SEC Says Prince, Rubin Knew of Losses on Assets at Suit's Focus (Bloomberg)
Prince, the bank’s chief executive officer at the time, and Rubin, then-chairman, knew the highest-rated segments of subprime mortgage-backed securities were the source of about $200 million in new losses in October 2007, the Securities and Exchange Commission said yesterday in a filing at federal court in Washington. In July, the agency accused the bank and two other executives of failing to disclose $40 billion in subprime assets before losses surged. It didn’t target Prince and Rubin.

Obama Says US Can't Afford To Extend Tax Cuts To Wealthiest (Bloomberg)
Obama said in a speech yesterday in Ohio that he realized that the recovery has been “painfully slow.” As a remedy, he urged Congress to enact measures to give businesses more tax breaks, keep tax cuts for middle-income Americans and let rates rise for the richest taxpayers.

Sweet On Goldman (NYP)
Goldman beat out other "Masters of the Universe," such as Steve Schwarzman's Blackstone Group, which , which ranked second, and Jamie Dimon's JPMorgan No. 3, in an online survey.

August Is Another Cruel Month For Hedge Funds (Reuters)
The average fund lost 0.55 percent last month after gaining 1.9 percent in July, according to data released on Wednesday by New York consulting firm Hennessee Group. Hedge funds lost 1.29 percent in June and fell 3.21 percent in May, reported Hennessee, one of a handful of groups that track performance and asset flows in the secretive $1.5 trillion industry. Some managers who remembered May's tumult played it safe and cut risky bets to protect capital when stocks declined sharply in the month, leaving them with better returns, while stocks declined sharply. Kenneth Griffin's flagship funds at Citadel inched up 0.75 percent during August to be up 1.78 percent for the year to date, a person invested with the fund said. Meanwhile Steven Cohen's SAC Capital Advisors gained 1 percent in August after a 3.7 percent gain in July. For the year, the fund is up 6 percent.

Barclays Hires Ex-CIT Chief Peek (WSJ)
Mr. Peek resigned from CIT, a lender to small business, at the end of last year after the company emerged from a quick trip through bankruptcy, during which it shed $10.5 billion in debt.

Female spectator gored to death in Spanish bull run (NYP)
A running bull gored and killed a female spectator who poked her head through a barrier during a town bull run in central Spain on Thursday, authorities said. "After poking her head through the bars she received a fatal blow to the head from a bull at the back of the herd," said a statement by the town hall of Arganda del Rey near the capital Madrid.

Sweating Your Way To Success (NYT)
Peter Orszag: Let me focus today on the core one. Too many of us believe in the “talent” myth — that top performers are born, rather than built. But Syed shows that in almost every arena in which tasks are complex, top performers excel not because of innate ability but because of dedicated practice. In effect, the stars among us have practiced so much that they are better at what psychologists call “chunking.”

Moody's: Bank writedowns at 2/3 of likely total (AP)
"It is clear to us that bank asset quality issues are past the peak," said Moody's Senior Vice President Craig Emrick. "However, charge-offs and non-performers remain near historic highs." Although there is a sizable amount of nonperforming loans left to clear, "the remaining losses are beginning to look manageable," Emrick said. Moody's estimates that U.S. banks will write off a total of $744 billion in bad loans between 2008 and 2011. About $476 billion of that has already been recognized, leaving $268 billion to be booked. The agency estimated that 68 percent of residential mortgage losses have been taken, but only 49 percent of commercial real estate losses.

Swiss Taxes Lure New Single Hedge Fund Managers as Industry `Reinvented' (Bloomberg)
“Heavy competition between cantons has helped to keep tax rates low,” making Switzerland more appealing, Regina Anhorn, one of the study’s authors, said in a presentation in Zurich. “We have seen famous names move part of their institution to Switzerland. We may see many more to come.” There are signs that fees charged by Swiss hedge funds fell over the past two years, from a typical 2 percent management fee and a 20 percent share of performance, according to the study. A 1 percent management fee is “increasing in popularity” together with a performance fee of 10 percent, it said.