Jamie Dimon: Banks Should Be Allowed To Expand–And Fail (WaPo)
“Ending the era of “too big to fail” does not mean that we must somehow cap the size of financial-services firms. Scale can create value for shareholders; for consumers, who are beneficiaries of better products, delivered more quickly and at less cost; for the businesses that are our customers; and for the economy as a whole. Artificially limiting the size of an institution, regardless of the business implications, does not make sense. The goal should be a regulatory system that allows financial institutions to meet the needs of individual and institutional customers while ensuring that even the biggest bank can be allowed to fail in a way that does not put taxpayers or the broader economy at risk.”
Warren Buffett Says The Financial Panic Is Over (Reuters)
“The financial panic is behind us,” Buffett said at Columbia University’s business school. “Our economy was sputtering, still is sputtering some.”
Ex-Bankers Form ‘Blind Pools’ in Bid for Failed Lenders (WSJ)
“Wall Street firms such as Goldman Sachs Group Inc. and Deutsche Bank AG are racing to form investment pools that plan to fund acquisitions by the bankers, who hope to leap into the auction process for failing banks led by the Federal Insurance Deposit Corp. One trio of banking veterans who are considering such plans is former J.P. Morgan Chase & Co. Chief Executive William Harrison, former Wachovia Corp. CEO Robert Steele, and Herb Boydstun, former CEO of Hibernia Corp., a regional bank in New Orleans that was sold to Capital One Financial Corp., according to people familiar with the situation.”
Roomy Khan Tipped Several People In Galleon Case (NYT)
“I provided information to several co-conspirators who worked for various hedge funds, who also traded on the inside information for profit,” Khan said. Also, she destroyed incriminating emails. NBD.
At Boeing, Dreamliner Fix Reveals New Wrinkle (WSJ)
Bad news. Your order is being delayed yet again.
Archive for November 2009
$$$ Forbes 67 Most Powerful: Ben Bernanke (4), Lloyd Blankfein (18), Jamie Dimon (30). [Forbes]
$$$ Fund Manager Horseman To Resign [WSJ]
$$$ Buy Madoff’s Boats [BI]
$$$ Europe Could Impose Pay Restrictions On Hedge Funds [FA]
Well, this is certainly not what the Bush administration and the companies that owned it had in mind. Who would have guessed that “American companies’ reputation here for overcharging and shoddy workmanship” would hurt our image even more than an invasion and occupation?
The populist rabble-rousing on Capitol Hill is getting ominous.
“I see it as one of our potentially last chances to get control, particularly of financial institutions in their mega-forms, before they take over the world,” Rep. Paul Kanjorski said of the banking regulation reforms proposed by the White House and congressional leaders. But for Kanjorski and Rep. Earl Perlmutter, both Democrats, the bill doesn’t nearly go far enough.
Both men, whose districts include few, if any, Fortune 500 companies, want to undo the deregulation enacted a decade ago, which demolished the barriers between commercial and investment banking, among other rules. Perlmutter’s “light-touch” option would simply allow whatever will be regulating banks to require hybrid commercial-investment banks to keep certain capital reserves. Kajorski’s more draconian proposal would give regulators the preemptive authority to place limits on the size, complexity or risk of any financial company that presents a systemic risk to the economy.
While it’s not yet clear how investors will fare, we’re told that Raj-Raj is taking care of his employees. The Galleon team will be paid bonuses based on the fund performance at the date of shutdown, plus two months severance, plus benefits. A Galleon spokesman confirmed the plan but declined to comment further.
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As you’re aware, Warren Buffett is in the city to talk to the youngsters at Columbia’s b-school, and to check out Becky Quick’s rack. He got in early yesterday though, and hand some time his hands. After spending the morning at the Museum of Sex, we’re told the Oracle paid a visit to 85 Broad, where he walked the trading floor with Lloyd Blankfein, and gave a brief speech to the team “over the hoot.” Obviously Warren B’s been pretty pleased with how his injection in the bank has panned out thus far, but he couldn’t help but noticing that his little fluffers seemed a bit down in the dumps, and figured they could benefit from some good folksy business wisdom married with abberant sex fetish. We’re waiting on a transcript of the remarks, which we’ll bring to you shortly, but in the meantime we’re told the speech went something like this:
Good afternoon, labias and gents. Oracle of O here (oh yeah, double entendre), coming at ya live from Lloyd Blankfein’s pussy palace on the 31st floor. “Long Lloyd” over here tells me that your once long, strong and down to get the friction on Johnsons have been flying at half-mast ever since Sunday. Relax your sphincters, girls, cause Uncle Warren is here to put your mind at ease.
Earlier this morning, a report came out that Goldman Sachs, after promising to pay the vet bills and find homes for five kittens discovered on the site of their new headquarters this past August, had neither paid the bills nor found houses for those cats. Now, like magic, Goldman has put out a statement* that the vet has been paid off, and the cats adopted. And that got us thinking– for a while now Goldman has been uncharacteristically trying to ingratiate itself to the public, and after this weekend’s latest attempt kind of backfired, they’re getting desperate. The old Goldman wouldn’t have thought twice about being accused of leaving those pussies out the cold but the new Goldman, sensitive to the hate, make it its first priority to squash any indication that they are anything but saintly. They want to keep us happy and they seem to be going to great lengths to make that happen. Basically we’ve got them right where we want them and I’d like to see what else we can get out of them.
There’s a new job requirement for the next Bank of America CEO, should one ever be found: dealing with a completely dysfunctional board of directors.
The U.S.’s largest bank continues to devour itself in its search for a successor to the apparently irreplaceable Ken Lewis. And so the firm will miss its second self-imposed deadline to name a winner of the Worst Job on Wall Street contest. There will be no new BofA CEO by Thanksgiving, leaving the bank little more than a month before Lewis’ resignation takes effect.
Not content to ravage the bank with his acquisition of Merrill Lynch and acceptance of Treasury Secretary Timothy Geithner and Federal Reserve chief Ben Bernanke as his liege lords, Lewis seems to have picked the worst possible time to resign. You see, at the Federal Reserve’s request, the bank had just tossed half of its board and added six new directors, and this board has simply failed to “gel,” according to the FT. So when Lewis surprised them with his resignation in September, they didn’t know what the hell to do.
The federal government may be the next too-big-to-fail institution to accept federal bailout money.
The Obama administration, struggling to keep the federal budget deficit from spiraling out of control, could accept up to $210 billion in TARP funds in a bid to cut its debt. The government won’t take all of the remaining TARP kitty, which is growing as other recipients race to return their bailout money to get out from under the onerous thumb of the government, especially that nasty pay czar Kenneth Feinberg.
On the bright side, no one in government makes nearly enough to run afoul of pay restrictions, and the government never has to pay itself back.
Goldman Sachs has gone on record to say that contrary to popular belief, the bank does not start each morning by clubbing baby seals in the basement of 85 Broad. Today the progress God’s workers made ingratiating themselves to the animal community is flushed down the toilet, with the news that while marine mammals get a pass, kittens with no place to go? Let them die in the streets, even if they were discovered in GS-owned cathouse.
According to a report by The Villager, five kittens were born this past August in the firm’s not yet completed new headquarters downtown. At the time Goldman said it would pay for the kitties’ vet bills and encourage employees to adopt the furballs. Three months later, none of them have a home, and the cat doctor is still awaiting payment. Now. Truth be told, we personally can understand that not everyone likes cats, as they’re fairly creepy. It’s not like Goldman abandoned a bunch of puppies in which case we’d advise every GS’er to get out of town, ASAP. And, by all accounts, Lloyd’s a parakeet guy. But the fact remains that those jerks used these things to come off all warm and fluffy to the public. What kind of sick fucks would do something like that? Goldman, apparently. They acted like they cared when in fact they don’t give a rat’s ass. This makes Goldman a liar. Capital “L”, small “i”, small “a”, small “r”, period. And now, we need to review everything else they’ve ever told us, and ask ourselves, what else have they been lying about? Maybe they do club baby seals. Maybe, despite what they’ve said, egomaniacs actually are employed at 85B. MAYBE THEY REALLY DID NEED THE TARP MONEY.
Goldman Sachs Charged With Abandoning Kittens [NYM]
