If you’re in a certain line of work, and I bet you are, then your main concern about things like the Volcker Rule and increased capital requirements for banks is that they might reduce your comp. If you’re in that line of work, you’re also probably the sort of person who has a higher than average aversion to having your comp reduced. However, you’re also the sort of person whose comp everyone else would be happy to see reduced, because you make too much already you greedy jackass.
That poses a quandary because nobody’s all that interested in hearing your arguments against the new rules, even if they’re good arguments and not 100% about your own personal remuneration. One thing you could do is get proxies to make your arguments. If you think that the Volcker Rule will reduce liquidity in foreign government bonds, you could suggest to foreign governments that it’s really important that they lobby against the rule on your behalf. You did that. Good work. Let’s see how it turns out. If it turns out well, the next step would be to get other clients to say “well, we want liquidity in our [stocks/bonds/rate swaps/whatevers] too,” since that would then be a more compelling argument.
I think that’s what’s going on in this sort of amazing FT article, but something has gone terribly wrong: Continue reading »
Why have there been multiple instances of guys dressed up as chickens descending on RBS’s Stamford trading floor, the most recent one being this past Friday? Continue reading »
It probably speaks well of the overall state of human rights in Europe that the European Court of Human Rights devotes a lot of its time to compelling moral issues like George Soros’s insider trading conviction. (Fine, there’s some torture too.) But how good is this:
Hedge funds have been known to use hardball tactics to make money. Now they have come up with a new one: suing Greece in a human rights court to make good on its bond payments. The novel approach would have the funds arguing in the European Court of Human Rights that Greece had violated bondholder rights, though that could be a multiyear project with no guarantee of a payoff. And it would not be likely to produce sympathy for these funds, which many blame for the lack of progress so far in the negotiations over restructuring Greece’s debts.
You … you think? You think that might look bad? Hmm.
More specifically the potential human rights violation here is the retroactive introduction of a collective action clause into the Greek-law bonds, which represent some 90% of the outstanding Greek debt. The idea here is along the lines of add CAC, scrape together a majority of the bondholders to agree to the exchange, and then force the holdouts to exchange on the same terms. Because Greece’s bonds do not currently have a CAC, people who bought the bonds would understandably feel a bit miffed to have one added retroactively, and some of them might replace the words “feel a bit miffed” with the words “have their human rights violated.” At the very least, though, retroactively and unilaterally adding material terms to the debt agreements seems pretty shady.
But one can have a little bit of perspective on this. I think there are about four things that Greece could do with its Greek-law bonds: Continue reading »
“I think there are still very talented traders at banks that could work out very well in the buy side. So, yes, we are looking to grow…If you hire one, it’s like shark teeth. There’s another five behind it.” [Bloomberg TV]
As many a successful financier can attest, amassing immense wealth does not protect one from having to interact with inferior beings. Never more is this unfortunate reality on display than when one deals with the food services industry, and waitstaff who don’t know their ass from their elbow. Whether it’s a matter of meals not being brought out hastily, failing to provide a good enough answer to the question of which entree they’d choose, or refilling the water glasses with a look on their face, it just never ends with these people, does it? While some are content to say nothing when confronted by these subpar beings and their subpar service, others realize that to ignore the issue is to do a disservice both to themselves and those needing the err of their ways called out. Bill Gross, for instance, leaves negative tips for waitresses he deems not up to snuff. Mitt Romney would (probably) fire them. For his part, private equity veteran John Castle chooses to be a bit more direct. Continue reading »
As astute followers of PIMCO chief Bill Gross know, the bond manager often uses metaphors to explain various market behavior in his monthly Investment Outlook letter. In the past, he’s told us about why US policy makers are basically praying mantises in that they’ll bite your head off after sex, why this country is a patient waiting for a heart transplant, and why Congress reminds him a lot of Pepé Le Pew. Gross has also taken the opportunity to sprinkle in little personal details, including his pajama preference, his hatred for automatic flushers, a story about the time he acted like a cheap prick to a waitress (“A Gross family legend!”), and, of course, his inability to love the body god gave him. Most recently, Bill used the space to warn people that 2012 will be the year the markets will make you feel like lost your fucking mind. Continue reading »
“We coined this investigation ‘Perfect Hedge’ because if you’re armed with that insider’s information, you can initiate the perfect hedge,” FBI agent David Chaves said in an interview of the largest hedge fund investigation ever. “You’re always protected — the upside and the down side.” [Bloomberg]
