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Paul Enright wanted access to the basement to store his crap (and a townhouse sans vermin). Brenda “The Wonderbra” Schad wanted a tenant who wasn’t constantly on her ass. Read more »

Opening Bell: 08.11.14

Hedge Funds Are Digging Gold Miners (WSJ)
The NYSE Arca Gold Miners Index, which tracks 39 gold-mining companies, has soared 26% so far this year, compared with a 8.9% rise in gold and a 4.5% increase in the S&P 500. The gold-miner rally is a boon for high-profile hedge-fund managers such as George Soros and John Paulson—as well as traditionally gold-focused traders like Peter Palmedo and Eric Sprott. Their gold bets were pummeled last year, when a rise in bond yields and muted inflation dulled gold’s allure, sparking a stampede that drove the precious metal’s price down 28% and the gold-mining index down 54%.

Judge in Argentina default case slams Singer lobbyists (NYP)
Federal court Judge Thomas Griesa said the ads run by the lobbying group, Task Force Argentina — financed by Singer to help fight his decade-long legal and political battle to win the right to collect on defaulted Argentina debt — were “wrong” to attack the country’s New York lawyers. One ad claims that one of the lawyers, Jonathan Blackman, of Cleary Gottlieb, personally called Argentina President Cristina Kirchner to suggest the country default — while a second displays a drawing of the lawyer’s head on a vulture…Griesa called the hearing after seeing two-page “legal notices” in US newspapers, placed by Argentina, saying it had paid its bondholders. The ad referred to the $539 million Argentina wired in late June to make a payment to the vast majority of its bondholders who accepted a debt swap years ago. But the court would not allow the payment to be made unless Argentina also pays Singer and other creditors the $1.65 billion they demand on defaulted debt they own. The payment to Singer wasn’t made, so Argentina defaulted on $15 billion in debt. “False and misleading statements by Argentina must cease,” said Griesa in an hour-long monologue. The 84-year-old judge said if the false statements don’t stop, he might consider holding the country in contempt.

Putin Starving Companies of Cash They Can’t Obtain Abroad (Bloomberg)
Russia is limiting corporate access to domestic financing even as the escalating Ukraine crisis increasingly isolates companies from overseas sources of cash. The government’s about-face on its pledge to end a freeze on pension cash being used by private money managers risks raising corporate borrowing costs as it deepens the country’s economic slowdown. Some of Russia’s biggest issuers are already locked out of international capital markets as punishment for what U.S. and European leaders say is President Vladimir Putin’s support of separatists in eastern Ukraine.

Kinder Morgan to Consolidate Empire (WSJ)
Kinder Morgan Inc. is consolidating its vast oil-and-gas pipeline empire into a single company in a $44 billion deal amid investor worries about the enterprises’ growth prospects. The reorganized company will abandon the financial structure it helped popularize in the late 1990s: the master limited partnership. These complex tax-oriented offerings have caught on among energy companies facing substantial investments in infrastructure because of the U.S. oil and gas boom. But Kinder now is so big that the MLP structure is limiting, said Richard Kinder, the companies’ founder and chief executive. Combining all four of its publicly traded units into one corporation, he said in an interview, “will allow us to further expand the reach of the kind of projects we can do.”

The Proper Care and Feeding of Your Spoiled 23-Year-Old (Bloomberg)
Rich people have enough money to solve almost all their problems but one: children who grow up to be entitled, materialistic and unhappy slackers. Wealth advisers to the rich see this all the time, says Coventry Edwards-Pitt, who helps clients manage their affairs at Ballentine Partners, a wealth advisory firm outside Boston. Often, children of rich parents can’t seem to strike out on their own, she says. They start doomed businesses and give up on one job after another, all while draining Mom and Dad’s bank account (or their own trust fund) into their 30s and beyond. It’s a phenomenon many parents and tax advisers do a lot to enable, albeit unintentionally, Edwards-Pitt argues in a new book, “Raised Healthy, Wealthy and Wise.” Most parents want their kids to become successful, self-sufficient adults. But smart tax planning can sabotage good parenting. To avoid the estate tax, the wealthy are told they can and should give their children $14,000, or $28,000 per couple, each year, which they’re allowed to do tax-free. That’s hardly enough to retire on, but it’s a cushion most people don’t have. Young wealthy adults may go from job to job as they seek their “passion” without putting in the hard work to actually get anywhere.

Man Armed With Leaf Blower Arrested For Doing Yard Work In The Nude (TSG)
A Massachusetts homeowner was arrested Monday for “open and gross lewdness” after passing motorists spotted him–leaf blower in hand–doing yard work in the nude, according to cops. As Richard Capra, 69, worked on the curb appeal of his Shrewsbury home, “several vehicles were slowing down taking photographs,” according to the Shrewsbury Police Department. Responding to 911 calls, Officer Timothy Charland spotted Capra “completely nude, blowing off his driveway with a leaf blower.” Capra was “intoxicated and belligerent towards police” when questioned. Capra, arrested on a misdemeanor charge, was later released from custody after posting $500 bail. He is scheduled for an August 15 appearance in Westboro District Court. Future arrestees will be happy to learn that Capra was “issued clothing” prior to being placed in a Shrewsbury patrol car. Read more »

  • 08 Aug 2014 at 2:30 PM

Judge Tells Argentina To Say It To His Face

Argentina has been pretty chatty since it defaulted rather than pay Paul Singer last week. Of course, the uniquely recalcitrant debtor insists that it has not defaulted. But it has also lobbed a few bombs in the direction of the judge overseeing its case, the mediator he appointed and the President of the United States, calling the first biased, the second incompetent and the third a pussy for not just making U.S. District Judge Thomas Griesa be nice to it.

Well, Griesa would like to have a little chat about those things, as well as Argentina’s continued badgering of the Bank of New York Mellon to just go ahead and ignore the old man, and probably its publicity-stunt of a lawsuit against the U.S. of A. in the International Court of Justice. Read more »

  • 08 Aug 2014 at 11:15 AM

The Bitcoin Bugle: Everyone’s A Bitcoin Dealer!

Since bitcoin ATMs don’t actually do what ATMs are there to do—you know, give you money—and in fact exist to do the opposite—take your money and turn it into some 0s and 1s that some people call a currency—why should you have to wait in line for it at the coffee shop? Why shouldn’t you just put it the same place you spend the rest of your money: on your iPhone? Read more »

A federal appeals court found that making Goldman angry is not a violation of federal law, freeing poor old Sergey so that he could face the same charges in state court. But making Ken Griffin angry? That’s a whole other story—one that could involve 20 years in prison for a plucky 26-year-old programmer who Citadel politely asked to stop downloading its secret sauce onto personal hard drives, but who kept doing it anyway. Read more »

Opening Bell: 08.08.14

Goldman, JPMorgan in Senate’s crosshairs for commodities holdings (Reuters)
U.S. Senator Carl Levin is preparing a last push to bring Wall Street’s big commodity traders to heel during his final months in office, wrapping up a nearly two year-long probe that could potentially reveal abuses in energy and metals markets. Levin’s investigators have met with representatives from Goldman Sachs and JPMorgan Chase in recent weeks, according to sources familiar with the matter. Executives from those companies may appear at a hearing as early as September, during which Levin’s Permanent Subcommittee on Investigations would present the findings of the probe, the sources said…Specifically, Senate investigators have explored whether Wall Street has abused its commodities holdings at the expense of clients, consumers, the environment or the health of the market, according to the people familiar with the probe.

Richest Russians Deprived of Luxury Foods by Putin’s Ban (Bloomberg)
Wealthy Muscovites will have to forgo favorite dishes such as Australian steak and sushi with Norwegian salmon and will pay more for substitutes because of President Vladimir Putin’s import ban. Putin decreed that imports of meat, fish, vegetables, cheese and dairy products from the U.S., European Union, Norway, Canada and Australia be stopped, effective yesterday, and called to replace them with local products. The ban applies to countries that imposed sanctions against Russia for its annexation of Crimea.

Power Network Draws Rich Families to Chicago Banker Byron Trott (Bloomberg)
Five years after leaving Goldman, Trott, 55, is parlaying longtime links to the moneyed elite into an investment and advisory firm that specializes in helping rich families get richer. BDT — for Byron David Trott — plays two roles for its well-heeled clients. It provides advice on whether to merge, expand or sell businesses, as it did for Alberto. And it raises money from them to invest in other mainly family-led companies, either directly or through BDT’s private-equity funds. BDT managed $6.3 billion in client assets as of Dec. 31 and is raising $5.2 billion more, according to regulatory filings. “Byron’s got a blue-chip list of people who trust him,” says John Canning, chairman of Madison Dearborn Partners LLC, the largest Midwestern private-equity firm. “He’s played a key role in Chicago. Since most large investment banks are headquartered elsewhere, he’s been able to establish a unique practice advising on extremely large transactions.” Warren Buffett, the third-wealthiest person in the world, is the biggest name on Trott’s prestigious list.

Argentina pulls US into debt dispute with hedge funds (NYP)
Argentina is trying to rope Uncle Sam into its debt dispute with a group of “vulture” hedge funds. The embattled country sued the US in the Hague, contending that America’s court system has “committed violations of Argentine sovereignty and immunities.” The suit was filed in the International Court of Justice, which is the judicial organ of the United Nations. The Hague-based court said no action will be taken unless the US agrees to have the case heard in that court.

Developer Who Sued Zuckerberg Cites E-Mail Showing Offer (Bloomberg)
A property developer who sued billionaire Mark Zuckerberg for allegedly failing to assist him with business networking as part of a real estate deal produced an e-mail mentioning that the Facebook Inc. founder offered to help him in a “light” way. The e-mail and others filed in a lawsuit against Zuckerberg show the executive knew he made the promise and reneged on it, David Draper, the attorney for developer Mircea Voskerician, said in court filings. Voskerician says he gave the Facebook chief executive officer a 40 percent discount in 2012 on a $4.3 million property located behind Zuckerberg’s Palo Alto, California, home because he was promised introductions and referrals to boost his business. After trying and failing to reach Zuckerberg, Voskerician sued in state court in San Jose, California, to get the house back, claiming fraud, breach of contract and misrepresentation, according to the complaint.

Judge Says Man Wasn’t Specific Enough About Alleged Penis Amputation (AP)
A judge threw out a lawsuit filed by an Alabama man who claims a botched circumcision resulted in the amputation of his penis, ruling Thursday that the complaint wasn’t specific under state malpractice law. Jefferson County Circuit Judge Jim Hughey III ruled after a brief hearing that the suit filed Johnny Lee Banks Jr. and his wife lacked sufficient details but could be filed again to include specific times and dates of alleged actions…Banks and his wife last month sued Princeton Baptist Medical Center in Birmingham plus Drs. Michael Bivins and Alan Aikens and their employers. Banks alleges that he awoke from what was supposed to be a routine circumcision in June to realize his penis was gone. Attorneys for the doctors and hospital contend the medical procedure alleged in the suit never happened and predicted the lawsuit will be dismissed again if Banks pursues the claim. The defense filed sworn statements from two nurses who said Banks had a circumcision at the hospital in February, months before he claimed in the suit, but there was no record of any amputation. Read more »

Write-Offs: 08.07.14

$$$ Argentina Sues U.S. in International Court of Justice Over Debt Dispute [WSJ]

$$$ Owner of Lingerie Chain Agent Provocateur Said to Hire Goldman to Run a Sale [Dealbook]

$$$ He sprayed a giant, white “AIG Sucks” on a six-foot by four-foot blue background. Over the first two letters of Sucks, Hancock painted a red “Ro,” spelling out “Rocks” and revealing on canvas the aspirations that would occupy the next years of his life. [Bloomberg]

$$$ Start-Ups Seize Marijuana Opportunities as Big Companies Hold Back [NYT]

$$$ Study: Most Sexting Occurs On Tuesdays Between 10 a.m. and Noon [BetaBeat] Read more »

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