Archive for March 2011

For the first anniversary of Wall Street 2: Money Never Sleeps, Bloomberg rang up Oliver Stone to see what’s been a’ poppin’ with the director of late and pick his brain about how things have been going in the finance world since the premiere. The interview touched on the fact that the original script had Josh Brolin playing an evil hedge fund manager, before Stone realized that it was the banks that did most of the heavy lifting with regard to bringing the global financial system to its knees (“[Hedge funds] are just the tail,” the filmmaker says. “The dog is wagging them. The big dog is these seven banks”). “You can’t condemn the hedge funders for doing what they’re doing,” was Stone’s response to the question of whether or not the hedge fund industry is deserving of blame for the crisis, indicating rational, lucid thought, and not those of someone who’s been drinking. But he wasn’t finished. Read more »

  • 28 Mar 2011 at 8:27 AM

Opening Bell: 03.28.11

The $300 Million Blunder (WSJ)
Philippe Jabre, one of Europe’s best-known hedge-fund managers, bought Japanese stocks on news of the earthquake, and then suffered when the Nikkei Stock Average quickly tumbled 13%. Making matters worse, Mr. Jabre got nervous and sold his shares last week, just before a rebound in Japanese stocks. The miscues cost his firm about $300 million, the worst few days of his career…By Wednesday, the Nikkei had dropped 13% in four trading days. Several of Mr. Jabre’s funds faced losses, one of them as much as 10% for the month. To his traders, Mr. Jabre appeared calm. He wasn’t. “I felt horrible, but I don’t express happiness or frustrations,” he said. “Emotions are the enemy of a balanced person.”

Goldman Special Situation Profit Seen at Risk With Volcker Rule (Bloomberg)
Goldman Sachs already has shut two units that made bets with the company’s money because such proprietary trading by banks will be prohibited under the Volcker rule approved by Congress last year. Created during the late 1990s, SSG invests the bank’s money in the debt and equity of troubled companies and makes loans to high-risk borrowers. The effort to defend it illustrates how important the business is to Goldman Sachs and may be a test of how flexible regulators will be in defining proprietary trading. “It is proprietary trading, but the business can also be modified if you had to,” said Brad Hintz. The question, he said, is “Where will the regulators draw the line?”

Buffett Draws Fervent Fans in India With His Folksy Advice (Dealbook)
At one point, Mr. Buffett said Berkshire Hathaway kept about $10 billion in cash on hand just in case “Ben Bernanke runs off to South America with Lindsay Lohan,” a remark that of course drew laughter. “We have to be prepared for anything.”

Tech Bubble? Investing Like It’s 1999 (NYT)
Funds set up by Goldman and JPMorgan Chase have invested in Internet start-ups like Facebook and Twitter or in funds with stakes in those start-ups. Even the mutual fund giants Fidelity Investments and T. Rowe Price have stepped up their efforts, placing large bets on companies like Groupon and Zynga. Thomas Weisel, founder of an investment bank called the Thomas Weisel Partners Group that prospered in the first Internet boom, says he is “astounded” by the amount of money now flooding the markets. “I think it’s much greater today,” he said. “The pools of capital that are looking at these Internet companies are far greater today than what you had in 2000.”

Glencore To Seek Hong Kong Listing Approval Thursday (WSJ)
Swiss commodities trader Glencore International AG is scheduled to meet with the Hong Kong stock exchange’s listing committee on Thursday to seek approval for its plans for an inital public offering, people familiar with the matter said. Glencore has hired banks to pursue a dual listing in Hong Kong and London to raise up to $10 billion.

KPMG Executive Survey: Worst Is Over (CNBC)
The survey shows 68 percent of manufacturing executives believe business activity will be higher in the next 12 months. That’s up from 57 percent in October. Forty-one percent of those same executives say they plan to hire more in the weeks and months ahead. That number was just 28 percent five months ago. As far as revenue is concerned, 65 percent of manufacturers surveyed by KPMG expect revenues to rise in the next year.

Fed Should Consider Curtailing Stimulus Program, Bullard Says (Bloomberg)
“The economy is looking pretty good,” Bullard said to reporters in Marseille, France, on March 26. “It is still reasonable to review QE2 in the coming meetings, especially this April meeting, and see if we want to decide to finish the program or to stop a little bit short,” he said, referring to the second round of so-called quantitative easing.

Felony charge lodged against BK bikini brawler (Herald)
Assistant State Attorney Greg Wilson filed formal charges Friday morning against Kimesa Smith, 30, of Montgomery, Ala. She was charged with felony criminal mischief with damage of more than $1,000, two counts of misdemeanor battery, disorderly conduct and resisting arrest without violence. Smith was caught on a cell phone video as she climbed onto the restaurant’s counter, threw items and struck employees March 19. She damaged one of the restaurant’s $3,800 LED screens and a cash register, authorities said. The video shows Smith standing on the counter to shout at a cashier she’d argued with in the drive-through moments earlier. About halfway through the 101-second clip, the dining room explodes with flying napkins, trays, straws, food and what appears to be either a child’s booster seat or a large water bottle. Read more »

  • 25 Mar 2011 at 5:20 PM

Write-Offs: 03.25.11

$$$ Radioactive Water Found in 2nd Reactor at Japan Plant [Reuters]

$$$ G.E.’s Strategies Let It Avoid Taxes Altogether [NYT]

$$$ Hedge Funds Crave Bonds That Almost Killed AIG [NetNet]

$$$ China detained Glencore trader in oil imports probe [Reuters]

$$$ John Paulson’s Sweet 16 (Billion) Party [Dealbook] Read more »

From an internal JPM update: Read more »

  • 25 Mar 2011 at 4:08 PM

Want To Mix It Up With A Colleague?

BusinessWeek is here to help! The magazine, for some reason, is offering tips for people interested in “picking-up” a co-worker. Read more »

  • 25 Mar 2011 at 2:53 PM

Why Does Warren Buffett Hate Facebook?

According to the Oracle of Omaha, “Most [social networking websites] will be overpriced and are extremely difficult to value.” Buffet noted that “investors should be wary of the valuations as some of the industry’s biggest startups prepare for initial share sales” and while he didn’t specify any sites in particular, one could take a gander at which one he’s talking about. If we know Buffett, he loves a good Groupon deal and can’t get enough of Ice T’s Twitter feed, so Facebook it must be. But with Goldman Sachs et al pouring money into the site the question is why does Warren Buffett (rightly) think the ‘book isn’t as hot as everyone say it is? Read more »

  • 25 Mar 2011 at 1:06 PM

Caption Contest Friday

Following his town hall speech to the JPMorgan staff in Tokyo, Jamie Dimon serves sake to employees.

And some bonus pictures from the trip. Read more »

Apparently “the guy that delivers water bottles to the trading floor” of a certain bank was escorted out of the building in handcuffs today, for “installing cameras in the men’s bathroom.” That’s all we know at this time. If you have any intel on the situation, or suspect you may have been filmed yourself, do get in touch! Read more »