Archive for April 2010

  • 19 Apr 2010 at 6:12 PM

Write-Offs: 04.19.10

By Bess Levin

$$$ Citi Distances Itself From Goldman’s Troubles [NYT]

$$$ Goldman Sachs Points to Magnetar Trades in Its Defense [ProPub]

$$$ Gasparino: Blankfein In The Hot Seat [FBN]

$$$ Team green: KKR, Carlyle partner with EDF [The Deal]

$$$ Report Says SEC Missed Many Shots at Stanford [WSJ]

$$$ Dick Bove: “There seems to be a concerted effort once again, by all supposed responsible parties, to prove to Americans that the financial system is corrupt, and that Americans cannot be treated fairly by dealing with it. No one has apparently learned that if all interested parties join together in condemning the financial system it will collapse. The stage is being set another bone chilling crisis.” [PDF]

  • 19 Apr 2010 at 4:38 PM

Caption Contest Monday

By Bess Levin

[via Dealbook]

  • 19 Apr 2010 at 4:15 PM

Dick Fuld Has Never Heard of Repo 105

By Zachery Kouwe

Dick Fuld plans to testify that not only did the infamous “Repo 105″ transactions play no part in Lehman’s bankruptcy, but they were so immaterial that he never knew about the accounting treatment until the bankruptcy examiner unearthed them.

In his prepared testimony, a copy of which was obtained by Deal Journal, he said the press has “unfairly vilified” Lehman by claiming the Repo 105 transactions were meant to hide the firm’s toxic assets. Instead the accounting gimmick, which Fuld says was totally legal, involved highly-liquid investment grade securities, mostly Treasury bonds.

Meanwhile, several hedge funds that supposedly shorted Lehman shares before the bankruptcy have been subpoenaed by investigators. They include SAC Capital, Och-Ziff Capital Management, Greenlight Capital and Citadel Investment Group.

Full Text of Fuld’s Statement: (Courtesy of Deal Journal)

Continue reading »

  • 19 Apr 2010 at 2:41 PM

Ashley Dupré On Love

By Bess Levin

A few months back, Eliot Spitzer gave us some Real Talk on love. Now the other half of the duo, Ashey Dupré, has weighed in on the topic. Sayeth Ash: “If you’re in love with someone, you want to treat them like the five year old. You want to cater to them and love them and hug them and like be emotionally there. Like you want to give them a blowjob! When you get married and, like, the wife doesn’t want to give a blow job anymore it’s like…[face].”

Ashley Dupre Has A Boyfriend [Daily Intel]

Earlier: This Is What Eliot Spitzer Paid $2,000 An Hour For (NOT SAFE FOR WORK)

  • 19 Apr 2010 at 1:51 PM

Sleep Where Shia LaBeouf (Pretended To) Hath Slept, For $13 Million

By Bess Levin

In 2003, an unnamed 47-year old “financial services pro” bought a 6,250 square foot apartment in the Flatiron district. Recently he’s been thinking about putting it on the market, having decided that the fact that an actor (who once shared a sandwich with a couplea Goldman Sachs employees) spent a couple days there will really up the resale value of the place. Continue reading »

  • 19 Apr 2010 at 1:01 PM

CNBC: Fabrice Tourre “Taking Some Time Off”

By Bess Levin

According to Goldman, this was totally voluntary. The bank would like it to be noted that His Fantabulousness made this decision himself, he was not suspended, and he remains an employee of the firm.

  • 19 Apr 2010 at 12:30 PM

Is A London-Based Investment Banker About To Make A Few Million Pounds Off Lloyd Blankfein?

By Bess Levin

Almost three months ago, an absurd story appeared in the Wall Street Journal, which quoted an unnamed senior London-based investment banker, who’d said he’d bet a bunch of people at Davos a few million pounds that Lloyd Blankfein would be out as CEO of Goldman Sachs within two years. It was ridiculous! We thought so, Lloyd thought so, and you know Lucas van Praag thought so, having told the paper, “It is preposterous that The Wall Street Journal would even consider publishing such effluent.” On Friday, the theory was discredited even further when Dick Bové, snapping her fingers and seeing the perfect opportunity to get Ken Lewis off the couch, wrote that she doesn’t think Blankfein and CFO David Viniar will “maintain their positions in the company, and must “fall on their swords for the devastating decline in [Goldman's] persona…for public relations reasons.” All of this is bull shit, obviously. Lloyd will be doing no stepping down and not just because everything in the executive suite is already fitted to the exact measurements of his golden scrot and would be a bitch to replace. So we’ll ask this just once and then move on to more important questions, like what LB’s going to do to Messier Fantabulous once his feet touch US soil (management soliciting suggestions now). Continue reading »

  • 19 Apr 2010 at 11:35 AM

Goldman Issues Another Response, Sets Up Fab as Potential Fall Guy

By Zachery Kouwe

Goldman Sachs just released its most detailed response yet against the SEC charges.

While it appears the firm is digging in for a fight, don’t count out an eventual settlement of the suit, most likely right before it goes to court. Goldman would probably rather pay the fine and move on rather than have all of its emails and other internal correspondence aired in public.

From the response, it appears Goldman is gearing up to make Fabrice Pierre Tourre, aka Fabulous Fab, the fall guy. The bank seems pretty confident that the official offering document for the Abacus deal never misled anyone about who was selecting the underlying mortgages. Continue reading »

  • 19 Apr 2010 at 10:45 AM

Fabrice “Fab” Tourre Reeled In Clients With His Backhand

By Bess Levin

What do we know about Fabrice Tourre, the only Goldman employee named-checked in Friday’s suit against Goldman? Save for the fact that he refers to himself as “Fabulous Fab” in emails to friends, not much, though the Daily Mail did uncover this photo of Mr. Fantabulous, I don’t know, jumping out of a plane? And a few more details on the man about to be placed a burlap sack and beaten with reeds by Lloyd Blankfein (if it hasn’t happened already):

* Ecole Centrale Paris graduate

* Masters from Stanford

* Apparently tells people he’s from a “very refined family”

* Earned £1.5million a year while working for GS in New York, where he lived in a £3,000-a-month apartment Continue reading »

  • 19 Apr 2010 at 9:10 AM

Caption Contest Monday

By Zachery Kouwe


Lloyd and Laura Blankfein sighting over the weekend, as “spotted” (i.e. stalked) by Bloomberg TV on the Upper West Side.

Opening Bell: 04.19.10

By Dealbreaker

Citi Reports Net Income of $4.4 Billion; $0.15 Per Diluted Share (MarketWatch)
“Citi today is fundamentally a very different company from what it was only two years ago,” said Vikram Pandit. “With its financial strength, strategic clarity, efficiency, world-class business talent, and unique global footprint, Citi is well positioned to benefit from the key drivers of economic growth in developed and emerging markets. None of this would have been possible without the magnificent work of Citi’s people. They produced strong results by focusing on our clients’ needs, creating a much more efficient company, maintaining strict risk management discipline, and reducing our portfolio of non-core assets and its losses.

Goldman Sachs May Face UK, Germany Inquiries After Suit (Bloomberg)
Prime Minister Gordon Brown called yesterday for the Financial Services Authority to start an inquiry, saying he was “shocked” at the “moral bankruptcy” indicated in the suit. Germany’s financial regulator, Bafin, asked the SEC for details on the suit, a spokesman for Chancellor Angela Merkel said.

Dick Bové : Goldman Case Weak But Risky For System (CNBC)
The analyst sent out a research report Monday morning calling the SEC’s case against Goldman Sachs weak, but says the events of Friday could be setting the stage for another financial system collapse.

Paulson May Face Litigation Following Goldman Suit, Christopher Whalen Says (Bloomberg)
“I’m not sure they will escape civil litigation arising from this,” the banking analyst said on April 16. “You can bet the parties who lost money here are going to be seeking redress.”

Krugman: Looters In Loafers (NYT)
The Professor: “Last October, I saw a cartoon by Mike Peters in which a teacher asks a student to create a sentence that uses the verb “sacks,” as in looting and pillaging. The student replies, ‘Goldman Sachs.’ Sure enough, last week the Securities and Exchange Commission accused the Gucci-loafer guys at Goldman of engaging in what amounts to white-collar looting.”

Top Goldman Leaders Said to Have Overseen Mortgage Unit (NYT)
Goldman’s top ranks changed its stance on housing in December 2006. In a meeting in a windowless conference room on the executive floor, Mr. Viniar, the chief financial officer, and Mr. Cohn, the president, gathered about 10 executives for a briefing. Mr. Sparks, the head of the mortgage unit, walked them through the numbers. The group was unanimous: Goldman had to reduce its exposure to the increasingly troubled mortgage market. A few months later, in February 2007, senior executives began turning up on the trading floor. The message, one former employee said, was clear: management was watching.

SEC Investigating Other Soured Deals (WSJ)
Among the firms that created mortgage deals that soon went sour were Deutsche Bank AG, UBS AG and Merrill Lynch & Co., now owned by Bank of America Corp. It isn’t known what deals the SEC is investigating. Further cases could hinge on whether the SEC sees what it considers misrepresentation, and not just questions such as whether a deal favored one client over another.

Chuck Schumer’s Legendary Sandwich (NYP)
Roast beef, banana peppers, pickled jalapeños, extra onions, extra tomatoes, two layers of pickles, mayonnaise and mustard on hearty Italian bread — it’s known as The Schumwich. “No lettuce — it kills the flavor!” Schumer is known to bark at aides who mess up the order. “Did you ask for extra pickles?” he bellows. “Did you watch them put them on, or did you not focus on it?” Continue reading »