“I really like the idea that there is a flowering tree that’s blossoming here, indigenous to Brooklyn, rising out of an urban area,” Blankfein said yesterday in Bed-Stuy, while helping break ground on The Bradford, a low-income housing project financed by Goldman’s Urban Investments Group named for a type of pear tree that grows in the borough. [Daily Intel]
Archive for October 2010
UBS Posts A Profit (MarketWatch)
The bank posted a net profit of 1.66 billion Swiss francs ($1.71 billion) as it halted the outflow of cash from its private-banking arm, though shares in the group dropped on Tuesday as its investment-banking unit disappointed investors. The profit in the latest quarter compared with a loss of 564 million francs a year earlier. UBS’s profit was ahead of the 1.17 billion franc consensus forecast but was flattered by one-off items, including an 825 million franc net tax credit.
Warren Buffett Flags A Successor (WSJ)
Berkshire named Todd Combs, manager of a small hedge fund from Connecticut, to oversee a portion of Berkshire’s roughly $100 billion investment portfolio. The surprise appointment will be a challenge for Mr. Combs, 39 years old, whose fund recently had only about $400 million in assets and primarily invested in the shares of financial-services companies.
A Look At Combs’ “Longs” (Fortune)
All told, he had long positions in more than 80 different stocks in that 30-month period. A buy-and-hold man he was not: Among his stocks, only one stayed in the portfolio for the entire period, that was United America Indemnity, a Nasdaq insurance and reinsurance company registered in the Cayman Islands until recently and now renamed Global Indemnity (GBLI) and registered in Ireland. From the end of 2007 until the end of June this year, this company’s stock fell by 58%.
George Soros: Why I Support Legalizing Marijuana (WSJ)
“Like many parents and grandparents, I am worried about young people getting into trouble with marijuana and other drugs. The best solution, however, is honest and effective drug education. One survey after another indicates that teenagers have better access than most adults to marijuana—and often other drugs as well—and find it easier to buy marijuana than alcohol. Legalizing marijuana may make it easier for adults to buy marijuana, but it can hardly make it any more accessible to young people. I’d much rather invest in effective education than ineffective arrest and incarceration.”
Volcker Sees No Short-Term Inflation Problem For US (Reuters)
“Inflation is not a problem right now. It won’t be a problem next year, it won’t be a problem for several years,” said Volcker, who is now chairman of the Obama administration’s Economic Recovery Board. “I see no possibility, frankly, that a deflation will take place,” Volcker said during a panel discussion on financial reform at Boston College.
Fed’s Deflation Terror to Spur Easing, Inflation, El-Erian Says (Bloomberg)
“One thing that the Fed cannot do is stand still, it is terrified of deflation,” El-Erian said. “QE on its own means we’ll have the same issues in six to nine months time with the rest of the world being inflated.”
Paul The Octopus Dies (Guardian)
Death’s inescapable tentacles have curled themselves around Paul the octopus, the cephalopod sage who won worldwide fame over the summer by correctly predicting the results of a host of World Cup matches. Stefan Porwoll, the manager of the Oberhausen Sea Life Centre in Germany that the tentacled psychic called home, said Paul appeared to have died peacefully of natural causes during the night. Continue reading »
$$$ BofA: Foreclosure Sales ‘Accurate,’ Moratorium Stands [CNBC]
$$$ Paul Krugman: “Is it really possible that the CNBC-watching crowd doesn’t understand that right now a weak dollar is good for America?” [NYT]
$$$ Todd Combs, the leading contender to manage Berkshire’s billions [Fortune]
$$$ AIG says Benmosche has cancer [MarketWatch]
$$$ “Our hope is that [the November 13-14 tournament] will be a real coming out party for the league,” says Alex Benepe—one of the sport’s founders and president of the newly formed nonprofit International Quidditch Association. Continue reading »
No One From Goldman Sachs Has Called Warren Buffett About Unwinding His Stake, Or So He Claims
By Bess Levin
Late last week, it was reported that Goldman Sachs has been considering paying back the $5 billion bone thrown to them by Warren Buffett during the scariest part of the financial crisis. It was very kind of him and all and they’re eternally grateful but as the firm is back to making it rain ka-ching on each other’s faces and the terms of the investment (special dividend payments of 10% a year on the bank’s preferred stock, plus warrants to buy shares of Goldman at $115/share) are, how to put this in a way WB will understand, like having the twin Geico cavemen play tug of war with your testicles– nice/somewhat intriguing under extraordinary circumstances/unusual dry-spells but fairly uncomfortable and not a place you want to be after the first or second yank, Lloyd and Co would like to put the experience behind them. Which, sure they do, but as Buffett’s payout is working out to be about $15 per second, it’s probably not something he’ll want to give up easily, and if he has to fake not knowing how to check his voicemail again, so be it. Continue reading »
Southridge Capital Management Founder Charged With Fraud Though He May Not Know It Yet
By Bess LevinThis afternoon, Connecticut regulators accused investment adviser Southridge Capital and its chief executive Stephen Hicks of “preparing false financial statements” that “inflated the assets of five funds from 2004 through 2007 so that they could charge higher fees,” in an alleged scam that netted them an ill-gotten $26 million. Additionally, many investors have apparently put in redemption requests as far back as 2001, though none of them have seen a dime. Attorney General said the firm told “lucrative lies” which hurt not only its clients “but also the entire economy.” How is Hicks taking the news? Is he ashamed and/or embarrassed? Is he defiantly calling the charges bogus, telling family and friends he’ll fight them? Is he proud of what he’s done and the alliterative prose he inspired in Blumenthal? Or does have no idea he’s been accused of anything, having only seen a bunch of missed calls on his phone? Continue reading »
Kingdon Capital Head Of IR Sends Letter To Investors Detailing Uncertainty Of Firm’s “Future Viability”
By Bess Levin
Marjorie Greenspan Kaufman was, until recently, a managing director and head of investor relations at Kingdon Capital. A week or so ago she was unceremoniously canned, as reported by Absolute Return, which prompted her to blast out an email to, we’re told, any clients with over $100 million invested, essentially telling them to take their money and run, as this bitch, and I’m paraphrasing here, is going down. We have the email, after the jump. Continue reading »
Each year, scores of college students interested in education and equality for all apply for positions with Teach For America in the hopes of being accepted and working with students in low-income communities. It’s both heartwarming and admirable. Still, while those doing so deserve loads of respect, one can’t but help thinking that, as selfless as these people are…as “good for humanity” as their work is…that they could be doing, I don’t know, more for society? I think you know what I’m getting at, if you know that what I’m getting at is that they should be rolling up their sleeves and working for Goldman Sachs and really making a difference.
Luckily, GS is on the same page. Continue reading »
As you may have heard, Kristin Davis, the former madam who supplied Eliot Ness with prostitutes when he was into that sort of thing, is running for governor of New York. She’s previously stated that her qualifications for the job are that she 1) “Was valedictorian of [her] high-school class 2) “Worked 10 years in finance [as] vice president of a hedge fund 3) “Went on to build a multimillion-dollar business from snatchscratch.” Today she elaborated on how her time in the industry helped prepare her for life (her boss was a real slave driver) and what you can expect should you vote Davis on election day. Continue reading »
Several weeks back, we mentioned that RBS had plans to cut about ten percent of the Stamford staff, with the timing being unclear though before the end of the year. Today we received a bit more info, namely that the assumption inside is that the bank will be cutting people slowly (just a few people have been let go so far), possibly to avoid press. Continue reading »
Bill Gross Enforces Total Silence On The Trading Floor Except For When He’s Leading A Conga Line Around People’s Desks
By Bess Levin
As someone who follows Wall Street and especially hedge funds for a living, I’ve long suspected, nay, known, that the secret to many a money manager’s success is a daily shimmy down the trading floor. However, and I think most of you will back me up on this, I figured the first time anyone would publicly admit to it would be attached to the name of a firm whose headquarters are located in Stamford, CT and whose founder could’ve been a dancer if he hadn’t gotten into stocks. Instead, it’s PIMCO, and it’s Bill Gross’s dancing feet. Continue reading »
BofA Finds Foreclosure Document Errors (WSJ)
They just found these. Just now…: “BofA discovered errors in 10 to 25 out of the first several hundred foreclosure cases it examined starting last Monday, acknowledging for the first time finding some mistakes in foreclosure files as it begins to resubmit documents in 102,000 cases. The problems included improper paperwork, lack of signatures and missing files, said people familiar with the results. In certain cases, information about the property and payment history didn’t match.”
Treasury Shields Citigroup As Deletions (Bloomberg)
The late Bloomberg News reporter Mark Pittman asked the Treasury in January 2009 to identify $301 billion of securities owned by Citigroup Inc. that the government had agreed to guarantee. He made the request on the grounds that taxpayers ought to know how their money was being used. More than 20 months later, after saying at least five times that a response was imminent, Treasury officials responded with 560 pages of printed-out e-mails — none of which Pittman requested. They were so heavily redacted that most of what’s left are everyday messages such as “Did you just try to call me?” and “Monday will be a busy day!” None of the documents answers Pittman’s request for “records sufficient to show the names of the relevant securities” or the dates and terms of the guarantees.
Deutsche Bank Jobs Cuts In The Works (NYP, DB)
Deutsche Bank is expected to kick off a round of layoffs that could see 5-to-10 percent of its workforce get axed, according to sources familiar with the bank’s thinking.
Cuban Offers To Hire Lawyers For SEC To Review Documents (Bloomberg)
An attorney for Cuban, Stephen Best, told U.S. District Judge Reggie Walton in Washington that he was seeking a creative solution to moving the case along, noting the federal government often hired contractors. “I have never heard about the government becoming indignant about accepting” assistance, Best told Walton at a hearing today.
Owners Seek To Sell At Loss As Banks Push Foreclosure (NYT)
In half a dozen more cases examined by The New York Times, Bank of America rejected short sale offers, foreclosed and auctioned off houses at lower prices.
UBS Nears Wealth Management Turnaround As Outflows Taper Off (Bloomberg)
And they might may post a profit (net income of 1.16 billion Swiss francs ($1.2 billion) for the third quarter, compared with a loss of 564 million francs a year earlier, according to the median estimate of 16 analysts)!
Tiger Woods’ mistress discusses sex with golfer in new book (NYP)
“As a love and sexual partner he is largely endowed and safe sex with him was definitely champion status,” she wrote. “When I was having my relationship with Tiger. I was like on the seventh cloud especially from a sexual perspective,” she raves, apparently confusing Cloud 9 with seventh heaven. Continue reading »
