May 2012

  • Write-Offs

    Write-Offs: 05.31.12

    $$$ Spain reveals €100bn capital flight [FT]

    $$$ Spain Says It Has Months to Raise Bank-Bailout Funds [WSJ]

    $$$ Market Braces for What Could Be Another Weak Jobs Report [CNBC]

    $$$ Goldman’s Cohn Warns Of Poaching Risks From Further Cuts [Bloomberg]

    $$$ Larry Fink’s hedge-fund-manager son Josh isn’t having a great time of it [AR-Alpha]

    $$$ “T. Boone Pickens, who apparently follows Drake on Twitter, sure isn’t [impressed], replying ‘The first billion is a helluva lot harder’ with a mic-drop retweet.” [Gizmodo]

    $$$ RAND Corporation is looking for a business analyst in Santa Monica [DBCC]

    $$$ Blankfein Expected to Testify at Gupta Trial [WSJ]

    $$$ JPMorgan CIO Swaps Pricing Said to Differ From Bank [Bloomberg]

    $$$ Felix Salmon is in a fight with a startup that has “has the best part of $300,000 in interest-free financing repayable at a time of its choosing in underwear.” [Reuters]

    $$$ “‘They signed off on their messages with LOL — laughing out loud,’ Police Commissioner Ray Kelly said. ‘Well, there was a person who was laughing out loud. That was Police Officer Michael Rodrigues of the 77th Precinct.'” [NYP]

    $$$ Try “the Douche Burger, a $666 edible fiscal disaster that piles caviar, lobster & truffles on top of a foie-stuffed, gold-leaf-wrapped Kobe patty, smothers it with Gruyere melted with Champagne steam, and finishes it off with BBQ sauce made using Kopi Luwak coffee that’s passed through the digestive tract of the Asian Palm Civet, explaining why it ‘may not taste good, but will make you feel rich as f*ck.'” [Thrillist via Copyranter]

    / May 31, 2012 at 7:15 PM
  • News

    Layoffs Watch ’12? Deutsche Bank?

    Mr. Jain, 49 years old, played a central role in building Deutsche Bank’s investment-banking business […]

    / May 31, 2012 at 6:05 PM
  • News

    Germans Still Not So Sure About This Anshu Jain Guy

    Tomorrow morning, Anshu Jain will start his new job as co-CEO of Deutsche Bank. Despite having previously overseen operations that produce 90 percent of the firm’s profits in any given quarter, sitting on the management committee, and generally being considered a “star” both within the company and among those who follow his work, chief executive officer is a title no one thought AJ would be given if he remained at DB, because 1) people back in Germany don’t like that he’s an investment banker and 2) “In Germany, no one can imagine an Indian working in London who does not speak German being CEO of Deutsche Bank.” To the haters’ chagrin, though, that’s exactly what’s about to happen. And if they want to continue bitching about it, they can be Jain’s guest– their insults go in one ear and out the other.

    While Mr. Jain has taken German lessons, he doesn’t speak the language, and Der Spiegel, the country’s best-selling weekly magazine, ran a 12-page cover story earlier this year laying much of the blame for Deutsche Bank’s troubles at Mr. Jain’s feet.

    Jain Takes The Reigns At Deutsche [WSJ]

    / May 31, 2012 at 6:02 PM
  • News

    Larry Robbins Is Off The Market, Back In Neighbors’ Good Graces

    Hedge-fund mogul Larry Robbins, founder of Glenview Capital Management, is getting married to former dancer […]

    / May 31, 2012 at 4:49 PM
  • News

    Housekeeping: Dealbreaker Is Looking For Columnists

    Do you want to write things on Dealbreaker? We are looking for a few more regular columnists to write regularly on the areas of their expertise and interest. Topics could include private equity, hedge funds, b-school, stripping one’s way through b-school, or something that has absolutely nothing to do with any of those things but which you are particularly passionate about. Topics like “what I am thinking about this week” or “finance!” will probably be less successful.

    If you are interested, and can commit to writing a column each week or so, please get in touch and tell us who you are (a resume if you want, or just what you do) and what you’d like to write about. A sample post on your idea would also be great.

    As always, if you are currently gainfully employed on Wall Street (and would like to stay that way) for a firm that would not look favorably on a part-time writing career, anonymous/pseudonymous columns are fine.

    / May 31, 2012 at 4:20 PM
  • News

    Goldman Sachs Beats Throngs Of College Kids Off With A Stick

    Are you among the people who mistakenly believe working for Goldman Sachs has lost its luster? That the youth of America no longer spend nights dreaming about what it’d be like to bask in the glow of Lloyd Blankfein? That a guy who couldn’t tie his shoes ’til he was 22 was able to ruin the picture they had their minds of what it would be like to one day, if they worked really hard, have Gary Cohn hike up one leg, plant his foot on a their desk, his thigh close to their face, and ask how markets were doing? Then you don’t have a clue.

    Goldman’s program has grown so big that the firm has to break their start date into two groups. This week welcomed the lucky few selected for “revenue” businesses, like investment banking and trading. Next week brings “services” workers, COO Gary Cohn said at a conference Thursday. Vampire squids, Greg Smith and Delaware judges can’t keep the applicants away. “Our application pool this year was greater than it ever has been,” Cohn said.

    Goldman Sachs Still Hot With The Youths [Deal Journal]
    Related: Goldman Sachs President Gary Cohn Likes To Speak To Employees On A Grundle-To-Face Basis

    / May 31, 2012 at 4:11 PM
  • three little letters

    CFA 2012: Good Luck To All

    As those of you who took the week off to study are well-aware, Saturday is CFA exam day, for all levels. And while we have complete confidence in all of your abilities, some people have expressed feeling a bit jittery about the test. For the vast majority, those fears, while normal, are unwarranted. You just need to talk it out and should consider this space a safe place to do so. For a smaller group of people, though, your fears are totally founded because, statistically speaking, you will fail. Having said that…

    Back in January, after Matt found out he’d passed Level 1 (with a perfect score), a conversation occurred at Dealbreaker HQ that went something like this:

    Me: So are you going to sign up for Level 2?
    Matt: Eh, I don’t think so…I mean, I don’t really feel like spending the next 5 months of my life studying, y’know? And then what am I going to do? Wait around another year to take Level 3?
    Me: Uh….YES, I thought that’s exactly what I thought you were going to do. Don’t you want to be a CFA charterholder? Don’t you want to go to CFA Camp?
    Matt: Meh.

    Fast forward to last Thursday, when we’re sitting around l’office shooting the shit and someone casually mentions, “I wish I were taking the CFA next week.” Unfortunately, said someone is not because he choose not to sign up, strangely forgetting how much he loves standardized tests. That being said, if anyone is scheduled to take Level 2 but a) is suffering performance anxiety and b) wants the opportunity to read another recap of how things panned out for an editor of this site, Matt is happy to go in your place and pass it for you. With two nights of studying he gives himself a 50 percent chance (I think it’s closer to 75), you’d get those 8 hours back, and it’d make him really, really happy. If he doesn’t get to take Level 2 he’s considering the idea of the Connecticut Bar in July. Let him have this.

    / May 31, 2012 at 2:11 PM
  • News

    Golfers Involved In “Grotesque Conduct” Given A Few Months To Think About What They Would Have Done Differently

    Just a quick update re: yesterday’s story about the group of Piedmont Driving Club golfers […]

    / May 31, 2012 at 12:47 PM
  • Banks, M&A, News

    Morgan Stanley Will Soon Not Share Its Research Estimates With 14% More Retail Customers

    Morgan Stanley has announced that it will be buying 14% of its Morgan Stanley Smith […]

    / May 31, 2012 at 12:26 PM
  • Opening Bell

    Opening Bell: 05.31.12

    At Core Of Greek Chaos, A Reviled Tax (WSJ)
    So despised is the property tax that its critics—which is to say, most of Greece—refer to it as the haratsi, after a per capita tax imposed by the occupying Ottomans. About three-quarters of Greece’s households own their homes. Like many other European countries, Greece already has some property taxes. But those have been aimed mostly at higher-value properties and raised little revenue.

    JPMorgan To Spin Out ‘Special Investments’ (FT)
    The unit, whose investments include LightSquared, the wireless internet provider, will be moved to the bank’s corporate division and prevented from seeking fresh investment opportunities, bankers were told on Wednesday.

    Woman Who Wouldn’t Be Intimidated By Citigroup Wins $31 Million (Bloomberg Markets)
    Sherry Hunt never expected to be a senior manager at a Wall Street bank. She was a country girl, raised in rural Michigan by a dad who taught her to fish and a mom who showed her how to find wild mushrooms. She listened to Marty Robbins and Buck Owens on the radio and came to believe that God has a bigger plan, that everything happens for a reason. She got married at 16 and didn’t go to college. After she had her first child at 17, she needed a job. A friend helped her find one in 1975, processing home loans at a small bank in Alaska. Sherry Hunt never expected to be a senior manager at a Wall Street bank. She was a country girl, raised in rural Michigan by a dad who taught her to fish and a mom who showed her how to find wild mushrooms. She listened to Marty Robbins and Buck Owens on the radio and came to believe that God has a bigger plan, that everything happens for a reason. She got married at 16 and didn’t go to college. After she had her first child at 17, she needed a job. A friend helped her find one in 1975, processing home loans at a small bank in Alaska…In March 2011, more than two years after Citigroup took $45 billion in bailouts from the U.S. government and billions more from the Federal Reserve — more in total than any other U.S. bank — Jeffery Polkinghorne, an O’Fallon executive in charge of loan quality, asked Hunt and a colleague to stay in a conference room after a meeting. The encounter with Polkinghorne was brief and tense, Hunt says. The number of loans classified as defective would have to fall, he told them, or it would be “your asses on the line.” Hunt says it was clear what Polkinghorne was asking — and she wanted no part of it.

    Jobless Claims Increased Last Week (Bloomberg)
    First-time claims for jobless benefits increased by 10,000 to 383,000 in the week ended May 26 from a revised 373,000 the prior week, the Labor Department said today. The initial claims exceeded the median estimate of 370,000 in a Bloomberg News survey of economists. The number of people on unemployment benefit rolls dropped.

    For French CEO’s, Politics Means Big Pay Cuts (WSJ)
    Top managers at France’s state-owned companies are expected to face significant pay cuts next month, when Socialist President François Hollande plans to begin enforcing salary caps as part of his broader electoral pledge to get tough on the rich. During the presidential campaign, Mr. Hollande vowed to curb “excessive” remunerations at France’s 52 state-controlled or partially state-owned companies by ordering that executive pay not exceed 20 times the salary of the lowest-ranking employees.

    New York Plans to Ban Sale of Big Sizes of Sugary Drinks (NYT)
    The proposed ban would affect virtually the entire menu of popular sugary drinks found in delis, fast-food franchises and even sports arenas, from energy drinks to pre-sweetened iced teas. The sale of any cup or bottle of sweetened drink larger than 16 fluid ounces — about the size of a medium coffee, and smaller than a common soda bottle — would be prohibited under the first-in-the-nation plan, which could take effect as soon as next March.

    Gorman, Greifeld ‘Face’ off (NYP)
    Morgan Stanley is prepared to take Nasdaq to court to recoup money it believes it lost in the flubbed Facebook initial public offering. CEO James Gorman’s investment bank, which led the now-notorious, snafu-ridden Facebook IPO, believes Bob Greifeld’s Nasdaq owes it roughly $10 million, sources said. The investment bank, which quarterbacked the $16 billion Facebook offering, had to shell out to clients a seven-figure sum to resolve a litany of Nasdaq trading glitches.

    Morgan Stanley’s Facebook Analyst: Sober Man in World of Hype (Reuters)
    Scott Devitt was one of a number of analysts to lower his revenue and earnings expectations for the social media giant after the company informed analysts that it was dropping its quarterly and annual revenue guidance. Facebook also issued an amended prospectus cautioning that the shift of its users to mobile platforms could have a negative impact on revenue growth. Such a move was highly unusual because it occurred just days before Facebook’s highly anticipated IPO, whose lead underwriter was Morgan Stanley, Devitt’s employer. The investment bank not only had control over the process, but over 38 percent of Facebook shares being sold. Devitt’s and other analysts’ revised revenue forecasts were shared via phone calls with institutional investors, but not with retail investors, before the stock began trading publicly. That in turn raised questions over whether the playing field was skewed against Main Street investors from the start and sparked lawsuits.

    Citigroup Debt Viewed As Risky (WSJ)
    Gimme Credit, a fixed-income research company based in New York, said it expects debt issued by the third-biggest U.S. bank by assets to perform less well over the next six months than bonds issued by the company’s peers.

    Russian Zuckerberg Throws Money Paper Planes At Passersby (MSN)
    Russian millionaire Pavel Durov reportedly spent last weekend flying paper airplanes made from 5,000-ruble notes (equal to about $160) out the window of his office in St. Petersburg. The 27-year-old gave away around $2,000 before he stopped because “people turned into animals” grabbing the cash. Durov is the CEO of Russia’s largest social network Vkontakte, which sort of makes him the Russki Mark Zuckerberg.

    Scarf-Wearing Pig Stuns Motorists (UPI)
    Pennsylvania State Police said a baby pig wearing a scarf crossed rush hour traffic in Pittsburgh and disappeared into the woods. Police said the fashionable swine was spotted crossing the inbound lanes of Parkway West near the Green Tree exit around 8:30 a.m. Wednesday, and many motorists pulled off the parkway and stopped to take pictures of the unusual pedestrian. Troopers said the pig had crossed over a guardrail and into the woods by the time they arrived, and they were unable to locate the animal.

    / May 31, 2012 at 9:24 AM
  • Write-Offs

    Write-Offs: 05.30.12

    $$$ EU Weighs Direct Aid To Banks As Antidote To Crisis [Bloomberg] $$$ Tempted, U.S. […]

    / May 30, 2012 at 6:31 PM
  • News

    Confidential To The Haters: Check Back In With James Gorman About Facebook In A Year

    Until then, step off, bitch.

    Morgan Stanley Chairman and Chief Executive James Gorman defended the securities firm’s role in Facebook’s tumultuous initial public offering, telling employees internally that the firm worked “100% within the rules” and calling the steep decline in Facebook’s stock “disappointing.” Mr. Gorman, in a weekly strategy meeting Tuesday that was later webcast to employees, said “speculation of nefarious activity” surrounding the social networking company’s IPO is untrue. Contrary to some reports, he said, he wasn’t “aware of any dissent” among the underwriting firms regarding Facebook’s IPO price of $38 a share. The discussion, called a strategy forum, is held weekly at the firm. The event, which Mr. Gorman attends periodically, features commentary from analysts and economists and is linked to on the company’s internal website.

    Mr. Gorman told employees to “be proud of the job your colleagues did [in the Facebook IPO process] and don’t judge us based upon what happened over a couple of days.” Commenting on Facebook’s stock performance, Mr. Gorman acknowledged the first day of trading “matters” but added investors should also judge an IPO based on its share price after 30 days, 90 days and 12 months.

    Morgan Stanley Chief Defends Facebook Handling [WSJ]

    / May 30, 2012 at 6:20 PM
  • News

    Chinese Insurer Making A Bunch Of Banks Run Its Practice IPO, Will Pick The Best One To Run Its Real IPO

    You can, if you’re interested, read a debate about bankers’ ethical obligations in IPOs here […]

    / May 30, 2012 at 4:51 PM
  • News

    Royal Bank Of Scotland Chairman Isn’t Gonna Sugarcoat Things Here

    Sir Philip Hampton said investors who owned RBS shares before its £45.5bn bailout in October […]

    / May 30, 2012 at 3:36 PM
  • News

    Thank God Someone Came To Work Today

    “Nationalised Spanish lender Bankia is offering a Spiderman towel to young investors as part of […]

    / May 30, 2012 at 3:24 PM
  • News

    “Let The Wives And Children Of These Drunkards Be Confronted With, And Shamed By, The Grotesque Conduct Of Their Husbands And Fathers”

    Last month, a fight broke out at the New York Athletic Club that a witness described as a “nondiscriminatory ragematch” involving “young people, old people, girls, members, and nonmembers,” which started as a tiff over a woman and “escalated into a brawl involving three fighting wolfpacks,” wherein “tables were overturned or moved to the room’s periphery to crate a lion’s pit for the battle,” a “fat pudgy kid came out of nowhere, laid out a larger man with a blow to the head and was tackled by a crowd,” approximately two noses were broken, and the police made three arrests. The club’s President was pretty, pretty embarrassed by the whole thing, as indicated in a letter to members in which he wrote, “I cannot state forcefully enough how abhorrent this even is to me…It is the responsibility of each and every member to protect and embellish the standing of the N.Y.A.C.” And while Manhattan prosecutors’ promise to go afterthe guy responsible for most of the damage ensures the shame NYAC officers are feeling won’t die down any time soon, perhaps they can take some small solace in the fact that they were hitting each other only with their hands.



    […]

    Piedmont Driving Club Letter [PDF]

    / May 30, 2012 at 2:56 PM
  • News

    Warren Buffett And David Einhorn Are In Agreement Re: The Frigidity Of Their Disfavored Investment Ideas

    Back in February, in his annual letter to investors, Berkshire Hathaway chief Warren Buffett spent a good bit of time discussing why one shouldn’t own gold. Beyond the fact that, according to WB, gold doesn’t “change in size and [is] incapable of producing anything,” and you’d be much better off buying farmland (which “a century from now will have produced staggering amounts of corn, wheat, cotton and other crops and will continue to produce that valuable bounty”) or shares of Exxon Mobil (which “will probably have delivered trillions of dollars in dividends to its owners,” the Oracle of Omaha had one incontrovertible, be all end all reason for eschewing the metal: its unfuckability. Oh sure, you can do things to a cube, you can fondle it, you can talk dirty to it, you can send nude pictures of yourself, you can even drill a hole in it and fuck it senseless, but, the thing is, the cube will not respond. No reciprocation, no gratitude, not even a sign it enjoyed itself.  For Buffett, no further argument was necessary as to the worthlessness of the commodity. (Silver, on the other hand, will make you feel like you’re 18 again.) Anyway, David Einhorn sort of feels the same way about the dollar.

    Greenlight Capital 1Q2012 Letter To Investors [PDF]
    Related: Don’t Think He Hasn’t Tried

    / May 30, 2012 at 12:47 PM
  • News

    If You Must Know, Nassim Taleb Is Actually Kind Of Looking Forward To The Break Up Of The Euro

    Nassim Taleb, author of “The Black Swan,” said he favors investing in Europe over the […]

    / May 30, 2012 at 10:47 AM
  • Opening Bell

    Opening Bell: 05.30.12

    Anger Over Christine Lagarde’s Tax-Free Salary (Independent)
    Lagarde was accused of hypocrisy yesterday after it emerged that she pays no income tax – just days after blaming the Greeks for causing their financial peril by dodging their own bills. The managing director of the International Monetary Fund is paid a salary of $467,940 (£298,675), automatically increased every year according to inflation. On top of that she receives an allowance of $83,760 – payable without “justification” – and additional expenses for entertainment, making her total package worth more than the amount received by US President Barack Obama according to reports last night. Unlike Mr Obama, however, she does not have to pay any tax on this substantial income because of her diplomatic status.

    EU Proposes ‘Banking Union’ (WSJ)
    The 17 countries that use the euro should consider setting up a “banking union” that allows them to share the burden of bank failures, the European Union’s executive arm said Wednesday in a report on the currency union’s crisis-fighting efforts. To further stop expensive bank bailouts from pulling down governments’ own finances, allowing the euro zone’s new rescue fund to directly boost the capital of banks “might be envisaged,” the European Commission said.

    Greeks Flock To Germany Even As They Criticize It (CNBC)
    Germany, Europe’s economic powerhouse and a country which has been criticized by many Greeks over its harsh demands for austerity cuts in return for bailout cash, has experienced an influx of young skilled immigrants. Der Spiegel magazine noted that while Greek newspapers “printed cartoons depicting the Germans as Nazis, concentration camp guards and euro zone imperialists who allow their debtors to bleed to death,” the Greeks have kept arriving — bringing an “anything is better than Athens” attitude with them.

    Pissarides Says Euro Exit Would Aid Rich Greeks At Cost To Poor (Bloomberg)
    Nobel economics laureate Christopher Pissarides said wealthy Greeks would benefit at the expense of poorer citizens were the country to exit the euro. “A lot of Greeks” have withdrawn money and deposited it with banks elswhere in the 17-nation currency zone, Pissarides said in an interview in London today. If the country returned to the drachma, the new currency would be so devalued they could buy it cheaply on international markets with the cash they’d exported, enabling them to buy more assets in Greece. While poorer Greeks are equally able to appreciate the difficulties facing their country, they’re not as able to shield their funds from an exit from the common currency, Pissarides said. They need to preserve quick access to their savings, which isn’t as easy to do if it’s held at a foreign bank, and such lenders may not always accept small deposits.

    Zuckerberg Drops Off Billionaires Index As Facebook Falls (Bloomberg)
    The 28-year-old’s fortune fell to $14.7 billion yesterday from $16.2 billion on May 25, as shares of the world’s largest social-networking company dropped 9.6 percent to $28.84.

    Woman’s Boyfriend Took Car Without Permission Before She Slammed It Into House (NYP, earlier)
    Dan Sajewski, 23, arrived at his family’s Huntington estate last weekend with Anderson, 21, his on-again, off-again waitress girlfriend. While his parents vacationed on Long Island’s North Fork, the duo helped themselves to his mother’s 2003 Mercedes-Benz CLK 320, a birthday gift from Sajewski’s anesthesiologist father, a source said. They took a joyride to the Hamptons, where they had a little too much fun. A field Breathalyzer test revealed that Anderson drove home with a .30 Blood-Alcohol Content — nearly four times the legal limit and the equivalent of about 15 drinks, prosecutors said at her arraignment yesterday. They drove back to Huntington and she was speeding along Southdown Road when she failed to turn at a T-instersection — ramming through the front of Indiere’s house, obliterating her kitchen, and exiting through the back wall, prosecutors said. “We can’t believe he just let this girl drive a car he wasn’t even supposed to have in the first place,” a Sajewski family member said. “He’s done this before; he took his sister’s Jeep and just took off. “He was trying to get the car home before the family got home from their own Memorial Day weekend. He’s not exactly the model son.’’ The relative added that Sajewski didn’t call his father about the accident until two hours later. In the police report, Anderson told cops “her power steering got stuck, causing her to crash,” and that she only drank “three beers.”

    Housing Market Crawls Back (WSJ)
    Housing prices across the U.S. fell in March, but not as much as in earlier months, according to a report Tuesday that offered fresh evidence of a real-estate market on the mend. Compared with February, prices fell just 0.03% in March, and after adjusting for seasonal factors, they rose 0.09%, according to the S&P/Case-Shiller 20-city home-price index. “This is the first flat report we’ve had in quite some time,” said David M. Blitzer, chairman of the Index Committee at S&P Indices. Still, “while there has been improvement in some regions, housing prices have not turned” everywhere, he said.

    Bankers Hired By Blackberry Maker (NYP)
    Research In Motion said yesterday it hired investment banks JPMorgan and RBC to review its “options,” which most investors took to mean a potential sale, and warned of another quarterly loss.

    Gold Investors Rush For The Exits (WSJ)
    Investors in SPDR Gold Shares and iShares Gold Trust, two high-profile exchange-traded funds that hold physical bullion, also have pulled back recently. Through Friday, the two funds had reduced the number of tons of gold they’re holding this month. As of May 15, hedge funds, pension funds and other money managers also had slashed their bets that gold prices will rise in the futures market, to the lowest level since January 20, 2009, according to weekly data released by the U.S. Commodity Futures Trading Commission. The bullish bets rose slightly last week, but remain near the low for the year.

    Police Find Another Human Body Part In Package In Ottawa (OC)
    Police found a human hand at the Ottawa Postal Terminal Tuesday night, hours after a bloody foot was delivered to the Conservative party’s Ottawa headquarters just blocks from Parliament Hill. Ottawa police were still trying to understand what they were dealing with even as detectives in Montreal combed through a crime scene where a torso was found in a suitcase in that city’s Snowdon district. Police discovered the second package, sent from the same place as the package sent to Tory headquarters, Tuesday evening. Officers carried it from the huge Riverside Drive terminal in a brown paper bag, which they X-rayed before they opened it to find the hand. The gruesome events began shortly before noon when access to the Conservative party’s headquarters was restricted after the fire department’s Hazmat team was called in to investigate a suspicious package. A party staffer had started to open a blood-stained box sent to the office at 130 Albert St. before police were called to investigate. At first, it was thought there was a human heart inside, but after the box was X-rayed, police confirmed that it contained a foot.

    / May 30, 2012 at 9:25 AM
  • News, Write-Offs

    Write-Offs: 05.29.12

    $$$ Why do some people hate Spain’s plan to bail out Bankia? [FT] $$$ Why […]

    / May 29, 2012 at 7:17 PM
  • News

    BusinessWeek: If You’re Going To Freebase A Seed, Make It A Chia

    Just something to keep in mind.

    A former Countrywide Financial Corp. manager whose fraud suit contributed to the mortgage industry’s $25 billion settlement with federal and state regulators received about $14.5 million for his efforts, his lawyers said. Kyle Lagow, an appraisal manager for Countrywide from 2004 to 2008, claimed that Countrywide inflated the value of homes to support bigger loans, according to a statement today from Seattle-based law firm Hagens Berman. Charlotte, North Carolina- based Bank of America bought Countrywide in 2008 to save it from collapse as defaults on home loans soared. Lagow’s information helped prompt a $1 billion settlement of Federal Housing Administration claims announced by Bank of America in February, according to the law firm. The sum was included in the nationwide settlement reached that month.

    [Bloomberg]

    / May 29, 2012 at 6:22 PM
  • Banks, News

    JPMorgan Has A Lot Of Great Things Going On This Quarter Other Than, Y’Know

    When the London Whale thing came out, JPMorgan made one sort of clever attempt to […]

    / May 29, 2012 at 5:55 PM
  • News

    Area Drunk Offers Handy How To Guide Re: Not Being Labeled “That Guy (Who Uses The Front Door Of A House As A Garage Door)” At The Office

    Planning to knock off work early every evening from now through Labor Day and/or take the edge off life with some adult beverages during lunch because it’s summer and you deserve it? Want to have “fun” but not do anything “crazy“? If parking your car in a stranger’s backyard via their house constitutes a line you don’t want to cross, and you have roughly the same alcohol tolerance as a 21 year-old female, consider telling co-workers and friends you want to be cut off at a dozen drinks. Fourteen, max.

    A Long Island prosecutor said today that a preliminary field test indicated that the Brooklyn woman who crashed through a house had consumed about 15 drinks before the accident. Police arrested 21-year-old Sophia Anderson following the crash Monday at 4 a.m. in Huntington. Anderson is accused of DWI after her red Mercedes-Benz CLK 320 in the rear of 96-year-old Helen Indiere’s once-tidy home. The car smashed through the home, ending up in the backyard. She suffered scrapes and bruises, while an unidentified passenger was not injured. Indiere who was inside the house and her caretaker were miraculously not injured. Anderson pleaded not guilty on Tuesday. Bail was set at $50,000. A Suffolk County prosecutor said a preliminary field test at the crash scene indicated a blood-alcohol reading of 0.30. Each alcoholic drink raises the level by about 0.02. The legal limit is 0.08. Anderson’s lawyer questioned the validity of the sobriety test.

    NY prosecutor: Woman drunk drove car through house [WSJ]
    B’klyn woman had ‘over a dozen drinks’ in her at time of crash: DA [NYP]

    / May 29, 2012 at 4:56 PM
  • News

    Plan D: A Hostile Takeover Of The Newark Bears

    “Major League Baseball has approved three potential buyers to review the financial records of the […]

    / May 29, 2012 at 2:30 PM
  • News

    Woman Wants $150 Trillion-ish From MF Global, Thinks She Is Barack Obama

    Earlier this month, the Journal explored the difficulty MF Global customers have encountered in attempting to get their “missing” back, after the firm went down for the dirt nap last October. One woman who can relate all too well? Barack Obama AKA Angela Dozier-Carter, who is owed $150 trillion and then some, of which she hasn’t seen a dime.

    Sadly, it doesn’t look like President Dozier-Carter will be seeing any money any time soon, as MF Global’s lawyers have filed a motion dismiss her claim, calling them “patently absurd on their face.” In related news, this isn’t the first time ADCBO has been screwed out of money rightfully owed to her.

    On January 27, 2010, Ms. Dozier-Carter filed two more complaints in the Court of Federal Claims, identified as case numbers 10-63 and 10-64. In Complaint 10-63, Ms. Dozier-Carter seeks $25 million as a reward for capturing Saddam Hussein. In Complaint 10-64, Ms. Dozier-Carter seeks $400,000 in annual salary and expenses because she allegedly “took the Oath of Office for the 44th President of the United States of America as Barack Obama[.]”

    This is far from over.

    MF Global Motion To Expunge Claim [PDF]
    Dozier-Carter v. U.S. [Leagle]
    Customer Divide At MF Global [WSJ]

    / May 29, 2012 at 1:47 PM
  • News

    Greek Exit From Euro Will Have Dire Consequences On Erotic Underwear Sales

    Only a quarter of the 300 to 400 sex shops that once existed in Athens […]

    / May 29, 2012 at 10:31 AM
  • Opening Bell

    Opening Bell: 05.29.12

    Greece Pours $22.6 Billion Into Four Biggest Banks (Reuters)
    The long-awaited injection—via bonds from the European Financial Stability Facility rescue fund—will boost the nearly depleted capital base of National Bank, Alpha, Eurobank and Piraeus Bank. “The funds have been disbursed,” an official at the Hellenic Financial Stability Facility, who declined to be named, told Reuters. The HFSF was set up to funnel funds from Greece’s bailout programme to recapitalise its tottering banks. The HFSF allocated 6.9 billion euros to National Bank, 1.9 billion to Alpha, 4.2 billion to Eurobank and 5 billion to Piraeus. All four are scheduled to report first-quarter earnings this week. The news came as two government officials told Reuters that near-bankrupt Greece could access 3 billion euros, left from its first bailout programme, to cover basic state payments if efforts to revive falling tax revenue fail.

    U.S. Ready for Europe Fallout, Says Fed Official (WSJ)
    “There’s absolutely no reason for people in the United States to get all in a dither,” Federal Reserve Bank of Philadelphia President Charles Plosser said in an interview with The Wall Street Journal. Mr. Plosser said that in the short run, uncertainty in Europe might even work in the U.S. economy’s favor, via lower U.S. interest rates and energy prices.

    Greece to Leave Euro Zone on June 18, Says Guy (CNBC)
    Greece will leave the euro zone on June 18 if the populist government wins the country’s elections on the 17 as the rest of the euro zone rounds on “cheaters,” Nick Dewhirst, director at wealth management firm Integral Asset Management, told CNBC Monday. “The euro zone is a club but you get cheaters who get away with it until everyone finds out and at that point you need to remove them otherwise everyone will cheat. It’s better for Greece to leave,” Dewhirst said. He added that Greek society was built on cheating and scheming, saying “everyone does it” but that voters elsewhere in the euro zone were now calling Greece to account. “The basic question is that a German has to increase working from 65 to 67 and that is to pay for Greeks retiring at 50. The 17th of June is the perfect opportunity to say either ‘we’ll behave’ or ‘we’ll carry on cheating,'” he said.

    Facebook Debacle Turns High Hopes Into Potentially Mood-Souring Skepticism (WSJ)
    It is impossible to measure the impact of Facebook’s flubbed deal on overall investor confidence. But there is at least one sign of possible fallout: More than $3 billion was yanked from U.S. stock mutual funds by small investors in the week ended Wednesday, according to EPFR Global Inc. in Cambridge, Mass. That was the worst week for withdrawals since March. In the previous week, investors added $311 million to U.S. stock mutual funds. David Guthrie, a 30-year-old actor in Toronto, bought 15 shares of Facebook on its opening day. Before then, he had bought just one stock, yet saw the market as a place to make his savings rise in the long run. Now he feels burned. “If Facebook had made a lot of money, I’d try it again,” Mr. Guthrie says. After the stock’s disappointing slide, “I would never put big money into the stock market.”

    Zoos’ Bitter Choice: To Save Some Species, Letting Others Die (NYT)
    …Ozzie, a lion-tailed macaque, will never father children. Lion-tails once flourished in the tops of rain forests in India, using their naturally dark coloring to disappear into the height of the jungle. Though there are only about 4,000 remaining in the wild, not one among Ozzie’s group here in St. Louis will be bred. American zoos are on the verge of giving up on trying to save them. As the number of species at risk of extinction soars, zoos are increasingly being called upon to rescue and sustain animals, and not just for marquee breeds like pandas and rhinos but also for all manner of mammals, frogs, birds and insects whose populations are suddenly crashing. To conserve animals effectively, however, zoo officials have concluded that they must winnow species in their care and devote more resources to a chosen few. The result is that zookeepers, usually animal lovers to the core, are increasingly being pressed into making cold calculations about which animals are the most crucial to save. Some days, the burden feels less like Noah building an ark and more like Schindler making a list.

    Icahn Takes Chesapeake Energy Stake (WSJ)
    Carl Icahn skewered Chesapeake Energy Corp.’s CHK board for corporate governance controversies and “irresponsible actions” while disclosing he acquired a sizeable new stake in the company.

    Euro Likely Worthless as Collector’s Item (Bloomberg)
    FYI.

    JPMorgan Beefs Up China Unit With $400 Million Injection (Reuters)
    “The additional capital will better position the bank in the evolving regulatory environment and cement our commitment to clients in China,” Zili Shao, Chairman and chief executive of J.P. Morgan China, said in a statement on Monday. “The capital will be used to expand the bank’s branch network, develop products, increase corporate lending, and recruit employees,” Shao added.

    Europe Turns To US For Loans (WSJ)
    In the latest symptom of Europe’s financial turmoil, the region’s riskier companies are bypassing banks and investors at home and turning to the U.S. for loans. European companies borrowed some €14.4 billion (about $18 billion at current rates) in the U.S. leveraged-loan market this year through Friday, more than double the €6.7 billion for all of 2011, according to data from S&P Capital IQ LCD. That is the highest amount since at least 2007, the height of the last boom in leveraged lending, when full-year loan volume was €12.2 billion, according to S&P.

    How Boaz Weinstein And Hedge Funds Outsmarted JPMorgan (NYT)
    By May, when fears over Europe’s debt crisis again came to the fore, the trade reversed. The London Whale was losing. And Mr. Weinstein began to make back all of his losses — and then some — in a matter of weeks. Other hedge funds were also big winners. Blue Mountain Capital and BlueCrest Capital, both created by former JPMorgan traders, were among those winners. Lucidus Capital Partners, CQS and a fund called III came out ahead, too. Inside the hedge fund world, some joked that Mr. Weinstein had been able to spot the London Whale because he himself had been a whale once, too.

    Drunk Brooklyn woman crashes car through Long Island home (NYDN)
    A drunken Brooklyn woman crashed her Mercedes into a Long Island home Monday, smashing through the house and landing in the backyard, cops said. Sophia Anderson, 21, failed to turn left or right when the road she was driving on in Huntington deadended at a T-intersection with another street, officials said. She left a train of wreckage as she smashed through the modest house on Southdown Rd., missing the 90-year-old homeowner and her caretaker. Anderson, treated and released at Huntington Hospital, was arrested and charged with driving while intoxicated, police said.

    / May 29, 2012 at 7:30 AM