The Latest

  • 31 Dec 2014 at 12:45 PM

Holiday Bell: 12.31.14

kengriffinKen Griffin, Illinois’ richest man, buys Gold Coast condo for $13.3 million (Chicago Tribune)
Billionaire Ken Griffin, the founder and chief executive of Chicago-based hedge fund Citadel who currently is going through a nasty divorce, recently paid $13.3 million for a 37th-floor, full-floor condominium unit in the Waldorf Astoria building on the Gold Coast. The transaction is one of the 10 highest-priced residential real estate purchases in Chicago-area. It’s also the second highest-priced condo sale of the year, topped only by Vistex founder and CEO Sanjay Shah’s recent $17 million purchase of the 14,260-square-foot penthouse on the top floor of the Trump International Hotel and Tower. Griffin, 46, currently lives in the 7,400-square-foot unit. He also owns two full-floor penthouse units in the Park Tower nearby. He paid $6.9 million in 2000 for his first, a 67th-floor unit, and then in 2012, he paid $15 million — at that time a record for a Chicago condo – to buy the full-floor unit one level below.

Goldman Sachs Pays Top U.K. Bankers Double That of U.S. Rivals (Bloomberg)
Goldman Sachs paid its top bankers in the U.K. an average of $4.72 million in 2013, about double what its largest U.S. rivals awarded to their most senior workers in Britain. The 121 employees received $106.3 million in cash bonuses and stock valued at $377.4 million at the end of 2013 in addition to salaries of $87.3 million, according to Goldman Sachs regulatory disclosures for U.K. operations. More than two-thirds of the total went to investment-bank employees.

Blackstone Opens Up About Hidden Fees as SEC Pushes Transparency (Bloomberg)
Two of the biggest private-equity firms are disclosing fees that had largely been hidden as U.S. regulators demand increased transparency from the industry. Blackstone Group LP said it could collect as much as $20 million annually from investors and companies in its next buyout fund, for services such as health care consulting and bulk purchasing. TPG Capital put the potential charge for similar services at as much as $10 million a year for its new fund, which is currently seeking to raise as much as $10 billion. The fees, detailed in recent marketing materials obtained by Bloomberg News, are on top of other monitoring and transaction fees and haven’t been disclosed in such detail in documents governing earlier funds.

Former Korean Air Executive Arrested Over In-Flight Nut Row (Bloomberg)
Heather Cho, the daughter of Korean Air Lines Co. (003490) Chairman Cho Yang Ho, was arrested on a charge of obstructing aviation safety after she ordered a crew member to deplane during a row over in-flight service. “I’m sorry,” Cho said, looking down and surrounded by reporters in footage broadcast by YTN from outside prosecutors’ offices in Seoul. The Seoul Western District Court issued an arrest warrant for Cho late yesterday, Heo Seung, a judge at the court, said today by phone. Cho’s arrest follows a public outcry in South Korea after she ordered the head of the service crew on Flight 86 from New York to Seoul to deplane Dec. 5 after an attendant served her macadamia nuts without asking.

That New Year’s Eve Uber ride home will cost you (NYP)
The ride-hailing app, in an email warning to its customers Wednesday morning, said it expects this New Year’s Eve to be its “busiest night ever!” And while Uber doesn’t come right out and say some people will pay double and triple their usual fare, the company does advise its customers that “busy nights require surge pricing to get enough cars on the road and ensure you always have a reliable ride.” The busiest — and therefore the costliest — time to get an Uber ride will be from 12:30 a.m. to 2:30 a.m., Uber said in its e-mail. Those out welcoming in 2015 and looking to avoid getting gouged should request a ride “right when the ball drops at midnight” or much later in the morning, Uber said.

Man drives two hours with knife lodged in his head (UPI)
A Brazilian man who was stabbed in the head with an 11-inch knife survived the attack and drove himself two hours to a hospital. Juacelo Nunes, 30, said he was arguing with a man at a party in Agua Branca when the other man summoned three friends to help him attack Nunes. Nunes said he was stabbed in the throat, shoulder and chest before the knife, which bears an 11-inch blade, was embedded in his head. The knife missed Nunes’ left eye and passed through his mouth to the right side of his jaw. “I did not see the moment of the stabbing, but at no time fainted and remained conscious even with pain,” he said. “I thought I would die and only came to believe when I saw what happened to me, because if someone told me I would not have believed it.” Nunes said he drove for two hours to a hospital in Teresina, 60 miles from Agua Branca. “The knife passed through several nerves and veins, structures that can quickly kill a patient,” hospital director Gilberto Albuquerque said. Read more »

David Tepper A Stock-Market Believer Again

Hasn't made this little since he looked like this.The brass balls have taken a bit of a beating this year, which means he’s going to have to make due with a bit less than $3.5 billion. It also means that he may have been a bit premature when he warned everyone not to “be too fricking long” back in May, and certainly when he then took his own advice. Well, he’s “longer” now, and not too fricking long, either, because the ride isn’t over yet. Six years into the frothy market rally, it hasn’t even begun. Read more »

  • 30 Dec 2014 at 12:45 PM

Attention Mutual-Fund Investors

You weren't counting on one of these, were you?Did you know that you have to pay taxes—like, all of them—on your mutual fund returns even when they suck? In fact, especially when they suck, but not badly enough? Well…

When they sell their holdings, mutual funds have to pay out any profits as taxable capital gains unless they can offset them against losses. After nearly six years of a raging bull market, most funds have no big losses left.

So, even after underperforming the market badly this year, funds are doling out startlingly big tax bills for their investors.

Of course, you always have recourse to the old-fashioned way of dealing with a mutual fund that’s pissed you off. Like, say, the “hedge-like” MainStay Marketfield, which would have been a great hedge this year if you wanted to cancel out all of those other mediocre returns you were earning in your other investments. Which, it turns out, most people do not want to do. Read more »

Ray Dalio Likes The Cut Of Janet Yellen’s Jib

You're doin' great, baby!Some people say that the Fed is the problem. That they’ve become drunk with their own power and are messing things up for everyone. That the stimulus and low interest rates are setting us up for Armageddon.

Ray Dalio is not one of those people. He’s put the Fed’s efforts through a rigorous, Principle-d examination, and come to the obvious, radically true conclusion: Janet Yellen & co. are doing just fine. Read more »

Holiday Bell: 12.30.14

shackburgerTech Startup Values Reach the Sky (WSJ)
Xiaomi is just the latest example. On Monday it raised more than $1 billion from investors, giving it the $46 billion overall valuation. Only Facebook Inc. raised capital at a higher value from private investors, at $50 billion in 2011. This year, venture capitalists, mutual funds and big banks bestowed valuations of $1 billion or more on about 40 startups world-wide, doubling the number of such companies at the start of the year, according to research firm Dow Jones VentureSource. Adjusted for inflation, the current roster of 70 “billion dollar” startups globally is nearly twice as large as the number during the boom years 1999 and 2000.

‘Cartel’ Chat Room Tied to BP Gave FX Tips From Banks to Client (Bloomberg)
Copies of messages sent to BP traders over the course of a year were provided to Bloomberg News by a person with access to the online conversations. The person, who redacted the names of banks sending the messages and dates of conversations, said they came from firms whose senior foreign-exchange traders belonged to a chat room called “The Cartel” that was set up by Usher and included dealers at JPMorgan, Citigroup Inc., Barclays Plc and UBS Group AG. The information offered an insight into currency moves minutes, sometimes hours before they happened. The messages could drag the U.K.’s biggest energy company into a scandal that has enveloped 11 banks and led to more than 30 traders from London to Singapore losing or being suspended from their jobs. Last month six banks were fined $4.3 billion for passing along information about their clients and working together to rig foreign-exchange markets.

Shake Shack Files for IPO That Could Value It at $1 Billion (Bloomberg)
Shake Shack Inc. is going public and may be worth as much as $1 billion — not bad considering New York restaurateur Danny Meyer started the joint as a public service. Founded more than a decade ago to help support the restoration of Manhattan’s Madison Square Park, Shake Shack was an instant success, drawing long lines of urbanites attracted by Meyer’s modern spin on a roadside burger stand. Today, Shake Shack has more than 63 outlets in 30-plus cities from London to Dubai. Shake Shack started as a hot-dog cart that later became a permanent kiosk and neighborhood fixture. Hungry urbanites have been known to hop on the subway to get their fix of $4.95 burgers and $5.15 shakes.

Eight Revealing Facts From Shake Shack’s IPO Filing (BusinessWeek)
The burgers aren’t the only things that come with cheese. Here are some other semicreative uses of the word “shack” from the filing: Shack-o-nomics. Same Shack Sales. Shack-level operating profit. The company’s stock will trade under the ticker SHAK, natch.

Petition launched in support of ‘manspreading’ on TTC (Globe And Mail)
While a new campaign by New York’s transportation authority aimed at tackling the phenomenon of “manspreading” has drawn interest from transit users in Toronto, some say a similar concept north of the border would unfairly target men. New York’s Metropolitan Transportation Authority is set to unveil public service ads that encourage men spreading their legs in crowded subways cars to be more courteous to their fellow travelers. The term “manspreading” has been coined as a reference to men spreading their legs wide, into a V-shaped formation while slouching, ultimately taking up extra space on public transportation. But a new online petition challenges TTC riders who have applauded the MTA’s upcoming advertisements, stating that those who seek a similar campaign on Toronto buses and subways should simply mind the gap. “This sets a very bad precedent as men opening their legs is something we have to do due to our biology. It’s physically painful for men to close their legs and we cannot be expected to do so, and it’s also a biological necessity for us to do so,” reads the petition, which calls “manspreading” a “sexist term.” “We can’t force woman to stop breast feeding on busses or trains and we can’t force them to stop bringing strollers on, why should we force men to close their legs?” it continues…According to the petition, a ban on spreading one’s legs would “be a big blow to men’s rights.” Read more »

Write-Offs: 12.29.14

$$$ Shake Shack Officially Files for $100 Million IPO [Grub Street]

$$$ Russian Economy Shrank in November for First Time Since 2009 [Bloomberg]

$$$ Why Greece’s Spillover Across Euro Area Will Probably Be Contained This Time [Bloomberg]

$$$ Yellen plays Kris Kringle [NYP]

$$$ Cat Finds His Way Home After Being Accidentally Sold With a Mattress [Gawker] Read more »

Click Here

This fellow illustrious Bush administration veteran still available for all  your p.e.-firm monitoring needs.Really, Freeman Spogli & Co. wouldn’t have it any other way. It is simply the nicest way of thanking it for all of the money it’s made for you over the past three decades.

Documents obtained by The New York Times show that the independent adviser appointment was disclosed after officials at the Securities and Exchange Commission raised questions about several of the firm’s practices.

According to the letter, S.E.C. officials said that Freeman Spogli appeared to be violating fee-sharing arrangements with its investors in two funds, despite promises to the contrary. And Freeman Spogli, the S.E.C.’s letter said, appeared to be reaping fees from investment-banking-type transactions without fulfilling the regulatory requirement of being registered as a broker-dealer.

Now that all of that is out of the way, perhaps you’d like to return the favor by leaving them the hell alone about those fees? Read more »

Hold on a second. I've just had another thought!Doug Kass is a short-seller, and a chatty one, at that, so he can’t help himself when things look like they finally might start to turn his way. Like next year, for instance, a “pivot point for the market,” if you will. “The year of reckoning,” even.

But don’t think Doug hasn’t had anything to say about things even as stocks have annoyingly gone up and up and up and then up some more over the last six years. Read more »