research

  • News

    Citigroup, Goldman Bankers Violated The Sanctity Of Toys ‘R Us Research: Finra

    The investment banks promised favorable research to Toys “R” Us Inc. and its private-equity owners to win roles in its initial public offering, the Financial Industry Regulatory Authority said today in a statement. The regulator fined the firms a total of $43.5 million, faulting them for “implicitly or explicitly” making promises that their analysts would […]

    / Dec 11, 2014 at 2:31 PM
  • a yummie in the wild [photo- WSJ]

    brainstorming sessions

    HSBC Tries To Come Up With Successor To ‘Yuppie,’ But Not Very Hard

    Luxury fashion may be switching gender and age roles. In much of the world now, the most attractive demographic for such companies as Burberry (BRBY) and Coach (COH) isn’t middle-aged women with sky-high credit limits; it’s twentysomething men with smartphones and self-esteem issues. At least that’s the theory put forth recently by a three researchers […]

    / Mar 25, 2014 at 5:07 PM
  • It's like, this y axis sort of sucks, but you can't really fault GS for that. The financial crisis screwed up a lot of graph scaling.

    News

    The Too Big To Fail Subsidy Is Negative Ten Billion Dollars, Says Goldman Sachs

    I feel like I’m on the “the too-big-to-fail subsidy is negative!” beat, even though I only kind of believe it, so in that spirit here is a fun paper from Goldman Sachs’ Global Markets Institute1 that finds that the too-big-to-fail subsidy is negative. That is, Goldman concludes, contrary to popular belief, that the biggest U.S. […]

    / May 22, 2013 at 3:59 PM
  • This is one of those where there's no particularly appropriate picture so we can at least look at Raj Rajaratnam in happier times.

    News

    Sell-Side Research Analysts Use Their Networking Skills For Good

    Yesterday’s delightful insider trading settlement with Richard Moore, the CIBC banker who deduced the identity of a buyout target through sheer clingyness, is a good reminder that insider trading is weird. Nobody told Moore any material nonpublic information, but he got in trouble anyway. It’s also a good reminder of this new-ish (March 2013) paper […]

    / Apr 17, 2013 at 10:46 AM
  • I have no idea what the boxes are?

    Banks

    Goldman Analysts Hint That Deutsche Bank Should Consider Just Packing It Up And Going Back To Germany

    I realize it doesn’t actually work this way but I always imagine that sell-side analysts at big banks who cover other big banks enjoy sabotaging each other a little. “Take that, you Deutsche Bank jerks!,” Jernej Omahen might have thought as he hit send on this one: Deutsche Bank AG fell the most in more […]

    / Mar 1, 2013 at 1:07 PM
  • Banks

    Survey: Investors Expect Banks To Meekly Over-Comply With Regulations Without Pushing Back On Anything

    On Monday, as a bevy of banks were settling a zillion dollars of mortgage lawsuits and putting themselves on a path to (1) certainty and (2) giving money back to shareholders, Goldman released a research note with the results of a survey of investors’ expectations of bank capital return.1 Here is what some sample of […]

    / Jan 9, 2013 at 11:03 AM
  • Lloyd thinks regulation is great; his analysts aren't so sure.

    Banks, News

    Goldman Research Analysts Suggest That Morgan Stanley Should Get Smaller And/Or Better At Bond Trading

    Wall Street banks’ research on their competitors is not only a window into analysts’ anxieties about their own banks’ prospects, but also a ripe area for conflicts between investment advice and industry advocacy. The days of analysts writing research reports that were like “Facebook should really do a huge equity offering and hire my bank […]

    / Sep 10, 2012 at 2:23 PM
  • Honestly, I'm pretty tenuously connected to this, aren't I?

    Banks, News

    JPMorgan Helpfully Quantifies How Much Banking Regulation Is Costing You Personally

    I like reading banks’ research reports on other banks these days because they give off a certain the-call-is-coming-from-inside-the-house vibe; you imagine the analyst running the numbers, looking them over, and saying “my God, this can’t be right, can it? This seems to say … I’m fired?” JPMorgan’s analysts maybe suffer from this less than most […]

    / Sep 4, 2012 at 5:00 PM
  • The letter is very good, you can tell that someone at the SEC had fun writing it and then someone else had less fun editing it to remove things like "look you pinhead, ..."

    News

    SEC Not Going To Let Bankers And Research Analysts Nod Hello To Each Other In The Hallway Just Because Congress Told It To

    The SEC had a feisty week last week, telling off Congress with cheery abandon. Darrell Issa sent them a pretty crazy letter a few months back demanding that all IPOs be Dutch auctions for some reason, and last week Mary Schapiro sent him a deeply researched 32-page letter telling him, with appropriate condescension, that that […]

    / Aug 27, 2012 at 6:08 PM
  • News

    Bristol-Meyers Squibb Employee Conducted Numerous Internet Searches Re: How To Not Get Caught Insider Trading Before Engaging In Insider Trading

    Which, it turns out, were not very helpful.

    Mr. Ramnarine, who served as assistant treasurer for capital markets at Bristol-Meyers Squibb from June, 2011, was charged in New Jersey federal court with three counts of securities fraud related to alleged insider trading in the stocks of three companies Bristol-Meyers was targeting for acquisition. According to the complaint, about a week before some of the alleged trading, Mr. Ramnarine opened up Yahoo on his office computer in Princeton, NJ and entered a flurry of searches, including “can option be traced to purchaser,” “can stock option be traced to purchase inside trading,” “insider trading options traceillegal [sic].” Mr. Ramnarine also looked at web sites and articles discussing insider trading laws and ways to avoid insider trading violations, and even downloaded press releases on insider trading from the office of the Securities and Exchange Commission, according to the complaint.

    Lessons In How Not To Insider Trade [Deal Journal]
    US v. Robert Ramnarine [Criminal Complaint]

    / Aug 2, 2012 at 6:19 PM
  • News

    Having Said All That, He Continues To Prop A Ladder Up Against His Open Bedroom Window Each Night, Just In Case

    Rochdale analyst Dick Bové loves fairy tales as much as the next guy. He loves the romance, he loves the drama, he loves the idea of magical footwear. Does he start every morning asking the question, “Mirror, Mirror on the wall, who’s the fairest analyst of them all?”? Yes. Does he consider Mike Mayo and Meredith Whitney his evil step-sisters? Yes. Does he dream about being awoken from his slumber by a handsome prince? But even Dick knows that five minutes after the prince wakes you up you’re going to be bitching to your girlfriends about being stuck with this asshole who lets the dishes pile up like you’re the god damn maid service.

    Everyone knows that when the handsome prince kissed the beautiful Snow White she awakened and everyone lived happily ever after. “It’s in the book” said comic John Standley when discussing another one solution character Little Bo Peep. This “one solution fits all,” or what I like to call the Snow White Syndrome, is a core belief of most who look at the financial crisis. There are three examples of this in today’s press: Just about everyone is unhappy that the EU leaders could not solve all of the European debt problems with one single solution – i.e., creating Euro Bonds that absorbed all individual country debt. In today’s Financial Times Senator Sherrod Brown (OH, Dem.) and Dallas Fed President Richard Fisher have a single solution to the nation’s banking problem – i.e., break up the big banks. The Wall Street Journal has a different single solution to the problems in banking – i.e., eliminate hedging in bank portfolios.

    Then there are the other big-time single solutions: The central banks in the North Atlantic Communities believe that by printing money economic woes will go away. Conservatives argue that by cutting taxes, this nation’s economic woes will disappear. The President and Congress believe that by passing laws the economic cycle will be eliminated (“kinda” like the dot-comers who had already eliminated the economic cycle in the 1990s). The Snow White Syndrome is everywhere. We only need to find that prince with the potent lips. The problem, of course, is that no single solution quickly arrived at is likely to achieve the results promised.

    Snow White Syndrome [Rochdale Research]

    / May 24, 2012 at 1:22 PM
  • News

    Even The Underwriters Were Sick of Facebook By The Time The IPO Priced

    This weekend the New York Times published an amazing, front-page-of-Sunday-business article about … well, there was this guy, see, and he was annoyed because he thought some people had access to his personal opinions that he had formed based on public information before some other people had access to those personal opinions, and he decided […]

    / May 22, 2012 at 10:47 AM
  • News

    Banks Apparently Want To Do More Work And Take More Risk For No Money

    We’ve talked a little before about how I don’t understand Wall Street research. Let’s start slow: why publish research? There are I think three, or three-ish, possibilities: 1. To inform your investing clients (asset managers and such) about your best views on how they should manage their money, so that they can manage their money […]

    / Apr 30, 2012 at 4:58 PM
  • News

    Risk-On, Risk-Off, Risk-Of-Firing

    Oh, the world. Go read Jeremy Grantham’s GMO quarterly letter; as always it’s pretty fun. Then go read this HSBC report that Paul Murphy wrote about on Alphaville. These are things you probably know already but are worth remembering. First, Grantham: The central truth of the investment business is that investment behavior is driven by […]

    / Apr 19, 2012 at 7:10 PM
  • News

    Banks May Have Trouble Taking Full Advantage Of JOBS Act’s New Opportunities For Deceiving Clients

    My time in the financial industry entirely postdated the global research settlement, which means that I have a different view of sell-side research from some of the olds. As far as I can make out, there are people who think that investment bank research was once a demonic scheme in which research analysts – larger-than-life figures whose recommendations were irresistible to the retail investors who in this vision bought all of every pre-2003 stock offering – swindled those besotted retail investors into buying crap stocks at inflated prices so that the banks could get gigantic investment banking fees. Whereas I always thought that investment bank research was a sort of cute endeavor of unclear commercial purpose, taken skeptically by the institutional investors who buy most of every post-2003 offering, made fun of by bankers, and conducted by people whom we never saw because, among other things, our network was set up to prevent them from emailing us and vice versa.

    Perhaps before the settlement giants roamed the halls of research divisions, defrauding investors with abandon, but once their email was cut off from the bankers’ email they retreated into mousy irrelevance? Unclear. In any case THEY’RE BACK BABY, sort of:

    / Apr 5, 2012 at 1:56 PM
  • dick-bove

    News

    Dick “Fire A-Rod” Bové: Underpaid Bank CEOs Should Seek Yankees Tryout

    The New York Yankees have won one World Series in the past 10 years. They will pay their players $196.9 million dollars this year. The team’s four infielders will earn 40.6% of that or about $80 million in 2012. The four largest banks in the United States employ more than 1 million people and have […]

    / Apr 5, 2012 at 12:23 PM
  • News

    Goldman Thinks You Should Buy Stocks Because You Don’t Think You Should Buy Stocks

    Every day that the S&P is up more than, say, 1%, I have this feeling of “well, I guess I should sell all my stocks now, because this won’t end well,” and sometimes I’m right and recently I’m wrong, but it doesn’t matter much because I never do it and just keep my roughly half-equities […]

    / Mar 21, 2012 at 4:58 PM
  • News, Private Equity

    Most, Least Passive Ways Of Investing In Equity Getting Increasingly Close To Each Other

    Goldman Sachs has a piece of research out today on ETFs, billed as sort of “ETFs for dummy portfolio managers who need to start understanding them.” It’s worth a read if you can get it, with a decent overview of questions that it is probably possible to think too hard about, like whether 400% short […]

    / Jan 6, 2012 at 2:23 PM

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