Late last week, it was reported that in Phil Falcone had loaned himself $113 million from one of Harbinger Capital’s funds, where redemptions had been suspended, in order to pay personal taxes. The hedge fund manager said he checked with his lawyers before borrowing the money but investors still were fairly miffed anyway. Goldman Sachs pulled its entire investment, as did Blackstone, and one client informed Reuters, “You can’t treat the fund like a personal piggy bank to pay taxes. I don’t know that there is really anything illegal about it, but it is certainly disgustingly immoral and shows a complete lack of fiduciary care.”
Which is why the sensitive ones in the bunch should be thrilled to hear that the next time Falcone needed a little money, he simply went to the bank and asked for some coin to tide himself over, rather than taking it out of their pockets and risking another lecture from mom and dad about “right” and “wrong.”
Earlier this month, Falcone and his wife posted some of their “fine art” as collateral for a secured five-year loan from Bank of America, public records show. The so-called security agreement between Bank of America and the Falcones was filed with the New York Secretary of State’s office on Nov. 4.
It’s unclear how much Lisa and Phil borrowed, what the terms were, and what they needed the money for, though naturally it could be anything from renovations to their townhouse (where Lisa’s closet is slated to include a wine bar), outfits, snacks for Wilbur, the family’s piano playing pig (who doesn’t perform unless his dressing room is stocked with Dom and truffles), or a down payment on Little People for this year’s investor dinner, in which case some ungrateful pricks are gonna feel pretty bad pretty soon for not realizing PF was using the money to plan a surprised for them.**
Falcone Applies For Another Loan [Reuters]
**Also unclear: how much more money Falcone is going to need in the future and since he apparently can’t take it from investors again– hilarious as that would be– it falls to us. I’ll set up a PayPal account later today and let everyone know when it’s open for donations.
Can somebody please explain to me the difference between this and a pawn shop?
Relax, Phil, these things usually work out in the end.
What is the adage, “I’d rather be in liquid rather than in solvent?”
Bacon, Bacon, Bacon. Mmm, me like Bacon!
I wonder what interest rate he’s paying on that loan.
Off topic
Is anyone else get irrationally angry at the (mis)use of “so called”? For fuck’s sake, it is not a “so called” security agreement. It IS a security agreement BY FUCKING DEFINITION!
Later s/he wrote “The loan Falcone took from the so-called Harbinger Special Situations Fund has sparked . . .”
*So-called* Harbinger Special Situations Fund? Seriously? Now things with proper names and titles are “so-called”.
I am going to take out my anger on an analyst now.
I wonder how much I could borrow against my collection?
I bid $2/pound for the piggy!
I bid $2/pound for the piggy!
Is it gently used?
I tried to borrow against mine, but they told me a collection of plushy fantasies weren’t acceptable collateral.
-P. Greenwood
Yes, except for the Sybian. That’s a bit banged up.
I don’t understand why this guy has no liquidity, I get the feeling this may end bad
I don’t understand why this guy has no liquidity, I get the feeling this may end bad
Is this what a future manhunt in the making is like?
If that dress shows up on eBay with hockeyplayer268 as the seller, we’ll now this thing is about to take the next leg down.
Well I guess the guy is quickly discovering how HBOS or Wachovia felt about the market when they had a liquidity crunch….
Lisa + sybian would be a visual feast and an audio nightmare
I feel that using words like “so-called,” “plethora,” and “indubitably” in an article lets the reader know you’re sophisticated and intellectually cerebral.
Have a big liquidity problem after eating the American Airlines food on the plane back from London last night.
That was once the case but now the situation is fluid
Sybian? Never heard of that artist.
Damascus has cleaned up quite a bit lately.
-AIG Quant
Phil is to be commended. I know for a fact that income taxes can be very difficult to plan for, you never know when they are due so rather than reserve for future tax liability Phil did the right thing and injected those dollars directly into our economy by shopping at Fredrick’s of Hollywood. This is just the type risk taking Ben and I are encouraging to get this economy moving.
Crane: I am more than aware that you are not intimidated by *me*, Mr. Falcone. But you know who I’m working for, and when he gets here…
Falcone: He-he’s coming to Gotham?
Crane: Yes he is. And when he gets here, he’s not gonna want to hear that you have endangered our operation just to get your thugs out of a little jail time.
lie down with dogs, wake up with slores
Lisa or Wilbur?
Chuck, you hit my other pet peeve “I feel”.
The newer generation seems to be using this more.
Its a phrase designed to preserve the self-esteem of piss poor students. I heard an analyst say last week, “I feel the TCE ratio can be improved.”
You feel it, huh? You have a gut instinct based on your 1.4 years in the industry that TCE can be improved or did the capital faeries visit you in your dreams and tell you to expect good things.
Christonacrutch, give me your analysis champ. show me the spreadsheets, the logic, or whatever lead you to that conclusion because I can’t tell our client that a 24 year old has a “feeling”.
n
He may be the recipient of an enhanced audit:
‘Audits From Hell’ Target Rich
http://online.wsj.com/article/SB10001424052748704865704575610641497495762.html
Shoulda stuck to iron ore, Phil…
hf managers should never be in the Forbes 400….for long
the bank of opportunity just gave me a 10yr fixed loan that i backed by a star i had named after me a couple of years ago.
But . . . aren’t most solvents liquids?
I feel the need…the need for speed!
i heard falcone’s wife had her sex diary leaked on facebook too
he screwed up with iron ore too, his foray into FMG is the first fiasco that comes to mind
Oooooh . . . someone’s going to be in big trouble!!!
Forgot about that.
I thought that was everyone on her facebook page.
Heat can be used as a solvent.
-Former BSC quant.
“Phil Falcone Needs More Cash.”
“And I need a blowjob from Christy Turlington.” – Joey Knish, Rounders
Go back to work, kids. Nothing here to see. Uncle Phil has it sorted. Jurisdictional issues have him covered. Caveat emptor all you dumb, greedy rich people.
http://dealbook.nytimes.com/2010/11/15/hurdles-ahead-in-the-harbinger-inquiry/?ref=business
Hurdles Ahead in Harbinger Inquiry
Remain Calm! All is well!
Let#s examine some motives here. Why is he putting his exquisite fine art in hock, rather than selling it? Is it a liquidity issue because he’s trying to get his cash out through his own gates or did he get some sort of LTV of 100%+?
You’re everyone’s problem. That’s because every time you go up in the air, you’re unsafe. I don’t like you because you’re dangerous.
I am guessing the interest rate and the fact the “fine art” probably doesn’t need to spend the term of the loan in the back room of the pawn shop.
Wilbur. Lights off, The Dress on.
Lisa may have to take it to the streets again. I’d give her a ten spot for head
Hate it when Bess posts these non-news stories that merely spread rumors and defame, when we all know that Allied Irish Bank stands ready to loan him whatever he needs.
According to Irish Finance Minister Brian Lenihan:
“It brings me great angst to observe professional critics – many of them acquaintances and friends of mine – rhetorically beating Phil Falcone about the head and shoulders for a loan. At the same time, the fact that Goldman Sachs has joined the chorus brings me great joy. If what Phil is doing offends both the learned and the unlearned, then he is clearly acting unconventionally relative to orthodoxy. And this is good, very good.”
I forget the link, but we all need to check our motives.
Those words also show that dames find you gregarious, erudite, and witty.
i can assure you, his investors haven’t forgotten.
Most of the art collection was purchased less than one year ago….some but not all…..art is way downnnnnnn!!!! overall and two birds were in play…here…..some of their art is way up….especially the modern. Were they to sell….capital gains on the art acquired less than one year ago would require 30 percent capital gain tax vs. 10 percent for what is over one year old…
The Falcones older acquisitions were mostly French Impressionists and that area of the art world has had enormous declines….
He can probably write off the interest on the loans vs…paying taxes…this is why he would borrow and not sell…But we do know that a very highly important diamond…..belonging to two sisters is on the block at Sotheby’s or Christies Dec. sale,,,,we forget which….Marquis shaped huge white diamond noted, Property of two sisters. Nearly all of Lisa’s jewels belong to the daughters and not to her…we have on great authority…
You should have sex more often. Just a suggestion.
Yellow diamond size 5.5?
He has 40% of AUM invested in one idea? It’s a miracle he still has investors.
If the parents are selling it to raise cash, how can they get the girls to do it without raiding their trust fund? Are they going to slap a management fee on the girls as a way to move it out of their account?
It is that tingling feeling you get in your nuts when on a roller coaster.
I had a similar experience except my collection consisted solely of Wiener Dog Beanie Babies (732).