Let’s role-play for a second. You’re a well-known hedge fund manager who’s had a really, really shitty 18 months. Your investors hate you, because of petty little stuff like 1) you loaned yourself $113 million from a gated fund to pay personal taxes 2) you tied up a good chunk of their money in a walkie-talkie passion project 3) you will only let them leave if they can find a buyer for said passion project on the black market and you both know that’s not happening any time soon. It appears as though you’re somewhat past due on paying property taxes. The deal you’ve bet pretty much everything on may be fucked. Your singing and dancing pig, the one person you thought you could count on and who, even if you lost everything, would still make you feel like a rich man, has started not just considering her options but unapologetically flaunting them in your face. (You didn’t need Wilbur to have her date– a potential new benefactor and the third this week– pick her up just as you were getting home to see them leave and you really could have dealt without hearing him ask “Who’s that guy?” and hearing her cruelly laugh and answer, “Oh him? He’s nobody”?). So when the SEC, which has been investigating what you’ve been up to, offers you a deal to settle by agreeing to be banned from the securities industry, what do you do? Do you say, “You know what, that actually sounds great,” because honestly, what are you holding onto anymore? This way, you can start fresh. Give the double-finger fuck you to everyone and take off? Maybe that’s what you do if you’re you but in this scenario you’re Phil Falcone and you’re not going anywhere. Throw in the towel, his ass. Read more »
Archive for December 2011
S&P Report on Euro Zone Ratings Seen Next Month (Reuters)
Standard & Poor’s is expected to release its eagerly awaited verdict on debt ratings for 15 euro zone countries in January, two independent European government sources told Reuters. “We have got an informal signal from Standard & Poor’s that they will come only in January,” said one source who declined to be named because exchanges with the rating agency are confidential. “In conversations we have had, they have let this be known if you read between the lines,” he added.
Italy To Kick The Cash Habit As Monti Cracks Down (Bloomberg)
Floriana d’Andrea, a Naples musician, carries rolls of euro notes when she buys instruments and audio gear, a practice she’ll have to change as Italy sets new limits on cash payments in a bid to curb tax evasion. “I bought some expensive sound equipment and the shop owner jacked up the price when I asked for a receipt,” said d’Andrea, 41, who paid 1,600 euros ($2,093) in cash in the transaction. She has a credit card, but rarely uses it, she said. Prime Minister Mario Monti, in office just over a month, wants landlords, plumbers, electricians and small businesses to stop conducting large transactions in cash, which critics say helps them evade taxes. The government on Dec. 4 reduced the maximum allowed cash payment to 1,000 euros from 2,500 euros. “If they force us to use credit cards, prices will go up,” said d’Andrea, noting that many retailers offer discounts to customers who pay in cash and don’t demand a receipt, in effect splitting with them the savings from evading the country’s 21 percent sales tax. She may curtail future purchases if she’s unable to use cash, d’Andrea said.
House, Senate Clear Payroll Tax Accord (WSJ)
The House and Senate on Friday approved a two-month extension of the payroll-tax cut, averting an increase that would have left workers with less take-home pay next year. Passage came after a nearly weeklong impasse that ended when House Speaker John Boehner (R, Ohio) bowed to increasing pressure from within his own party and agreed to the short-term extension. The $33 billion package also provides extended federal unemployment benefits for two months, avoids a cut in payments to doctors who treat Medicare patients and compels the Obama administration to act within 60 days on a permit for TransCanada Corp.’s proposed Keystone XL pipeline expansion. The deal, which forestalls a Jan. 1 tax increase on 160 million workers, represents a retreat for the House GOP, which had been at odds with Senate Republicans and party elders who feared a backlash in the 2012 elections if the tax break was allowed to expire. The agreement is essentially the same package negotiated by the Democratic-controlled Senate that Mr. Boehner’s House rejected earlier this week.
Fed’s Once Secret Data Now Release To The Public (Bloomberg)
Bloomberg News today released spreadsheets showing daily borrowing totals for 407 banks and companies that tapped Federal Reserve emergency programs during the 2007 to 2009 financial crisis. It’s the first time such data have been publicly available in this form. To download a zip file of the spreadsheets, go to http://bit.ly/Bloomberg-Fed-Data. For an explanation of the files, see the one labeled “1a Fed Data Roadmap.”
AIG’s Benmosche Extends His Stay (WSJ)
Mr. Benmosche said in an interview that he plans to run New York-based AIG beyond next year, his health permitting. The 67-year-old, who was diagnosed with cancer in late 2010, previously indicated he planned to return to retirement sometime in 2012. “I’ve talked to the board and said that if I stay healthy—and I’m still hopeful—I would like to stay on for another year,” he said. “I want to stay active and energized, and having too much time on my hands is not healthy, I think.”
Pigeons Can Learn Higher Math, Study Finds (NYT)
By now, the intelligence of birds is well known. Alex the African gray parrot had great verbal skills. Scrub jays, which hide caches of seeds and other food, have remarkable memories. And New Caledonian crows make and use tools in ways that would put the average home plumber to shame. Pigeons, it turns out, are no slouches either. It was known that they could count. But all sorts of animals, including bees, can count. Pigeons have now shown that they can learn abstract rules about numbers, an ability that until now had been demonstrated only in primates. In the 1990s scientists trained rhesus monkeys to look at groups of items on a screen and to rank them from the lowest number of items to the highest. They learned to rank groups of one, two and three items in various sizes and shapes. When tested, they were able to do the task even when unfamiliar numbers of things were introduced. In other words, having learned that two was more than one and three more than two, they could also figure out that five was more than two, or eight more than six. Read more »
$$$ Lauren E. Weinberg, a 23-year-old ASU business student, told Sheriff’s deputies she survived in her car for nine days without cold weather gear and on nothing more than two candy bars. For drinking water, she used the sun to melt snow in bottles. [AZDS] Read more »
The bad news, if you’re a Paulson & Co investor that doesn’t have a special situation worked out with JP on the side, is that the firm’s funds are down by a lot. A whole lot. The good news is that you’ve all now been offered a unique opportunity. Read more »
That may change though, after their chairs and desks are sold. Read more »
For reasons that are not yet entirely clear, Sandy Weill is selling all his worldly possessions. (He claims he and the wife are “downsizing a little bit” but this smacks more of someone having a feng shui attack.) Earlier this month it was Sando’s 15 Central Park West penthouse, which was bought for $88 million as a gift for a 22 year-old fertilizer heiress, today it’s his yacht. For those in the market: Read more »
Today we’re going to talk about something really important: your beauty routines. What you do to look good, what buy to look better. Hard numbers re: what kind of coin you’re dropping on toners and moisturizers. Thinking about claiming you don’t use any of that crap? Let’s not play that game. You’re slathering $95 eye cream on your bags and you’re liking it. Read more »
Facebook’s Goal: to Be a Blue Chip (WSJ)
…interviews with Mr. Zuckerberg and others inside Facebook reveal the eight-year-old company is trying to emulate the influence, staying power, and meticulousness of the biggest technology companies. Since last year, Facebook executives have been crafting dummy scripts for quarterly earnings calls, addressing imaginary questions from analysts about the company’s revenue and profit, people familiar with the matter say. They have even written a top-secret draft of an IPO prospectus, a role traditionally left to bankers. The company’s chief financial officer, David Ebersman, has been professionally auditing Facebook’s financial statements each quarter, say people familiar with the matter, and avoiding the accounting approaches that raised questions for Groupon and Zynga…Even the CEO’s trademark Adidas flip-flops are growing up. Mr. Zuckerberg, 27, has upgraded to Brooks running shoes and went so far as to wear a dark blue tie and sports coat when President Obama visited in April—a sartorial move he was once loathe to take for the many bankers, lawyers and CEOs he meets.
Jobless Claims in U.S. Decrease to Lowest Since April 2008 (Bloomberg)
Jobless claims fell by 4,000 to 364,000 in the week ended Dec. 17, Labor Department figures showed today in Washington. The median forecast of 45 economists surveyed by Bloomberg News projected an increase to 380,000. “Claims have been improving pretty rapidly,” said Sam Coffin, an economist at UBS Securities LLC in Stamford, Connecticut, who forecast jobless applications would fall to 365,000. “The labor market is gaining some momentum. The question about the first half of next year is how rapid growth is.”
Fitch Warns US Over AAA Credit Rating Again (Reuters)
Fitch Ratings on Wednesday warned again that the United States’ rising debt burden was not consistent with maintaining the country’s top AAA credit rating, but said there would likely be no decision on whether to cut the rating before 2013.
Swiss Bankers’ Millionaire Dreams Fade (Bloomberg)
When Werner Rueegg managed wealth for clients of Credit Suisse Group AG, Oswald Gruebel, who became chief executive officer at the Zurich-based bank, promised to make him rich. “Ossie Gruebel told us: ‘To serve a millionaire, you have to be a millionaire and I promise you I will make you a millionaire,’” said Rueegg, 48, who has spent the last three years of a 28-year career at Bank Sarasin & Cie. AG. (BSAN). Those days may be over with the average pay of Swiss private bankers declining more than 6 percent to 245,000 Swiss francs ($263,000) this year from 2008, according to data compiled by Boston Consulting Group.
RBS Chairman Predicts ‘Small Country’ Out of Euro Zone (Reuters)
Royal Bank of Scotland’s chairman expects a “small country” to leave the euro zone, telling Sky News this scenario would put more strain on the world’s banking system. “I think it is likely that one country, a small country, will drop out,” Philip Hampton said in a prerecorded program scheduled to be broadcast on Thursday. “It could be any of them because I think that some of these things will be driven by political events as much as by economic circumstances and social unrest, and all of those sorts of things. But I think there is a very good chance that one country will fall out,” he said.
White Castle To Serve Alcohol? (NYDN)
White Castle, the slider shack where drunks go to soak up their suds, now offers beer on its menu. At a Lafayette, Ind., greasy spoon, where a traditional White Castle is fused with a BBQ joint called Blaze Modern BBQ, beer and wine are served with the belly bombers, Jamie Richardson told the Daily News. White Castle isn’t rolling out barrels of booze at all its locations just yet, the company says. “For now, this is a one-restaurant test,” Richardson told the Daily News. “Our thought is to learn as much as we can from customers and our team members to see if this is something that might have merit for other locations.” Read more »
$$$ Goldman Preps for New Age of Regulation [FBN]
$$$ Collapse in M&A amid debt turbulence [FT]
$$$ Money market funds are risk averse [FT]
$$$ “On my economic forecast, I drew a picture of a dragon,” other charts [WaPo]
$$$ On the menu, dishes like a mix of seafood in a white wine and marinara-saffron broth served with toasted ciabatta bread are aimed at “a group that knows food,” says Mr. Caron. Overall preference for the dish is “relatively low.” – Every sentence in this article about Olive Garden is amazing [WSJ]
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Richard Handler has declared himself not worthy. Read more »