Financial News

[Balta1701]

Here is what I think you are missing. These were not bonuses in addition to anything. These guys probably we slotted for large bonuses. The deal was likely something like "you get to keep your job for an extra year, and get part of your bonus, if you help us untangle this whole web and show us everything".

 

Its a gamble though. On the one hand, having a few people like that around during the investigation could probably get you answers to your questions a lot more quickly, or even just plain get them at all. On the other hand, if one of them was actually complicit in some way, they could hide their tracks as they go, potentially. I'd bet there are independent auditors stalking their every move.

Of course it's something they were scheduled to get anyway, you're right on all of that. Just personally, if I were somehow sitting on a jury for this, and the defense asked one of the guys who helped untangle the fraud how much he was paid to do so, and he answered several hundred thousand dollars, I'd burst into laughter in the jury box.

 

I just think that's another sign of a ridiculously broken and corrupt financial system.

[Balta1701]

The FDIC hit South Michigan Avenue tonight. New City Bank.

[Balta1701]

Articles you write when you leave Goldman Sachs.

What are three quick ways to become a leader? a) Execute on the firm’s “axes,” which is Goldman-speak for persuading your clients to invest in the stocks or other products that we are trying to get rid of because they are not seen as having a lot of potential profit. b) “Hunt Elephants.” In English: get your clients — some of whom are sophisticated, and some of whom aren’t — to trade whatever will bring the biggest profit to Goldman. Call me old-fashioned, but I don’t like selling my clients a product that is wrong for them. c) Find yourself sitting in a seat where your job is to trade any illiquid, opaque product with a three-letter acronym.

 

Today, many of these leaders display a Goldman Sachs culture quotient of exactly zero percent. I attend derivatives sales meetings where not one single minute is spent asking questions about how we can help clients. It’s purely about how we can make the most possible money off of them. If you were an alien from Mars and sat in on one of these meetings, you would believe that a client’s success or progress was not part of the thought process at all.

 

It makes me ill how callously people talk about ripping their clients off. Over the last 12 months I have seen five different managing directors refer to their own clients as “muppets,” sometimes over internal e-mail. Even after the S.E.C., Fabulous Fab, Abacus, God’s work, Carl Levin, Vampire Squids? No humility? I mean, come on. Integrity? It is eroding. I don’t know of any illegal behavior, but will people push the envelope and pitch lucrative and complicated products to clients even if they are not the simplest investments or the ones most directly aligned with the client’s goals? Absolutely. Every day, in fact.

 

It astounds me how little senior management gets a basic truth: If clients don’t trust you they will eventually stop doing business with you. It doesn’t matter how smart you are.

 

These days, the most common question I get from junior analysts about derivatives is, “How much money did we make off the client?” It bothers me every time I hear it, because it is a clear reflection of what they are observing from their leaders about the way they should behave. Now project 10 years into the future: You don’t have to be a rocket scientist to figure out that the junior analyst sitting quietly in the corner of the room hearing about “muppets,” “ripping eyeballs out” and “getting paid” doesn’t exactly turn into a model citizen.

[mr_genius]

Some recommended reading

 

http://www.nytimes.com/2012/03/18/magazine...nted=1&_r=1

[StrangeSox]

Some recommended reading

 

http://www.nytimes.com/2012/03/18/magazine...nted=1&_r=1

Wow another commie screed from the nyt, shocking. Of course they would publish Das Kapital 2.0.

 

Eta I knew his name looked familiar, I read this interview a couple of months ago.

http://m.thebrowser.com/interviews/daron-a...u-on-inequality

Edited March 20, 2012 by StrangeSox

[NorthSideSox72]

Some recommended reading

 

http://www.nytimes.com/2012/03/18/magazine...nted=1&_r=1

I guess I must be missing what is so groundbreaking with this guy's (the professor's) posits. I mean, basically, he is saying that a country's wealth is correlated with how well the majority of its people do economically. Um... duh?

 

Then of course, the author takes that oracle of the obvious, and turns his words into something he clearly didn't mean - that enabling of free markets to the point of loss of control is somehow a good thing. Which is in fact, I'd say, the opposite of what this professor is saying.

 

[mr_genius]

I guess I must be missing what is so groundbreaking with this guy's (the professor's) posits.

 

you are

[NorthSideSox72]

you are

Enlighten me.

 

[NorthSideSox72]

For the love of... I am getting so tired of people blaming this, or any, President for "letting gas prices get so high". It amazes me how many people think there is some magic switch a President can pull, some oil rig that can magically be opened, some law that can magically be put into effect, that will somehow alter the basic supply and demand equation at play with oil prices.

 

Hey GOP'ers - you can go open up all the offshore drilling sites near the US, approve all the domestic lease requests, and open up the Keystone pipeline... and gas prices might, in half a decade, go down a nickel. Was that your big idea? Thanks for playing. What have you got next? And oh by the way, your wonderful plan includes increasing health care costs and problems, and letting yet more high paying jobs go overseas instead of staying here.

 

Hey Democrats - you think alternative energy is going to suddenly take over and gas and oil will go away? If you pumped a metric f***-ton of money into it for the next decade, then maybe you can get the US materially close to being energy independent... and STILL be using an amount of oil more than the US output. And prices will still be sky high, because it is a GLOBAL MARKET. What now, do you want to shut down all exports of oil? Ruin some industries and lose a bunch of jobs? And oh by the way, you know that stimulus money and all that spending? That's called printing money, and it is part of the reason for those high prices.

 

There is only one way out of this. It will take a long time - like decades - and cost a whole lot of money. You have to have some flexibility on environmental issues and allow some new drilling and pipelines, AND you have to invest heavily in alternatives for the long run. Then, hopefully, your grandkids can enjoy cheap, renewable, low-pollution energy, and not have to care so much about the Middle East's squabbles. But nothing Bush, or Obama, or Romney/Santorum can do will make this happen in the next election cycle or two. Accept this and move on.

[Balta1701]

There is only one way out of this. It will take a long time - like decades - and cost a whole lot of money. You have to have some flexibility on environmental issues and allow some new drilling and pipelines, AND you have to invest heavily in alternatives for the long run. Then, hopefully, your grandkids can enjoy cheap, renewable, low-pollution energy, and not have to care so much about the Middle East's squabbles. But nothing Bush, or Obama, or Romney/Santorum can do will make this happen in the next election cycle or two. Accept this and move on.

I'm getting fairly tired of people pretending that this isn't the explicit position of the Democratic Party.

[StrangeSox]

sort of a follow up to those posts

 

http://abcnews.go.com/Politics/wireStory/f...22#.T2psgtUf7yA

[Y2HH]

I'm getting fairly tired of people pretending that this isn't the explicit position of the Democratic Party.

 

Because it isn't. They're not making these promises for our grand kids, which would be a more realistic time frame...they 're making them for the short term undefined "future"...but not 40+ years from now as your claiming is their "explicit" position is. What a joke.

 

We've been investing in alternates for a while now, and so far, when it comes to automobiles, any strides that are made are offset by the cars in question being way more expensive and far less powerful.

 

Also forgotten is that in the last 10 years almost everyone has upgraded to higher MPG automobiles, even trucks and suv's get 5+ more than they did 15 years ago...and none of it mattered. Let's not forget the record number of MPG upgrades during the cash for clunkers deal, too. The problem is oil is a finite material, thus a world consumption commodity, but so are the rare metals they make batteries out of...you know, the same batteries they put in hybrids? Replacing one finite commodity with another is awesome...and also not "renewable". Hybrids are, however, the most realistic alternative thus far. We've been hearing about affordable hydrogen vehicles, and solar vehicles, and vehicles that run on nothing but garbage...but they never seem to materialize.

 

More realistically, this is the explicit position of logic, not of the Democratic party, or any other party. Unfortunately, in politics, you can't promise people something that will happen 40-50 years from now, because 1) you don't know if it will or not, because at that age you probably won't even be alive to see it come to fruition, and 2) the majority don't care about 40-50 years from now, they care about their everyday struggles NOW. You don't get elected running on promises that most voters alive today will never get to see delivered on, you get elected by making promises you can't really deliver on, but make them anyway because they sound really really good to the masses...

 

You know, like campaigning that you will deliver wireless or broadband access to 98% of Americans in an affordable way (today, not 40 years from now). And then forgetting all about said promise shortly after elected when you realize it's not as easily done as it is said. Hell, they haven't even taken the steps to reign in wireless broadband costs from the mobile carriers which would be an excellent place to start, who are busy price fixing the market together. We have 4G iPads and super phones that can download 2 gigs of data in 2 minutes...all for 30$ a month, but the f***ing cap on said plan is 2 gigs before overage costs kick in! Brilliant! Also note where I said price fixing...funny how Verizon and AT&T charge the exact same prices for everything on a race to the TOP, not bottom. When AT&T increases their costs, Verizon follows suit...rather than showing customers they're cheaper...it's a joke. If they want to start making delivery on these promises, they need to go after Verizon and AT&T and fix this bandwidth garbage sooner than later.

Edited March 22, 2012 by Y2HH

[southsider2k5]

http://www.securitiestechnologymonitor.com...lyClose__032112

 

Twitter Model Helps Predict Price, Volume of Stock Trading

 

March 21, 2012

Tom Steinert-Threlkeld

 

Researchers have developed a model that uses data from Twitter to help predict the volume and value of a stock in an upcoming trading session.

 

Like what you see? Click here to sign up for Securities Technology Monitor's weekly newsletter to get the latest news and analysis that matters to the effective operation of capital markets.

 

The model was created by three researchers at Yahoo! In Spain, Vagelis Hristidis, an associate professor at the Bourns College of Engineering, at the Unviersity of California in Riverside and one of his graduate students. A trading stragegy based on the model outperformed other baseline strategies by between 1.4 percent and nearly 11 percent, the researchers said.

 

The model produced results that were superior to the Dow Jones Industrial Average during a four-month simulation, the creators also said.

 

“These findings have the potential to have a big impact on market investors,” said Hristidis, a specialist data mining research, which focuses on discovering patterns in large data sets. “

 

Hristidis, graduate student Eduardo J. Ruiz, and Carlos Castillo, Aristides Gionis and Alejandro Jaimes, all of whom work for Yahoo! Research Barcelona, presented the findings at the Fifth ACM International Conference on Web Search & Data Mining in Seattle.

 

Hristidis and his co-authors studied how activity in Twitter is correlated to stock prices and traded volume. Their work tried to quantify the volume of interest in a stock, where past research looked the sentiment, positive or negative, of tweets to predict stock price. They also tried to link the volume to individual stocks, not indices.

 

The research focused on the volume of tweets and the ways that tweets are linked to other tweets, topics or users.

 

They obtained the daily closing price and the number of trades from Yahoo! Finance for 150 randomly selected companies in the S&P 500 Index for the first half of 2010.

 

Then, they developed filters to select only relevant tweets for those companies during that time period. For example, if they were looking at Apple, they needed to exclude tweets that focused on the fruit.

 

The number of trades was correlated with the number of tweets on a given company. However, the number of trades rises more consistently when the subject company is involved in a number of different “connected components,’’ as the researchers put it.

 

That is to say, multiple events or topics are being discussed about the subject firm.

 

In the Apple case, that might mean separate series of posts on Apple’s new CEO, a new product and an earnings report.

 

For the study, the researchers simulated a series of investments between March 1, 2010 and June 30, 2010 and analyzed performance using several investment strategies. During that time frame, the Dow Jones Industrial Average fell 4.2 percent.

[NorthSideSox72]

I'm getting fairly tired of people pretending that this isn't the explicit position of the Democratic Party.

First of all, the Democratic party at large has been reticent to allow any flexibility on oil/coal/gas exploration. Obama has, but not the larger party. Not that I even necessarily disagree with their stance on principle, but it gets us nowhere.

 

Second, the Dems want to invest in this, but also invest in dozens of other things, print a bunch more money, and cause gas prices to go higher because of the dollar going lower.

 

I don't disagree that the Dems want more investment in alternative energy - I know that is the case. But there is some other BS they are carrying with it, and they are weighing it down with ideology that doesn't allow for compromise.

 

[Balta1701]

The problem is oil is a finite material, thus a world consumption commodity, but so are the rare metals they make batteries out of...you know, the same batteries they put in hybrids?

Really, this is only a very limited "problem". There are substantial supplies of just about everything we'd plausibly want to use accessible at the Earth's surface. The problem is actually, again, one of money...it costs money to extract them, it costs land quality and it costs money to avoid polluting the planet at the same time.

[NorthSideSox72]

Really, this is only a very limited "problem". There are substantial supplies of just about everything we'd plausibly want to use accessible at the Earth's surface. The problem is actually, again, one of money...it costs money to extract them, it costs land quality and it costs money to avoid polluting the planet at the same time.

Also, you are talking about each vehicle with sophisticated batteries having a small amount of said metal(s), and done only once. Not really comparable to gas and oil that are used in large quantites throughout the life of the car.

 

[Balta1701]

Also, you are talking about each vehicle with sophisticated batteries having a small amount of said metal(s), and done only once. Not really comparable to gas and oil that are used in large quantites throughout the life of the car.

And in the long run, those metals are recoverable and recyclable, probably at a profit, if there is a large enough supply of them where someone could run a business by recycling them.

 

Again though, the same problem...cleanup costs. It's expensive to do so, and that cost has to be paid, while the huge costs of cleanup of burning fossil fuels don't.

[StrangeSox]

A weak version of the STOCK act passed the Senate yesterday, along with the JOBS act that is a large deregulation bill.

[StrangeSox]

DELONG AND SUMMERS: FISCAL POLICY IN A DEPRESSED ECONOMY: CONFERENCE DRAFT

[southsider2k5]

For a great laugh, go watch Bob Pisani on the BATS IPO disaster day.

[StrangeSox]

Bruce Bartlett examines the numbers on Paul Ryan's budget:

 

http://www.thefiscaltimes.com/Columns/2012...lity.aspx#page1

 

In short, looking only at the tax side of Ryan’s plan, he is anticipating enactment of an extraordinarily ambitious tax reform on top of the most ambitious budget cutting effort ever enacted. He would sharply cut outlays for every major program except Social Security and national defense. Every governmental function one can think of would be virtually abolished except for Medicare, Social Security and defense. A key reason for the severity of these cuts, of course, is that Ryan would cut taxes at the same time he is cutting spending. To achieve balance with lower than projected revenues requires even larger cuts in spending.

 

I do not believe any of this will ever happen or could ever happen. I think Ryan has an undeserved reputation for seriousness in budget matters. The word “fantasy” would better apply. As Prof. Calvin Johnson of the University of Texas law school told me, the tax side of Ryan’s plan “is floating in the clouds without any connection to earth or reality.” And of course accomplishing what he hopes to do on the spending side is even more fanciful.

 

In my opinion, the Ryan budget should be seen as nothing more than a PR document for Republicans so they can say they have a plan to balance the budget, cut taxes, and cure the common cold. It may serve that narrow purpose, although many Republicans are saying that it doesn’t go far enough in slashing spending. I wish I could buy some of the stuff these guys are drinking or smoking.

 

Anyone can make up numbers that balance the budget while slashing taxes at the same time if they have no concern whatsoever for the proper functioning of government, no concern for the hardship it would cause, and are in a position to order the CBO to accept those numbers at face value. Coming up with specific legislative changes that will actually implement such a vision, getting it enacted, and accepting the consequences is something else altogether.

[southsider2k5]

For a great laugh, go watch Bob Pisani on the BATS IPO disaster day.

 

And then they ended up withdrawing the IPO all together. What a nightmare.

[StrangeSox]

I had no idea what you were talking about, so I found this article:

 

http://www.forbes.com/sites/steveschaefer/...ses-apple-halt/

[southsider2k5]

Its a good day for Corzine to have this come out at the close on a Friday...

 

http://www.zerohedge.com/news/corzine-corz...m-fund-transfer

 

Corzine Corzined - Congressional Panel Finds Former MF Global CEO Ordered JPM Fund Transfer

Tyler Durden's picture

Submitted by Tyler Durden on 03/23/2012 16:13 -0400

 

Bloomberg News

JPMorgan Chase

MF Global

 

 

 

Then only thing that could top today's epic market insanity and hilarity, would be that Corzine is himself about to be Corzined. And just released from Bloomberg:

 

MF GLOBAL'S CORZINE ORDERED FUNDS MOVED TO JPMORGAN, MEMO SAYS

CORZINE'S `DIRECT INSTRUCTIONS' CITED BY CONGRESSIONAL PANEL

MF GLOBAL TRANSFER WAS USED TO COVER OVERDRAFT, PANEL SAYS

MF GLOBAL FINDINGS CITED IN MEMO OBTAINED BY BLOOMBERG NEWS

 

And so we can now add perjury to felony embezzlement. Which means we now have to wait to find just which MF'er (and JPM'er) will be given a promise of untold millions if they only get Fab Tourred for a few years, and spend 5-7 in minimum security state prison instead of brave Jonny.

 

From Bloomberg:

 

Jon S. Corzine, MF Global Holding Ltd.’s chief executive officer, gave “direct instructions” to transfer $200 million from a customer fund account to meet an overdraft in one of the brokerage’s JPMorgan Chase & Co.

accounts in London, according to an e-mail sent by a firm executive.

 

 

 

Edith O’Brien, a treasurer for the firm, said in an e-mail sent the afternoon of Oct. 28, three days before the company collapsed, that the transfer of the funds was “Per JC’s direct instructions,” according to a copy of a memo drafted by congressional investigators and obtained by Bloomberg News.

 

 

 

O’Brien’s internal e-mail came as the New York-based broker found intraday credit lines limited by JPMorgan, the firm’s clearing bank as well as one of its custodian banks for segregated customer funds, according to the memo, which was prepared for a March 28 House Financial Services subcommittee hearing on the firm’s collapse. O’Brien is scheduled to testify after being subpoenaed this week.

 

 

 

“Over the course of that week, MF Global’s financial position deteriorated, but the firm represented to its regulators and self-regulatory organizations that its customers’segregated funds were safe,” said the memo, written by Financial Services Committee staff and sent to lawmakers.

 

 

 

Vinay Mahajan, global treasurer of MF Global Holdings, wrote an e-mail on Oct. 28 that said JPMorgan was “holding up vital business in the U.S. as a result” of the overdrawn account, which had to be “fully funded ASAP,” according to the memo.

 

 

 

O’Brien Letter

 

 

 

Barry Zubrow, JPMorgan’s chief risk officer, called Corzine to seek assurances that the funds belonged to MF Global and not customers. JPMorgan drafted a letter to be signed by O’Brien to ensure that MF Global was complying with rules requiring customers’ collateral to be segregated. The letter was never returned to JPMorgan, the memo said.

 

The money transferred came from a segregated customer account, according to congressional investigators. Segregated accounts can include customer money and excess company funds.

 

 

 

Corzine testified that he never intended a misuse of customer funds at MF Global, and that he doesn’t know where client funds went.

 

 

 

“I did not instruct anyone to lend customer funds to anyone,” Corzine told lawmakers in December.

 

Steven Goldberg, a spokesman for Corzine, declined immediate comment.

[NorthSideSox72]

Its a good day for Corzine to have this come out at the close on a Friday...

 

http://www.zerohedge.com/news/corzine-corz...m-fund-transfer

He's toast.