” Later, Nails claims that he and Jim Cramer are still tight, and that JC is really broken up about what happened, which strikes us as a crock since he’s yet to turn Mad Money into a Save Nails telethon, which is what a true friend would do. Also:

- “I still have the jet” (despite evidence the contrary— the private plane was taken away in February— we pray to the god of brain damaged all-stars this is true, as you know how LD feels about flying commercial)

- “If I have to live in the street I would”

- “If I have to eat grass I will”

- “Thousands of people still invest with me” (and every tip he’s dispensed has “worked out”)

- “I only sleep twice a week. You caught me on my sleep day.”

Take ten and listen to the whole thing now, or take the rest of the day and play it on loop. I don’t have to tell you it will not disappoint.

From Magic Johnson.

Please someone send us a clip of T. Geith nodding vigorously, while making a mental note to have his assistant find out if this means he’s gotta wrap it up when whipping it out in the presence of questionable fucks.

Being in charge of the agency that deals with failed financial ideas and business models, SheBair can probably spot a disaster waiting to happen pretty easily. In response to the forthcoming CFPA rallies next month (hopefully including one outside of 85 Broad), the FDIC Chairwoman is already trying to limit the powers of an agency that has yet to be created, Undoubtedly terrified by the vociferous support for the CFPA from you-know-who, SheBair is recommending that the agency be put on permanent back-up duty and leave the matter of consumer protection to bank regulators. Congratulations Maxine- the prospect of having a piece of banking legislation that you staunchly support pass may have actually scared bank regulators into waking up and protecting the financial system.

You can lock him up, you can call him a perv, you can accuse him of having a 15 year-old sex slave and a trannie lover, and possibly running a Ponzi scheme, but god damn it, you cannot make Jeffrey Epstein smile in way that doesn’t scream “any underage chicas lookin’ for a good time???” even if it’s for the flyer that will follow him around for life and inform new neighbors that yes, you are in the presence of a sex offender. It is his right and you will not take that from him.

Jeffrey Epstein’s Predator Flyer [Cityfile]

Just because he and his firm are being investigated for some possible wrongdoing doesn’t mean you shouldn’t fork over a briefcase of unmarked twenties, ASAP. Interested but need to know more re: what kind of returns you could expect? Performance history for the NIR Group’s AJW Qualified Partners below, plus the obvious value-added of having a guy whose background includes working at a firm called “The Rainmaker Group LLC” overseeing your cash.

May AJW Partners Share Class B 06.22.09-1.pdf

Who knew Tim Geithner was such a master of market timing? Faced with mounting pressure to put the regulatory vice on the financial industry sooner rather than later, Timmy threw out the end of this year as a target completion date for the regulatory overhaul. His timing couldn’t be better. Adjusting for the fact that financial regulation is never timely, TG has likely succeeded in pushing off the signing of potential regulation to the moment when even Nouriel Roubini expects GDP will be growing. At that point, the last thing Timmy or anybody else in the administration will want on their hands is being responsible for knowingly dumping regulatory weed killer on all those green shoots.

And what are they saying? That Bernie was a baller, and also an imbecile, possibly. The Post reports that an upcoming book about B-boy, “Madoff With the Money,” will expose a few previously unknown details about the Ponz Master. Some are of little interest (he was weaseled way out of serving in ‘Nam, he was “a serial Casanova,” he had to pay off female employees he might’ve banged). Others seem unlikely (supposedly acquaintances considered him “the dumbest man on Earth.” Obviously you don’t pull off the shit he did, for as long as he did without having something resembling a clue, leaving us to wonder, did Bernie actively play dumb to throw people off? And if so, how far did he go? Talkin’ telling people he couldn’t read, or, like, trying to convince them he was an actual rètard?). One is just. plain. awesome:

Just before Madoff’s arrest, a pal ran into him in Central Park and saw him wearing two gold Rolexes on one wrist. “I gotta know what time it is in my London office,” Madoff explained to the friend, who told Oppenheimer: “Think about that — Bernie couldn’t do the addition or the subtraction!

Zee Germans, just like everyone else, are raising base pay. Supposedly global banking employees were informed yesterday that first years are being bumped to 60k, second years 70k, third years 80k and first year associates 95k. One HY informed us that he and his colleagues are “extremely displeased” with numbers, as they are “insulting low compared to competitors (even Jefferies, for God’s sake).”

A familiar face went 40 hours before the tears started.

Warren Buffett To Get Animated (CNBC)
Yes. The Oracle of O will be starring in a series of cartoons imparting wisdom on kids in the areas of finance and huge cans.

JPMorgan Said to Increase Some Investment Banker Salaries Starting in 2010 (Bloomberg)
“The plan, unveiled yesterday at a meeting with investment bank co-heads Steven Black and William Winters, affects those who earn half or more of their total compensation in year-end bonuses, the person said, declining to be identified because pay matters are confidential. It will be implemented in 2010 and details will be announced closer to the end of this year. The salary increase doesn’t change total pay.”

Fortress Plans Buying Spree (FT)
Wes Edens has a message for any hedge funds that haven’t made back last year’s losses by the end of ‘09: “It’s all over for you,” so you might as well turn over the keys to the place now.

Citigroup Board Names Three New Outside Directors (C)
Vikula welcomes (Mike Bloomberg gal-pal) Diana Taylor, Timothy Collins, and Robert L. Joss.

Calpers Hopes Riskier Bets Will Restore Its Health (NYT)
The fund’s new head of investments aims to sink a few billion into “beaten-down private equity and hedge funds. Junk bonds and California real estate also ride high on his list. And then there are timber, commodities and infrastructure.”

Blindsided By Bear, Mr. Miller Sees Bull (WSJ)
In a quarterly report to fund shareholders, Mr. Miller said that a new bull market is under way and that technology and financial-services stocks would be among its leaders.

Buffett’s Goldman Stake Pays Richly (Dealbook)
Ka-ching for the Oracle. WB’s stake in Goldman is now worth $4.1 billion more than what he paid 10 months ago and the girls are on Lloyd.

$$$ Matthew Goldstein: Mack Is No Blankfein, Thankfully [Reuters]

$$$ Has Carl Icahn given up blogging? [Cityfile]

$$$ Be the flyest bitch on the desk: buy the Bernie Madoff jumpsuit. [AA]

$$$ A curious nomination [True Slant]

$$$ The Backlash to the Macklash [Daily Intel]

$$$ HSBC’s Hedge Fund Hope [FTAlphaville]

The Chairman of the Senate Banking Committee gave a little glimpse into the thought processes coming from the Washington braintrust as they craft risk management legislation. While keeping people alerted to the possibility that the bailout beast may hiccup again and throw some support CIT’s way, Dodd also offered his two cents on the topic of risk management and the rationale behind the need for things like the CFPA.

“There is an important signal for shareholders and others out there who invested their resources and have been hurt terribly by what’s happened,” Dodd said. As an investor, “I’d want to know whether we’re keeping the same people around that watched the value of my investments decline so precipitously.”

Evidently having completely unhedged long exposure is the hallmark of prudent risk management that all forthcoming regulation should seek to enhance.

CDS target practice starts next week with a proposal that may call for banning naked CDS trades. Lawmakers will get their opportunity to shine and add to their distinguished track records identifying the risks in sophisticated financial products. For example, people should rest easy that House Agriculture Committee Chairman Collin Peterson, sponsor of such pieces of CDS-related legislation as ‘Amending the Rules of the House of Representatives to clarify the treatment of reimbursements to Members for the use of personally owned airplanes in the performance of official or campaign travel’ as well as the unforgettable ‘To suspend temporarily the duty on certain engines for snowmobiles’ will help to decide the conditions under which the multi-trillion dollar market operates.

Have you sort of felt, for the last year, that the Journal wasn’t doing a very good job addressing the real issues surrounding the crashing of the global economy? Sure, they’ve kept us abreast of which CEO’s are taking the jets out for rides on the company dime, and who’s getting big ass bonuses straight from the taxpayer pocket, but it’s mostly just been frivolous bunk. I don’t know what happened over there last night, but today the paper has finally printed a substantive story that gets to the heart of the matter of the danger that lurks among us, and how not until we fix it will there be a true recovery. We’re talking, of course about a Page One exposé on your cankles. That’s right: your fat fucking ankles. The fat located between your foot and your calf. Need a more clinical description?

Cankle, a portmanteau word combining calf and ankle, refers to “the area in affected female legs where the calf meets the foot in an abrupt, nontapering terminus,” according to Urban Dictionary. A spokeswoman for the American Podiatric Medical Association says the word is not a medical term.

Are you so in denial that you have no idea what we mean? Here, the Journal will draw you a picture:

The UBS tax saga seems to have really thrown Switzerland out of its sweet spot. Having defined itself as a place that doesn’t choose sides and simply exists in a neutral, grey area, the heat the country has taken over the past several months for helping Americans (and many others) avoid the tax man has forced its hand. In a somber moment today, the Swiss initiated a double-taxation treaty with Finland which now sets the stage for the country’s removal from the G20’s “grey list” of uncooperative tax havens. For those looking to stash funds (real or fake) in a place that won’t automatically set off alarm bells, your remaining grey list choices are Luxembourg, Austria, Belgium, and for the Latin American set, Chile.

Nothing has actually been done yet (why rush themselves?) but ABC News reports that the Securities and Exchange Commission is most definitely leaning in the direction of showing Joe Cassano and the AIG Financial Products team they mean business. Actually, that’s not true that the regulator hasn’t done anything— the SEC has sent strongly worded letters to the possibly guilty parties making it clear that they intend to make Joe and Co pay, which should count for something. How bad? Money-wise, not bad at all. Fines could amount to $1 million, if that, but what is really upsetting and, we think, a bit extreme, is that these guys might lose their professional licenses, which could make finding new gigs kind of difficult. That’s sure to weigh on JC during today’s bike ride.

If Ken Lewis has his way, yes! For the Victorians in Charlotte, this will come as a huge disappointment. For the Hasselhoffs (pictured at left), get psyched. From Bank of Amerillwide HR tips line:

Thought everyone should that George Ellison, the George Ellison whose behavior in Vegas a few years back scarred employees into leaving BAC for UBS (after they were threatened to keep it on the DL), is third in line to take over at Bank of America, having been promoted by Ken Lewis all these years and supported by Lewis no matter what. He’s also overseeing public bailout monies, which are probably going towards hookers and blow.

Update: Don’t break out the blow just yet:

Ellison does not manage the bailout money and he definitely isn’t under consideration to for KLs job. Ellison is a life long investment banker that currently manages structured finances. He lack of corporate banking experience combined with his very well known personal issues will never pass the board.

As California lawmakers vote today on the proposed $15 billion solution to the $26 billion problem, the Governator may want to consider sticking to the ongoing efforts to make the IOU the common currency. In a state where a “native” is somebody that moved there more than 5 years ago, some of Arnold’s proposals may make even the most diehard transplants think twice about whether or not the California lifestyle makes up for the state’s fiscal idiocy.

Two of the more desperate plans under consideration to save money and sell everything it can to raise cash are releasing up to 27,000 prisoners and allowing new drilling for oil off the coast of Santa Barbara. With the recent passing of tax legislation on medical marijuana in Oakland, the state find itself one step closer to legalizing and taxing pot altogether. At this rate, the true image of the Golden State will be a bunch of baked ex-cons surfing through black sludge on their way back to squatting in foreclosed McMansions.

It probably seemed exciting to those of you not intimately familiar in the ways of Jews from the Garden State but this thing really didn’t elicit much more than a NBD from us this morning. Money-laundering? Rabbis? Shady politicians? Welcome to my childhood. Now, our interest has been piqued, not so much because of the dead bodies but the notion that you could make an entire career out of peddling this shit:

The probe also involves the trafficking of body parts, according to a person familiar with the matter. One of the individuals who was arrested Thursday morning is an alleged organ dealer, this person said.

Or elicit a “no fucking shit,” I can’t decide which. This morning there are two of them, both about Dennis Kneale:

1) Apparently Kneale’s on-air “meltdown” and rant against “digital dickweeds,” who suggested DK’s bold claim that the recession was over was dead wrong (and whose commenters* later noted that DK should be put in a burlap sack and beaten with reeds, that he was functionally retarded, and that he bears a resemblance to Beaker) was manufactured. Specifically by his producer, former Fox guy Jerry Burke (the one who told DK the outburst was poetry, and the best thing he’d ever done on the show). But…but I thought…but didn’t Dennis say…didn’t he tell a reporter this wasn’t “about standing out”? And now you’re telling us the truth is that the whole thing was a stunt “to draw attention and drum up buzz”? So it was all a sham? I mean, it makes sense, given that Dennis had been in the slot for 14 weeks and no one was really paying attention, and if you consider that CNBC talent is contractually obligated to not let 15 seconds go by without starting a fight over something, anything, with fellow colleagues or guest, lest they receive an electric shock to the nipple but….but this means we were lied to? And…used? And might never be able to trust anything that comes out of Dennis’s mouth again?

2) DK (allegedly) gets drunk and gropes the wives of underlings.

*Some people—Dennis— have trouble differentiating, and you guys should be getting credit for your contributions.

Chris Gillick contributed to this story.

This week, alarms sounded at Long Island investment firm NIR Group - which manages over $7 billion - when Forbes reported that investors were suing because they believe the fund has been reporting bogus returns.

But Dealbreaker has learned that well before Steven Mizel and Palmetto Partners filed suit in March, NIR, based in the Long Island suburb of Roslyn and founded by 38-year-old Corey Ribotsky, had tried to bribe an investor from going to the press after NIR suspended redemptions on its AJW Partners Fund back in October 2008.

Sequoia Sun, who runs a restoration project for a humanitarian-aid-delivering sailboat called Schooner Dolphin in Norwalk, Connecticut (just across the Long Island Sound from Roslyn), wanted to warn investors last fall about the trouble he had redeeming his money.

But Ribotsky would have none of it, as a member of his staff tried to bribe Sun in exchange for not going to the media. Specifically, the staffer offered Sun a discounted portion of his invested principal if he signed a confidently clause and pulled his quotes for a story that was set to run in a New York City-based newspaper. Sun turned down the bribe, but the fund turned the tables on him, telling the newspaper’s attorney its source was actually trying to bribe the fund! While the paper never proved there was any bribe, it withheld the story anyway.

Apparently the Consumer Financial Protection Agency is going to do a lot more than just define what products retail consumers will be duped by. According to Mad Max, it will also act as a national truth serum and prohibit people from lying. During a tour rehearsal yesterday, the leader of the David Obey fan club remarked that,”consumers fell prey to unscrupulous loan initiators who put them into subprime mortgages that they could not afford, such as adjustable rate mortgages, Alt-A loans, and liar loans.”

Having seen thousands of people give into the temptation to upgrade their income and assets when filling out loan documents, Maxie believes that the CFPA, acting in its capacity as sodium pentothal administrator, “would put an end to those practices”. Hopefully she will offer her priceless stamp of approval should the government decide to create the Consumer Personal Responsibility Agency.

On Tuesday, the awful news came out that Stephen Baldwin joined Lenny Dykstra on Team Bankruptcy. Alec and Billy seem to not give a rat’s ass about their brother’s financial situation, offering nothing in the way of a bailout. Stephen’s good friend and tenant, a heroin dealer, was recently arrested and will not be able to lend Baldy any proceeds from his crack slinging business. And now, we’ve learned that Stephen was forced to give up his spot on the reality TV show, “I’m a Celebrity … Get Me Out of Here!” after being attacked by wild animals. That’s right, people— Baldwin says he exited the show after receiving more than 125 insect bites in eight days.

According to Baldy, the bites were so bad that he had “an extreme allergic reaction that caused him to lose sleep and 22 pounds.” What we’re getting at here, is that Baldwin is really in a bad spot. He’s clearly in no position to work, at time when he could really use the money. It’s time to get charitable. It doesn’t have to come from your checkbook, though that would obviously help. Something as small but meaningful as rubbing on some Calamine lotion to reduce the swelling would mean a lot. He’d do the same for you.

*Which sounds really bad if you’re a celeb or pussy but at some the more hard-core hedge fund in the bunch is merely a standard exercise for non-performing PMs or when the big guy just wants to have some fun.

While US banks come increasingly under fire for scaling back traditional lending due to minor details like near 10% unemployment, at least one emerging market country has made sure that its citizens will have access to loans regardless of economic conditions. Russian state-owned bank Sberbank was ordered by Vladimir Putin to keep on lending despite a rise in bad loans and continued economic contraction. Vlady also made sure the bank didn’t just close unprofitable branches to focus on money-making ventures.

A significant part of the [branch] network is not profitable but you cannot abandon it,” he said. “This is your payment for the state support.”

Make bad loans and love it- the very words the now state-controlled banks in the US have lived by for years.

From: Cliff Asness

Date: Wed, Jul 22, 2009 at 11:14 AM

Subject: New version of health care essay at www.stumblingontruth.com and attached here.

Dear Friends (and bitter rivals),

NJ politicians—>Corzine—>Goldman. Boom. Done.

FBI agents swept across northern New Jersey Thursday, making arrests in a major international money laundering probe.

Federal prosecutors say about 30 people have been arrested in the two-track investigation. They include Assemblyman Daniel Van Pelt, Hoboken Mayor Peter Cammarano III and Secaucus Mayor Dennis Elwell. Federal prosecutors say several rabbis in New York and New Jersey were also arrested.

Radio station New Jersey 101.5 FM reports the sweeps are taking place in Hudson, Bergen, Monmouth and Ocean counties.

The station said the probe centers on money-laundering and political bid rigging.

Dozens Arrests Dozens In Corruption Probe [WSJ]

Don’t get too excited just yet— Shia LaBeouf is still committed to this thing. It’s Javier Bardem that’s dropped out due to scheduling conflicts (a RomCom with Julia Roberts), leaving an opening for the role of the “villainous hedge fund chief” (a short seller, natch), who ShiLa somehow gets in his head is responsible for the suicide of his mentor (Dick Fuld*).

Obviously this is quite disappointing to those of us who were hoping the “evil short” would be a guy who walks the trading floor with a captive bolt pistol and can pull off a bowl-cut. Fox hasn’t announced an alternative actor, presumably because they’ve yet to come up with one, which is clearly where we come in. One London trader told Forbes the part calls for a thespian who can do the whole “emotionless expression” thing, since “successful traders need a bit of a steely demeanor where nothing shakes you, and he epitomizes that.” We could go in that direction, sure, if we wanted to be unimaginative fucks, or we could go with someone who could play an eccentric, should the role call for losing it at the drop of a hat, smashing computer screens, riding Zambonis around the office, and tap dancing on the desk, all in the course of one trading session. Ideas?

Bardem Snubs ‘Wall Street’ Sequel [Forbes via Dealbook]

*We’ve yet to see a script, and we’re not even sure if a final one has been completed but
who among us can say there wouldn’t be some comedic value there?

Obama: Banks Will Act Recklessly Without Reform (CBS)
“With respect to compensation, I’d like to think that people would feel a little remorse and feel embarrassed and would not get million-dollar or multimillion-dollar bonuses,” the President said.

Ford Posts $2.3 Billion Profit (WSJ)
Slowing of the cash burn! “The auto maker reported a net income of $2.3 billion or 69 cents a share, compared with a loss of $8.67 billion, or $3.89 a share for the same period a year earlier. The company burned through about $1 billion in cash during the quarter as it controlled incentive spending around the world while increasing output in its North American plants.”

Ice Cream Market Hot For Dairy Queen (Shanghai Daily)
The Oracle of Omaha is spreading the love: 500 more DQ’s in China over the next 5 years.

US Files Indictment Against Danny Pang (WSJ)
Basically just a restating of previous charges which were that the PEMGroup, as Pang once told a colleague, is a scam. A spokesman for Mr. Pang, however, said the businessman “believes these charges are false and he looks forward to being vindicated at trial.”

Howard Marks: Stem Those Fees (NYP)
The Oaktree Capital Management founder has a problem with huge incentive fees. Only the best (like Oaktree) should be getting them. “Incentive fees on the order of what we’ve seen are a big deal and they should only go to extraordinary portfolio managers,” said Marks.

Credit Suisse Reports $1.5 Billion Profit (NYT)
Up 29 percent from year-on-year but down from the first quarter profit of 2 billion francs. Brady Dougan is confident the team can keep this up, and that the other Swiss bank in town will blow Toblerone bars when it reports on August 4.

Fannie & Freddie: The most expensive bailout (CNN Money)
“We’re assuming they each will cross the $100 billion mark fairly soon. They could be hitting the $200 billion barrier by the end of next year,” said Bose George, mortgage analyst at Keefe, Bruyette & Woods, an investment bank specializing in financial services firms.

Hamptons Luxury Market Stalls With Four-Year Inventory Pileup (Bloomberg)
Only 37 homes above $2.37 million sold last quarter. Will no one step it up? How about this baby, any interest here? “The asking price for a 13,500-square-foot oceanfront home in Southampton Village with nine bedrooms, 11 bathrooms and a tennis court was reduced 25 percent in April to $60 million after sitting on the market for a year, and still hasn’t sold.”

$$$ “Clearly, we can do better,” Colm Kelleher, Morgan Stanley’s chief financial officer, said after analysts pushed him on the weak trading numbers. [Dealbook]

$$$ Bernie Madoff’s Personal Ad (it’s a fake, obviously, but posted on a real Craiglist-for-inmates site with his number and address so hopefully it’ll be of interest to someone on the inside looking for love). [The Frisky]

$$$ Would You Stand On Planes For Cheaper Tickets? [The Atlantic]

$$$ Investors Accuse NIR Group Of Providing ‘Fanciful’ Returns [FINalternatives]

$$$ Attorney For Three Former UBS Employees— the quants who left for Jefferies, where the Swiss claim they took “prop trading secrets”—Fires Back [Traders Magazine]

$$$The wardens who run this asylum want you to take this survey. We’re told it should be painless.

Picking up where the expired Trader Monthly left off, Dealbreaker is compiling our own who’s who list of buy-side all-stars (which you will be able to select for your DB fantasy team at a later date). We’re taking nominations now. Info we’ll need on your draft picks:

- Age

- Current Firm

- Previous Firm(s) if any

- Position

- Sector/Asset Class

- College

- Hometown

- Other things you’d like us to know

Remember Robin Katz, from yesterday? Of course you do. Anyway, like we said, girlfriend’s looking for a) $50,000 bail to get her out of Riker’s and b) a new job (her dream is Oppenheimer but will entertain other offers), on account of JPMorgan Chase having a problem with the financial adviser creating an extra ATM card in the name of one of her clients and helping herself to $100,00 or so over the course of a year. To the end, and as unofficial headhunters for Katz, we’d just like to put it out there that say what you will about her crime, but could it really have been so bad, given that her victim still doesn’t know about it? The Post got in touch with Dorone Illan Farber, who apparently has no idea about any of this.

Farber, a broker for Hilliard, Farber & Co., a Wall Street company owned by his uncle, loves cards and placed 128th in the 2008 World Series of Poker. He won $4,216.

When asked by phone yesterday about the pilfering of his bank account, he told a reporter, “I don’t know what you’re talking about.”

Oh, and a new pic of Katz eating a strawberry has been procured (we’re partial to the domestic one, and will use it exclusively).

August looks set to be the month of Mad Max. The derivatives diva is a bit irritated that lobbyists are starting to win the battle against the proposed Consumer Financial Protection Agency by targeting politicians who rely on Rolling Stone to teach them about the evils at GS.

“We think they’ve hired three lobbyists for each one of us,” Rep. Maxine Waters said at the rally, adding that lobbyists were “running up and down these halls” persuading lawmakers who don’t work primarily on financial matters.

As a result, Maxie has vowed that she will be ramping up her speaking engagements around the country next month. She will be spreading the message that only through the CFPA will people rest easy knowing that the woman previously famous for threatening to nationalize the US petroleum industry has their back when it comes to preventing unsuitable investment proposals.

Ever watch CNBC, previously around around lunch (before he was put on what appears to be a permanent time-out) or, for reasons you cannot explain, past 8PM and wonder what happened to this bespectacled fellow, screeching about the recession being over and “digital dickweeds” and god knows what else and thought, what happened to this guy in childhood, or adolescence, or a previous life that made him the way he is today? It has to have been something horrific, right? You can’t just be born like this, can you? It turns out the answers are yes and yes.

In a NYO profile of Kneale, we find out a whole bunch of stuff about DK, including the fact that his father that his father was hit by a car and killed, when Dennis was 14 years-old. The tragedy changed a young Kneale, who became “more outgoing and pugnacious.” A bully, basically. A nerdy, nerdy bully. “When [a sudden death] happens, you’re like, well, fuck,” Kneale says. “There’s nothing you can do anymore that’s going to even come close to that. It’s like, ‘Bring it on. What have you got?’” Other things we’ve learned about DK today:

* His mother always told him, “Don’t say something if you can’t say it to somebody’s face.” She probably meant something more along the lines of what most mothers tell their children, i.e. if you don’t have anything nice to say, don’t say it at all, but Dennis interpreted Mother Kneale’s words to mean if you’re in front of them, or they can see your lips moving through the tube, fire away.

* DK very much took this bit of wisdom to heart, which I guess would explain the rationale of being proud, decades later, of the fact that he wrote a scathing take-down of his high school’s chorus concert with his own by-line. “I wrote the mean review on the record,” said Kneale. “Not anonymously.”

* He really, really hates people who write anonymously online, because it often creates victims of vicious, masked attacks. Like this girl, who truly was made a victim, and like Dennis Kneale, who is not a victim, but believes people taking issue with the claim the “recession is over” are attacking him.

Mr. Kneale traces his genuine distaste for anonymous online criticism to a cover story he edited at Forbes in the fall of 2007, titled “Hiding Behind the Net.” The article, by Victoria Murphy Barret, revolved around the tragic story of a teenage girl who crashes her father’s Porsche at high speeds on the highway, crushing her to death. Afterward, a mob of anonymous Web users posted police photographs of the girl’s mangled remains on various Internet sites, along with commentary mocking the carnage.

“And Google is allowing that to happen?” said Kneale. “Because, oh, well, that’s the blogosphere, they’re anonymous. You know what? How dare you? How dare you hurt people like that?”

* He could be even more obnoxious, if he wasn’t holding himself back. “I have a high obnoxious quotient. I try and reign it in.”

* He’s being produced by people who think he’s a genius. “After [the night DK called a bunch of bloggers ‘digital dickweeds’], Mr. Kneale’s producer told him that his outburst was poetry, the best thing he’d done on the show.”

Not sure what exactly they’re taking issue with (obviously there’s much to choose from), or why this guy get a free pass.

Update: Our photographer informs us the signs read “Stop the injustice at Stella D’Oro,” forcing us to ask, why does Lloyd Blankfein hate cookies?

Update II: Brynwood Partners owns Stella D’Oro, and wants to sell it to Lance, Inc., a North Carolina-based manufacturing and marketing firm, sans the Bronx plant. The cookie makers are upset about this, and believe that Goldman has the power to stop the deal from going through.

In the words of TBP himself, the little driveway incident wasn’t so much theft as a rescue mission.

I was disappointed at the state of disrepair my grandmother’s house had fallen into, with broken windows, overgrown yard and a deteriorating condition…. I was sad, and felt a desire to protect what cherished memories I could, most notably the cement that I etched my name into the sidewalk as a youth….I knew it was city property and, in hindsight, regret that I did not work with the appropriate city officials to seek their permission

But TBP offered up a lot more than just a heart felt apology to the current owner of grandma Pickens’ place.

If it helps, I’m more than willing to return to Holdenville and etch my name in new cement, if they deem it appropriate

If not, then they’ll just have to worry about waking up in the middle of the night and discovering their house is cruising at 35mph on a trailer headed towards the Texas Panhandle.

So, AIG was supposed to be paying senior executives millions in bonuses today, but Reuters is now reporting that the plan has hit a bump in the road, that bump being Kenneth Feinberg. AIG, of course, put in a request with the Compensation Cop for permission make it rain like weeks ago but Kenny hasn’t given them the go-ahead just yet. What’s the hold up some antsy employees, shooting off e-mails to Ed Liddy, Subject: “I Gots To Get PAID,” would like to know? Apparently some BS about having to convince Feinberg they deserve it, will be good this time, and have “struck the right balance to discourage excessive risk taking and reward performance.” In happier dolla dolla billz news, Morgan Stanley has set aside 72% of revenue for employee pay, prompting Brad Hintz to note, “It was a very good quarter to be a Morgan Stanley employee. I’m not so sure it was so good to be a Morgan Stanley shareholder.” Oh yeah, he went there.

Forget throwing down seven or eight figures to give to the silver haired guy who promised returns of 10-15% annually; the real opportunists found South African Barry Tannenbaum. BT used his family’s presence in the pharmaceutical industry as a launchpad to lure investors by promising returns of at least 15% every 12 weeks through the purchase of raw materials to be sold to drugmakers. Those lucky enough to partner with Tannenbaum when he was “making” 3%/wk through his opportunistic investing in AIDS drugs are now wondering where their collective 2 billion rand wound up going. As the roughly 400 investors look for payback, the pharma fraud takes issue with any comparison to King Ponz.

“Your attempt to compare me with Madoff isn’t only odious, but is blatantly and patently incorrect without any factual foundation and sensationalist,” Tannenbaum said in a July 8 e- mail.

He is right; not even Bernie played the ‘helping children with AIDS in Africa’ card.

And obviously, we dig it. ABC had a little chat with the TARP Inspector General (which you can listen to here), on the matter of that $23.7 trillion estimate. As you’re aware, Barofsky said earlier this week that the total tab could be way higher than previously expected, which the government via Steve Liesman almost immediately shot down, claiming the numbers were inflated, had been pulled out of Barofsky’s ass, and just generally got in a huff (without offering their own number. You’re not going to box them into that, they’ll do it on their own terms, pal). The General came back this morning to suggest that “perhaps their criticism is that we dare to do math,” and, claws still dangling:

“I think that the Treasury Department ought to read the report before they make comments, at least the spokesperson’s office…Our methodology is laid out in black and white in the report…As far as the numbers being inflated, where do you think we got the numbers from? We got it from the Treasury Department, we got it from the Federal Reserve…If these numbers are inflated, it’s because they inflated them when they put them out in the public, not because of us.”

“This recent attack on my report is really, in many ways, an attack on basic transparency — of not wanting the American people in a certain way to see exactly what’s going on in their government as included in our report…with respect to this program, they’ve not met their claims that this is going to be ‘unprecedented transparency,’ as President Obama suggested there would be.”

Geithner/Liesman, your rebuttal?

The Erin Andrews reference is obvious but what is a reverse peep-hole PR blitz? If we’re working with Seinfeld rules here, then there’s a repairman at the Francis residence right now rigging things up so that when you get to the door, you get to see what’s going on inside, whatever that may be. Is that…what we’re getting at here? And will it be MF on the other side, or is this some sort of hazing ritual for the pool-boy?

I’m not asking if you’d want to, I’m asking if you could. For many of you it won’t come to that, and for those receiving record bonuses this year, the question isn’t so much could you live in a cave but when will I be able to move into the sweet manse I bought from a Mexican drug lord? But not everyone will be so lucky and we need to prepare you for a reality that may be just around the corner by asking, could you hack it? Daniel Suelo can and seems to be pretty happy doing so, by choice, for the almost decade. If the answer is fuck to the no, there’s no shame in that, and remember, if you’ve been saving, you can always pitch a tent in Brooklyn.

In related news, the heir-apparent to Berkshire Hathaway, Ajit Jain, will be living not in a cave but Marc Dreier’s old pad, which he outbid 45 people to land for $8.2 million. The pad overlooks the Queensboro Bridge and came with a signed photo of Dreier and Diana Ross.

Could You Survive Without Money? Meet The Guy Who Does [Details]

With a 23 percent return for the taxpayer! Look for the check in the mail, don’t spend it all in one place! The Salt of The Earth had this to say on the occasion:

“This return is reflective of the government’s assistance, which benefitted the financial system, our firm and our shareholders. We are grateful for the government efforts and are pleased that this additional money can be used by the government to revitalize the economy, a priority in which we all have a common stake.”

Goldman Sachs Pays $1.1 Billion to Redeem TARP Warrants [CNBC]

To solve the problem of a single systemically critical firm potentially bringing down the rest of the economy, SEC Chairwoman Mary Schapiro believes a single systemic-risk regulator should do the trick. While a group of regulators will be involved in creative guesswork to set standards for,”liquidity, capital and risk-management practices” for large financial firms, it will be up to the systemic risk gatekeepers to determine when to force companies to sell assets or cease business. Should this stroke of genius come into being, the government will have pulled off the impossible. It will have successfully transferred the fate of systemic risk mitigation to the only group of people currently trusted less than risk management groups at banks- the government itself.

On the one hand, the massage enthusiast has officially been let out of prison today, after spending the last year of his life locked up for soliciting minors to stand awkwardly next to him while he jerked off into a towel (it was actually his assistant/social director who lined up the girls but details). So that’s got to feel pretty good. On the other, he’s got a bunch of lbs to lose (Bubba told him he’d regret the Hersey Bars, Peanut Butter Squeezer, and Li’l Chub Sausage) in order to get back to his fighting/tail chasing weight, some legal battles to deal with, including a recent suit that he made a “sex slave” out of a 15 year old, and an allegation by John Carney that Epstein is running a Ponzi scheme.

Earlier: Jeffrey Epstein, Comin’ At Ya

But since we asked nicely, in the case of Janet Tavakoli, Chaz will make an exception. Tavakoli got some Gaspo-related issues off her chest this morning, including but not limited to what she believes is a hypocritical inability on Chazza’s part to allow people (Joe Kernan, Dennis Kneale, etc) to interrupt him, and “caving” to Goldman Sachs, after he was invited to 85 Broad for lox and a schmear. Here’s what CG had to say about that:

“I generally don’t respond to people who don’t matter on Wall Street. But any rational, sane person who hasn’t been either hitting the bottle or smoking a joint would watch what I said about Goldman Sachs and come away with two things. 1) I am very tough on them— they always complain about what I say. and 2) In the so-called ‘caving’ clip I was letting them give their side of the story because that’s what journalists do. If someone named Janet thinks I’m selling out, she’s entitled to her opinion, which I hate to break it to her, really doesn’t matter.

We also asked CG how he felt about Tava-K’s low-blow, re: Gaspo never making it to the Golden Gloves, on account of an injury, which he’s claimed, several times, is the biggest regret of his life. “She’s not important enough to give me a low blow,” Chaz told us. “The guy that owns the pizza place down the block I care more about than some lady named Janet.” As for settling this on-air, Tavakoli has already told the FT she’s declined previous invitations from CNBC, and if she’s thinking there’ll be another offer, think again. “I wouldn’t debate her. She’s a nobody, she’s a publicity hound,” CG said. “I’d rather debate Lucas Van Praag.”

I don’t want to get myself into another legal situation on account of you people, so I’m not going to require you to take the next 30 minutes of your time with the following exercise, but I’m going to strongly suggest you or one of your underlings give it a shot. Re: possible death, regular smokers should be okay, and non-smokers will just have to take that chance.

105 pieces of Nicorette gum in 25 minutes [UPI]

We are now inside of the two minute warning on the rating agency credibility countdown clock. While even the most green shoot loving politicians and pundits warn that there is a world of hurt coming in the commercial real estate market, S&P took the opportunity to upgrade 7 series of highly coveted 2007 vintage CMBS to AAA after downgrading them a week earlier. It seems S&P took a step back and rethought its approach to the scenario loss assumptions that brought it worldwide praise from investors and governments alike and realized that it was far too harsh. Consequently, the rating agency handed out the frequently seen 9-notch upgrade from BBB- to AAA to three series yesterday and made them (and the four other series) TALF eligible. Mad Max, take notice, the three series that got the supersized upgrade were from your favorite firm.

Specifically Janet Tavakoli, who thinks that Chaz has been going easy on Goldman Sachs, even after Lloyd Blankfein called him a thug and Lucas Van Praag told the FT he was a blow-hard. Some people think CG might be suddenly treating GS with kid gloves ever since the bank deigned to speak with him, though it’s just as likely the insults and name-calling could’ve done the trick. We’ve yet to hear what CG thinks of all this, but assuming he takes issue with it, and fast-forwarding through the rebuttal (“This woman isn’t fit to slice my deli meat”) any idea who these two could bury the hatch? [via ZH]

Tavakoli on CNBC

Been watching Dylan Ratigan at MSNBC much? We had every intention to do so, but the bottom line is it would require effort to flip the channel over from CNBC and we just can’t quit Mark Haines even for a second. MarketWatch’s Jon Friedman has, however, and while he loves the DRat, needs to get several gripes off his chest.

1) Ratigan has a brain up in that dome piece of his, but isn’t being allowed to use it, or show off his riffing skills like he did on Fast Money, on account of being locked into a script. Friedman wants him improving, moving around the set, sticking his face in the camera, tap dancing and perhaps opening with some jokes.

2) Guests, and the issue of credibility. Friedman was disappointed that MSNBC allowed everyone’s favorite prostie connoisseur even into the studio, let alone on the set of Ratigan’s show because it made DRat look, by extension, like a cheap hooker. To this we say, how dare you? Spitzer injects credibility into everything he touches.

3) Bizarre non-sequiturs:

His references to the New York Knicks’ bloated salary structure and on-the-court futility was a strange counterpoint to a discussion about the endless wrangling over a solution to the health-care mess in Washington.

4) Asking a question then cutting his guest off before giving him a chance to answer that yes, Ashley does move her hips like a cyclone and he didn’t have to pay extra to wear the Scream mask while doing her from behind:

Morgan Stanley reports a loss of $159 million, or $1.37 a share for the second quarter (MS)
“Net revenues for the quarter were $5.4 billion, compared with $6.1 billion in last year’s second quarter. Non-interest expenses were $6.0 billion, compared with $5.2 billion a year ago. Compensation expenses were $3.9 billion, compared with $3.1 bill