August, 2009
The (Long) Weekender
Please note there will be no 6am Cut service on Monday due to the UK Bank Holiday.
Subscribe to the 6am Cut and the Lunch Wrap – FT Alphaville emails that keep you informed and entertained.
This week on FT Alphaville,
BlueCrest pay bonanza
By some guy called Sam Jones. The FT’s hedge fund correspondent apparently!
Pay for staff at BlueCrest, one of Europe’s largest hedge funds, close to doubled in 2008 on the back of a successful year for most of the company’s funds.
Claws of crisis
All kudos to CNBC for bringing attention to a gravely under-reported story — the crisis facing the US lobster industry.
It was probably a slow news day, we know — but bear with us, it’s not an uninteresting tale (despite the drastic overuse of the word ‘boil’,
The Fed’s black sheep CMBS bond herd grows
Baaaaaaaaaaaa.
Here’s some perhaps unexpected news from the Fed — the central bank appears to be getting more selective, at least when it comes to Talf legacy CMBS.
According to a release by the Federal Reserve Bank of New York,
Gold war
Dennis Gartman, of the Gartman Letter – and who recently established a hedge fund, River Crescent, to put to work the buy and sell recommendations he publicises in his daily note – issued an interesting view on gold on Friday.
Lunch Wrap
On FT Alphaville Friday morning,
- Anatomy of a Goldman trading huddle.
- Goldman’s client cuddles.
- AIG’s new CEO is very busy, OK?
- Big Brother’s blood oaths – Stanford Series.
- Quantitative bonus-ing.
[The Stanford Series] Big Brother’s blood oaths
The alleged shenanigans at the Stanford Financial Group went far beyond misleading regulators and fleecing investors, according to court documents released as part of the guilty plea entered by the company’s former CFO,
Markets live transcript 28 Aug 2009
Markets live chat transcript for the chat ending at 12:10 on 28 Aug 2009. Participants in this chat were: Tracy Alloway, FT (TA) Stacy-Marie Ishmael, FT (SMI) Izabella Kaminska, FT (IK) Paul Murphy (PM) Neil Hume,
AIG’s new CEO is very busy, ok?
Do not worry, US taxpayer.
Robert Benmosche, the new CEO of bailed-out mega-insurer AIG, may be on holiday, but he is actually very busy doing very important things. He just happens to be doing those things from his palatial 12-bedroom villa on the Croatian coast.
Quantitative bonus-ing
As the Bank of England’s balance sheet balloons, so too do its bonuses, according to data disclosed by the Bank under a FOI request from The Telegraph.
Anatomy of a Goldman trading huddle
Part of Goldman Sach’s defence of its ‘trading and tipping huddles’ concerns a couple of specific instances used in the Wall Street Journal’s story:
The article cits two examples of company-specific that came out of huddles.
Goldman’s client cuddle huddles
DealBreaker has got hold of Goldman’s response to Monday’s trading ‘huddle’ allegations by the Wall Street Journal.
This was not preferential treatment aimed at helping select clients make more money via trading tips,
Further reading
Elsewhere this Friday,
- Good and bad financial innovation.
- “Obama is lucky to have Bernanke.”
- The ex-Stanford CFO actually has to work.
- The Tobin tax is back in fashion, but not very popular.
Pink picks
Comment, analysis and other offerings from Friday’s FT,
News analysis: Bankers watch as Sweden goes negative
Last month, the Swedish Riksbank entered uncharted territory when it became the world’s first central bank to introduce negative interest rates on bank deposits,
Snap news
Breaking pre-market news on Friday,
- Japan’s jobless rate hits record 5.7 per cent — Bloomberg.
- US Treasury document called AIG investment ‘highly speculative’ — Bloomberg.
- Daniels’ position in jeopardy as Lloyds investors make demands to back fundraising — Times.
US GDP shrinks 1% in second quarter
The US economy shrank less than expected in the second quarter, as aggressive government spending eased the pace of contraction, signalling that the worst of the longest recession on record is over. Q2 US GDP declined by an annualised rate of 1% after plunging by 6.4% in the first quarter,
US ‘problem’ bank list hits 15-year high
The number of US banks at risk of failure reached a 15-year-high while the fund protecting depositors hit its lowest level since 1993, according to figures that highlight the spread of the crisis in the US financial system.
Lloyds considers protection options
Lloyds Banking Group is weighing up several alternatives to joining the UK’s asset protection scheme, which may include a rights issue as well as the sale of Scottish Widows. For months Lloyds and its advisers have been negotiating over its participation in the insurance scheme that will allow the bank to ringfence £260bn of toxic assets.
‘Swollen’ financials hit at FSA chief
UK bankers, industrialists and London’s mayor fiercely rejected Lord Turner’s argument that Britain’s “swollen” banking industry is destabilising the economy and should be cut down to size, the day after the FSA chairman said the City watchdog should not make London’s competitiveness a major aim.
EU business opposes derivatives reform
European companies have warned that proposed reforms of the derivatives markets requiring contracts to be routed through clearing houses could impose a huge drain on corporate cash. In a comment paper criticising European Commission proposals for the OTC derivatives market,
NYSE Euronext acquires Nyfix
NYSE Euronext on Thursday agreed to pay a significant premium to buy Nyfix, a US company which sells software used by asset managers and hedge funds to communicate trading intentions to their brokers and banks.
Investors reject revised NatExpress bid
Key shareholders in National Express, the troubled UK train and bus operator, have signalled they will not back a revised all-cash 450p takeover offer from the group’s largest investor and stick by the management’s alternative plans for a rights issue.
Crédit Agricole beats expectations
Shares in Crédit Agricole surged on Thursday after it reported better-than-expected Q2 net profits, helped by resilient sales in its retail and asset management businesses and lower asset writedowns. France’s third-largest bank said it made net profit of €201m ($286m),
Bank of China sees earnings fall
Bank of China, the country’s third-largest lender, reported a 2.5% drop in first-half earnings despite an unprecedented lending spree that saw its total outstanding loans rise 38% in six months. BoC extended Rmb896.3bn ($131.2bn) of new loans in the first half,
Macquarie’s Shanghai JV approved
Macquarie Group has secured approval to launch a Chinese joint venture offering corporate banking and asset management services. The Australian investment bank has taken a 19.99% stake in a Shanghai trust company – lightly regulated vehicles that can also make a wide range of equity investments – acquiring a 19.99% per cent stake in Sino-Australian International Trust Co,
Accor looks at splitting businesses
Accor jettisoned years of opposition to a break-up on Thursday by announcing plans to study a spin-off of its vouchers business, as the hotel group’s interim results underlined the global downturn in the hospitality industry,
AIG Taiwan unit may fall short of target
Bidders for AIG’s Taiwanese life insurance unit may offer less than the US insurer’s $2bn target according to people with knowledge of the matter, reports Bloomberg. A group led by Primus Financial may bid $1.2bn to $1.4bn for AIG’s Nan Shan Life Insurance,
UK business spending slides
UK businesses slashed investment spending at the fastest pace since records began in 1966 in the year to June 30, figures showed on Thursday. The data sparked fresh fears over prospects for a sustainable recovery as company results pointed to further cutbacks.
Stanford’s finance chief pleads guilty
James Davis, the chief financial officer at the Stanford Financial Group, on Thursday pleaded guilty to charges that he helped Sir Allen Stanford, the company’s billionaire founder, in an alleged $7bn Ponzi scheme.
Overnight markets: Up
Asian stocks rose on Friday, led by materials producers and technology companies, on higher commodity prices and better-than-expected US economic data. Futures on the S&P500 Index were little changed after the gauge rose 0.3% on Thursday as crude oil futures increased for the first time in three days,