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From the mailbag (of unfounded rumors):
“Matthew Simmons was on Bloomberg several days ago talking about nuking the BP wellhead to stop the leak, then was on the tape saying BP wouldn’t last through the summer. I’m now hearing that Simmons and Co. is putting a buy rec on BP. Also hearing also that Simmons and Co. sent out a letter to investors asking them to disavow anything Mr. Simmons has said recently.”
And don’t give them that crap about the disclosures– those things were paragraphs long! You think a sheep reading at a 3rd grade level’s gonna go through all that?
When Merrill Lynch & Co. raced ahead of its rivals to become the king of collateralized-debt obligations last decade, pensions and hedge funds weren’t its only targets. The Wall Street firm also used its vaunted network of financial advisers to pitch the risky investment pools to Main Street. Some of these individual investors now say they weren’t sophisticated enough, despite their relative wealth, to understand the dangers.”We were just lambs being led to the slaughter,” said Michael Slomak, a member of a Cleveland family that he says invested $2.65 million in several Merrill-issued CDOs. He says these structured securities, typically based on a pool of debt such as mortgages, had a level of risk that was never adequately explained. The family lost all but $16,500, according to an arbitration claim the family brought against Merrill before the Financial Industry Regulatory Authority.
Merrill spokesman said investors signed a disclosure document stating that the CDO “involves a considerable amount of risk and that some or all of the investment may be lost.” Other CDO investors admit they didn’t read or overlooked certain risk disclosures spelled out in the prospectuses.
Suck it, TCW. No, really. Do it.
Congratulations are in order for Jeff Gundlach and the DoubleLine Team! In addition to being ranked number one globally in asses (on tape), the new firm has gathered the most assets among 2010 fund launches. Naturally this calls for a celebration and a screening of Ass Traffic Volume 2 at the office would probably be most fitting, if anyone has a copy lying around. Continue reading »
On Mr. Starr’s promise of 28-percent returns, Simon told the Observer: “I am that naïve and stupid. I thought that that was possible.” On her Martha’s Vineyard estate: “If I sold this house, which is our family compound, if I sold that and lived in a trailer we would have money.”
No word at this time on whether or not she’ll be joining Starr’s wife on stage. [NYO]
Perhaps some of you remember Jon Winkelried? The former Goldman Sachs co-president is persona non grata at the firm but for the purposes of context, a quick refresh: Winkelried was the good for nothing prick who abandoned Lloyd Blankfein when the CEO needed him most, and when it would look most bad for the company to have a high level departure (circa the shit hitting the fan era). A traitorous shrew, really, who let deaf ears fall on Blankfein’s pleas to stay, and who traded it all in for a bunch of barnyard animals.
Anywho, Goldman ended up getting on just fine with out he whose name shall not be mentioned, got on great in fact, but his actions did leave a lasting mark on Blankfein, namely that he lost the ability to open up and trust high level execs and that his previously dormant abandonment issues flared up like nobody’s business. So when there was talk of Goldman CFO David “Bones” Viniar retiring, Lloyd naturally panicked. But apparently it was for naught. Bones would never do that to his li’l fella. Continue reading »
Goldman Has No Indication Of SEC Settlement (Reuters)
“There’s no indications of anything at this point” on a settlement or its timing, President Gary Cohn told reporters on the sidelines of a conference in Montreal. “Our client franchise is very strong. We’ve built up a relationship with our clients over 140 years. We continue to service our clients, we continue to serve our client needs. Our clients are very loyal,” he said.
BP Plans To Defer Dividend After Pressure From Obama (Times)
BP is preparing to defer payment of its next dividend to shareholders by placing the money in an escrow account until the full scale of the company’s liabilities from the Gulf of Mexico disaster can be determined. BP board members are discussing a plan that would see the expected £1.7 billion second quarter payout, due to be announced on July 27, delayed until the crisis can be brought under control.
Democrats Clash On Derivatives Rules (WSJ)
House Agriculture Committee Chairman Collin Peterson (D., Minn.) said lawmakers should adopt the House bill, while Senate Agriculture Committee Chairman Blanche Lincoln (D., Ark.) and other Senate Democrats said the Senate measure should be the main plank of the bill. “End users … did not cause the financial crisis of 2008,” Mr. Peterson said. “A lot of them were the victims of it.” He said the Senate language was too complex and confusing.
Soros Says ‘We Have Just Entered Act II’ of Crisis (Bloomberg)
“The collapse of the financial system as we know it is real, and the crisis is far from over,” Soros said today at a conference in Vienna. “Indeed, we have just entered Act II of the drama.”
Ex-SAC Capital President Brian Cohn Said to Open Hedge Fund (BW)
Cohn, who left SAC at the end of 2007 for personal reasons, has named the firm Archeroak Capital Management. It’s scheduled to scheduled to begin trading equities by the end of the year and is based in Old Greenwich.
FBI To Target Mortgage Fraud (FT)
The FBI is preparing to arrest hundreds of people across the US as early as next week for offences including encouraging borrowers to falsify income on mortgage applications, misleading home owners about foreclosure rescue programmes, and inflating home appraisals, said two people with knowledge of the operation. An FBI spokesman declined to comment.
SEC Approves ‘Circuit Breaker’ (WSJ)
The New York Stock Exchange said it will begin a phased rollout on Friday. BATS Global Markets and Direct Edge also have said they expect to begin implementation Friday. The rule will be in effect on a pilot basis for six months. All exchanges will halt trading for five minutes in an individual stock when its price moves 10% or more, up or down, in the previous five minutes. The pause is designed to give traders time to catch their breath and assess whether a stock’s price change stems from a real shift in value or an unrelated market hiccup.
New York Bars Gear Up For World Cup (WSJ)
Where to get drunk and watch.
South African gamblers smoke endangered vulture brains for luck (Scientific America)
As the World Cup launches in South Africa this week, conservationists fear that gamblers looking for a little extra luck will turn to a source those of us in the West might not expect: the practice of smoking vulture brains. Continue reading »
