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’Clear and present danger
This is barking — but rather readable if you’re the sort of person who enjoyed Oliver Stone’s JFK.
It’s a report commissioned by the Department of Defense Irregular Warfare Support Program which claims the US is facing an ‘Economic Pearl Harbor’ and the attack has entered its third and most critical phase.
World’s best bank (2006 vintage)
It has long been known that consulting firm Oliver Wyman crowned Anglo Irish the world’s best bank in 2006 — just when Anglo was actually… well, you know the story.
Sadly, the report that bestowed this fateful distinction has (quite unaccountably!) vanished from the Oliver Wyman corporate site.
A very messy Ambac lawsuit for JPMorgan
JPMorgan didn’t want this to be made public. You can kind of see why.
Quick background — the bank has been engaged in a legal battle with Ambac since November 2008. The monoline says EMC, Bear Stearns old mortgage-banking arm,
Cayne TV
Tune in now via C-Span: Jimmy Cayne, former boss of former brokerage Bear Stearns, is due to appear in front of the Financial Crisis Inquiry Commission in Washington later on Wednesday.
You can catch Alan Rappeport’s live blog of the proceedings here.
The illustrative Maiden Lane I portfolio
Here it is — the ratings composition of Maiden Lane I: the special purpose vehicle created by the Fed to bail out Bear Stearns in 2008. The portfolio’s contents were made public last week.
A few caveats/notes on methodology
We’ve focused on ratings because they’re a quick and simple way to gauge the credit risk of a portfolio.
In the Fed we TruPS
Wading through 161-pages of CUSIPS takes a while.
But here’s something that caught our eye from the Federal Reserve’s Maiden Lane I portfolio — the special purpose vehicle it created to buy up assets from the failed Bear Stearns:
Maiden Lane goes public
Here’s something to keep you busy over Easter break — 161-pages of CUSIPS and principal balances for the securities held by the Federal Reserve’s three Maiden Lane special purpose vehicles.
As a reminder,
The Maiden (Lanes) beauty contest
Compare and contrast.
From the FT — one maiden (I):
The US Federal Reserve is sitting on significant paper losses on the real estate assets it acquired in the Bear Stearns rescue, with much of the red ink coming from debt used to back some of the most highprofile buy-out deals of the bubble years.
The US v. Cioffi and Tannin, or how not to scare would-be fraudsters
The post-Madoff campaign by US regulators and federal prosecutors to portray themselves as tough on (white collar) crime was dealt a blow on Tuesday, when a jury cleared two former Bear Stearns hedge fund managers of all the charges against them.
US loses Bear fraud case
Two former Bear Stearns hedge fund managers accused of misleading investors were found innocent of all charges on Tuesday, marking a blow to the first big effort by US prosecutors to bring a criminal case related to the subprime mortgage crisis.
Former Bear Stearns fund managers not guilty of fraud charges, jury finds
Those accused of white collar crimes in recent months – including but not limited to the man formerly known as Sir Allen Stanford and one Raj Rajaratnam – probably breathed a sigh of relief on Tuesday,
Ex-Bear Stearns manager wins ruling
Former Bear Stearns hedge fund manager Matthew Tannin won a round during his trial in New York on fraud charges on Monday when a judge ruled the jury cannot see an email in which he wrote about his fears of a “blow up risk”
[Galleon] “I’ll be like Martha ……. Stewart” – FBI cracks alleged Rajaratnam ring
Okay, this looks like a big one. The FBI and other US enforcement agencies on Friday moved against an alleged insider dealing ring stretching from Wall Street to Silicon Valley, by way of Bear Stearns,
The perils of corporate email, Bear Stearns edition
On Tuesday, former Bear Stearns hedge fund managers Ralph Cioffi and Matthew Tannin will appear in a Brooklyn court on charges they misled investors about the financial prospects of two investment vehicles they ran.
Bear Stearns duo to stand trial
A US federal jury will this week start to hear the first and only criminal case against Wall Street executives arising from the credit crisis. The trial in a Brooklyn, New York courtroom of Ralph Cioffi and Matthew Tannin,
Bear’s Schwartz for Goldman?
Alan Schwartz, who took the role as chief executive of Bear Stearns just two months before the firm collapsed in January 2008, may be headed to Goldman Sachs, reports Fortune magazine, giving a “50-50″
Maiden losses for Fed
The Federal Reserve released its 2008 annual financial statements on Thursday. As broadly noted, and highlighted by the Fed itself, the statements revealed new information about the balance sheets and P&Ls of the consolidated special vehicles created to take on the distressed assets of Bear Stearns and AIG – known as the Maiden Lane LLCs.
Tracking Bears
CNBC has found the bigger ones after their release into the wild one year ago.
Jimmy Cayne: Cayne was the chief executive of Bear Stearns for 15 years until months before its collapse, and he personally lost about $1 billion in net worth in it.
Structured finance paramnesia, Bear Stearns edition
The transaction was not structured with adequate over- collateralization…
Ever was it so.
Point in case: the Maiden Lane/Bear Stearns portfolio, which, since June, has declined by $4.22bn in value.
The end, the end, and the end
So finally, Alan “Ace” Greenberg has called “the end” of Wall Street as we knew it. The octagenarian former Bear Stearns chief executive who is approaching his 61st year on Wall Street has told Bloomberg that the investment-banking model he helped pioneer is “gone”.
A systemic risk counterfactual
Here’s an interesting thought: saving Bear Stearns increased risk in the financial system.
From Bank of America:
…the support of Bear Stearns appears to have unintentionally exacerbated the systemic risk of the Lehman Brothers’ default as short-term investors did not reduce their exposures leading up to the default despite the steady erosion in Lehman’s stock price and CDS spreads.
Annals of risk management, Bear Stearns edition
We’re a little bit late to this story, but that’s alright, because so was the Wall Street Journal, Reuters and pretty much everyone else.
Via Bloomberg, which had the scoop on October 31:
The Federal Reserve Bank of New York hired Michael Alix,
Wall Street ‘made rod for own back’
Wall Street unwittingly created one of the catalysts for the collapse of Bear Stearns, Lehman and AIG by backing new bankruptcy rules, lawyers and bankers say. The 2005 changes made clear that certain derivatives and financial transactions were exempt from provisions in the bankruptcy code that freeze a failed company’s assets until a court decides how to apportion them among creditors.
Fed takes $2.7bn loss on Bear
The Fed has suffered a $2.7bn paper loss on the $29bn portfolio of toxic assets it took over from Bear Stearns as part of JPMorgan Chase’s government-brokered takeover of the failed investment bank. The value of the Bear portfolio fell from $29.5bn to $26.8bn over the past three months,
Weekend catch-up: CDS probe, SEC/Bear, Macquarie, NZ
In case you missed these FT stories:
NY launches investigation into CDS trades
Andrew Cuomo, the New York attorney-general, is investigating whether traders have been manipulating the largely unregulated credit insurance market as a way to push down the prices of stocks.
The run on Morgan Stanley (up dated)
This is a pretty stunning line to read:
“We need a merger partner or we’re not going to make it,” Mr. Mack told Mr. Pandit, according to two people briefed on the talks. Mr. Pandit, a former senior investment banker at Morgan Stanley,
The ‘Japanification’ of Wall Street
Some old Tokyo hands have that creeping feeling of déjà vu when they look across the Pacific at events in the US.
The unfolding crises at Lehman Brothers, Washington Mutual – and before, , at Bear Stearns — have some eerily familiar patterns that evoke those days when Japan’s banks seemed physically incapable of calling a bad loan a “bad loan”,