Late last evening, Senator Carl Levin released a report of his investigation into the financial crisis entitled “Wall Street And The Financial Crisis: Anatomy Of A Financial Collapse.” The majority of the blame goes toward investment banks, particularly Goldman Sachs (described by Levin- no relation- as “a financial snake pit rife with greed, conflicts of interest, and wrongdoing”), as well as Deutsche Bank, whose former trader, Greg Lippmann (he of “I’m short your house” and sushi spreadsheet fame) gets a lot of airtime. Also criticized are the ratings agencies, who Levin says “weakened their standards as each compete to provide the most favorable rating to win business and greater market share.” To that end, the Senator from Michigan illustrates his point with a story about Standard & Poor’s and UBS. Continue reading »
Archive for April 2011
Vanilla Ice’s role in the housing crisis is finally revealed. Continue reading »
Goldman Sachs is “a financial snake pit rife with greed, conflicts of interest, and wrongdoing,” Levin told reporters today.
$$$ John Paulson’s Complete Les Echos Interview In Which He Is Bearish On Housing, Bullish On Gold [ZH via BI]
$$$ Fed Reports Economic Improvement [WSJ]
$$$ Byron Wien: End of Fed Easing Will Create Summer ‘Swoon‘ [CNBC]
$$$ Cash-Strapped NFL Players Seeking High-Risk “Lockout Loans” [TPG] Continue reading »
The U.S. is the only large AAA-rated country that saw its debt rise during the crisis that until recently had no plan that would reverse the trend, said Steven Hess, senior credit officer at Moody’s. Budget cuts would mean the U.S. wouldn’t likely sell as much debt, which has grown to $9.13 trillion in marketable Treasuries from $4.34 billion in mid-2007 as the government boosted spending to pull the economy out of recession. “It seems both sides of this debate are now targeting lower debt and lower deficits,” said Hess, based on the president’s speech today. “We do see this as a turning point in terms of the debate. We would view that as a positive, but we’ll have to wait to see the outcome.” [Bloomberg]
Expert: Raj Rajaratnam Might Consider Spending Some Of The Money Earmarked For Legal Bills On A Personal Stylist
By Bess Levin
If you’ve been keeping up with the Raj Rajaratnam insider trading trial, you may have come to the conclusion that things have not been going so hot for the Galleon founder. Though he is of course innocent until proven guilty, so far jurors have heard that Raj’s brother felt the need to destroy his big brother’s “private notebooks,” tapes of Raj telling Danielle Chiesi to keep their dealings on the down low, tapes of Raj telling a friend he knew to buy shares of a company because “one of our guys is on the board,” and testimony from former McKinsey exec that Raj paid him $1 million for his tip about AMD’s acquisition of ATI. Sure, Raj’s former head of research testified he never heard the boss asking for inside information and that the big man was “the most prepared of” any of the Galleon team simply by virtue of being “amazingly educated on the issues at hand” but the odds of getting off? Not so great. That’s why he needs a Hail Mary- one in which he’ll dazzle ‘em with fashion. Continue reading »
FYI, Paul Ryan’s plan will not put us on the path to winning. Continue reading »
Just before the lunch break on Wednesday, prosecutors began questioning Mr. Schutte as part of their cross examination, hitting him with a variety of rapid-fire questions about investor expectations for hedge funds and their managers. “They didn’t want hedge funds corrupting executives at companies, did they?” Assistant U.S. Attorney Reed Brodsky said. “I don’t know what investors want,” Mr. Schutte said. “I don’t think that’s a business plan I would put forth, if that’s what you’re asking.” [WSJ]
If There’s A Better Way To Compensate Your Tipster For Inside Information Than Handing Him Envelopes Filled With Cash, Chip Skowron Hasn’t Heard Of It
By Bess Levin
Earlier this morning, former Frontpoint Partners manager Joseph “Chip” Skowron surrender to authorities and is expected to appear in court today on charges of securities fraud. Skowron has been accused of insider trading, in a scam that involved trading on material non-public information he obtained from a French doctor named Yves Benhamou. In one instance, saved Frontpoint from a $30 million loss based on a tip about the trial of a drug used to treat Hepatitis C, which cause the fund to make a timely sale of six million shares of Human Genome Sciences. For his helpful information, the Chipster met the the doc in various hotel rooms and paid him a bunch of money stuffed in envelopes, which strikes us as better than putting it in garbage bags or canvas sacks with a big $ sign on them and dragging them through the lobby but maybe not the best way to go about it. Continue reading »
Assuming the last quarter is an indication of the next three and- fingers crossed- nothing goes catastrophically wrong, JPMorgan employees may be looking at raises next year. Continue reading »
In 2010, Bank of America posted a profit of negative $2.2 billion. For 2011, the goal is to stop losing money and start making it, stat. And it’s not just like a wish list, “it would be great if we could do this, if not, no biggie” type goal but a deadly serious one. So much so that it needs a special codename: Project New BAC, an initiative that was unveiled to employees yesterday by Brian Moynihan. Continue reading »
