Greece Bailout Faces European Finance Chiefs After Parliamentary Approval (Bloomberg)
European finance chiefs get the second chance in a week to pull Greece back from the brink of collapse after lawmakers in Athens approved the austerity measures demanded for a financial lifeline. Greece “will be saved in one way or another,” German Finance Minister Wolfgang Schaeuble told newspaper Welt am Sonntag yesterday, though the country must “do its homework.” Euro-area finance ministers will convene in Brussels on Feb. 15 for an extraordinary meeting called after they declined to ratify the 130 billion-euro ($172 billion) package in a special session on Feb. 9. Frustrated after two years of missed budget targets, the European authorities demanded Greek officials put their verbal commitments into law. The Greek parliament passed the legislation in the early morning hours today as rioters battled police and set fire to buildings in downtown Athens. Still, Schaeuble told German lawmakers on Feb. 10 that Greece was set to miss deficit goals, suggesting that the measures may fall short.
We’re Not Greece Says Italian Prime Minister Monti (CNBC)
Volcker To Push Bank On Banks’ Trading (WSJ)
The former Federal Reserve chairman is expected to file a comment letter on the Volcker rule before a Monday deadline, contending that the U.S. financial system will be safer and healthier with a ban on proprietary trading by banks, according to people familiar with the situation. Mr. Volcker also is likely to resist recent attacks on the Volcker rule from money managers, financial firms and foreign governments, including claims that banning banks from trading with their own money could reduce liquidity in the financial markets. Critics of the proposed rule contend that corporate borrowing and trading might cost more as a result. According to people familiar with Mr. Volcker’s thinking, his comment letter will argue that too much liquidity in the market can cause investors to bid up asset prices with the expectation that there will always be a buyer.
A Secretive Hedge Fund Legend Prepares to Surface (CNBC)
Amid the tumult, the Dodd-Frank legislation now requires Louis Bacon’s Moore and other large hedge funds to register with the Securities and Exchange Commission and provide details about their risk management, trading, and disciplinary records. Bacon is loath to reveal any of it. That has prompted him to reconsider the way he has done business for more than 20 years, according to associates. Some, in fact, believe that in the coming years Bacon may transform Moore into what’s known as a “family office,” a far smaller operation primarily managing Bacon’s own capital as opposed to that of outside investors. “Louis has been talking about becoming a family office for at least two years,” says one investor, adding that Bacon considers the new disclosures required by the Dodd-Frank Act to be “a problem.”
Mortgage Problems? Turn Your House Into a Billboard (Reuters)
In return for allowing the front of their four-bedroom house in a Los Angeles suburb to become a garish advertisement, the Hostetlers are getting their nearly $2,000 monthly mortgage paid by the marketing company behind the project, Brainiacs From Mars…Romeo Mendoza, the company’s founder and CEO, told Reuters that his ultimate goal is to turn 1,000 homes across the United States into giant advertisements for his marketing firm. And in each case struggling homeowners will get their mortgage paid, for up to a year. “If we roll it out to scale and impact the foreclosure crisis, that would be amazing,” Mendoza, 42, said.
SEC Private Equity Review Eyes Smaller Firms (WSJ)
The U.S. Securities and Exchange Commission’s review of how private equity firms value assets and market their funds is so far looking at mainly smaller firms, omitting some of the industry’s largest, publicly traded companies, said a person familiar with the inquiry. Blackstone Group, the biggest private equity firm, and KKR & Co. haven’t received the SEC’s December request for information, said the person, who asked not to be named because the information is private. The inquiry stems from a task force set up two years ago to look into practices ranging from asset valuation to conflicts of interest at private equity firms and hedge funds, said another person with knowledge of the matter.
Jeremy Lin Drives Knicks’ Sales, MSG Shares (Bloomberg)
Jeremy Lin has helped drive shares in his boss, Madison Square Garden Co., to a record high and produced the National Basketball Association’s best-selling jersey just over a week after he was a substitute at the end of the New York Knicks’ bench. Since the beginning of the weekend, the Modell’s Sporting Goods Inc. outlet on 34th street and Broadway in Midtown Manhattan, near the Knicks’s home court, has run through multiple shipments of Lin gear, including his No. 17 jersey and T-shirts celebrating “Linsanity,” the catch phrase adopted by the team since the Asian-American Harvard University graduate led the Knicks to a season-best five straight wins in eight days. “Just last week I was reading in the paper about him for the first time,” Miguel Gutierrez, the 28-year-old assistant manager at Modell’s, said in an interview. “I didn’t see this coming. We’re pretty much going to be getting new stuff every day.”
S&P’s Moritz Kraemer: Europe’s AAA-rated Mr Scissorhands (Reuters)
On January 13, Standard & Poor’s Ratings Services cut the credit ratings of nine euro zone countries, stripping France and Austria of their triple-A status and triggering new concerns about the region’s financial health. Since then, the lead analyst in the downgrades, who long has toiled in obscurity as an economist, has gone largely quiet as he monitors Europe’s next move from a Frankfurt office tower. Some policymakers have a nickname for Moritz Kraemer: “Mr Scissorhands.” Since 2007, Kraemer and a team of little-known economists at S&P’s European sovereign debt team have downgraded euro zone countries 36 times.
Athens Burns As Austerity Is Approved (Reuters)
Cinemas, cafes, shops and banks were set ablaze in central Athens as black-masked protesters fought riot police outside parliament. State television reported the violence spread to the tourist islands of Corfu and Crete, the northern city of Thessaloniki and towns in central Greece. Shops were looted in the capital where police said 34 buildings were ablaze.
Crisis in Japan Transforms Global Natural-Gas Market (WSJ)
“The environment surrounding energy has dramatically changed since March 11,” said Tsuyoshi Okamoto, president of Tokyo Gas Co., Japan’s largest gas utility. On that date in 2011, the Fukushima Daiichi nuclear plant was hit by the earthquake and a tsunami, leading to meltdowns and explosions. Since then, other reactors across Japan that shut down for regular inspections have stayed offline. The nation now has just three of its 54 nuclear reactors operating, with the last one set to stop in April or May. The government hasn’t set a target date for restarts. Japan’s industry minister says people should be prepared for a summer without nuclear power, a shift that has virtually no precedent among developed nations in peacetime. As recently as 2010, nuclear reactors supplied 30% of Japan’s electricity.
Berkowitz Says ‘To Survive Is to Win’ as Fairholme Wagers on BofA Rebound (Bloomberg)
“I like what Brian Moynihan’s doing,” Berkowitz said in a Feb. 10 interview in New York after speaking at the Columbia Investment Management Conference. “I like the trends.”
Sofa So Good It Launched Lin (NYP)
An ordinary sofa could become the most famous piece of furniture in sports — as the impromptu sleeping place that Knick phenom Jeremy Lin crashed on in his teammate’s Manhattan pad the night before his breakout game. Knick guard Landry Fields satisfied the ravenous interest of couch potatoes swept up in the Linsanity by tweeting a picture of the artifact. “Ladies and gentlemen, the one and only couch made famous by @JLin7!” Fields tweeted at around 4 p.m. “Let the bidding begin,” he quipped. After Lin got off the couch — and the Knick bench — he scored 25 points against the Nets on Feb. 4. Fields is not the only one who can post a historical marker that reads: “Jeremy Lin slept here.’’ Until he moved to Fields’ sofa, the nomadic Lin had been crashing on the couch in his brother’s Lower East Side apartment. But when he came home from a game in Boston two Fridays ago, Lin found himself displaced because his brother, Joshua, was hosting a party. So the 6-foot-3 point guard landed on his teammate’s sofa — described by Fields as “decent but not huge’’ — and went from unknown to superstar in the course of a week. “Thank you to Landry for hosting me,” Lin said after his career-best performance against the Nets on Saturday. “I think I might just move in with him.”