Opening Bell: 10.06.10

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Goldman Sachs Says US Economy May Be 'Fairly Bad' (Bloomberg)
“We see two main scenarios,” analysts led by Jan Hatzius, the New York-based chief U.S. economist at the company, wrote in an e-mail to clients. “A fairly bad one in which the economy grows at a 1 1/2 percent to 2 percent rate through the middle of next year and the unemployment rate rises moderately to 10 percent, and a very bad one in which the economy returns to an outright recession.”

Paulson's Flagship Fund Up 12%; Wipes Year's Losses (Reuters)
Paulson told investors that his Advantage Plus fund rose 12.41 percent in September, according to the person familiar with the matter. In comparison, Advantage Plus fell 4.27 percent in August, leaving it down 11 percent for the year. Paulson's Credit Opportunities fund was up 3.94 percent in September, while the Recovery fund gained 8.47 percent and the gold fund returned 5.67 percent.

Soros Blames Germany For Europe's "Deflation Spiral" (NYT)
Additional fiscal stimulus --and not fiscal discipline-- is the way out of the crisis for both Europe and the United States, Soros said in a speech at Columbia University on Tuesday. "Deficit reduction by a creditor country such as Germany is in direct contradiction of the lessons learnt from the Great Depression of the 1930s. It is liable to push Europe into a period of prolonged stagnation or worse," Soros said.

Fitch Downgrades Ireland's Credit Rating (WSJ)
Fitch cut the government's rating to single-A-plus from double-A-minus and said the outlook is negative.

Red Sox’s Hedge Fund Owner to Buy Liverpool F.C. (Dealbook)
Liverpool F.C. said Wednesday that it had agreed to sell itself to New England Sports Ventures, which also owns the Boston Red Sox and is run by the hedge fund manager John W. Henry, for an undisclosed sum. The deal may be worth about £300 million (about $475 million).

Undercover federal agent buried what he thought was corpse to pass muster with Pagans biker gang (NYDN)
Feds and state troopers found a foul-smelling tarpaulin containing two boots, towels and rotting garbage - but no body - a law enforcement source told The News. "We believe the agent was given a test to see if he would do it and whether he would tell anybody about it later," a source told The News. The undercover operative, one of two U.S. Alcohol, Tobacco, Firearms and Explosives agents who penetrated the Pagans, became so trusted within the gang that he rose to the second-highest position in the Long Island chapter, according to court papers.

Hedge Funds Post Year's Biggest Gain as Stock Market Rebounds (Bloomberg)
Hedge funds probably recorded their highest monthly return of the year in September, Credit Suisse Group AG said, as the benchmark gauge for U.S. equities posted its biggest rally for the month since World War II.

Central Banks Open Spigot (WSJ)
Fed Chairman Bernanke, in a speech Monday, said "premature fiscal tightening could put the recovery at risk," but pressed the case for moving now to deal with long-term budget pressure.

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