Tag Archive | "america"

Opening Bell: 05.17.11

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IMF chief claims consent in hotel ‘attack’ (NY Post)
“The evidence, we believe, will not be consistent with a forcible encounter,” said Ben Brafman, the high-powered lawyer of IMF chief Dominique Strauss-Kahn, at the suspect’s sensational arraignment in a packed criminal courtroom. A source close to the defense later told The Post, “There may well have been consent.”

New York Investigates Banks’ Role in Fiscal Crisis (NYT)
The New York attorney general has requested information and documents in recent weeks from three major Wall Street banks about their mortgage securities operations during the credit boom, indicating the existence of a new investigation into practices that contributed to billions in mortgage losses. Officials in Eric T. Schneiderman’s, office have also requested meetings with representatives from Bank of America, Goldman Sachs and Morgan Stanley, according to people briefed on the matter who were not authorized to speak publicly.

How Big Investors Are Betting (WSJ)
Mr. Cohen, whose SAC Capital reported a 9.3% increase in securities holdings in the quarter ended March 31, increased a stake in consumer electronics retailer Best Buy Co. to 2.3 million shares from 53,306 at the end of the previous quarter. SAC also more than doubled its stake in BJ’s Wholesale Club Inc. to 2.8 million shares from 1.1 million.

John Paulson Loves Hewlett-Packard (Deal Journal)
The $5 Billion Man, hedge fund manager John Paulson, reported plowing $1 billion into Hewlett-Packard, pared his stake in Citigroup and is standing pat with his big investment in a gold ETF…Paulson & Co. also disclosed owning 123.6 million shares of Bank of America, down by 226,522 from the end of 2010. And one interesting new holding showing up on Paulson’s radar: Lubrizol.

Soros Fund Cuts Gold, BofA, J.P. Morgan Stakes; Adds to Citi, Wells (Deal Journal)
Soros decreased his holdings of the SPDR Gold Trust, a gold-backed exchanged-traded fund, by 4.7 million shares to 49,400 shares, valued at $6.9 million at March 31…The fund lowered its Bank of America holding by 1.2 million shares and now owns 29,400 shares. Soros sold 378,050 shares of J.P. Morgan, leaving him with 624,600 shares. In contrast, his firm tripled its stake in Citigroup to 29.4 million shares. Soros’ stake in Wells Fargo climbed six-fold to 3.5 million shares.

Bill Ackman Throws in the Towel on Target (Deal Journal)
Pershing Square reported owning 7.4 million Target shares as of Dec. 31, but there is no whisper of the Target investment in Pershing’s latest snapshot of its stock holdings as of March 31.

David Einhorn Buys…General Motors (DJ)
David Einhorn’s Greenlight Capital investment fund reported new ownership stakes in two newly public companies, hospital operator HCA Holdings and General Motors, a.k.a. Government Motors.

Falcone’s Harbinger Holdings Adds Bunge Shares, Trims Gold Stake (Bloomberg)
Harbinger Holdings LLC, the hedge fund run by Philip Falcone, bought shares of food company Bunge Ltd. (BG) in the first quarter and sold shares of SPDR Gold Trust, according to a regulatory filing.

Schwarzenegger fathered a child with longtime member of household staff (LA Times)
Former California Gov. Arnold Schwarzenegger and his wife, Maria Shriver, separated after she learned he had fathered a child more than a decade ago — before his first run for office — with a longtime member of their household staff.

Jump in Revenue Helps Halve California Deficit (NYT)
After months of doomsday scenarios and apocalyptic warnings about cuts to California schools, parks and the police, the news from Gov. Jerry Brown on Monday was nothing short of startling: California is now expected to see $6.6 billion more in revenue over the next two years than had been expected.

U.K. Inflation Quickens More Than Forecast (Bloomberg)l
Consumer prices rose 4.5 percent in April after a 4 percent increase in March, data today showed. The median forecast of 32 economists in a Bloomberg News survey was 4.1 percent. Core inflation quickened to the fastest in at least 14 years. King said in a letter to Chancellor of the Exchequer George Osborne that the surge is being driven by higher sales tax and increases in energy and import prices.

London Finance Job Openings Climbed 15% in April (Bloomberg)
The number of openings in the City, London’s main financial district, and elsewhere in the capital rose to 6,426 last month from 5,569 in April 2010, executive search firm Morgan McKinley said today. The figure was flat compared with the previous month.

President, first lady’s assets valued at $1.8 million to nearly $12 million (WaPo)
Financial disclosure documents released Monday showed the assets for last year…Assets are listed in wide ranges on the disclosure forms — for example, between $1 million and $5 million — making it difficult to determine their value with precision. Royalties from Obama’s books, “Dreams From My Father” and “Audacity of Hope,” totaled between about $1 million and $6 million.

Man To Eat 25,000th Big Mac (HP)
Wisconsin-based Don Gorske plans to eat his 25,000th Big Mac on May 17, 2011, 39 years after his first Big Mac bite on May 17, 1972. He averages two Big Macs per day and has 10,000 Big Mac cartons still in his possession. He keeps two Big Macs in his luggage in case he cannot find a McDonald’s when he travels. Gorske believes he has drank over 200,000 Cokes along with his burgers.



Article courtesy of Dealbreaker

Brevan Howard Shutting Down Equities Fund

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According to CNBC’s Kate Kelly, BH made the decision to close the $600 million fund after portfolio manager Fabrizio Gallo left to join Bank of America (which has got to hurt) and investors were rumored to be unhappy with the ‘personnel changes.’ In related news, Larry Summers has apparently been tapped to help ‘woo‘ new clients, so they should be okay.



Article courtesy of Dealbreaker

Opening Bell: 05.12.11

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Next Up: A Crackdown on Outside-Expert Firms (DealBook)
With the government securing a conviction against Raj Rajaratnam of the Galleon Group on Wednesday, federal prosecutors will shift their focus to expert networks — the intricate web of money managers, corporate executives and consultants at the center of another wave of insider trading cases.

Goldman Sachs Viewed Unfavorably by 54% (Bloomberg)
The company was viewed less favorably than other banks by the 1,263 poll respondents. While 54 percent said they had an unfavorable view of Goldman Sachs, 25 percent felt the same about JPMorgan, 49 percent for Citigroup Inc. (C) and 48 percent for Bank of America Corp. (BAC) Thirty-five percent had an unfavorable view of Frankfurt-based Deutsche Bank AG (DBK), which was also singled out in the U.S. Senate subcommittee report.

AIG Share Sale Starts But Could Be Pulled (WSJ)
The stock offering commenced Wednesday following lengthy discussions between Treasury and AIG’s management and directors about what they want to achieve from the share sales…Following the discussions, the Treasury and AIG are now in alignment about how to proceed with the offering, and they won’t sell shares if taxpayers don’t earn a profit now and in the future on the sales, according to people familiar with the matter. In other words, if they don’t get the price they want, Treasury will “pull the deal,” said one of the people.

Glencore Said to Gain Double Orders for IPO (Bloomberg)
Glencore International Plc received enough demand from investors for its $11 billion initial public offering to sell the shares more than twice over, according to three people with knowledge of the matter. Highbridge Capital Management LLC, a hedge fund owned by JPMorgan Chase & Co., proposed a $500 million investment, said one of the people, who declined to be identified because the information isn’t yet public. The last orders for the offer are due on May 18, with final pricing to be disclosed the following day, according to a term sheet for the sale.

Exit interview: Kobe Bryant says Lakers’ failed title run was a ‘wasted year of my life’ (LA Times)
Kobe Bryant is never much for sentimentality, and he’s not going to change any time soon. So when he reflected Wednesday on the Lakers’ underachieving 2010-2011 season, which included being swept in a Western Conference semifinal series, Bryant didn’t mince words on his disappointment.

China hikes reserve requirement ratio for banks (MarketWatch)
The People’s Bank of China lifted the ratio of funds domestic banks must set aside as reserves on Thursday, the fifth such hike this year amid persistent inflation concerns. From Monday the reserve requirement ratio will be increased 0.5-percentage point, bringing the rate to 21% for most big banks and 19% for smaller banks.

Copper tumbles to 5-month low on growth blues (Reuters)
Copper tumbled to a five-month through on Thursday as investors headed for the exit, fearing slower economic growth and demand from top consumers China and the United States. Also weighing on sentiment was the stronger dollar .DXY across a basket of currencies, which makes commodities priced in dollars more expensive for holders of other currencies.

SEC Investigating State Street Foreign Exchange (WSJ)
The Securities and Exchange Commission is investigating State Street Corp.’s foreign-exchange trading on behalf of pension funds in a sign that law-enforcement probes into how custody banks process tens of thousands of foreign-exchange trades are widening.

Draghi to Take Helm at ECB in November (Bloomberg)
[Italy’s Mario] Draghi, 63, will on Nov. 1 inherit an ECB that’s almost unrecognizable from the one Jean-Claude Trichet took charge of eight years ago. The bank’s balance sheet has more than doubled to 1.9 trillion euros ($2.7 trillion), mostly as a result of the extraordinary measures it used to battle the global financial crisis and now Europe’s sovereign debt woes…[German Chancellor Angela] Merkel made clear she’s backing the Bank of Italy governor in the expectation he will subscribe to the tight-money tradition of the Bundesbank, which provided the blueprint for the ECB when it was created 1998.

Bill Proposes Mortgage Shake-Up (WSJ)
Two lawmakers, a California Republican and a Michigan Democrat, are set to unveil legislation Thursday to replace mortgage giants Fannie Mae and Freddie Mac with at least five private companies that would issue mortgage-backed securities with explicit federal guarantees… Like Fannie and Freddie, the new entities would be restricted to buying loans that meet certain standards, including size caps. But the firms would have to hold much more capital than Fannie and Freddie.

Goldman, Beijing Launch Yuan Private-Equity Fund (WSJ)
Goldman Sachs Group Inc. has signed a deal with the Beijing government to launch a yuan-denominated private-equity fund that aims to raise 5 billion yuan ($769 million), according to a person familiar with the situation.

Morgan Stanley to Announce Private-Equity Yuan Fund (WSJ)
Morgan Stanley is expected to announce details of a yuan-denominated private equity fund in Hangzhou next week, according to a person familiar with the matter. The Wall Street firm will be running the fund in a partnership with Hangzhou Industrial & Commercial Trust Co., the person said. It wasn’t immediately clear how much the fund expected to raise.

China growth could slow to 8 percent: Goldman’s O’Neill says (Reuters)
“It is my judgment that the Chinese economy is probably slowing down more than people realize,” [O'Neill, Chairman of Goldman Sachs Asset Management] said, adding that as a result, he was not surprised that commodity prices are coming under pressure. As evidence, he cited the Goldman Sachs China Activity Index, the firm’s propriperary indicator of GDP, which shows that the momentum of Chinese growth has slowed, and that slowdown was supported by economic data reported this week. “And I suspect that China is going to slow down to around 8 pct GDP growth. If I’m right, that means sometime in the 2nd half this year, Chinese inflation will not be a problem, and will come back down to around 4 percent,” he said. “And the PBOC will be able to stop tightening monetary policy and we can all live happily ever after.”

UBS: Basel Rules Leave Banks Overcapitalized (WSJ)
Banks will likely have too much cash by 2019 as a result of the Basel III global banking rules, UBS AG Chief Executive Oswald Grübel said Thursday. “In the next 10 years, at the end of 2019, we will have overly liquid, overcapitalized banks,” said Mr. Grübel, who was addressing a business audience at a conference here. “However this also means we won’t have a lot of growth,” he said.

MIT sells $750m of century bonds (FT)

The Massachusetts Institute of Technology is planning to sell 100-year bonds as the recent drop in interest rates draws a flood of bond issuance this week.

In Exquisite Detail, Donald Trump Describes How He Styles His Hair (Rolling Stone via Vanity Fair Daily)
“O.K., what I do is, wash it with Head and Shoulders. I don’t dry it, though. I let it dry by itself. It takes about an hour. O.K., so I’ve done all that. I then comb my hair. Yes, I do use a comb. Do I comb it forward? No, I don’t comb it forward. I actually don’t have a bad hairline. When you think about it, it’s not bad. I mean, I get a lot of credit for comb-overs. But it’s not really a comb-over. It’s sort of a little bit forward and back. I’ve combed it the same way for years. Same thing, every time.”



Article courtesy of Dealbreaker

Lenny Dykstra: “I Did Not Get Stupid Over Night”

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As you may have heard, early this morning, Lenny Dykstra decided to bare his soul to, and lay some truth on the asses of, “the people of the great city of New York.” The last couple years have been a bit of a whirlwind for LD, culminating in his being arrested and indicted on charges of bankruptcy fraud for ripping the toilets out of his foreclosed on house, which was precipitated by, among other things, filing for Chapter 11, living out of his car and bouncing a check to a hooker. But there are other things you don’t know. Things you probably can’t even imagine. Things you probably think are made up but that LD promises are not. Like that he has hundreds of millions in assets. Like that prison wardens tortured him. Like that he didn’t steal that car.  Like that he didn’t get this way overnight. Why is he telling this story now? Because God came to him in the middle of the night and commanded him to do so. If you’re ready to listen, Lenny- whose story has undeniable parallels to that of Christ- is ready to talk.

I address the people of the great City of New York:

You need to buckle your seat belts, because what you are about to read could not be made up. What I have somehow lived through the past 2½ years, and continue to live through now, makes me fully understand that God would never make someone endure what I have endured unless there was a reason for it.

That being said, I was wrong when I thought God put me on this earth to entertain people at Shea Stadium. (Remember? I was pretty good at that.) However, I have come to realize that God put me on this earth to help people, to be a factor. And that, my friends, is what I intend to do — because at the end of the day, it’s all about results. The kind of results I will bring to the party will be unlike any seen before. Talk is cheap; I am about walking the talk.

You need to know, now that the “shock factor” and the disbelief of what these people did to me has worn off. What I am forced to endure with the FBI and the US attorney sets the stage for me to tell my side of the story, so that all of America will finally hear the truth surrounding my particular set of circumstances over the last two years.

This is exactly the platform needed for me to get my story out, to get the real truth out. Bottom line: When all of the evidence is brought forward, the jury will be told by the judge to make an example out of these corrupt people so this does not continue to happen to other Americans.

THE TRUTH, NOTHING BUT THE TRUTH, SO HELP ME GOD:

To begin with, I had $100 million in assets when I filed my Chapter 11. It is also important for you to know that I did not get stupid overnight. I didn’t make bad investments; every company that I have ever created or owned was and still is a winning company. And I sure as hell was not going to get on my knees, put my hands behind my head, and let this corrupt group of people masquerading as attorneys execute me — as that is what bankruptcy is all about. Just because they do this to everyone else does not mean I was going to let them do it to me. The corrupt world of bankruptcy is best described as “the death chamber.”

The so-called “grand theft auto” was never even brought; the case was dismissed. The theft was committed by them, as they stole a car I was leasing from Ford. Heck, it was only a Ford Flex.

Are they allowed to steal it when they brought no charges? Are they allowed to shuffle me from jail to jail in what was left of my street clothes that they made me wear for seven days without even being permitted to take a shower? Are they allowed to then lock me up in a cell at three different courthouses, on three different days, and not even let me see a judge? Are they allowed to physically and mentally assault me and tie me up like I was some kind of animal “because they thought it was funny?” Are they allowed to torture me to the point where two nurses happened to be walking by and saw me — came to my rescue — took my blood pressure and registered it at 180 over 120?

I told them, “If you are trying to kill me, then you better put a bullet in my head because I am not backing down. Torture me all you want, I am stronger than you will ever know.” So, they kept going, almost like the movies, except this was a real, living nightmare!

Over the last two years, they have basically stolen everything from me — my family, my kids, my homes, my cars, my businesses, my reputation, my money, my life. But what they can never steal is my HEART and my FIGHT — and at the end of the day, I will win and I will win big!

Dykstra Writes Exclusive Column About Recen Troubles [NYP]



Article courtesy of Dealbreaker

Netflix: FT Sees Latin America Expansion; WSJ Sees Big Media Warming

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In case you missed it, the Financial Times’s Matthew Garrahan, Adam Thomson, and Joe Leahy write in this morning’s edition about Netflix (NFLX) is close to signing a deal with three of the biggest broadcasters in Latin America to begin streaming programming in Argentina, Brazil, Chile, and Mexico, citing multiple anonymous sources.

Netflix’s overseas expansion beyond its U.S. and Canada audience is seen as an important route for expanding its total subscriber count in coming years.

The broadcasters are Mexico’s Grupo Televisa and TV Azteca, and Brazil’s Globo.

And in case you missed this, The Wall Street Journal’s Jessica Vascellaro, Lauren Schuker, and Sam Schechner this morning report that a gaggle of big media companies are turning in their attitude toward Netflix: Time Warner (TWX) is among those companies that seem to be in a rush to tout their deals with the company.

Note, too, the Breaking Views piece by Jeffrey Goldfarb and Reynolds Holding, in the NY Times business section today that talks about how Netflix lifted its limit on stock options employees can take as a portion of their pay, and how the company offers the options on a monthly, rather than an annual, basis.

Netflix shares today are up $5.59, or 2.4%, at $235.06.

Article courtesy of Tech Trader Daily

Opening Bell: 05.06.11

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Goldman BRIC Fund Among Most Hurt in ‘Panic’ Commodities Selling (Bloomberg)
The $831 million Goldman Sachs BRIC Fund (GBRAX) and the $825 million Templeton BRIC Fund (TABRX), which focus on Brazil, China, India and Russia, both fell 5.7 percent in the week ended yesterday. The funds, from New York-based Goldman Sachs Group Inc. and San Mateo, California’s Franklin Resources Inc., lost the most among diversified equity funds with more than $500 million in assets and at least 20 percent in energy or basic materials stocks, according to data compiled by Bloomberg.

Glencore IPO Orders Continue To Roll In (WSJ)
Glencore on Wednesday set the price range for the offer at 480 pence to 580 pence, valuing it at around $61 billion, including the new money being raised. Around $10 billion in shares will be sold, plus a $1 billion overallotment. Most of the offer is in the form of new shares. Bankers said the order book was covered after the first day of subscriptions. One on Friday said a “material” amount of orders were added to the total on Thursday, even as oil and silver prices slid sharply.

Paulson’s Biggest Fund Said to Be Down in 2011 After April Gain (SFGate/Bloomberg)
Paulson’s Advantage Plus Fund, which uses strategies designed to profit from corporate events such as takeovers and bankruptcies, is down 1.7 percent in 2011 after gaining 0.1 percent last month, said the person, who asked not to be identified because the returns are private. The fund’s gold- denominated share class rose 6.3 percent in April and 4.9 percent this year.

Bank of America Had Positive Trading Revenue Every Day of First Quarter (Bloomberg)
Trading-related revenue was positive every day and exceeded $25 million on 98 percent of days during the year’s first three months, the Charlotte, North Carolina-based lender said today in a filing with the U.S. Securities and Exchange Commission. In 2010, it had gains on 90 percent of trading days, with perfect records in that year’s first and third quarters, according to previous filings.

AIG quarterly net income drops 85% (MarketWatch)
First-quarter net income attributable to AIG was $269 million, compared with $1.8 billion a year earlier, the company said. On a per-share basis, AIG reported a net loss of 35 cents, versus a profit of $2.66 a share in the first quarter of 2010…AIG expected to make 34 cents a share, according to a FactSet survey of three analysts. A Thomson Reuters survey of three analysts came up with a consensus estimate of a loss of 15 cents a share.

JPMorgan Chase Said to Be Subpoenaed by SEC Over Mortgage Debt Documents (Bloomberg)
JPMorgan received a subpoena from the U.S. Securities and Exchange Commission over failed mortgages, a person familiar with the investigation said, as the agency probes banks including Credit Suisse Group AG for allegedly failing to share refunds from sellers of faulty debt.

RBS core operating profit jumps 25 pct (Reuters)
RBS, which is majority-owned by the British government, made a first quarter loss of 528 million pounds ($841.5 million) after it racked up 1.3 billion pounds in bad debts at Ulster Bank… RBS said Irish loan losses would stay high this quarter before “gradually declining” in the second half of the year. The bank’s core business – namely its main retail and investment banking arms and excluding its insurance unit which is due to be sold off or floated on the stock market in 2012 – had an operating profit of about 2 billion pounds a quarter.

Schumer Tilts Toward Offer by Germans for Big Board (WSJ)
Chuck Schumer, a New York Democrat, remains publicly neutral on the competing proposals: a roughly $10 billion bid from Deutsche Börse AG, which agreed in February to buy NYSE Euronext, and a hostile, $11 billion offer from Nasdaq OMX Group Inc. and IntercontinentalExchange Inc.  But Mr. Schumer is favoring the German deal as the best way to protect New York, according to the people who have spoken with him. Mr. Schumer focuses on the question so much that he tracks the number of Bloomberg terminals sold in major financial capitals.

Coffee, Sex, Blowing Nose May Increase Risk of a Stroke, Dutch Study Finds (Bloomberg)
Researchers from University Medical Center in Utrecht, the Netherlands, analyzed 250 patients who survived such a stroke and identified eight risk factors tied to the event. They included drinking a cup of coffee, which carried the highest risk, having sex, physical exercise, nose blowing, straining to defecate, drinking cola and being startled or angry.

Carlyle faces questions over China investments (FT)
Carlyle, the US private equity group, is facing questions over its investments in two Chinese companies that have been accused of fraud and suspended from trading on stock exchanges in Hong Kong and New York. The scrutiny comes at an unwelcome time for Carlyle, as the manager of some $106bn in funds seeks to burnish its reputation ahead of a planned initial public offering. China Forestry, a Hong Kong-listed plantation operator in which Carlyle has an 11 per cent stake, and China Agritech, a Nasdaq-listed fertiliser maker in which Carlyle has a 22 per cent stake, have both had their shares suspended from trading in recent months.

CME launches London clearing house (FT)
CME Group is considering offering clearing services to exchanges in Europe as the largest US futures exchange establishes a beachhead in the region by launching a new clearing house in London on Friday.
The move into clearing in Europe highlights the Chicago-based operator’s ambitions to expand into Europe, where CME’s two biggest rivals, IntercontinentalExchange (ICE) and Deutsche Börse, have established clearing businesses.

US Lawmaker Wants To Require Whistleblowers To Report Internally (DJ via WSJ)
A U.S. House Republican lawmaker plans to introduce legislation that would require whistleblowers to report wrongdoing to their employer to be eligible for a Securities and Exchange Commission bounty program, Dow Jones reported.

Indonesia Imposes More Sanctions on Citigroup (WSJ)
Bank Indonesia on Friday announced a raft of additional sanctions against Citigroup Inc. as investigations continue into the alleged embezzlement of millions of dollars and the death of a debtor…[Bank Indonesia Deputy Governor Budi] Rochadi said, the central bank imposed a number of restrictions on Citi’s operations in Indonesia, including a one-year ban on the local unit signing new clients to its Citigold wealth-management unit and a two-year ban on it issuing new credit cards. The central bank also forbade Citi’s local unit from opening new branches in Indonesia for one year and imposed an offshore travel ban on some of the unit’s executives, effective from Friday, while investigations continue.

Allen Stanford Indicted Again as Prosecutors Drop 7 of 21 Criminal Charges (Bloomberg)
The original indictment contained 21 criminal counts. The new one contains 14, including conspiracy to commit money laundering, obstruction of a U.S. Securities and Exchange Commission investigation, wire fraud and mail fraud. Two wire-fraud counts were dropped as were five mail-fraud charges. Stanford, 61, still faces five of each count, conviction for any one of which could result in a maximum sentence of 20 years in prison.

A wide-open Derby field of odds (USA Today)
With so many unknowns among local 3-year-olds, it might pay to take a chance on Master of Hounds, a new face shipping in from afar — Ireland, via Dubai in the United Arab Emirates. Trained by perpetual Irish champion Aiden O’Brien and owned by the imposing Coolmore partnership, Master of Hounds has never raced on dirt, but the same can be said for several other leading Derby contenders. Bred to stay every yard of the 1¼-mile Derby distance, Master of Hounds was beaten by a nose in his last start, the UAE Derby run on a synthetic surface in March. Master of Hounds stalked the leaders, burst to the front in the stretch and was just caught after battling gamely all the way to the finish.



Article courtesy of Dealbreaker

Opening Bell: 05.05.11

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Fed Presidents Signal Record Stimulus Won’t Be Removed Soon (Bloomberg)
Eric Rosengren, president of the Federal Reserve Bank of Boston, and San Francisco’s John C. Williams followed the lead taken by Fed Chairman Ben S. Bernanke, who signaled last week that policy makers will keep stimulus in place after ending large-scale bond purchases in June. “Right now we’re pretty far away from our targets, and right now we’re keeping monetary policy accommodative,” Rosengren, 53, said yesterday in an interview with Bloomberg News. “It’s very appropriate given how far we are from our targets.”

Traders Exit High-Speed Lane (WSJ)
Companies that use fast-trading, computer-driven strategies, which were painted by some as culprits of the collapse, have curtailed trading. So, too, have many long-term investors, for whom the trauma of that May 6 afternoon was the final straw after a decade of stock-market turmoil. In their absence, trading volume and volatility have plunged, further deterring high-frequency traders.

A Lack of Supply Feeds Rise in Munis (WSJ)
Yields on a benchmark of highly rated 10-year general-obligation bonds, backed by a government’s taxing authority, have fallen to 2.79% from 3.21% at the start of the year, according to Thomson Reuters. Meanwhile, the cost of insuring against default by some of the most financially troubled states also has dropped…A major driver of the dropping yields, which move opposite to price, is the lack of new supply, which hit an 11-year quarterly low in the first quarter. That slowdown has prompted many investors and bankers to caution it is too early to size up whether the market could absorb any significant uptick in bond issuance.

Claiming Fraud in A.I.G. Bailout, Whistle-Blower Lawsuit Names 3 Companies (NYT)
The lawsuit, filed by a pair of veteran political activists from the La Jolla area of San Diego, asserts that A.I.G. and two large banks engaged in a variety of fraudulent and speculative transactions, running up losses well into the billions of dollars. Then the three institutions persuaded the Federal Reserve Bank of New York to bail them out by giving A.I.G. two rescue loans, which were used to unwind hundreds of failed trades…The lawsuit names A.I.G., Goldman Sachs and Deutsche Bank as defendants, but not the Fed.

Facebook and Google mull Skype deals (Reuters)
Facebook Chief Executive Mark Zuckerberg has been involved in internal discussions about buying Skype, according to one of the sources. Another source said Facebook had reached out to the Luxembourg-based company about forming a joint venture.Google has also held early talks for a joint venture with Skype, the second source said.

Mexican central bank buys 100 tonnes of gold (FT)
The purchase, reported in monthly data published by Mexico’s central bank, is the latest in a series of large gold buys by emerging market economies intent on diversifying reserves away from the faltering US dollar. China, Russia and India have acquired large amounts of gold in recent years, while Thailand, Sri Lanka and Bolivia have made smaller purchases…Mexico bought 93.3 tonnes of gold in February and March, according to the central bank, in a haul valued at $4.5bn at current prices and equivalent to 3.5 per cent of annual mined output.

GM Profit Triples (WSJ)
GM said net income rose to $3.2 billion, or $1.77 a share, from $865 million or $0.55 a share. Operating profit, reflecting the strength of its core automotive business, increased to $2 billion from $1.7 billion. Revenue increased 15%, to $36.2 billion, from $31.5 billion.

Government Joins Bowl-Game Brawl (WSJ)
The Justice Department sent a letter Tuesday to the National Collegiate Athletic Association stating that “serious questions continue to arise” over whether the Bowl Championship Series—the sport’s much-criticized method for choosing a champion—complies with antitrust laws. The letter also asks why major-college football doesn’t have a playoff, when so many other college sports do; what steps the NCAA has taken to create a playoff; and whether the NCAA has determined that aspects of the BCS system are unfair.

Bank of America to Triple Number of Mortgage Help Centers (NYT)
The bank, which will announce the plan on Thursday, will focus on regions hit especially hard by the rising tide of homeowners struggling to make their mortgage payments. Seven locations will open in California and three in the Detroit area; other centers will be unveiled in St. Louis, Newark, Philadelphia and Tucson, among other cities…Additional centers may open later this year, the bank said. Counselors fluent in languages including Spanish, Korean, Vietnamese and Russian will be available for non-English speaking customers…Most of the counselors in the new centers will be transferred from other areas of the mortgage business, like sales and originations, which have slowed with the decline in mortgage demand.

Brazil Banks Beat Wall Street as Itau Shows JPMorgan Who Rules (Bloomberg)
Foreign firms pursuing investment-banking fees in Brazil, where an emerging middle class and rising commodity prices are propelling one of the world’s fastest-growing economies, face stiff competition. Local players have a greater capacity to finance deals, improved relationships with investors, experienced executives and the ability to provide services once offered only by large global banks.

Indian stocks suffer worst losing streak in 10 years (FT)
Mumbai’s BSE Sensex index fell for a ninth-consecutive session, its longest losing streak in a decade, on concerns over the impact of rising costs on corporate earnings. The BSE Sensex index fell 1.1 per cent to 18,266.79, taking its losses since Monday’s 50 basis point interest rate increase by the Reserve Bank of India to 4 per cent. Over the nine consecutive losing sessions, the index has fallen 6.8 per cent.

Charges, rising costs hit Societe Generale results (MarketWatch)
The group reported a profit of 916 million euros ($1.36 billion), compared to €1.06 billion a year earlier, driven by a €239 million accounting charge as improving spreads on the group’s own debt make it theoretically more expensive to buy back. The bottom line was below the €1.12 billion consensus forecast of analysts polled by Dow Jones Newswires.

Citi Hires UBS Banker (DealBook)
Kevin Cox, formerly head of Americas investment banking at UBS, is joining Citigroup as co-chairman of global industrials banking.  

Dalai Lama suggests Osama bin Laden’s death was justified (LA Times)
As a human being, Bin Laden may have deserved compassion and even forgiveness, the Dalai Lama said in answer to a question about the assassination of the Al Qaeda leader. But, he said, “Forgiveness doesn’t mean forget what happened. … If something is serious and it is necessary to take counter-measures, you have to take counter-measures.”

Hero dog helped snare Osama (The Sun)
Heavily armoured hounds — equipped with infrared night-sight cameras — have been used in the past by the top-secret unit. The war dogs wear ballistic body armour that is said to withstand damage from single and double-edged knives, as well as protective gear which shields them from shrapnel and gunfire…Wearing oxygen masks, the pooches have been trained to jump from aircraft at 25,000ft, before seeking out insurgents in hostile environments.



Article courtesy of Dealbreaker

Write-Offs: 05.02.11

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$$$ The death of bin Laden could create even more instability to the Middle East and northern African nations now undergoing turmoil, potentially driving up oil prices and creating more economic strife for the U.S. and other developed countries. “I don’t want to sound pessimistic, but I’m not sure [it is] great,” Ruben Vardanian, chief executive of the Moscow-based asset management company Troika Dialog Group, told a moderator at the Milken Conference. [MarketWatch]

$$$ Debt-Limit Deniers Don’t Buy ’Chicken Little’ Warnings [Bloomberg]

$$$ Buffett [with a 25 pound box of See's peanut brittle] Believes Reputation After Sokol Is Still Intact [Reuters]

$$$ Steve Cohen may pick up $55 million in pocket change on two paintings [Bloomberg]

$$$ Study: Paul Krugman Is America’s Most Correct Columnist [Daily Intel]

$$$ Ex-Lawyer For Kenneth Star Admits Role In Fraud [WSJ]

$$$ Rejecting Wall Street, Business School Graduates Turn To Entrepreneurship [Dealbook]

$$$ Ross Says It `Was Time to Harvest‘ ICG Investment‎ [Bloomberg via WaPo]



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Jim Paulsen: Killing Osama Will Translate To People “Feeling Better About Their Portfolio” And The US “Not Having To Take Crap, If You Will”…

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Earlier this morning, Jim Paulsen popped by the Squawk Box set (via phone) for a chat about the death of Osama bin Laden. What does it all mean? According to Paulsen, it’s not so much about the short-term effects on the market but those further down the road. The way Paulsen sees it, what the US did had the potential to “screw up, putting us in deep doo-doo with Pakistan.” That we went for it told the world, “Hey, world, we’ve got balls.” Paulsen woke up this morning “feeling great” and it’s because we’ve got our mojo, confidence, all that jazz back and we didn’t even have to “repair any balance sheets.”

The way JP sees it, Sunday “cutting off the head of the snake” was “just the type of thing that adds up to the confidence to spend cash flow and..to feel better about your portfolio and equities in general.” Another reason to feel “bullish on America”? Putting our balls out there means “we don’t have to take crap, if you will, from China or North Korea or anybody. That’s a good feeling overall.”



Article courtesy of Dealbreaker

Who Made It Out To Animal Tuesdays This Week

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Go HERE for more photos by Trevor Penna and tag yourself and your friends!

Have you managed to make your way on over to Animal (not the restaurant) yet? I know, I know! Don’t worry if you’re experiencing some minor confusion, we’re about to make things crystal clear for you. Every Tuesday night, MyStudio plays dress up and disguises itself as Animal, making it socially acceptable to admit you’re venturing out to what the rest of the world and city of Los Angeles recognizes as MyStudio but technically isn’t, make sense? Read the full story