Every year starting in around late December and continuing until around this time, I found myself at the end of each day hoping that the S&P had gone down. Rooting against GS, of course, made obvious sense, but I was also keenly aware that I was soon going to be buying a whole lot – relatively! – of equities and it would be nice to get them at a discount. This guy knows what I’m taking about:

The logic is simple: If you are going to be a net buyer of stocks in the future, either directly with your own money or indirectly (through your ownership of a company that is repurchasing shares), you are hurt when stocks rise. You benefit when stocks swoon. Emotions, however, too often complicate the matter: Most people, including those who will be net buyers in the future, take comfort in seeing stock prices advance. These shareholders resemble a commuter who rejoices after the price of gas increases, simply because his tank contains a day’s supply.

Like everyone in my former industry, I had no emotions, so I simply counted my expected-value gains when stocks went down. And because I dealt in derivatives, I spent some time thinking about the inflection point: when, in expectation, do you stop being a net buyer and become a net seller? For a profitable and growing P&C insurer is the answer never? For a banker … well for me at least it was in March of every year as my bonus-time discount rate of future bonuses was extremely high for reasons you can probably guess. (Hint: Now I blog.) For Warren Buffett … I mean … what should you take away from this long letter explaining why BRK is undervalued? (Also: does this change your discount rate?) Read more »

The former IBM exec, who had no idea Danielle Chiesi was just “playing” him when he passed her inside info during the course of a relationship that apparently meant a lot more to him than her, which he has twice cried in public over, has been sentenced to six months in prison.

For years and years before she was charged with insider trading in the Galleon case, people were aware of Danielle Chiesi’s schtick. Chieisi, often wearing some sort of get-up that involved fishnet stockings would show up to conferences, parties or other gatherings, seduce some well-informed men with her moves on the dance floor, maybe massage their thighs while they ate, perhaps sleep with them or maybe just engage in sexual banter over the phone for a period of months. Naturally she didn’t do any of this because she wanted to date or mate with these guys but because she was using them for hot tips and other things of that nature. Most people understood this. Bob Moffat did not. He thought there was something there, something real, so real that he’s twice cried in public over this woman, over what they had and over what he lost. Now though, he’s done. This chick is not worth his tears. (Also, he shouldn’t have to go to jail for that long because he did what he did out of love.)

The former IBM executive who pleaded guilty in the fed’s widespread insider trading case centering on hedge fund Galleon Group says his alleged accomplice and former mistress Danielle Chiesi “played” him.

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  • 21 May 2010 at 4:36 PM

Galleon Informant Sentenced to 27 Months in the Big House

Mark Kurland, Danielle Chiesi’s partner at New Castle Funds who pleaded guilty to insider trading in Galleon Group case, just got slapped with a 27-month prison sentence and a $900,000 fine for participating in the alleged scheme.

Kurland, 61, had argued for probation saying his life had already been ruined by the insider trading charges. “Regardless of his sentence, Mark’s legacy is forever ruined. He can no longer work in the profession he loved and thrived in,” his lawyer said.

Meanwhile, Robert Moffat, the IBM exec who also pleaded guilty to securities fraud and conspiracy in the Galleon case in March, had an “intimate relationship” with Chiesi and, therefore, should get a shorter sentence than Kurland, prosecutors said at a hearing today.

Earlier: Former IBM Exec Bob Moffatt Had A Really Good Excuse For Passing Inside Info To Danielle Chiesi

  • 26 Jun 2009 at 12:39 PM

Former IBM Exec Had Second Job In Venture Capital

IBM.jpgWhile nobody at IBM would dispute that its former head of M&A, David Johnson, was putting in some serious hours, they are taking issue with the fact that he spent a good deal of that time preparing to launch a technology focused VC firm, JSJ Capital Management. Johnson’s indiscretions ran a bit deeper than egregious use of the copy machine and ordering dinner. He once used an IBM funded trip to the Middle East to double as a JSJ roadshow and then administered another swift kick in the teeth last May.

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  • 25 Jun 2009 at 9:40 AM

The Proposal To Bring Back Buy-And-Hold

Former IBM CEO Lou Gerstner is not making any new friends on trading desks. Gerstner bemoans Wall St.’s focus on short term trading rewards but goes one step further and offers a modest proposal to solve the problem. In his utopia, day traders would pay an 80% tax on gains, individuals holding investments for 6 months would pay a paltry 60%, and for those willing to hold on for 5 years, you’d pay nothing (presumably to match the gain).
Gerstner Says Short-Term Gains Should Be Taxed at 80% [Bloomberg]

  • 16 Apr 2009 at 2:56 PM

Antitrust Is Back Home Early

And you thought antitrust had no surprises left in it. Far from it. Even the threat of extended reviews (six to nine months in this case) is still enough to blow a chilly breeze over the swollen nether regions of about-to-merge firms. In fact, Mom’s sudden appearance at the door (“I thought you were going to the mall!”) can drain the blood from the hottest deals- leaving one party or another pleading for another shot (“I’ll even cuddle after this time. For ten minutes! I promise!”) but often to no avail.

IBM is no longer interested in buying smaller rival Sun Microsystems Inc at any price, due to concerns that such a deal would draw intense regulatory scrutiny, CNBC reported on Thursday.
Citing sources close to Sun, CNBC said the high-end computer maker had approached International Business Machines Corp earlier this week to ask it to return to the negotiating table, indicating that Sun would be flexible about price.

Sorry Sun. We understand cold showers help.
IBM not interested in Sun at any price: report [Reuters]

  • 02 Apr 2009 at 3:55 PM

IBM To Capture The Power Of The Sun?

In case you missed it earlier today, not everyone is taking this recession thing laying down.

International Business Machines Corp. and Sun Microsystems Inc. are negotiating a takeover that values Sun at $9 to $10 a share, people familiar with the matter said.

Personally, we like the world better with an independent Sun. There’s no standing in the way of progress, however. (Or an 80% premium).
IBM, Sun Said to Be Discussing Deal at $9 to $10 [Bloomberg]