Opening Bell: 12.18.08


Schapiro To Take Over For Cox Under Obama (WSJ)
It looks like the embattled Cox will be retiring from the SEC after this year: Obama has elected to replace him with Mary Schapiro, head of FINRA since 2006. There has to be a question about vetting, as in: did or didn't the administration actually look into Mary's past. Mary's the one that appointed Mark Madoff to the National Adjudicatory Council in 2001, which we have to assume is an oversight on the part of Obama's camp if for no other reason than it's so bloody insane it defies all bounds of logic. And then there's the whispers that Mary didn't really do much at FINRA except make things pretty by protecting the old people from annuity salesmen - and I'm not saying that's not important, I'm just proposing maybe it shouldn't be the chief qualifier for the next chair of the SEC. On the flip side, at NASD she worked through the perilous bid/ask "spreads" BS back in the mid 90's, and "oversaw" the merger between the NYSE regulatory unit and NASD.
Goldman Bonuses Off 80% (FT)
"Partners at Goldman Sachs are set to see their bonuses fall by up to 80 per cent this year and the cash component of their year-end packages capped at $400,000"
We posted first year analyst numbers yesterday, and there were some comments suggesting first year associate numbers would come in at approx $100,000 - but this is really the first we've seen of a hard cap on the upper echelon. We don't know what the rest of the comp package looks like yet, but it's the same 5 year vest (and remember they're moving from 55 year retirement to 60) that was mentioned earlier.
MS is also mentioned in the article as announcing yesterday that it's bonus pool is seeing a 50% cut to reflect its "sharp fall in annual profits", but until we see the actual numbers side by side there's no knowing if GS has been usurped.
If you have numbers, send them to us at tips (AT) dealbreaker (DOT) com.
Bonus Structure Criticized, Again (NYT)
A rather long piece criticizing the bonus structure of the banks, and taking great pain to explore the paychecks of everyone they've ever heard of. One wonders if this isn't a public appeal piece on behalf of our great Attorney General, but I digress.
I think there needs to be a concerted effort to move banks away from the use of the word Bonus, because in the rest of America it's meant to be a term used for when someone does something particularly outstanding. Here though, it's a part of the compensation plan - which should (does) have a completely different meaning - and the mass majority of people are just flat out missing that.
Of course I still hold that the mass majority of people are raging morons, but still.
Blagojevich Will Not Fill Senate Vacancy (FT)
I can't believe that was even a headline.
US Tax Code To The Rescue (Bloomberg)
Just when the masses needed it most, the Government showed up on a white horse (no, not cocaine people, calm the fuck down):
"Capital-gains taxes paid by investors may be refundable for 2005 through 2007, lawyers said. In addition, they said investors probably can convince the Internal Revenue Service they are victims of theft, which would let them deduct losses from their income taxes dating back to 2006. Any unused theft losses could be used to reduce tax liabilities for the next 20 years."
BNP Paribas/Fortis Merger Killed (CNBC)
The French/Dutch love child plan was killed after a court decision was handed down that effectively enforced a suspension. Apparently Fortis had a cold, and wanted her first time to be "special" - wait what?

OPEC Makes Cut, Oil Forgets To Respond (Reuters)
You have to know these guys are going to be pissed after their "I'm for Super Serious" meeting on massive cuts in production to protect price points.
Biggest Madoff loser, Fairfield Greenwich, eyes legal move on PwC (FT)
--William Richards


Opening Bell: 04.05.12

Falcone Says Bankruptcy Is an Option for LightSquared (Bloomberg) Phil Falcone said he may consider voluntary bankruptcy for LightSquared Inc., the broadband wireless venture majority owned by his hedge fund that has been derailed by regulators. “There are arguments that we would be better off in bankruptcy than not,” Falcone said in an interview. “LightSquared, if I have to, I’ll put it into bankruptcy. I don’t care,” adding that he would maintain control of the Reston, Virginia-based company if it filed. Jobless Claims Decline (WSJ) New applications for jobless benefits fell to the lowest level in nearly four years last week, further evidence that U.S. employers likely added a healthy number of workers to their payrolls in March. Initial jobless claims decreased by 6,000 to a seasonally adjusted 357,000 in the week ended March 31, the Labor Department said Thursday. Economists surveyed by Dow Jones Newswires predicted that 360,000 new claims would be filed last week. Morgan Stanley Tries to Stave Off Ratings Cut (FT) James Gorman, Morgan Stanley’s chief executive, has been in discussions with Moody’s in an attempt to maintain its credit ratings and stave off a downgrade that could diminish the bank’s ability to buy the rest of Citigroup brokerage Smith Barney, according to people familiar with the matter...Morgan Stanley would most likely have to issue debt to fund the purchase, people say. That would become more expensive if Morgan Stanley is downgraded. Moody’s put Morgan Stanley, along with five other banks, on review for a downgrade in February. The bank could see its rating reduced by as many as three notches to Baa2 - two levels above junk status. A downgrade would also force Morgan Stanley to provide additional collateral to back its vast derivatives business, where it acts as a counterparty. JPMorgan Investment Bank Chief Widens Pay Lead on Rival (Bloomberg) Jes Staley, chief executive officer of JPMorgan’s investment bank, beat his Bank of America counterpart in compensation after boosting earnings amid a market slump. Staley’s $16 million award for 2011 almost held steady from the $17 million he made the previous year as profit at the firm’s investment bank climbed 2.3 percent to $6.8 billion. Bank of America co-chief operating officer Thomas K. Montag’s pay dropped 25 percent to $12 million after profit at the lender’s investment bank plunged by more than half to $2.97 billion. Gorman's Pay Falls (Bloomberg) Morgan Stanley Chief Executive Officer James Gorman’s compensation for 2011 totaled $10.5 million, a 25 percent cut from 2010 as the firm’s shares fell by almost half. Gorman, 53, got $5.04 million in restricted shares, and $1.94 million in shares tied to company performance, according to a proxy filing today from the New York-based investment bank. He also received a deferred cash bonus of $2.72 million that can be clawed back, in addition to his $800,000 salary. He didn’t receive an immediate cash bonus. Mets in Opening Day ticket panic (NYP) The Mets are so terrified by the embarrassing prospect of playing to empty seats at today's opener, they've made an Amazin' "buy one get one free" pitch. Some 15,000 of their fans have been offered one free seat for Saturday's or Sunday's Atlanta game in exchange for every ticket they buy for today’s opener. Plenty of the 41,880 seats for this afternoon’s game at Citi Field against the Braves were still available early today. If the Mets don’t sell out, it will be the first home opener since 1997 that didn’t fill their stadium. Madoff wives to face trustee claims in Ponzi case (Reuters) The trustee seeking money for victims of Bernard Madoff's Ponzi scheme, who lost an estimated $20 billion, may pursue claims against wives of the imprisoned swindler's sons, a U.S. federal court judge said on Wednesday. U.S. Bankruptcy Judge Burton Lifland in Manhattan said the trustee Irving Picard may pursue about $43 million of claims against Deborah Madoff, who married Andrew Madoff; and $33 million of claims against Stephanie Mack, the widow of Mark Madoff. Germany, Switzerland Sign Tax Plan (WSJ) Germany and Switzerland signed a new tax deal which allows wealthy Germans to retain their anonymity, while generating billions of euros in tax revenues for Berlin and ending a bruising dispute between the two neighboring countries over tax evasion and bank secrecy. The deal comes after Berlin and Bern agreed on last-minute amendments to a pact reached last summer in an effort to make it more appealing to German opposition leaders, who said Thursday they plan to veto it. "We believe it would be irresponsible to sign this deal, which is a slap in the face of every honest taxpayer," said Sigmar Gabriel, leader of the Social Democrats. Mega Millions ‘winner’ Mirlande Wilson's lawyer: 'I cannot say with any certainty this ticket exists' (NYDN) McDonald’s worker who claims she has a $218 million-winning Mega Millions ticket called a huge press conference Wednesday - and then arrived late only to tell the press to leave. Her lawyer announced to the mystified journalists packed into his Baltimore law office that the purpose of the press conference was “to ask you all to go home.” Mirlande Wilson, 37, of Maryland, who is said by coworkers to crave attention, hit one jackpot: a chaotic scrum of reporters and camera crews waiting to talk to her. But she never spoke. Asked if this was her plea for 15 minutes of fame, she shook her head. Her lawyer, Edward Smith, said, “no, she doesn't want 15 minutes of fame." Instead, he said, she would "like you all to go home." For the record, Smith says he hasn’t seen the purported ticket either. “I cannot say with any certainty this ticket exists,” he said, unreasurringly. Wilson has told various conflicting stories about how she came by her alleged ducat. She told a TV station she bought it at a 7-Eleven store for herself. Then she said a coworker purchased it for her alone while separately buying tickets for the pool organized at her McDonald’s in Baltimore. “I thought I'd play one dollar by myself,” she told the Daily News. She has said she definitely won; she thinks she won; she has the ticket at home; she stashed the ticket at McDonalds; and she has it in another, unspecified secret “safe” place. On Monday, she told the News that she hasn’t even checked her ticket against the winning numbers.