Opening Bell: 05.16.12

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Greece Teeters As Talks Fail (WSJ)
In a potent sign of Greeks’ rising anxiety, depositors withdrew €700 million ($898 million) from local banks on Monday alone, according to the country’s national bank—a significant escalation in capital flight from the country. Greek President Karolos Papoulias told party leaders that the situation facing Greece’s lenders was very difficult and that “the strength of banks is very weak right now,” according to a transcript released Tuesday.

Merkel: I Want Greece To Stay In The Euro (CNBC)
In an interview with CNBC’s “Worldwide Exchange,” Merkel said: “I want, just like Jean-Claude Juncker, that Greece stays in the euro. I think that would be good for Greece and for all of us. If Greece believes that we can find more stimulus in Europe in addition to the Memorandum (the deal stuck with the Troika), then we have to talk about that,” she said, but she underlined that Greece and its euro zone partners had to be able to trust each other.

What Happens When Greece’s Money Runs Out (Reuters)
“I’m really not sure Greece could survive for very long if external money was cut off,” said Darren Williams, economist at fund manager AllianceBernstein. “But what an experience of IOUs may do rather quickly is bring home to the average Greek citizen just how much more difficult a place it is outside the bailout program and outside the euro.”

Moore Leads Hedge Funds Betting on JPMorgan Before Losses (Bloomberg)
Hedge funds Moore Capital Management LLC and Blue Ridge Capital LLC boosted their stakes in JPMorgan Chase, while Kingdon Capital Management LLC divested, before the shares plunged because of a $2 billion trading loss. Moore, the $15 billion New York-based firm run by Louis Moore Bacon, bought 6 million shares of JPMorgan and its $297.3 million stake was its largest U.S. stock holding as of March 31, according to a filing yesterday with the Securities and Exchange Commission. John Griffin’s New York-based Blue Ridge purchased 1.85 million shares, raising its stake in the bank to 6.14 million. Continue reading »

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    Write-Offs: 05.15.12

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    $$$ Greece fails to form unity government [FT]

    $$$ Greek Depositors Withdrew $898 Million From Banks Monday [WSJ]

    $$$ “The plane carrying newly sworn-in French President François Hollande was hit by lightning Tuesday afternoon, forcing him to delay a trip to Berlin, where he is due to meet German Chancellor Angela Merkel.” [WSJ]

    $$$ Happy 13F day, Warren Buffett, Phil Falcone, Whitney Tilson [WSJ, WSJ, ZH]

    $$$ Bank boards should focus on businesses that are doing suspiciously well [HBR / Sallie Krawcheck]

    $$$ Mario Batali is living on food stamps for a week [AP]

    $$$ A Bronx principal who fantasized to female subordinates about getting intimate with office furniture is being demoted to assistant principal amid new allegations, The Post has learned. The Department of Education is investigating claims by a 15-year-old girl at Bronxdale HS that first-year principal John Chase Jr. made comments that made her uncomfortable, according to a source. Staffers at the brand new school have been calling for Chase’s ouster since a DOE probe confirmed in December that he had made at least three remarks about oral sex to female staffers – including that a new copy machine was so fancy it could give “b–w j–s.” [NYP]
    Continue reading »

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      • 15 May 2012 at 7:18 PM

      Layoffs Watch ’12: Credit Suisse

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      The Swiss bank is not done with its firings. Continue reading »

      • 15 May 2012 at 5:26 PM
      • IPO

      Facebook Attracting Children, Retirees, Not Advertisers

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      A wonderful thing about the Facebook IPO is that there is a proliferation of imaginary markets in which to … well, not trade it exactly, but say what you would be doing if you could trade it, which is almost as good. Here is the Wall Street Journal’s imaginary market, with a “Current Price Prediction” of $52.43, off a touch from the $150.13 as of … yesterday. Admire their specificity! Elsewhere you get only binaries, or I guess ternaries, like CNBC’s “Do You Think Buying Facebook Shares Would Be a Good Investment?” [yes / no / don't know], or Felix Salmon’s “Are you seriously thinking of buying Facebook shares?” [yes / no / umm, I'm buying them for a friend].

      In the imaginary market that counts (I guess?), Facebook is up “an average of 14 percent” (!) as the underwriters raised the IPO range from $28-$35 to $34-$38 in a refiled S-1 this morning. This is good news if you bought in the imaginary market at $28-$35, as I suppose the underwriters imaginarily did, and also good news if you avoided the real market when it last cleared north of $44, as this guy who’s pissing away his child’s college money on Facebook did. If you like numbers, you could look at these numbers*: Continue reading »

      • 15 May 2012 at 4:23 PM

      Jamie Dimon: JPMorgan’s Balance Sheet Still Fortress-Esque

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      “We maintain a fortress balance sheet to manage surprises and setbacks like this,” Dimon said today. “I’m confident when we’re done here we’ll be a stronger company.” [Bloomberg, earlier]

      • 15 May 2012 at 4:16 PM

      Lloyd Blankfein Finally Gets To Be The Prettiest Girl At The Ball

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      Time was, Jamie Dimon was the most popular CEO on Wall Street and America’s “Least Hated Banker,” for reasons that included the fact that the man has soulful blue eyes, charisma out the ass, and was in charge of one of the banks that a) didn’t go out of business during the financial crisis, like Lehman and Bear and b) supposedly didn’t actually need the bailout money the government made it take (as JD has said previously), like Bank of America and Citigroup. The man, in the hearts of many and especially the adoring press, could do no wrong. Which is why it probably stung a lot that Lloyd Blankfein, a Wall Street CEO who also possesses more charm than a person would know what do do with, who was also in charge of a bank that neither went out of business during the financial crisis nor required the bailout money it was forced to take (according to GS), and who is also the owner of a pair of baby blues, though in his case ones that sparkle, could only do wrong. And while LB is not one to gloat at another’s misfortune, especially that of a friend, he’s obviously feeling pretty good about being living proof of the old saying, “only one Wall Street CEO’s balls can be in a vise at a time,” and right now it’s JD’s turn. Continue reading »

      • 15 May 2012 at 12:26 PM

      Jamie Dimon Might Clawback Whale Team’s Bonuses Or He Might Not

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      Dimon was approached by reporters after the [shareholder] meeting and was asked about whether executive pay would be taken back under the bank’s clawback provisions. “We will do the right thing…And that may well include clawbacks,” Dimon said. “The buck always stops with me.” [WSJ, earlier]

      Opening Bell: 05.15.12

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      In Facebook IPO, Frenzy, Skepticism (WSJ)
      Michael Belanger, a lawyer from Oklahoma City, invests his personal money in the stock market. But he will be skipping Facebook’s IPO because he thinks its valuation is totally “out of whack.” Scott Schermerhorn, chief investment officer of investment-management firm Granite Investment Advisors, says the hype around Facebook’s IPO is going to keep his firm away. “It’s a cult stock,” he says. Little of that skepticism is weighing on three investors, tracked by The Wall Street Journal since Facebook announced in February that it would go public. Jim Supple was driving with his daughter Jade last autumn, when she turned to him and said, “Daddy, can I buy some of the Facebook company?” Mr. Supple, 47, had been teaching Jade about investing in the stock market for years. He started putting money for her in stocks like eBay and Disney when she was a baby. But the request still took him aback. “How do you know about buying Facebook?” he asked. “I saw in the news that they were going to be selling parts of the company,” she responded. “Can we buy some?” Since then, Mr. Supple has been trying to find a way to take $25,000 he has saved for her college fund and purchase Facebook stock. “She doesn’t need this money for another eight years,” says Mr. Supple. “If it goes the Google route, I’ll be in good shape.”

      JPMorgan Said To Weigh Bonus Clawbacks After Loss (Bloomberg)
      The lender can cancel stock awards or demand they be repaid if an employee “engages in conduct that causes material financial or reputational harm,” JPMorgan said in its annual proxy statement. The company will claw back pay if it’s appropriate, said one of the executives, who asked not to be identified because no decisions have been made. The incident, which led to Drew’s retirement yesterday, may test JPMorgan’s claw-back policy amid mounting investor criticism over Wall Street pay practices and as regulators investigate the trades.

      JPMorgan Moves To Protect Dimon (WSJ)
      The board backs Mr. Dimon and the way he quickly admitted and sought to fix the bank’s mistakes, according to this person. “We made errors, and we are going to take care of it,” Mr. Dimon told fellow directors during a conference call last week, the person said. “This was bad thinking. This was stupid.”

      Euro Chiefs May Offer Leniency to Greece (Bloomberg)
      Calling talk of a Greek pullout from the euro “nonsense” and “propaganda,” Luxembourg Prime Minister Jean-Claude Juncker said only a “fully functioning” Greek government would be entitled to tinker with the conditions attached to 240 billion euros ($308 billion) of rescue aid.

      Man Spends $60,000 In Custody Battle Over Dog Knuckles (CBS)
      Dershowitz, 34, said he considers Knuckles to be his son, and that although he’s gone through his life savings, he said it’s worth it. In papers filed earlier this year in Manhattan state Supreme Court, Dershowitz said ex-girlfriend Sarah Brega “kidnapped” Knuckles after they broke up. Brega said Dershowitz gave her the puggle pup — half pug, half beagle. Dershowitz started the website Rescue Knux to raise money for the custody fight. For $250, contributors can play fetch with Knuckles. For $10,000, Legends of Graffiti will do a giant, personalized mural. Dershowitz made an emotional video plea and posted the following on his site: I know it might sound funny and I understand that. If it wasn’t so painful, I would be laughing too (I mean, c’mon – dognapp – really?) but this is very serious to me and I miss him a lot. Enough that I have gone into debt to retrieve him and enough that I am on here asking for your help. I need the money to keep fighting the court battle. She comes from a wealthy family that is backing her. I don’t. She keeps filing crazy, frivolous motions just knowing that I can’t afford to respond even after the judge has ruled in my favor. The courts gave me custody already but, sadly, the system is too complex and expensive to make anything that simple and easy. I need help bringing my boy home…where he belongs…for good.” Continue reading »