Atticus Closes Flagship Fund (FT)
Atticus Capital’s Barakett is stepping down from his role as Manager of the fund, which has roughly 3.5B in assets. FT says his decision was “purely personal” and had nothing to do with the fact that the fund was off its high water mark.

DiPascali Admits To Madoff Fraud, Judge Denies Bail (NYT)
Frank DiPascali, the Queens kid, pled guilty to 10 counts of fraud and admitted to knowing the whole thing was a sham from the beginning. He detailed for the judge how he and the big M created wire transfers from the London to the NY office to make it look like they were earning commissions, and how they created fake account statements. Judge Sullivan ended up pulling the plug on DiPascali’s bail though, claiming that the cash involved vs. the 125 years he was facing amounted to little more than an honor system.

Ackman Easing Interest In Target (NYPost)
Shortly after Ackman’s attempt to upend Target’s board it looks like the Manager may have started dumping his positions; his exposure has dropped from 7.8% to 4.4%.

JP Morgan Looking To sell 23 Office Properties (WSJ)
On the list: One Chase Manhattan Plaza, and Four New York Plaza, as well as the former WaMu headquarters in downtown Seattle. All in all it will include 7.1MM square feet of space.

HSBC Lays Off 90 in UAE (B24-7.ae)
This is dangerous for several reasons, not the least of which is the debtor’s prison the UAE still boasts. Hopefully the company got word to the employees in ample time, if not, Godspeed.

FSA Rules To Reign In Bonuses (Bloomberg)
The FSA has moved to kill banking in the U.K. as the combination of higher taxes and death to bonuses will surely send top talent off shore.

ING Profitable After Three Quarters (NYT)
Looking to show up their Swiss three letter counterpart, the Dutch bank posted a profit of $100MM. Sure, it was down a couple of billion from the year before, and still missed analyst estimates by some two hundred million, but they beat UBS, damnit. That counts for something.

China Arrests Rio Employees (FT)
“Chinese prosecutors have formally arrested four Rio Tinto employees on suspicion of obtaining trade secrets and commercial bribery, making it more likely the highly-politicised case will be brought to trial.”

Judge Questions Merrill Bonuses (NYT)
“A week after the Securities and Exchange Commission announced that it had settled the matter, Judge Jed S. Rakoff questioned whether the $33 million agreement with Bank of America was adequate. He refused to approve the deal, saying too many questions remained unanswered, including who knew what and when about the controversial payouts.”

Distressed Debt Deals On The Rise (Reuters)
At $84.4B, distressed-debt deals are on pace to double last year’s numbers.

Stanford Can’t Get Money To Mount Legal Defense (NYPost)
There stands a decent chance the government has the money tied up to the point that Stanford will effectively be getting a team of public defenders.

Despite Negative Revenue, UBS Making High Profile Hires (Bloomberg)
The marginally less client friendly Swiss bank is building out its teams in the downtime, having picked up more than 20 bankers from the competition. No mention of comp plans.

Toxic Assets May Need More Help (Reuters)
The Congressional Oversight Panel is looking for stress tests on the smaller banks/institutions to assure they’re not functionally inept, and wants capital support much in the same way it was available to the larger institutions.

Asia Showing Slow Climb Out Of Recession (NYT)
China released its economic numbers today, showing industrial output raising 10.8% and retail sales up 15%.

New York Fed In Hiring Spree (FT)
“The Federal Reserve Bank of New York is aggressively hiring traders as it seeks to manage its burgeoning securities holdings, making the central bank one of Wall Street’s most active recruiters of financial talent.”

The Annual Review of Wall Street Pay (NYT)
Compensation numbers of the top 25 are due in by Thursday, after which, Feinberg will be doing his annual review of who-makes-too-much-loot. Once everything is reviewed and the big F decides who to chastise and who to let be, I don’t see the media getting nearly the response they did on this topic in recent years/quarters/months; the wholehearted flogging of salaries as a subject reached its high water mark and I think it’s safe to say people are fairly sick of hearing about this shit.

JP Morgan To Buy Back Warrants In Public Auction (NYPost)
“Unlike the other major banks, which gave warrants to the federal government in exchange for billions in capital under the Troubled Asset Relief Program, JPMorgan is expected to have its warrants sold in a public auction that would be run by the US Treasury. Warrants grant their owners the right to purchase shares at a discount sometime in the future.”

U.S. Economy May Be On The Brink Of Recovery (Bloomberg)
“”We may have hit stability, we may be in the beginning of an upturn” based on the latest economic data, Tyson, a member of the White House’s Economic Recovery Advisory Board, said yesterday during an interview in Kuala Lumpur. Nobel Prize- winning economist Paul Krugman said the deepest slump since the Great Depression may be ending.”

The Business Of Pleasure (CNBC)
CNBC will be continuing its in depth porn coverage tonight at 10.

Banks Make $38B From Overdraft Fees (FT)
Banks are likely to take a PR hit for charging the average American consumer too much to withdraw money they don’t have; I can see that there’s an argument here to be had from both sides. While anything above $30 seems ludicrous, there has to be sufficient incentive for people not to overextend themselves. Lack of that incentive is what got many of those people in the positions they’re currently in.

Rio Spying Cost China $102B (Bloomberg)
“Rio Tinto Group, the third-largest mining company, spied on China’s steel mills for six years, creating 700 billion yuan ($102 billion) in excess charges for iron ore, a report on a Chinese government-run Web site said.”

A Few Notes On AIG’s New Fearless Leader (WSJ)
Aside for the MetLife IPO and the 7-10MM he’ll be getting for the AIG gig, what’s important here is he has such soft hands, and the most beautiful tramp stamp.

Krugman Thinks Bernanke Should Keep His Job (Bloomberg)
You really have to wonder what the criteria for keeping your job as chairman of the Fed are during a depression, but it would seem chief among them is public perception (not that I agree with this methodology, but we live in a media age). Just so we’re up to date, Krugman and Roubini are for him staying in the seat, and Anna Schwartz appears to be leaning against.

Oh For The Love Of Love (DealBreaker)
Yesterday on one of Greg’s posts I noticed a little calf showing, a snip here or there, perhaps even some honest flirting (one can’t be sure where hatred and horny meet with this crowd). We care about our readers; we want you to be happy.It’s just what we do, people. That said, after speaking with InvestorCluzo (who has been a remarkably good sport about this), if Tax Chick can summon the gumption to accompany that mouth we’d be happy to arrange for the two of you lovebirds to shake hands.

AIG Reports First Profit In Seven Quarters (Bloomberg)
AIG has managed to pull its head from its ass for at least a quarter, as they report second quarter income of $1.82B or $2.30 a share.

RBS Posts $7.52B Loss (Bloomberg)
“”There is every sign that our financial performance over the next two years, at a group level, will be poor due to the severe economic downturn in 2008 and 2009 and consequent impact on impairments and funding costs,” Chief Executive Officer Stephen Hester said today in a statement.”

Small Banks Picking Up Talent (WSJ)
Regionals are dipping into the talent pool of the larger firms, though the article doesn’t expressly define what positions these finance geniuses are interested in. Is this a sign of times to come (people looking for the stability of smaller/less risky operations), or of desperation?

President Obama Not Saying Shit About Replacing Bernanke (Reuters)
Bernanke’s term expires January 31st, 2010; as is we don’t have any clue as to whether or not the President will be stepping in to replace him. There’s a good point to be made in cutting him down now, though - you don’t give him the authority or respect that tenure demands.

ProShare Getting Sued Over Leveraged ETF (WSJ)
It’s a failure to disclose risk suit, which is comical on so many levels. Labaton Sucharow LLP is leading the charge.

Citigroup Considers Options With Philbro (NYT)
“After putting out feelers to sell its Phibro commodities business, including a brief talk with the billionaire investor Warren E. Buffett, Citigroup is considering a variety of options. Among them is a deal that would give control of the unit to Mr. Hall, the energy trader who runs Phibro, two people close to the negotiations said.”

NYT Hires Goldman To Explore Boston Globe Sale (Reuters via CNN)
“The New York Times Co has enlisted Goldman Sachs to explore a sale of its New England Media Group, which owns the 137-year-old Boston Globe and other media assets.”

Bankers Beat Odds In Toxic Pay Plan (WSJ)
Despite its detractors, it turns out the CS plan to pay bankers with bonds hasn’t been all that bad.

Judge Halts Payout On BAC Settlement (NYT)
Judge Jed Rakoff has refused to approve the payouts because he believes they may be unfair to the public. As it’s all government money, I tend to agree.

Former Head Of Amex Frontrunner For AIG Chairman Role (FT)
“Mr Golub, who joined AIG’s board in June, has the edge over other candidates, including ­Dennis Dammerman, the former General Electric executive who is also a director of the government-controlled insurer, people close to the situation said”

Related, it looks like the breakup of the former giant is going to generate somewhere in the neighborhood of $1B in fees across sectors.

Murdoch Pulls The Plug On Free Shit (BBC)
The news mogul Rupert Murdoch has decided to pull the plug on the free shit as News Corp sees a $3.4B loss.

NYT Offers Up Statistics As A Career Path (NYT)
Tired of getting laid? Have a penchant for hating yourself and others? Then statistics might just be for you, and it turns out people need the poor bastards to do it.

Schapiro Pushes For Self-Funding (FT)
“The US Securities and Exchange Commission should fund itself directly from industry fees, a system that would allow it to tackle more complex investigations and invest more in technology and skilled people, Mary Schapiro, its chairman, told the Financial Times.”

Economists Up Expectations For Second Half (WSJ)
The pseudo-scientists-cum-fortune-tellers have mounted an attack on the second half numbers, calling for revisions upward based on the overwhelming success of the clunkers program. Leading the assault are UBS (Q3 to 2.5% from 2 and Q4 to 3% from 2.5) Wells Fargo (Q3 to 3% from 2.2% and Q4 2% from 1.6%) , and T. Rowe Price (it doesn’t really matter, does it?).

Clinton Secures Release Of Journalists, Gives Il Spotlight (Bloomberg)
Firstly, I was under the impression Mr. Il had the spotlight before and kind of screwed it up - it was clearly chronicled in the documentary “Team America”.

Secondly, welcome home ladies.

Society Generale Reports Decent Showing (BBC)
“The bank made 309m euros ($445m; £263m) between April and June, down 52% on the 644m euros it made in the same period a year earlier.”

Lloyds Reports £4B Loss (FT)
“Lloyds Banking Group on Wednesday said that the deteriorating state of its loan portfolio had caused it to recognise £13.4bn of impairment charges in the first half of 2009.”

GM Chief Vows To Defend Market Share (NYT)
It’s refreshing to see the return of the vow, it’s been so long since anyone in the automotive industry had the balls to promise, no.. wait. Anyway, Whitacre Jr., is vowing to not give up market share despite their reduction in production/lines. Take note, you can sleep now.

Two Traders Urge Gas Market Changes (WSJ)
This is too complicated to summarize, but it’s worth a read.

Lehman In Tax Trouble (NYT)
“The Bloomberg administration has accused Lehman of shortchanging the city of $627 million in corporate and other taxes, beginning in 1996. It is now trying to convince federal bankruptcy court in Manhattan that the city should jump closer to the front of Lehman’s long line of creditors.”

Treasury Considering Mores Sales Of TIPS (WSJ)
With the budget deficit ballooning, the US Gov is ever in search of exciting way to raise capital - enter TIPS. With 1.8T of debt issued through September (I’m citing the article here) it’s not impossible to think there might be a little jack in the prices going forward (but of course, not too much - the talking heads won’t hear of it).

BAC Hit By Fine Over Merrill (WSJ)
BAC’s having to shell out $33MM after settling a civil suit brought against the company (neither admitted nor denied) tied to the Merrill bonus pool. Impressively, the complaint had just been filed Monday, and was focused on proxy documents sent to shareholders of both companies for the vote on takeover.

UBS Loss Widens To $1.32B (WSJ)
The Zurich based firm best known for its strict measures to safeguard client data has widened its loss in the second quarter due to, as it claims, restructuring efforts.

Google’s Schmidt Quits Apple Board (FT)
“Mr Schmidt’s departure comes three months after the US Federal Trade Commission started an investigation into multiple directorships, and days after the US Federal Communications Commission launched a review of its own into why Apple had blocked a Google application from working on its iPhone.”

AIG Finds CEO Replacement (FT)
The embattled and embittered company has filled the CEO role with none other than MetLife’s Benmosche. We wish Mr. Benmosche all the best in his role, and can only hope the US Government shows him the respect they allowed Mr. Liddy.

Goldman’s Blankfein Tells Employees To Reel It In (NY Post)
The idea being the company is facing a bit of a PR crunch, Blankfein is asking the ‘ites to refrain from blowing their wad on useless high profile shit. Needless to say, there’s going to be that one guy who, post heist, buys the Lamborghini and leads the Feds right back to the hideout. Or given the address, a dozen midget hookers and a kilo of ibogaine. Your Call.

Clinton Hits North Korea In Rescue Mission (Bloomberg)
Former President Bill Clinton is in N. Korea to aid in the release of the two journalists captured infiltrating the motherland. If successful, it’s a long trip home. Good luck ladies.

Kaupthing Leak Exposes Loans (Telegraph)
It appears that just before the bank lost its ass and relegated an entire country to indentured serfdom it paid out billions in loans to its largest shareholders.

HSBC And Barclays Report Profits (NYT)
HSBC’s number’s sagged pathetically in the first half of the year, showing a net of $3.3B compared to $7.7B from last year. Barclays fared somewhat better (though, notably, they’ve sold off nearly everything they own) having returned $3.5B over the first half.


Fed Plays Crucial “Phase 2” Role In Money Making On Wall (FT)
There’s concern over whether the Fed is being made to buy securities at an inflated price, and whether or not some firms are capitalizing on the inefficiencies of the Government and intervention in general. The answer is obviously no; I mean it would be ridiculous for anyone to seek to profit off the Fed (or the US Government in general) and their lackadaisical approach to finance.

Roubini Has Commodity Prices Rising In 2010 (Bloomberg)
Looking to make the most obvious call possible Roubini has decided to jump on the “inflation for 2010” bandwagon. Be careful, little ones, the chief prognosticator has it that commodities could see a bump in days to come.

Citadel Moving To Become A Market Maker (WSJ)
Griffen & Co is looking to become a primary dealer in some EU government bonds, which would make theirs the first fund to do so.

Catholic Church Invests In Sin (BBC)
The Catholic Church, still reeling from having its ass handed to it by a certain dealbreaker editor, has apparently been heavily invested in some of our favorite nouns: firearms, birth control, and tobacco.

UBS Not Fined In US Tax Settlement (Reuters)
UBS is releasing the data but keeping their cash in an exchange that will surely strengthen US ties internationally, and force evil evaders out into the light of public.

Goldman Suffering From Waning Reputation (FT)
“”Goldman Sachs still has that Gordon Gekko look to it among the general public,” said Anne Rivers, who oversaw the survey, referring to the villain of the 1987 film Wall Street.”

“Thanks For Not Running” (Bloomberg)
Sean Swift, of JP Morgan, won the Corp Challenge this week in Central Park, and thereafter fired off this text to his pal: “Thanks for not running this year,” Swift, 24, wrote to his friend Karl Dusen, an analyst at American International Group Inc. who took the title in 2006, 2007 and 2008. “Maybe now I’ll get a bonus.”

Lewis Defends Merrill Deal (WSJ)
“Despite being pummeled by Congress, shareholders and other critics, Mr. Lewis likely isn’t stepping down anytime soon. “I don’t see anyone who could be doing a better job of leading this organization at this time,” said Walter Massey, Bank of America’s chairman.”

AIG Balks At Claims From Hudson Crash (NYT)
AIG is dragging its ass in paying the claims from the downed plane, it appears. The article attributes much of their slow response to the general perception that the crew handled the incident so well, explaining it’s hard to find fault in their actions when everyone considers them heroes.

BlackRock To Acquire Stake In Barclays Unit (NYT)
“BlackRock said Thursday night that it had agreed to buy Barclays Global Investors from the British banking giant Barclays for about $13.5 billion in one of the largest deals in the money management industry, creating a juggernaut with nearly $3 trillion in assets.”

Paulson & Co. Goes Long Distressed Debt/Mortgage Securities (Bloomberg)
Paulson & Co. is dumping a hefty little chunk of change into jumbo prime securitizations and distressed opportunities (including banks and finance companies). While not in direct contrast to his shorting of the subprime market in general, it could mark the fund manager’s belief that the market is turning (if only slowly).

Soros: Ban Credit Default Swaps (Guardian)
“Some derivatives ought not to be allowed to be traded at all. I have in mind credit default swaps. The more I’ve heard about them, the more I’ve realised they’re truly toxic…CDS are instruments of destruction which ought to be outlawed,” Soros told a meeting of the Institute of International Finance.

Jim Simons Delays Retirement Plans (WSJ)
Talks with officials of the China Investment Corp about a multi-billion dollar stake in Renaissance and plans to retire have been put on hold. Spokesman Jonathan Gasthalter declined discuss what factors may have changed. Also, “two veteran Renaissance insiders, speech-recognition experts Peter Brown and Robert Mercer, are considered likely successors to lead the firm,” whenever Simons, who quit his two-pack a day habit this year, decides to start taking it easy. The Journal took about 30 years off his head cut, and made him look like Biff’s long lost brother, which is nice.

JPMorgan to Acquire Rest of Highbridge Capital (Dealbook)
Had a majority stake since 2004.

US Pushes A Troubled Citi To Heal Itself (NYT)
“The question now is when, or perhaps even if, Citigroup will be able to free itself from Washington.” Shall we take odds?

California nears financial “meltdown” as revenues tumble (Reuters)
California’s government risks a financial “meltdown” within 50 days in light of its weakening May revenues unless Governor Arnold Schwarzenegger and lawmakers quickly plug a $24.3 billion budget gap, the state’s controller said on Wednesday.