Life On Wall Street Grows Less Risky (WSJ)
By both force and choice, Morgan Stanley has upended its culture and ethos. Go-go trading businesses once hailed as its future are gone or curtailed. In their place, the storied investment bank has embraced the retail-brokerage business—peddling stocks and doling out financial advice to ordinary investors—a less exclusive club more often associated with names like Merrill Lynch and Schwab. Morgan Stanley’s transformation has been dramatic. The firm’s top five executives before the financial crisis have all left. Mr. Gorman, a onetime Merrill Lynch & Co. executive and McKinsey & Co. consultant, became Morgan Stanley CEO in 2010 after being at the firm for just four years. He pushed for the $9 billion acquisition of brokerage firm Smith Barney, essentially doubling down on the business of catering to regular investors while dealing away riskier units, including four proprietary trading desks that bet the firm’s own money, and an actual casino it was helping develop in Atlantic City, N.J. The firm also has changed in less noticeable ways. There now are 3,000 different limits that restrict such things as how much capital traders can put at risk, up from 30 before the crisis. About 50 full-time government regulators are now stationed at Morgan Stanley. There were none before 2008, when it was regulated as a brokerage firm instead of a bank. Most deals over $10 million now require a green light from a risk committee and Mr. Gorman.
Tiger Global Goes Long-Only (NYP)
After giving back $2 billion to investors in his Tiger Global hedge fund at the end of last year, Chase Coleman’s now trying to raise almost that much for a fund launching Oct. 1. The new Tiger Global fund will invest only in stocks on the long side, according to a Sept. 5 letter to investors obtained by The Post, and thus is not a hedge fund. Coleman, 38 — a descendant of Peter Stuyvesant, the last Dutch governor of New York — expects to start with between $1 billion and $1.5 billion. He will run the fund along with portfolio managers Feroz Dewan and Scott Schleifer.
What Might Have Been, and the Fall of Lehman (Dealbook)
Sorkin: Let’s play a game. It is called “What if … .”
Young analyst draws Wall Street ire taking on Kinder Morgan (Reuters)
Kevin Kaiser, a 26-year-old analyst only three years into his first job out of the Ivy League, jolted Wall Street last week with a pithy email taking aim at North America’s largest oil and gas pipeline and processing company – Kinder Morgan. The email, sent to clients of independent research firm Hedgeye Risk Management, said Kinder Morgan and its associated companies “is a house of cards, completely misunderstood and mispriced.” No specifics were provided, but the missive and his comments on Twitter spooked investors who shaved $4 billion off the company’s market capitalization and sent Kinder Morgan Inc (KMI.N) shares down 6 percent last Wednesday. Analysts are not certain why Kaiser’s comments resonated with so many investors, but they underscore the growing influence of social media like Twitter, which can deliver investment information – accurate or not – to thousands in seconds at the push of a button. Some compared the market to a circus. “Here is your PT Barnum people,” one user tweeted as Kaiser caused a firestorm on Twitter and prompted people to question his experience. “It seems a little surprising that enough people would be spooked by unsupported assertions,” said Jason Stevens, an analyst at Morningstar. The email titled “New Best Idea: Short Kinder Morgan,” was a teaser for a report to be issued on Tuesday. No analysis was provided: only seven bullet points with topics that the report will address, including the valuation of the company’s sprawling oil and gas business, which has surged as exploration companies tap into shale deposits driving a U.S. energy boom.
Man charged with theft at Town Center of Boca Raton tries to chew receipt to elude police (PBP)
An officer pulled his patrol car alongside Ojea and told him stop. Ojea was walking while talking on a cellphone. He sped up his pace but was caught and forced to sit down by deputies. While being questioned, Ojea told deputies he bought Gucci items with cash. Ojea was asked if he had any weapons on him and gave deputies permission to search him. During the search, he reached into his pocket and grabbed the Nordstrom receipt, the report said. Before deputies could grab the receipt, Ojea allegedly put it in his mouth and quickly chewed it. He was taken to the ground and placed in handcuffs. A security officer for Norstrom printed a new receipt that showed Ojea spent $561.80 using a Visa card. The bank confirmed that the name on the card did not match the number or three-digt security code on the back of it, police said.
BofA Cuts Jobs As Mortgage Slump Ensnares JP Morgan, Wells Fargo (Bloomberg)
Mortgage lenders including Wells Fargo & Co. and JPMorgan Chase & Co. that feasted on refinancings as interest rates reached all-time lows are now warning that the drop in demand may be steeper than expected. Even Bank of America Corp., which fell to fourth in U.S. mortgages last year as it scaled back after buying Countrywide Financial Corp., is reducing capacity further as surging interest rates crimp demand. The Charlotte, North Carolina-based firm is eliminating 2,100 jobs and closing 16 offices by Oct. 31, said two people with direct knowledge of the plan.
Van Gogh Work Missing for Century on Show in Amsterdam (Bloomberg)
A new painting by Vincent Van Gogh has been discovered after two years of research to determine its authenticity, the Van Gogh Museum in Amsterdam said today. “Sunset at Montmajour” (1888) — painted during the artist’s time in the southern French city of Arles — will be on display from Sept. 24 in the current “Van Gogh at Work” exhibition (ending Jan. 12), the museum said in a news release. It was during the same Arles period that Van Gogh painted his “Sunflowers,” “The Yellow House” and “The Bedroom.” “A discovery of this magnitude has never before occurred in the history of the Van Gogh Museum,” director Axel Rueger said.
Crop Insurers’ $14 Billion Some See as Money Laundering (Bloomberg)
Former American International Group Inc. chief Maurice “Hank” Greenberg has a new business partner: the U.S. taxpayer. Greenberg’s Starr Indemnity & Liability Co. is one of 18 companies approved to get federal cash for insuring farmers against loss of crops or income. Wells Fargo & Co., the nation’s fourth-largest bank by assets, Zurich-based Ace Ltd. and units of American Financial Group Inc., Deere & Co. and Archer-Daniels-Midland Co. all enjoy similar public backing. The government subsidies show how a program created to safeguard the nation’s farmers has evolved into a system that in most years all but guarantees profits for insurers. In 2012, taxpayers spent $14 billion paying more than 60 percent of farmers’ insurance premiums, the companies’ operating costs and the lion’s share of claims triggered by a historic drought, according to the Congressional Research Service. “What we’ve got is a money-laundering operation,” says Harwood Schaffer of the University of Tennessee’s Agricultural Policy Analysis Center. “It looks like we’re doing a free market thing and it’s not free market at all.”
FBI Collars Pink Polka Dot Dress Bank Robber (TSG)
A 50-year-old man wore a “pink with purple polka dots dress, a pink wig, and sunglasses” during a bank robbery that briefly netted him $1537, according to the FBI…The teller told FBI agents that the robber tried to disguise his true voice by speaking in a “high pitched squeaky voice.” Though it was difficult to decipher what the robber was saying through his white rag, the teller reported hearing “Give me all the money.”