Wall Street is set to cut over 100,000 financial services employees by the end of the year. The Dow dropped 521 points today. Harbinger Capital Partners muse Wilbur Falcone was just dealt a horrible blow. While some of you may think we get off on writing about Wall Street getting its teeth knocked out, in truth, it’s really just as much a buzz kill for us as it is for those taking it up the tailpipe. So we’ve decided to do something about it, in an admittedly self-serving effort to cheer ourselves up (it’s strange, but making you feel good makes us feel good). And here’s what it is: WE’RE BRINGING BACK THE SANDWICH FAIRY. Continue reading »
Archive for August 2011
Great news Paul Krugman! A lack of trees and fake-doc mortgages add up to a down (31%) YTD performance for John Paulson’s levered Advantage Plus and (21.5%) YTD for the regular Advantage. But gold bugs will also have something to cheer:
There appears to be a sliver or two of good news for Paulson. His gold fund is up about 6% for the year, according to an investor’s calculations. The bulk of Paulson’s own money is in gold, and in gold-denominated share classes offered by his firm, so he’s making out much better than many of his investors. Continue reading »
Fearing People Might Not Get It, Nouriel Spells Out The Reference In His Horribly Unfunny Joke
By Bess Levin
[via Twitter]
[via BI]
It’s Becoming Increasingly Obvious That You’re Going To Need To Get (More) Comfortable Slaughtering Chickens
By Matt Levine
A few weeks ago Jeremy Grantham, in Part 1 of his quarterly letter, told you everything you need to know about current markets. Specifically (1) get rid of stocks, bonds, and just capitalism generally while we’re at it, (2) get yourself a farm, and (3) keep a pretty close eye on soil erosion. Good news: some of you have clearly been listening. For example Perry Vieth, a former quant money manager who now buys farmland at Ceres Partners LLC. And as Bloomberg reports, he is not going to let a dystopian future of soil erosion rain on his 16% returns:
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As you may have heard, today at 1PM Bank of America take part in a conference call held by Fairholme Capital manager Bruce Berkowitz to talk business. Most people who comment on such things have reminded us of the last bank executive (first name Erin, last name Callan) to hold a conference call while business is being called into question and where she is today. And while the people who follow such things are interested in the call, you couldn’t exactly say they care in an “I’m emotionally invested in this whole thing and I am freaking the fuck out” sort of way. Then you have Dick Bové. The Rochdale analyst is straight up losing her mind that Brian Moynihan would even entertain the thought of getting on the phone with Berkowitz and has spent the last 24 hours pleading with him to reconsider. This is what she had to say last night on Fox Business:
Mr. Moynihan’s credibility has fallen dramatically because the company made certain statements concerning what their losses would be in the mortgage sector and what the earnings might be going forward, and all of those promises have not been kept. It is very difficult for Mr. Moynihan to convince investors what he says is correct. Having an hour presentation is a terrible mistake; if I tell you as a CEO I don’t need equity, I don’t need shareholders. He should not do this meeting tomorrow. There is very little he can say other than ‘I will increase the dividend, that will get the stock to move higher.’
Now, if this were any other analyst, we’d tell Bri-Moy to ignore it and do what you gotta do. Knowing Bové, however, we urge you to get out of this call immediately. Think she sounds angry now? If you go through with this meeting you will find out that hell hath no fury like a chafed Dick. Don’t believe us? Allow us to refresh your memory as to how she reacted the last time a bank got cozy with someone while she sat home alone. Continue reading »
Back in May, Rengen Rajaratnam, little brother of Raj, made a simple request. For friends of the Galleon founder to send character letters to the judge in an effort to convince him to be lenient in sentencing. Rengen helpfully included some links on the proper formatting to use when drafting such missives and considering all the lives Raj had touched, it shouldn’t have proved too difficult a task. Was it so much to ask that people recall, for instance, the tears of joy he brought to their eyes when he paid an employee to allow herself to be tased? Or the midget gags? Apparently yes because his legal team has been forced to turn to plan B: breaking the news that Raj is dying of a disease the likes of which you can’t even imagine. Continue reading »
France Seeks To Retain Top Rating (WSJ)
Sarkozy, who unexpectedly came back to Paris from his holiday retreat on the Côte d’Azur to call a meeting with key cabinet ministers and Bank of France governor Christian Noyer, said the deficit-reduction goals are “imperative,” and tasked the finance and budget ministers to make proposals so that they can be safeguarded.
London Rioting Prompts Fears Over Soccer And Olympics (NYT)
Fearing for the safety of players and fans amid the rioting in London, soccer officials on Tuesday canceled two international matches and may postpone the opening weekend of the English Premier League, prompting questions about the city’s ability to secure high-profile events like soccer matches and next summer’s Olympics.
SEC Probes Goldman Over Libya Dealings (WSJ)
Tuesday’s disclosure by Goldman of numerous investigations, regulatory reviews and legal action related to its sprawling businesses included a probe of the company’s “compliance with the U.S. Foreign Corrupt Practices Act,” according to a securities filing…People familiar with the probe said the SEC is scrutinizing Goldman’s dealings with Libya’s sovereign-wealth fund, called the Libyan Investment Authority. In 2008, Goldman made options trades for the fund, controlled by Col. Moammar Gadhafi, but they suffered losses of more than $1 billion.
Reid Names First Debt Panel Picks (WSJ)
Reid named Sens. Patty Murray of Washington, Max Baucus of Montana and John Kerry of Massachusetts. Ms. Murray will be co-chairman of the committee. House Speaker John Boehner (R., Ohio) will name the other co-chairman. Mr. Reid avoided choosing anyone in the so-called Gang of Six senators that recently came up with its own deficit-cutting plan. That group irked Mr. Reid by going its own way and trying to influence matters during the recent negotiations on the debt ceiling. In addition, those senators accepted cuts to Social Security at a time when Mr. Reid was strongly rejecting such cuts.
Commerzbank Profit Drops 93% on Greek Debt (Bloomberg)
“The earnings were very positive if you strip out the Greek writedown,” said Dirk Becker, a Frankfurt-based analyst at Kepler Capital Markets who recommends buying the shares.
US Mint Halts Sales Of Gold Collector Coins (Reuters)
A spike in gold prices prompted the U.S. Mint to suspend the online sale of gold collector coins Tuesday for the first time in recent memory, a mint spokesman said. The move affects only the gold numismatic products sold to collectors and not the gold bullion coins sold to investors, Mint spokesman Mike White said from Washington. Sales were suspended at midday for re-pricing, which was expected to be completed by late Wednesday, he said. Asked when that had last happened, White said, “not in recent history that I can remember.” Continue reading »
Marc Faber Will Steal Your Girlfriend After He’s Done Rifling Through Your Shit And Insulting Your Commodities Picks
By Bess Levin
“I don’t think [gold] is a bubble, but I think the gold market has exploded to the upside recently and the correction is overdue. But as I have always maintained for the last 12 years, every responsible adult should gradually accumulate gold, because not owning any gold is the trouble with government. I don’t understand. People of Bloomberg, I hardly know anyone who owns any gold physically. All of the Bloomberg employees are intelligent people. They listen to the news everyday. They make the news everyday. Hardly anyone owns any gold…I disagree [that you can't do anything with gold.] You give your girlfriend copper rings and I give them gold rings and I keep them longer.” Continue reading »
Would You Be Surprised To Learn That Gretchen Morgenson Wants To Talk About Municipal Derivatives?
By Matt Levine
S&P’s decision not to downgrade a whole bunch of municipal issuers, and its claim that “the fiscal autonomy, political independence, and generally strong credit cultures of U.S. states and local governments can support ratings above that of the U.S. sovereign” reminded us of all the other good news about state and local government financial genius. Such as the Maine municipal authority who swears through bites of bank-sponsored filet mignon that closing dinners for negotiated bond deals aren’t costing his state anything (hint: bankers aren’t buying you dinner because they’re dying to hear about your fishing trip!). But our favorite muni news is Gretchen Morgenson’s story from this weekend about her favorite topic, municipal derivatives.
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