2012

  • News

    Whaledemort’s Soul, Portfolio Broken Up And Hidden In JPMorgan Investment Bank

    Who wins the call-the-Whale-close? The headline number is a $4.4 billion loss this quarter but that is lower than it could have been because those losses propagated backwards through time: JPMorgan Chase & Co. (NYSE: JPM) today reported that it will restate its previously-filed interim financial statements for the first quarter of 2012. The restatement […]

    / Jul 13, 2012 at 8:38 AM
  • Write-Offs

    Write-Offs: 07.12.12

    $$$ Excited for Whale day? [Reuters]

    $$$ Banks’ Libor costs may hit $22bn [FT]

    $$$ Bain Starts Raising Buyout Fund With $6 Billion Target [Bloomberg]

    $$$ PFG Employee Files Lawsuit for Wages so he could afford the new leash, harness and doggie bed he had bought for Apple, his terrier mix [FINS]

    $$$ Piggy bank has a new meaning in a town east of Vienna after a surveillance camera caught a wild pig on a night foray to a local branch of one of Austria’s financial institutions. The Austria Press Agency reports that the inquisitive porker managed to push open a locked sliding glass door of a bank in Hainburg an der Donau to make its way inside. After looking around, it left the same way it came without causing significant damage, with the door locking behind it. [AP]

    $$$ A prominent broker-dealer is looking for a junior non-agency mortgage trader [DBCC]

    $$$ Richard Posner: Why There Are Too Many Patents in America [Atlantic]

    $$$ Goldman recruits former Treasury spokesman [FT]

    $$$ In spite of the Barclays scandal, LIBOR product continues to do well [Sober Look]

    $$$ Here you will find NSFW pictures of dinosaur loving [Daily Mail]

    / Jul 12, 2012 at 6:42 PM
  • Buzzfeed's 25 Photos of Mitt Romney Looking Perfectly Normal: Amazing

    News

    Mitt Romney, Bill Ackman Undone By Forms

    Let’s talk about two tenuously related stories about government filings, why not. I don’t have much to say about this Mitt Romney Bain thing today but go read it, it is fascinating. Basically Mitt Romney certified under penalty of perjury in some federal electoral forms* that he was not involved with Bain Capital after 1999, […]

    / Jul 12, 2012 at 5:30 PM
  • News

    Fox Business Correspondent’s Drink Offer Brutally Rebuffed By Facebook CEO Despite Similarly Casual Attire

    And after a late entrance, Mr. Zuckerberg also showed up, alongside his friend Drew Houston, the chief of Dropbox. Clad in his uniform gray shirt and jeans, Mr. Zuckerberg made a quick beeline for Duchin, but not before Dennis Kneale of Fox Business Network managed to get in a few words. “Can I buy you […]

    / Jul 12, 2012 at 4:26 PM
  • News

    Wells Fargo Wants To Be Clear The $175 Million It’s Paying To Make Allegations It Discriminated Against Black And Hispanic People Go Away Does Not Mean It Discriminated Against Black And Hispanic People

    The settlement announced by the Justice Department Thursday involves at least 34,000 [black and Hispanic] borrowers who were charged higher fees or were steered into risky subprime mortgages when they could have qualified for a prime mortgage, ones offered to borrowers with the best credit. In settling, Wells Fargo said it “not only denies that […]

    / Jul 12, 2012 at 2:41 PM
  • News

    Call The JPMorgan (Whale Loss) Close (Updated)

    Did Bruno Iksil make the bank -$2 billion? -$9 billion? -$20 billion? Was this all just a hoax and he actually didn’t lose any money at all? JPMorgan will let us know tomorrow at 7AM.

    Standard Price Is Right rules, closest without going over. Guesses in by 4PM today. Winner will receive his or her choice of a visit from the sandwich fairy, a highly coveted whale bath toy, or an I heart Dealbreaker button.

    / Jul 12, 2012 at 1:21 PM
  • News

    Bill Gross Is Not The Only One Who Feels Fat

    Are your pants getting a little tight? Have you become convinced mirrors have a personal vendetta against you? Are you too distracted by the rolls spilling over your pants to trade? Do you find yourself veering off course in your letters to investors to talk about your love handles? Is it only a matter of time before you lose your firm billions and/or take down the entire market because your fingers are so big they span four keys each on the keyboard? Do you want to do something about it but are repulsed by the idea of healthy eating and exercise and also know yourself well enough to realize that there is no way you’re going to be able to stay strong if everyone around you is eating delicious fried food at lunch and sooner or later you, a usually pretty mild-mannered guy, will be leaping across a row of Bloomberg terminals and threatening to kill a coworker (and meaning it) unless he hands over Ho Ho now? Then round up your tubbiest colleagues and tell them they’re in for a real treat.

    Eric Helms, who founded the four-year-old Cooler Cleanse company with the actress Salma Hayek, says office cleansers now make up 30 percent of his business, and in the last year he has hired three customer-service employees just to handle the details of them. He said there has been a “huge increase in popularity” of cleansing with co-workers in the last year, which he credits to juice diets being more mainstream. “Everyone knows someone who’s done one, and they realize they’re a lot easier to do with colleagues during the workweek,” he said. “People want to indulge” — not sip celery — “on weekends.”

    Recent six-juice-a-day-dieters include employees at Merrill Lynch and the Carlyle Group, she said. In May, Citigroup began offering BluePrintCleanse in some of its Manhattan cafeterias, a spokeswoman said…About two-thirds of cleanse clients over all are women, but corporate cleanses “commonly skew toward men, especially traders, investment bankers and lawyers,” said Jina Wye, director of sales and marketing for BluePrintCleanse, founded in 2007 by two former Hudson Hotel bartenders looking to swap their poisons. (Mr. Helms said 90 percent of his male customers are part of groups.) Ms. Wye said: “These Type-A men have an all-or-none perspective. If they’re going to commit, they do it whole hog.” Most popular among male en masse cleansers: the Excavation cleanse, described on the Web site as “the most intense.”

    And if you want to really crank things up a notch, consider gauging interest in a group colonic to top things off.

    Cleansing From Cubicle To Cubicle [NYT]
    Related: I’m afraid I might tell her to buy a gun and just shoot me before the fat and the cellulite strike again.

    / Jul 12, 2012 at 12:48 PM
  • News

    Meanwhile, At UBS…

    / Jul 12, 2012 at 11:11 AM
  • Opening Bell

    Opening Bell: 07.12.12

    Fed Weighs More Stimulus (WSJ)
    A few Fed officials were ready to move aggressively when the Fed met in June and several others said they might want to take new measures if the recovery loses momentum or their growth and employment forecasts are cut once again. That is according to minutes of the central bank’s June 19-20 meeting, which were released Wednesday with their usual three-week lag.

    Gold to Hit $2,000 by Year-End on More Fed Easing: Merrill (CNBC)
    “We think that $2,000 an ounce is sort of the right number,” Francisco Blanch, Head of Global Commodity & Multi-Asset Strategy Research at the investment bank, said Thursday.

    Regulators’ Shake-Up Seen as Missed Bid to Police JPMorgan (NYT)
    After the financial crisis, regulators vowed to overhaul supervision of the nation’s largest banks. As part of that effort, the Federal Reserve Bank of New York in mid-2011 replaced virtually all of its roughly 40 examiners at JPMorgan Chase to bolster the team’s expertise and prevent regulators from forming cozy ties with executives, according to several current and former government officials who spoke on the condition of anonymity. But those changes left the New York Fed’s front-line examiners without deep knowledge of JPMorgan’s operations for a brief yet critical time, said those people, who spoke on the condition of anonymity because there is a federal investigation of the bank. Forced to play catch-up, the examiners struggled to understand the inner workings of a powerful investment unit, those officials said. At first, the examiners sought basic information about the group, including the name of the unit’s core trading portfolio.

    Neb. Man Jailed for Bomb Threat on Job Application (AP)
    the Legacy 272 Lounge employee who reviewed 38-year-old Jason Dornhoff’s application last Thursday called police when he read the threat that closed with: “If you be quiet and help me, you won’t die.” Police arrested Dornhoff, of Heartwell, Neb., at gunpoint and searched his truck, but didn’t find any bomb. Court documents say Dornhoff told police he uses methamphetamines and went to the restaurant hoping to find a way to fulfill his sexual fantasies.

    Clock Is Ticking On Crisis Charges (WSJ)
    Federal laws under which the Securities and Exchange Commission usually goes after alleged fraud and other misdeeds have a five-year statute of limitations. The five-year limit is causing SEC officials to race to file lawsuits in some cases and ask lawyers representing the targets of certain investigations to give the agency more time, according to people close to the investigation. The SEC intends to file charges against firms and people involved in the creation of a $1.6 billion mortgage-bond deal called Delphinus CDO 2007-1, people close to the investigation said.

    Credit Suisse Clients Targets Of Tax Probe (WSJ)
    German tax inspectors in recent weeks have been raiding the homes of Credit Suisse Group AG clients suspected of evading taxes, according to bank and German government officials. The investigation is centering on about 5,000 clients who between 2005 and 2009 allegedly bought insurance policies at a Bermuda-based subsidiary of the Swiss bank.

    In These Knife Fights, Only Pride Gets Wounded (WSJ)
    Donavon Phillips windmilled his arms. He hopped a few times to get the blood flowing in his legs. A light sweat formed under his black-and-red jersey—just the right dew. “You can’t go into this cold, because it’s an all-out sport,” said Mr. Phillips, pulling his right arm across his chest. He was warming up for a cutthroat event: the 10th annual World Championship Cutting Competition. It takes razor-sharp focus to be a cutting champ, along with a blade that resembles a bulkier, sharper version of a kitchen meat cleaver. Mr. Phillips is one of a few who have helped make a sport out of demonstrating they can swiftly, flawlessly slice through a dozen water bottles or chop a rolling tennis ball in half. Having won the national title in May, he is a favorite on the cutting circuit.

    SEC Votes To Require Consolidated Audit Trail For Markets (Bloomberg)
    “A consolidated audit trail that accurately tracks orders throughout their lifecycle and identifies the broker-dealers handling them will provide us with an unprecedented ability to effectively oversee the markets we regulate,” said SEC Chairman Mary Schapiro. The rule is a “great leap forward,” she said.

    BofA Execs Dodge A Bullet (NYP)
    Bank of America won a federal court ruling dismissing claims against former Chief Executive Officer Ken Lewis and others in a securities-fraud lawsuit over the bank’s use of an electronic mortgage registry.

    Buffett: US Economic Growth Slowing, US Slipping “Pretty Fast” (CNBC)
    Despite the slowdown, Buffett says the U.S. economy is still doing better than “virtually any other big economy” around the world.

    New York Fed to Release Libor Documents Friday, Official Says (Reuters)
    The Federal Reserve Bank of New York will release on Friday documents showing it took “prompt action” four years ago to highlight problems with the benchmark interest rate known as Libor and to press for reform, an official at the regional U.S. central bank said on Wednesday.

    ‘Con artists’ scammed Hamptons homeowners by turning rentals into teen party pads: officials (NYP)
    Two real-estate con artists made hundreds of thousands of dollars by renting homes in the Hamptons and using them as post-prom and graduation-party crash pads for raucous teens, authorities said. Officials and outraged homeowners said the front man, 25-year-old Lee Hnetinka, of Jericho, would rent the mansions saying he intended to use them for his own family reunions. “He said it was his aunt having a party at his house,” said Lucy Sachs, 64, who rented her family’s East Hampton home to Hnetinka for $30,000 a month. When a neighbor called on June 8 to tell her that a “party bus with a disco ball had arrived” at Sachs’ place in the middle of the night, she rushed over, confused. What Sachs found was a houseful of nearly 100 teens smoking and drinking in the century-old building. Hnetinka allegedly teamed up with Leslie Jennemann (both inset), a Hamptons real-estate agent who in 2002 was convicted of running over and killing a migrant potato picker on her way home from a party, Southampton officials said…The suspects charged students $355 each for three days at the house, homeowners said. Scarlato estimated that the pair brought in $60,000 to $80,000 a weekend and had as many as 10 rentals. Another East Hampton homeowner, Eli Braha, rented to Hnetinka and became suspicious after a landscaper called to ask about all the trash and as many as 30 inflatable beds in the home.

    / Jul 12, 2012 at 8:43 AM
  • News

    Libor Manipulating Banks Used Baltimore’s Tax Dollars To Help Pay Off Your Mortgage, Or Something

    There is a line forming to the left for people to beat up on Libor-manipulating banks, and it’s a long line so your beating time is limited and you have to make the most of it if you want anyone to care. Today’s the day for U.S. municipal borrowers. How’d they do? The municipalities are […]

    / Jul 11, 2012 at 6:31 PM
  • News

    CFTC Commissioner Bart Chilton Uses Public Meeting On Dodd/Frank Rulemaking To Test Out Open Mic Night Bits

    In full:

    “Thank you Mr. Chairman. There are a couple of important events coming up that I want to share with you today. First, tonight the All-Star game will be played. Also, in just 11 days, we’ll have the two-year anniversary of the signing of the Dodd-Frank Wall Street Reform and Consumer Protection Act. Now, some of you are asking, “How’s he going to put these two totally divergent things together?” It’ll all make sense in a minute. Really.

    First, how many of you have heard of Bryce Harper? He’s the youngest position player ever chosen for an All Star game and plays for what is for many of you, your hometown team, the Washington Nats. He not only has a way with the bat but he seems to have a way with words, too. A couple weeks ago, a reporter asked him what he seemed to think was a silly question, and he responded by saying, “That’s a clown question, bro.” That answer went on T-shirts. It went on late-night TV. It went viral.

    Now, back to Dodd-Frank. There are those who say we don’t need it. Let’s repeal it—or at least parts of it. Let’s de-fund the agencies overseeing it so they can’t enforce it. Heck, let’s just take ‘em to court if we don’t like the line-up. Let’s take our bat and ball and go home. So, here’s the question they seem to be asking: “Do we even need Dodd-Frank?”

    Let’s not even talk about 2008 and the financial collapse and the real reason Dodd-Frank came along in the first place. Let’s talk about how MF Global (as some would suggest) got caught trying to steal. Let’s talk about JPMorgan’s losing streak. Let’s talk about Barclays’ balk. Do we need Dodd-Frank? That’s a clown question, bro.

    So yes, we need rules. We need the funding to enforce them. Plenty of folks still seem to think they can get around the rules. Plenty of folks in this town seem to think we don’t need umpires. Do we? That’s a clown question, bro.”

    That’s A Clown Question, Bro [CFTC]

    / Jul 11, 2012 at 2:50 PM
  • News

    Bank Of America Willing To Concede Traumautized Homeowners May Not Be Eager To Do Business With Or Even Open Mail From The Death Star

    When Bank of America Corp. sent letters to 60,000 struggling homeowners offering to slice an average $150,000 off their loans, the lender got an unusual response from most of them: silence. Homeowners who fell behind on their payments began receiving the mailings in May, part of the bank’s effort to meet terms of the $25 […]

    / Jul 11, 2012 at 2:09 PM
  • bernanke lip

    News

    Ben Bernanke’s Superpowers Include Propping Up Stock Prices, Time Travel

    This paper from David O. Lucca and Emanuel Moench at the New York Fed, concluding that 80% of excess returns to U.S. equities come in the 24 hours before Fed monetary policy announcements, is pretty amazing. Here is the money chart; what does this tell you about the effect of the Fed’s actions on stock […]

    / Jul 11, 2012 at 1:55 PM
  • Can't nobody hold me down

    Who Wants To Invest In Phil Falcone’s New Company?

    Harbinger Global Corp is coming to an exchange near you.

    Phil Falcone, the embattled billionaire hedge fund manager, has put together an unorthodox IPO that will see his hedge fund firm contribute assets valued at $350 million to a blank check company that will trade publicly. In the deal, a special purpose acquisition company that is expected to trade on Nasdaq and be known as Harbinger Global Corp., will acquire a majority interest in an MGM-branded hotel and casino development in Vietnam and a minority interest in an iron ore producer working in Brazil. Funds run by Falcone’s Harbinger Capital Management that are contributing the assets will get an ownership stake that could be as high as 96% in Harbinger Global and Falcone is slated to become executive chairman of the company. Falcone’s move to become closely involved in a publicly-traded company is audacious given that he is currently facing securities fraud charges from the Securities & Exchange Commission.

    Yeah, well, people also thought it was audacious for him to invite a burlesque dancing pig he barely knew to come and live with him and she turned out to be the best thing that ever happened to him, so.

    / Jul 11, 2012 at 1:38 PM
  • Hedge Funds

    Former Paulson Protégé In A Charitable Places About Losses

    Remember Paolo Pellegrini? For those who need a refresher, the Italian Stallion is the former Paulson and Co. employee who helped John come up with a highly lucrative subprime trade, later leaving the firm to set up his own shop (the delightfully named PSQR AKA Pellegrini Squared) after some reported friction re: whether or not […]

    / Jul 11, 2012 at 11:47 AM
  • Opening Bell

    Opening Bell: 07.11.12

    Claw Is Out For ‘Whale’ Officials (WSJ)
    The nation’s biggest bank is expected to claw back compensation from individuals including Ina Drew, who ran the company’s Chief Investment Office, according to people familiar with the bank’s plans.

    Dimon Risk Reputation On Line As JPMorgan Faces Analysts (Bloomberg)
    In a departure from his customary earnings-day conference call, Dimon will meet analysts for two hours on July 13 at the bank’s New York headquarters to field questions about the loss and what he’s doing to contain the damage.

    Scandal Shakes Trading Firm (WSJ)
    The firm, Peregrine Financial Group Inc., filed Tuesday evening in Chicago to liquidate under Chapter 7 of the bankruptcy code. Earlier in the day, the Commodity Futures Trading Commission filed a lawsuit in federal court in Chicago accusing Peregrine Financial and its founder, Russell Wasendorf Sr., of fraud, customer-funds violations and making false statements. The CFTC said shortfalls may have been present since at least February 2010. A spokeswoman for the FBI said it has also begun an investigation into the company, also known as PFGBest. Brokerage and retail customers had their accounts frozen as regulators began looking into the company’s books. Police in Cedar Falls, Iowa, said they found Mr. Wasendorf, 64, in his silver Chevrolet Cavalier Monday morning outside the company headquarters, with a hose running from the car’s tailpipe. His son, company President Russell Wasendorf Jr., told the company’s roughly 200 employees late Monday that his father had left behind a note alluding to “a crime that had been committed,” according to one employee.

    Diamond Rebuts Claims By UK Lawmakers (WSJ)
    Former Barclays CEO Robert Diamond hit back at allegations he had misled U.K. lawmakers when giving evidence over an interest-rate scandal, calling them “unfair and unfounded.”

    HSBC Is Sorry (WSJ)
    will apologize at a U.S. Senate hearing for its lax efforts to prevent money laundering, the London-based lender’s chief executive said in an internal memo. “Between 2004 and 2010, our anti-money-laundering controls should have been stronger and more effective and we failed to spot and deal with unacceptable behaviour,” Stuart Gulliver said in the memo, sent to employees Tuesday.

    Tigers Kill Man Who Scaled Fence At Danish Zoo (Reuters)
    A man was killed by tigers at a zoo on Wednesday after he scaled a fence and crossed a moat to get into their enclosure in the Danish capital Copenhagen, police said. The man, in his early 20s, was savaged by three tigers after he broke into Copenhagen Zoo in the early hours. He was dead when staff arrived for work. “We received an emergency call at about 7:30 a.m. that a person had been found lying in the tiger pen and that three tigers were surrounding that person,” police Superintendent Lars Borg told Reuters. “The tigers attacked him and killed him. It is likely that a bite to the throat was the primary reason for his death,” Borg said.

    Australia Is No Spain, Says Official (CNBC)
    Australia’s Deputy Prime Minister and Treasurer Wayne Swan has denied that Australia’s economy is at risk of a Spain-like economic crisis, calling the thesis put forth by the former chief Asia-Pacific economist for Morgan Stanley, Andy Xie “absurd”. “Let’s go through the fundamentals,” Swan said. “Bringing our budget back to surplus in 2012-2013, low unemployment, strong job creation over time, a record investment pipeline in resources – half a trillion (dollars). What planet does he live on?”

    San Bernardino Becomes Third California City Seeking Bankruptcy (Reuters)
    The decision by the leaders of San Bernardino, a city of about 210,000 residents approximately 65 miles east of Los Angeles, followed a report by city staff that said the city faced an imminent financial crisis. The report said the city had exhausted its reserves and projected spending would exceed revenue by $45 million in the current fiscal year which started on July 1.

    Dalio Hits Midyear Off 2.7% (NYP)
    After leaving its rivals in the dust for the past two years with mouth-watering double-digit returns, Bridgewater is now trailing them. Its flagship fund, Pure Alpha, fell 2.7 percent in 2012’s first half.

    Wildebeest takes on 18ft killer crocodile (DM)
    As regular as the seasons themselves, herds of wildebeest make an annual migration across east Africa – following rainfall and the growth of new grass. Exploiting this predictability, each year predators lay in wait until the migrating beasts come into their killing zone. Day or night, death can come to the young, sick or simply unlucky members of the herd – swiftly from a single cheetah, or without mercy from a pride of lions or pack of hyenas. For one young male, the end came not on the plains but in one of Kenya’s heaving rivers – delivered by one of nature’s apex killing machines. Like all in his herd, the doomed wildebeest was taking his chances crossing the Mara River in the Masai Mara reserve in Kenya. Unfortunately for him, he walked straight into the path of an 18ft Nile crocodile – a species of predator so efficient that it has barely changed throughout evolution. The crocodile used its huge weight and strength to attack the beast as it was already caught off balance by the rushing water and uneven footing. Its enormous jaw span virtually took in the entire wildebeest’s body as the victim attempted in vain to escape the attack.

    / Jul 11, 2012 at 8:47 AM

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