Matt Levine

  • We ... love ... raising ... capital


    Deutsche Bank Goes Back To Improving Its Balance Sheet In The Traditional Ways

    I’m beginning to get the hang of how Deutsche Bank works, which seems to be: When they lose money, that strengthens their capital position, and When they make money, that weakens their capital position, requiring them to sell shares. Maybe? Three months ago we talked about how … well, I said “Deutsche Bank Improved Its […]

    / Apr 29, 2013 at 4:14 PM
  • jacob-lew-260x173


    Next Financial Crisis To Be Caused By Libor, Subsidiaries, Or Possibly Something Else

    It must be pretty hard to be a Financial Stability Oversight Council. Or easy? Two key facts about the FSOC are that (1) its job is to prevent a crisis in the U.S. financial industry1 and (2) it was established a year or so after a once-in-a-generation-or-lifetime-or-whatever crisis in the U.S. financial industry. So if […]

    / Apr 26, 2013 at 4:10 PM
  • They'll take anyone who walks in off the street, apparently.


    Chicago Hedge Fund Manager Knew He Had To Make Up Money To Make Money

    SEC enforcement orders against low-grade investment hucksters are among my favorite literary genres, full of oddball characters, devious drama, and silly names for hedge funds. Part of me wants the SEC to just issue fake enforcement orders when they don’t have any real cases – no one would know the difference, and I would read […]

    / Apr 18, 2013 at 4:31 PM
  • GWM = Global Wealth Management obvs


    Morgan Stanley Slowly Approaching Its Goal Of Becoming Boring

    So Morgan Stanley announced earnings today and people are sad because FICC trading wasn’t so hot. Asset management and wealth management are okay though? Anyway here’s a guy: “The fixed-income rebuild hasn’t worked as well as they had hoped,” David Trone, an analyst with JMP Securities LLC in New York, said in a Bloomberg Radio […]

    / Apr 18, 2013 at 2:17 PM
  • A little meta.


    Bloomberg Wants Regulation To Be Fair And Consistent For Some Reason

    I confess that I have not followed the swap-futurization thing closely but my assumption was that the politico-regulatory view was: Swaps are evil instruments of financial instability and fraud and should be discouraged, and Listed futures are mostly harmless. I mean, look around. Swaps blew up AIG, Oakland, Monte dei Paschi, the U.S. housing market, […]

    / Apr 17, 2013 at 6:25 PM
  • This is one of those where there's no particularly appropriate picture so we can at least look at Raj Rajaratnam in happier times.


    Sell-Side Research Analysts Use Their Networking Skills For Good

    Yesterday’s delightful insider trading settlement with Richard Moore, the CIBC banker who deduced the identity of a buyout target through sheer clingyness, is a good reminder that insider trading is weird. Nobody told Moore any material nonpublic information, but he got in trouble anyway. It’s also a good reminder of this new-ish (March 2013) paper […]

    / Apr 17, 2013 at 10:46 AM
  • Oh, agreements.


    Carl Icahn And Dell Disagree About What They Agreed On

    A good public-relations rule of thumb is that, when you and your nemesis sign an agreement putting aside your differences, you should probably also agree on how you’ll announce your new friendship to the world. What you don’t want to do is, for instance, to sign a standstill agreement with a potential buyer in your […]

    / Apr 16, 2013 at 6:22 PM
  • Richard Bruce Moore


    CIBC Banker Used His Networking Skills For Evil

    To get in trouble for insider trading, the information you trade on has to be “inside” information in some sense. Just standing outside a company’s offices and seeing who walks in, and extrapolating from that, is probably not insider trading. Seeing where corporate jets land is mostly not insider trading, to the point that it […]

    / Apr 16, 2013 at 2:40 PM
  • harvey-schwartz-260x195

    Goldman Sachs

    Goldman Had A Quarter

    Honestly bank earnings week has been a little boring, no? It’s been quarters since anyone announced a six billion dollar trading loss, and the recent news is pretty much modest beats from a diverse mix of businesses and where is the fun in that I ask you. Financial-market memories are short and … have negative […]

    / Apr 16, 2013 at 12:18 PM
  • This face will haunt Miller's dreams.


    Trader Who Brought Down Dick Bové’s Former Firm Suffers The Consequences

    There are a lot of good options and I’m not prepared to make a definitive choice at this time, but I can at least say that one of my favorite recent financial crooks is David Miller, the doofus who put a fat suit on his finger, bought 1.6 million instead of 1.6 thousand Apple shares, […]

    / Apr 15, 2013 at 5:00 PM
  • Still not a lot of  pictures of him but he's working on it.


    Mike Corbat Gets An A- For The Quarter From Mike Corbat

    Citi announced its quarter this morning and there are various ways to tell that it was good, of which “the stock was up” is probably the main one. A possibly less objective test is that, back in March, Mike Corbat told everyone how he would grade himself, if he was grading himself. As he put […]

    / Apr 15, 2013 at 3:23 PM
  • Wow is this ever the face of a man not having any fun.


    J.P. Morgan Isn’t Doing This For Fun You Know

    Yesterday JPMorgan research released a 328 page report arguing that global tier 1 investment banks were “un-investable,” and today JPMorgan reported record first-quarter earnings of $1.59 per share versus $1.40 consensus, so I guess it sort of looks like there’s a disconnect. But not really? Here are the analysts on banking regulation: We believe Tier […]

    / Apr 12, 2013 at 2:48 PM
  • Yeah it's a random picture of a ship, but the DealBook article had a random slideshow of pictures of ships, so.


    Lehman Alum Was Going To Name His New Fund “Hidden Fraud LLC” But Thought Better Of It

    Susanne Craig had an article in DealBook today about regulatory capital relief trades and a basic thing about regulatory capital relief trades is that they always allow you to say this: One Citigroup executive with knowledge of this trade but not authorized to speak on the record said it was structured to reduce Citigroup’s exposure […]

    / Apr 11, 2013 at 6:57 PM
  • [your winning caption here]


    KPMG Partner Assured Coconspirator Who Handed Him Bags Of Cash In Parking Lots That Insider Trading Wasn’t Really Illegal

    I don’t want to give you legal advice, but on the other hand you could be getting it from a worse source. Scott London for instance: [Insider trader Bryan] Shaw said that in approximately July 2012, he received a notice from Fidelity Brokerage Services that Fidelity was putting a hold on his investment account. Shaw […]

    / Apr 11, 2013 at 4:04 PM
  • A pyramid o' money. But not in the bad way.


    Guy Trades Dream Of Making Millions Selling Herbalife For New Dream Of Making Millions Suing Herbalife

    It’s a little surprising that it took this long for someone to sue Herbalife, isn’t it? Whether or not Bill Ackman is right about Herbalife being an illegal pyramid scheme, he did take the trouble of writing like 300 pages about it, which is usually more than enough to inspire some intrepid class action lawyer […]

    / Apr 11, 2013 at 10:45 AM
  • Honestly I hope they're paying him royalties; he's creating a lot of business for activist-defense types.


    Report Suggests Carl Icahn Isn’t Spending Nearly Enough Time Bothering Electric Utilities

    “Looking for a juicy [hostile] takeover candidate? A new report suggests you might find one at Fifth Third Bancorp, the utility holding company Ameren or ConAgra Foods,” which shows you how much that new report knows. Oh, you’re gonna launch a hostile takeover on a regional bank? A regulated utility holding company? Let me know […]

    / Apr 10, 2013 at 4:12 PM
  • RMBS structurer at Slytherin Capital


    Judge Finds That Investors Who Bought A Security Called “Draco” Pretty Much Got What They Deserved

    One thing that a lot of crisis-era synthetic CDOs referencing residential mortgage-backed securities have in common is that they were “designed to fail,” in that the short credit (protection buying) party to the synthetic CDO (1) was short and (2) had a hand in selecting the reference property. There’s nothing particularly odd or nefarious about […]

    / Apr 9, 2013 at 5:45 PM
  •, though I have not read and do not endorse the recipes


    Herbalife’s Auditor Says You Can’t Rely On Its Financials, But Not In A Fun Way

    CAN YOU FEEL THE EXCITEMENT? No, right? Okay good. A senior audit partner at KPMG Los Angeles did a bad thing and “was involved in providing non-public client information to a third party, who then used that information in stock trades involving several West Coast companies.” And now KPMG has resigned as the auditor of […]

    / Apr 9, 2013 at 12:05 PM
  • But they seemed so friendly at the interview

    Hedge Funds

    Former Cerberus Marketer Wasn’t Really Comfortable Marketing Cerberus

    My favorite financial news story of 2013 so far might be the Reuters story last Friday about how NYSE and Nasdaq each listed more IPOs than the other during the first quarter. A normal human might find that odd: listing an IPO is the sort of thing that you tend to notice and keep a […]

    / Apr 8, 2013 at 6:43 PM
  • The units are weird I guess? They're "pre-crisis standard deviations," meaning the standard deviation of each statistic measured up to 2007.


    Senate Bill May Solve Too-Big-To-Fail By Shrinking Banks By 70%

    The Brown-Vitter bill, which two senators plan to introduce in an effort to dramatically raise bank capital requirements, has caused a range of fairly predictable reactions, and a few strange ones. Here, for instance, is a lobbyist complaining about “raising required capital to comically high levels,” but the comedy is perhaps elusive. But one stylized […]

    / Apr 8, 2013 at 3:20 PM
  • vitter brown capital 2


    Some Senators Think Big U.S. Banks Could Use An Extra Trillion Dollars Or So Of Capital

    There’s a surprisingly large and vocal group of people who think that capital ratio requirements for large banks should be much higher than they are now (like, 15+%), and that those ratios should be based on total assets rather than any sort of regulatory risk-weighting. It’s surprising not because those are especially bad or counterintuitive […]

    / Apr 5, 2013 at 5:46 PM
  • They've got various ideas to make this a better *trade*, but that's why they're providing research and I'm just blogging. I don't really care about your trades.

    Hedge Funds

    Everyone’s Just Gonna Wait Until The Next Crash To Buy Crash Insurance

    Will stocks go down? Sure, maybe, whatever. I mean, they have so far today, I don’t know. It’s a thing that might happen and you might want to bet on it, one way or another. If you want to bet against it – if you think stocks won’t go down, or won’t go down by […]

    / Apr 5, 2013 at 2:27 PM
  • Don't act too fast though.


    Former Thomson Reuters Data Salesman Not Really Comfortable With The Whole Selling Data Concept

    Insider trading confuses many people but few react quite like Mark Rosenblum, who has this to say about Thomson Reuters: By an agreement between THOMSON and the … University of Michigan, the Product [i.e. the Thomson Reuters/University of Michigan Surveys of Consumers] is compiled by the University of Michigan, and released by THOMSON in 3 […]

    / Apr 4, 2013 at 6:26 PM
  • Do you have my liquidity dashboard? It's here somewhere


    MF Global Report Shows Limits Of The “Just Write All Your Positions On Post-Its” Method Of Risk Management

    There’s a new report out today describing how MF Global blew up, which is not to be confused with the other two reports describing how MF Global blew up, and really enough is enough. If you’re interested in how MF Global blew up, basically Jon Corzine decided to put all its money into ultimately-not-all-that-horrible peripheral […]

    / Apr 4, 2013 at 2:29 PM
  • Sorry which RMBS fraud case was this again?


    Bear Stearns RMBS Ruling Good News For Banks, Except Maybe Bank Of America

    A while back Bear Stearns sold some mortgage-backed securities to a thing called FSAM, which was basically a subsidiary of Franco-Belgian monstrosité Dexia, and FSAM sold the RMBS on to Dexia, and the mortgages were all terrible, and their value dropped, and Dexia sued JPMorgan, currently the proud owner of Bear Stearns, and today JPMorgan […]

    / Apr 3, 2013 at 6:21 PM
  • John Varley: not Bob Diamond


    Barclays Was Never Sure If It Cared Most About “Loving Success,” “100% Energy,” or “Think Smart”

    Here you can read an independent review of how Barclays lost its way and I submit to you that the fundamental problem was grammar: In 2005, John Varley launched the Group’s five Guiding Principles – ‘customer focus’, ‘winning together’, ‘best people’, ‘pioneering’ and ‘trusted’ – demonstrating intent to oversee the Group through one set of […]

    / Apr 3, 2013 at 12:14 PM
  • JFC "most hipster bank"


    Volcker Rule Forces Goldman To Shift Focus From Prop Trading To Small-Business Lending

    There’s that old line that “hedge funds are a compensation scheme masquerading as an asset class” but the masquerade is getting harder to keep up because you can pay 2 and 20 for just about anything these days. If you wanted to you could pay – well, 1.5 and 20, with a 7% hurdle – […]

    / Apr 2, 2013 at 6:28 PM
  • bucket-260x195


    Prime Brokers Will Sell You Those Shares If You Want, But Wouldn’t It Be Cheaper To Rent?

    “Bucket shop” has become a general-purpose Wall Street insult – “don’t work at Blackstone, it’s a total bucket shop” – but it’s actually a particular thing, “[a]n establishment, nominally for the transaction of a stock exchange business, or business of similar character, but really for the registration of bets, or wagers, usually for small amounts, […]

    / Apr 2, 2013 at 11:58 AM

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