Many people have spoken at great length about the evils of Wall St. but the Oracle is not buying the argument that Wall St. is evil itself. Keeping up the trend this week of refusing to name names, WB said part of the problem is ability of certain individuals to do their best George Costanza impression by leaving on top at the same time their respective organizations are in mortal danger.
Archive for October 2009
Forbes reports that “an unnamed hedge fund” is seeking to bring in a specialist who can come in and “make sure employees are not wearing wires,” in an effort to screw (or: finger) said fund. Who do we think it is?
How Dirty Are Hedge Funds? [Forbes via BI]
“But Seriously, This Is Not A Laughing Matter. I’m Probably Going To Lose A Lot Of Friends To Pound Town.”
By Bess Levin
Pershing Square hedge fund manager Bill Ackman highlighted prison operator Corrections Corp. as one of the best real-estate businesses around, during a presentation at the Value Investing Congress in New York on Tuesday. The government is a major customer and there is strong demand for prison space and limited supply, Ackman explained. “It’s also a hedge against your hedge fund business, because as the SEC ramps up…” Ackman said, prompting laughter at the conference. “We shouldn’t joke about that,” he added.
So Hank Paulson held secret meetings with Goldman in a hotel room in Russia and now we also find out, from Andrew Ross Sorkin’s new book, that matchmakers Paulson and Geither arranged a midnight meeting between Dick Fuld and Ken Lewis on Monday, July 21, 2008 to discuss the possibility of something going down between the two men’s firms. The rendez-vous took place after a dinner honoring the then Treasury Secretary, at which all of Wall Street’s CEO’s were assembled and one sort of gets the impression that maybe if Geithner had thought to talk Fuld/Lehman up to Lewis a little more (“he’s a grower, not a shower”), and told Fuld “for god’s sake, don’t look so desperate, play it cool,” the outcome might’ve been different. (It probably also would’ve required Richard to not be delusional about what he was trying to sell which, admittedly, TG couldn’t have helped.)
As the dinner was ending, Mr. Geithner, approached Mr. Lewis and, leaning close, whispered, “I believe you have a meeting with Dick.”
“Yeah, I do,” Mr. Lewis replied.
Mr. Geithner gave him directions to a side room where the two could speak in private. He had apparently already given Mr. Fuld the same instructions, because Mr. Lewis noticed him across the room looking back at them like a nervous date.
In democracies like the US, the will of the people is supposed to at least help determine the country’s direction. It’s part of the culture and manifests itself in a variety of places. Take, for example, Who Wants to Be a Millionaire. When you run into a tough question you have the option of finding out what the majority thinks by asking the audience. Congress may want to consider applying the same methodology to the tough question of how much financial regulation to introduce.
As reported yesterday, a source close to Sanjay Santhanam, Galleon’s head of risk management, told Dealbreaker that Santhanam recently expressed fears the firm “could be closed by Friday,” due to a massive amount of redemptions. A representative of the fund, however, takes issue with the potential expiration date offered by San-San, pointing out that, technically, the death would be much more slower and painful, and take us through the New Year.
It appears lawmakers and regulators are going to make sure one of the alleged primary causes of the economic crisis, speculation, is also part of the solution and clean up efforts. As the countdown to the next 10 people to be taken away in handcuffs for insider trading continues and speculation runs rampant, the institutional version of the whodunit perp walk is over in California. One day after the state’s attorney general, Jerry Brown, announced that a ” major institutional bank” was going to receive a $200 million legal surprise due to some of their dealings with CalPERS and CalSTRS, the grand prize winner was announced today. Brown singled out State Streets efforts allegedly overcharging the two pension funds over the past 8 years in the award presentation ceremony.
If the administration is looking for one more reason to do everything they can to create jobs, they don’t have to look much farther than the housing crisis. But the rationale extends far beyond simply keeping people in their homes. Presumably if more people were employed it might distract some of them from their current full-time occupation of trying to cheat the system. Not surprisingly, when the government advertises free cash in any form, there’s a stampede to get to the front of the line and the home-buyer tax credit program is no exception.
As you’ve probably heard, at least ten more people are expected to be charged with insider trading this week. Some of them may be connected to the Rajaratnam case. Others will be accused of dipping their wick elsewhere. Annoyingly, the authorities refuse to give any hints as to who’s going down. And we can’t take the suspense!
Few areas of the country have been hit harder by unemployment than the Rust Belt. The auto industry’s implosion has created widespread economic hardship and left many anxiously waiting for a sign that the tide is turning. Almost a quarter century after watching John Elway’s signature performance in “The Drive” from the sidelines, Bernie Kosar and the Cleveland Browns have offered a ray of hope to the residents of the mistake on the lake.
