TABLE OF CONTENTS
December 2007
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FRIDAY JANUARY 18
Bad Trade Goes Bad
Real bad. Ever sell a car you hadn’t finished paying off? Yeah, us neither. But pretend you did. And you thought you were going to pay for it…one day. But you didn’t. And then it turned out that the car was worth $60 billion (we’re talking about a really nice car, here) and the person you sold it had no idea their purchase wasn’t any good – until today. And you without a nickel to spare. That’s basically what’s happened to ailing bond insurer ACA and its sale of billions in insurance contracts to banks across Wall Street. So, if it goes bust today, what’s going to happen to all you credit-default swaps traders?
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MONDAY DECEMBER 31
Home Equity: Offshoring
Rising oceans may one day lap at your door, but today’s market for island luxury is highly liquid. . .in a good way. Don’t splash out for any digs, though, until you know the lay of the land.
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MONDAY DECEMBER 31
Gambling Tips For 2008
The start of a new year is always a good opportunity to take stock and work out where you can make more (or lose less) from your gambling benders. Here are five resolutions, culled from the experts, guaranteed to improve any bettor's performance.
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MONDAY DECEMBER 31
The Great Refinancing
Wall Street is likely on the cusp of a massive refinancing of corporate bonds – to the tune of $557 billion, according to Bank of America. As one can imagine, that won’t exactly have a nothing effect on the broader debt market.
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MONDAY DECEMBER 31
Alert: Myth Of ‘Peak 2007’
Time and time again, people say we are running out of 2007. The cries began as early as January; by July, some ne’er-do-wells were even claiming that there was less 2007 remaining than the amount of 2007 that had already been consumed. Why this is clearly all stuff and nonsense.
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MONDAY DECEMBER 31
Lowest Of The Low
A report from the National Association of Realtors this morning is expected to show sales of existing homes in the U.S. hitting rock bottom…but where, exactly, would that be?
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MONDAY DECEMBER 31
Smart People, Dumb Money
On Wall Street, hedge funds and buyout professionals are seen as smart. But their new shareholders are starting to look kind of dumb. Isn’t it ironic?
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FRIDAY DECEMBER 28
Friday Levity: How We Know It’s Not Christmas
According to Long Or Short Capital, there is only one way to make the scientific distinction between whether it is Christmas or whether it is, in fact, not Christmas. And they just ripped the lid off it.
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FRIDAY DECEMBER 28
Dollar Dive Dénouement?
Why some currency strategists think the dollar may be poised to end its two-year slide against the euro next year, thanks to an assist from asset-hungry sovereign wealth funds.
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FRIDAY DECEMBER 28
Inflation Titillation Conflation
Japan's inflation climbed at its fastest pace in more than nine years in November as industrial production declined. But it’s not a surge in consumer spending that’s powering this uptick. The real culprit is something else entirely – and it’s threatening to derail the economy's longest-ever postwar expansion.
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FRIDAY DECEMBER 28
The Fire Sale To End All Fire Sales?
With backlogged debt still weighing heavily on many a balance sheet (no doubt creating massive opportunity costs) some of Wall Street’s top banks are quietly pedaling high-yield bonds and loans at discounts of as much as 10 cents on the dollar. While no one at these institutions seems to be commenting on the under-the-radar push to unload an additional $231 billion of debt, there are already some murmurs afoot as to how much the market can take – and whether traders will be in any kind of a mood to buy.
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FRIDAY DECEMBER 28
Bhutto: Why You Should Care
Just to show how truly intertwined markets are with the goings-on of everyday life – not to mention the major tragedies and political events of our time – look no further than the unforgivable assassination of former Prime Minister Benazir Bhutto and its impact on debt and equities bets.
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FRIDAY DECEMBER 28
Rude Awakening
Despite the fact that most hedge funds defied the odds to boast a hella good year (returns were up roughly 12% through November, FYI) traders are finding that doesn’t necessarily insulate them from the newfound stinginess of lenders who, only months ago, fell all over themselves to help them leverage up or short a stock. A quick look at who’s getting the gravy – and who’s getting the shaft – in this tough new pecking order.
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THURSDAY DECEMBER 27
Cognacs…And The Cobra Pose
How this past year provided another bumper crop of extremes and oddities in the world of fine wine and spirits.
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THURSDAY DECEMBER 27
Traders Break For Convertible Bonds
Why convertible bond sales jumped to a record high this year as stock volatility increased, upping the appeal of securities that can be exchanged for shares.
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THURSDAY DECEMBER 27
That Other Merrill Savior
OK, it’s quiz time. When Singapore’s state-run Temasek Holdings invested $6.2 billion in Merrill earlier this week, which mutual-funds manager played a supporting role as its right-hand man? Can’t guess? Here’s a hint: It’s the same firm that’s now throwing its cash into yet another high-profile, if ailing, financial stock.
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THURSDAY DECEMBER 27
Consumer Confidence At 2-Year Low?
Such a prediction from economists may be what’s driving Treasuries higher for the first time in five days ahead of today’s December consumer confidence report and a $13 billion securities sale planned by the Treasury Department. A closer look at the hard numbers.
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THURSDAY DECEMBER 27
Hedge Fund Mourns Loss Of Chief
The untimely death of Michael Klein, the high-yield hedge fund manager whose plane went down in Panama over the holiday, shocked and saddened many across the global trading community. An update on the aftermath of the crash and how Pacificor, the fund he left behind, is attempting to cope with the loss of its young, but extremely talented, leader. Trader Daily extends its sincere condolences to Klein’s family and also apologizes for any clumsy editing in yesterday’s Morning Call.
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THURSDAY DECEMBER 27
Year-End Review – Of Yourself
Research shows that people who write out specific goals tend to be more successful in accomplishing things, whatever those “things” may be. So grab some paper and a pencil and get to work on this right-brain, left-brain exercise guaranteed to kick-start your resolutions for 2008.
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THURSDAY DECEMBER 27
Housing Prices: Steepest Nosedive Ever
While prices in the boomtowns of Seattle and Charlotte, N.C., have continued to climb against a year ago, one closely watched tracker is now showing they’ve staged their biggest drop ever in 2007 (topping last year’s record slump). What’s more, fresh stats out from the Census Bureau indicate a slowdown in the number of Americans moving to states that led the housing boom, including Nevada, Florida and Arizona. A drill-down into the latest figures and how they might set the stage for the economy in 2008.
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WEDNESDAY DECEMBER 26
Economics Can Make You A Better Person
Yep, sounds like a load of hooey, but here’s an argument as to how you might use your financial know-how to keep from (yet again) breaking all your new year’s resolutions.
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WEDNESDAY DECEMBER 26
If You Think You Work/Play Hard
Years of heavy drinking compromised his health; he said at one point he was consuming half a bottle of whiskey a day, washed down with beer chasers. Born in the copper-mining town of Butte, Montana, and raised by his grandparents, this world-renowned daredevil wasn’t a trader, but he had a trader’s guts and fighting spirit.
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WEDNESDAY DECEMBER 26
Dollar: Makes You Wanna’ Holler
Everyone seems to agree that Wall Street banks, the housing market and especially the greenback are in bad shape, possibly setting the stage for another Fed rate cut early in the new year. What seems to be the main sticking point now is determining whether the worst is over in this damage trajectory…or if it’s just beginning. One macro viewpoint.
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WEDNESDAY DECEMBER 26
If The Word ‘Chief’ Is In Your Title…
…You are one of a group whose ranks are rapidly growing. In the past year, the number of execs with “chief” in their title have briskly multiplied. Heck, we even have a chief wordsmith here at Dealmaker Daily. (Does pretty well for himself too, one of those hideous, smart-aleck, top-quartile types; probably makes triple our salary.) Anyhoo, according to this article, other, more ludicrous titles are now making the rounds. Try chief beer officer and chief luxury officer…But can too many chiefs spoil the title?
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WEDNESDAY DECEMBER 26
Too Little, Too Late
Why last-minute holiday purchases, despite the weekend’s shopping surge, ultimately failed to salvage what might be the slowest holiday spending season in five years.
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WEDNESDAY DECEMBER 26
Pacificor Hedge Fund's Klein Is Killed in Plane Crash
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MONDAY DECEMBER 24
Why You Should Be Long Short – And Short Long
Why are things so long? Why does any conference call last more than 20 minutes? Why is any report longer than, say, 20 pages? Why are history books more than 50 pages? Why does your story not end sooner? Because they are waaay too long. One prophylactic.
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MONDAY DECEMBER 24
2008: Get Your Risk Map Here
Hey, things might go swimmingly in ‘08. Like, maybe we won’t have another subprime crisis – lightning doesn’t strike twice and all that, right? And maybe events won’t unfold that PhDs assured us would not happen more than once every 10,000 years (unlike this past August). That would be nice. You know, just a normal, recessionless year, that’s all we want. But if we don’t get it, it’s probably because of one or more of the following.
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MONDAY DECEMBER 24
Credit Crunch: From Bad to Worse…To Very Bad Verse
The squalid factories of England's Industrial Revolution inspired Charles Dickens to write "Hard Times," and the Great Depression spawned John Steinbeck's "The Grapes of Wrath." But this winter, the global credit crisis has unleashed its own burst of creativity.
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MONDAY DECEMBER 24
Pound Gets Pounded
And as the price of one Starbucks coffee in the U.K. rapidly approaches $10, it’s about time (though some of us are slightly biased, as we are paid in American dollars and tend to frequent Old Blighty…). Today, the pound fell to its lowest level against the euro. Is this a momentary lapse for the sterling – or a portent of deeper losses? One story claims it already has the answer.
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MONDAY DECEMBER 24
Middle Class Vs. Rich
If $1 million a year is incontrovertibly rich (and this, we would posit, is probably not the case) then what is middle class? This question flummoxes pollsters and pundits alike. The category is about as flexible as an accordion file, expands and contracts to accommodate almost any number, and yet still never fails to arrest the attention. As it does here.
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MONDAY DECEMBER 24
Wall Street’s Drug Of Choice
Well, cash, obviously. But after that, take your pick. In the case of “John,” he did a little too much drinking. Not the first guy on Wall Street guilty of that. And coke. He thought he could handle it. The second divorce? Hey, things happen. Then came the 30-day jail sentence.
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MONDAY DECEMBER 24
Fools Rush In
Last-minute holiday shoppers, that is. And scads of them. Though sales numbers aren’t immediately availing, it looks like fears of a backslide in gift-buying this season may have been grossly overblown. In fact, growth in dollars spent against a year ago may jackknife higher than expected. Lesson learned: Never underestimate the power of the superpsycho, hyper-spending American consumer. Where there is no cash, they will sell their soul. Or just charge it. (Same thing, these days.) Let’s just not think about what it all means for credit card debt down the road…
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FRIDAY DECEMBER 21
Gear : Money Bag
Nobody knows what to buy you for the holidays? Be bold: Ask for a $10,000 golf bag. (You say there’s no such thing? Au contraire, mon frère.)
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FRIDAY DECEMBER 21
Friday Levity: So, You Think You Know Sports?
And we don’t mean like how you think you know how to make a good steak (you don’t, btw). We mean, if we throw some curve balls at you, right now, would you ace them cold? Oh, yeah? Prove it.
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FRIDAY DECEMBER 21
Red-Hot Capital Injection
Move over Middle East, Singapore has got some cash to burn and Wall Street squarely in its sights. The rundown on how much state-run Temasek Holdings plans to shell out for the world’s largest brokerage and just how many firms are now sucking at the teet of scrambling overseas opportunists. (Not that we knock it; as for us, we can only dream of having our own access to such a formidable bosom.)
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FRIDAY DECEMBER 21
Safe Haven No More?
Thought bonds were a good place to tuck away your rainy-day cash until the subprime snafu finally ends? Perhaps not. Investors are now dealing with a growing problem: Some firms on the other side of their credit market trades look like they aren’t going to be able to hold up their end of the bargain.
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FRIDAY DECEMBER 21
How They Did It
Meet the three traders that saved Goldman’s arse from the subprime meltdown while minting a cool $4 billion for the bank – and between $5 and $15 million for themselves.
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FRIDAY DECEMBER 21
Hedgies’ One-Up
In a bizarre reversal of conventional risk-management fortunes, hedge funds are now drilling down into their portfolios to assess their exposure to – you guessed it – top banks that engineered this eight-headed hydra that is the subrime catastrophe. Why fears are boiling over that huge bulge-bracket defaults may soon crop up.
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FRIDAY DECEMBER 21
Beef On Bonuses
The play-by-play of how Wall Street's end-of-year bonuses climbed 14%, even as shareholders got steamrolled by the worst declines since 2002 and were forced to swallow the shabbiest earnings in almost a decade. We pretty much know who didn’t make out like a bandit. Now, for those who did...
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THURSDAY DECEMBER 20
Watch List: Simply Stated
Holiday parties mean it’s time to don a tux — but what’s a tux without a watch that says “This thing could buy me at least 12 more of these tuxes?” Your definitive primer on the timepieces guaranteed to make you the center of attention.
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THURSDAY DECEMBER 20
Big Squeeze Averted – For Now
No sooner does the Fed hold a $20 billion loan auction to relieve the cowering banks of their credit worries than yet another ratings agency (this time, S&P) swoops in with a bond-insurer downgrade to make everybody start freaking out again. How a disaster was miraculously sidestepped, no thanks to our ratings pals.
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THURSDAY DECEMBER 20
All The Things You Can’t Leave Behind
As Long or Short Capital proudly touts: “Even though prior to reading this guide, you hadn’t known you wanted these things, you quickly realized yet again that we are a better judge of what you like than you. These things are the things you want to own, trust us. We did the research and we’re smarter than you.”
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THURSDAY DECEMBER 20
`Interesting Presentation…God I Hope You’re Wrong’
The words of one chief risk officer at a monster bank after this hedge fund manager dared give a presentation on the looming housing market meltdown – six months before it happened. The blow-by-blow of how savvy market-watchers cleaned up on the subprime mess while most of Wall Street was asleep at the switch.
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THURSDAY DECEMBER 20
Eye On Japan
A close-up look at the goings-on of the Japanese economy these days – something that’s becoming an increasingly hotter topic – and why the Bank of Japan opted today to back off from raising its interest rates in its first unanimous decision since June.
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THURSDAY DECEMBER 20
And The Men’s Room Shall Lead Them…
Whether Bear Stearns's board has been holding informal meetings in the 14th floor john of 383 Madison Ave. to clandestinely discuss ousting CEO Jimmy “Candy” Cayne is not the point (but way to class it up, Bear directors. Taking a page from the Sen. Larry Craig book of keeping it real. Nice). The point is that even Mr. Spingold KO deserves better than a simple latrine powwow before being forced to go the way of the dodo.
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WEDNESDAY DECEMBER 19
Back Issue: Going Dutch
We scoured the Trader Monthly “archives” to unearth this 1637 issue — and excerpted just a few of its many timeless insights.
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WEDNESDAY DECEMBER 19
Power To ‘Im!
It is a fair day, indeed, in Activistinvestorland when an activist investor need do no more than threaten to become “significantly more active” to get a behemoth company to eat out of its hand. A lesson from the master on how to get your favorite corporate target quaking in its boots.
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WEDNESDAY DECEMBER 19
There, There, Bear
Bear Stearns traders cannot catch a break. What’s the encore, will they be forced to watch their memberships to Nobu be ripped up while sugar is simultaneously poured into their Maserati gas tanks? We will say only this about the following piece: insider trading, hedge funds and yet still more subprime palaver.
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WEDNESDAY DECEMBER 19
Wisdom Of The Crowds
Do you believe that, overall, the guesswork of the peanut-munching hoards tends to point to the right answer? We don’t, either. That’s a lie, we totally do. (Or we hope so, given that our most current and evolved strategy is to pick our bets by dartboard.) Either way, a major force on the Web is now putting this thesis to the test.
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WEDNESDAY DECEMBER 19
Fast Cars, Life, Women
Must be a trader, right? Nope. Daniel Sadek cannot make that proud claim, but his devil-may-care attitude, rock-star persona, queen-of-soaps engagement and penchant for recreational gambling reminded us of some of our favorite risk-takers. It’s just that in Sadek’s case, everything went pear-shaped.
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WEDNESDAY DECEMBER 19
No End To The Mewlings Of Pundits
That said, this particular mewling by investment-fund manager – cum – Harvard University don (and former Treasury secretary) is more comprehensive than most. Food for thought from Larry Summers on Wall Street, food stamps, the Fed and whether a recession will soon overtake the subprime race for the cure.
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WEDNESDAY DECEMBER 19
SAC Trader Heads Out
The scoop on the latest Stevie Cohen protégé to break ranks in search of a more singular kind of fame and fortune (read: a king’s ransom in trading coups he won’t have to share with a team of 50). Now, that’s more like it.
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WEDNESDAY DECEMBER 19
Lonely Goldman Sachser As J. Alfred Prufrock
Maybe Goldman guys got the gravy in 2007, but according to at least one Craigslist posting, that doesn’t say much for their personal lives. Behold, the sad lament of one highfalutin exec who just figured out his shiny new condo, lifetime membership at Nobu, fat bonus and Viking stove won’t be enough get him through the cold, winter nights.
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TUESDAY DECEMBER 18
Super Bowl Showdown 2007
Think you’ve got what it takes to beat your Wall Street brethren? This week’s results get you that much closer to finding out. You may be just a few steps away from winning up to $10,000 in Super Bowl prizes, or two, impossible-to-get tickets to the game.
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TUESDAY DECEMBER 18
The Trade: Doing The Dow
Also known simply as “the market” (despite representing merely a highly dysfunctional, paltry slice of it) why the Dow continues to reign supreme as a proud staple of trading.
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TUESDAY DECEMBER 18
Fed Focus To Shift?
What if Federal Reserve officials cease their tedious habit of brandishing “growth” or “inflation” as the reason for their every move? As one of their ranks bravely suggests, perhaps by doing this, they are wrongly implying they know what the heck is going on.
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TUESDAY DECEMBER 18
Find Us A Primitive ‘Man
So, maybe those guys over at Goldman earned their well-defended title of Bank of the Sun Gods, or whatever you want to call it, this year. But no one can claim their hedge funds made out as well. No matter. The G-men are forging ahead with what is being billed as the biggest start-up fund ever (!). Instead of relying on the same computer-driven trading models that got them in trouble earlier this year, however, they are going for something a little more primitive.
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TUESDAY DECEMBER 18
Cash Crunch Fears Boil Over
At the monster banks, it’s every man for himself. Which means no one wants to lend money to anybody, especially if it’s a bank. Now, the only two forces with any clout anymore (and that’s not saying much) have been forced to step in.
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TUESDAY DECEMBER 18
Beating The Bear – Again
Bear Stearns got a lot of flak last summer when two of its highflying hedge funds wiped out $1.6 billion of investor capital in a much-publicized flameout. As funds imploded across the greater landscape, we confess to having felt for them. Now that we hear a Bear investment manager may have yanked millions of his own cash from one of the offending funds – while boneheadedly telling jittery investors that both of the funds were AOK – we aren’t sure how we feel about it anymore. And neither do the feds.
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TUESDAY DECEMBER 18
Know Your Enemy
Once and for all, the sad truth about the world’s growing population of nasty, creepy, no good, good-for-nothing gold-diggers. A new survey blows the lid off the demographics of this unsavory crowd – which apparently includes both men and women – and exactly what they look for in their higher-earning, albeit unwitting, prey.
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MONDAY DECEMBER 17
Card Shark: The Situation Room
Sometimes the best move strategically isn’t the best move mathematically. Here’s some real-life game theory.
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MONDAY DECEMBER 17
Bondholders Strike Back
Sick of watching their bonds suffer every time the underlying company feels like tilting at windmills, roughly 50 large debt investors are banding together to reverse some of the old rules that ail them – and their ranks include some very big names.
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MONDAY DECEMBER 17
Power Hour
Does absolute power corrupt absolutely? In the wholesale electricity market it does, according to a large coalition of industrial, governmental and consumer groups that’s pressuring regulators to take immediate action. Is this just another consumer kvetch targeting energy prices – or will there be hell to pay?
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MONDAY DECEMBER 17
Moody’s Gets Even Moodier
Another day, another dire warning from the laggard ratings agency. (That’s not entirely true; Moody’s, like many of its ilk, seems to get its kicks making major pronouncements late Friday night. Lame.) Per its latest late-Friday announcement, bond issuers with heretofore top marks are now cowering in the shadow of its sword with about $1.2 trillion of municipal, corporate and asset-backed securities at stake. So…how now, Moody’s clowns?
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MONDAY DECEMBER 17
Vindicated!
As we fast approach the end of year, the performances of both conventional (and less conventional) fund managers are looking more solid than recently rumored. The average diversified equity mutual fund is about a percentage point ahead of the S&P 500. And the average fund-of-funds has made almost 10% on the year. Read on for more stats proving how traders managed to overcome the doomsday scenarios that dogged them all year.
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MONDAY DECEMBER 17
Hope You Like Eating Crow...
It was only last April when John Kosar, the president of Asbury Research, insisted that anyone with a pencil and ruler could prove the 25-year bull market in Treasury bonds was over. Kosar said then that the looming decline was so obvious even a five-year-old could see yields would climb for ``many years'' to come…So what happened?
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FRIDAY DECEMBER 14
Silicon Valley Says 'Sorry'
Will an apology make everything OK with tech investors?
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FRIDAY DECEMBER 14
Art Acquisitions
Hedge fund manager Steven A. Cohen is a connoisseur of fine art.
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FRIDAY DECEMBER 14
Who Knew? : Oh, Canada!
Television shows about trading often stink. We stumbled across one that isn’t half bad.
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FRIDAY DECEMBER 14
Lufthansa Plans to Gain Edge With JetBlue Buy
In the latest example of of foreign investors leveraging the strength of the euro against the dollar, the German airline will buy up to a 19 percent stake in JetBlue.
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FRIDAY DECEMBER 14
Hedge Funds: Shorting Subprime
In a down market, one fund leapt 550% from January to October and three others more than doubled their money.
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FRIDAY DECEMBER 14
Goldman Makes the Best of a Mortgage Meltdown
Simply put: The investment bank made a bet that the value of securities backed by risky home loans would fall.
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THURSDAY DECEMBER 13
House Votes to Close Fund Loophole
A bill preventing hedge funds from deferring taxes on offshore accounts could hit executives with valid deferred compensation plans.
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THURSDAY DECEMBER 13
The Card Shark
Sometimes the best move strategically isn’t the best move mathematically. Here’s some real-life game theory.
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THURSDAY DECEMBER 13
Red Kite Loses 22% in November
After tripling investments last year, the metal-focused hedge fund lost more than one-fifth of its value in November and half of its value year-to-date.
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THURSDAY DECEMBER 13
Hedge Funds Beat Out Equities
Even during November’s stock market pressure, hedge funds outperformed index funds.
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THURSDAY DECEMBER 13
Fund Fight: Bermuda vs. Caymans
Bermuda is struggling to beat out the Caymans and British Virgin Islands for the top spot to house hedge funds.
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THURSDAY DECEMBER 13
The Mainstreaming of Alternative Investments
Traditional stock and bond portfolios could lose ground to asset management firms in the next five years, but approximately 2,000 hedge funds could disappear.
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WEDNESDAY DECEMBER 12
Watch List : Simply Stated
Elegant and easily accessorized timepieces make a subtle statement during the holidays.
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WEDNESDAY DECEMBER 12
Luxury Auto Dealerships Offer Amenities
In attempt to ease luxury consumers troubled ─ yet less affected ─ by the weak housing market and tighter credit conditions, car dealerships are offering perks to boost the upscale experience.
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WEDNESDAY DECEMBER 12
By Acquiring Art, Hedge Fund Gains 53%
Some artists’ work has doubled in value, earning Exis Capital Management bountiful returns in a volatile market.
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WEDNESDAY DECEMBER 12
A Bull in a Weak Market
Hedge fund heavyweight Leon Cooperman says stocks are still a buy.
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WEDNESDAY DECEMBER 12
Fitch Pushes Risk Management Reviews
Low-risk products like money-market funds have been the hardest hit, suggesting risk analysts should review investment objectives and think again.
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WEDNESDAY DECEMBER 12
Dow Sinks Despite Fed Rate Cut
Traders, who had hoped for a half-point interest rate cut, trimmed their long positions in stocks, sending the Dow down nearly 300 points.
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TUESDAY DECEMBER 11
The Trade : Doing the Dow
Long the proxy for “the market” despite being a dysfunctional, paltry slice, the Dow remains a great staple of trading.
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TUESDAY DECEMBER 11
Generation-targeting Companies Boom
Consumers born between 1946 and 1964 are increasingly influential on cultural, political and economic fronts.
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TUESDAY DECEMBER 11
Supply and Demand: Real Food on Long Flights
A little more money can go a long way as US Airways, Midwest, Delta and other carriers shift their menus in a more nutritional and flavorful direction.
> read more
TUESDAY DECEMBER 11
Financial Jitters Ahead of Fed
Interest rate cuts are expected to draw investors away from treasuries toward gold and other precious metals.
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TUESDAY DECEMBER 11
Mortgage Crisis Forces Big Cuts at WaMu
Washington Mutual seeks a fund infusion as mortgage and credit market turmoil take a toll on yet another lender.
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TUESDAY DECEMBER 11
A Black Eye for Bank of America
As institutional investors cash out, a $34 billion Bank of America cash fund is set to close.
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MONDAY DECEMBER 10
Risk/Reward : House Money
One of the pioneers of mortgage trading, HFH Group’s Paul Ullman is aiming to turn subprime dislocation into many happy returns
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MONDAY DECEMBER 10
Goals for Charitable Giving
To make the most of tax advantages, charitable donations should be a part of regular financial planning.
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MONDAY DECEMBER 10
Modern Merger: Slot Machines and Video Games
With a new generation of gamblers having fewer qualms about playing the slots, a new class of machines that work hand-eye coordination skills are gaining popularity.
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MONDAY DECEMBER 10
Amid the Chaos, Money Funds Thrive
In a volatile year, Some classes of fund investments are holding up fine.
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MONDAY DECEMBER 10
A Year-End Clearance on Wall Street
The year’s losing companies are seeing a sell-off as investors near year-end.
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MONDAY DECEMBER 10
Bernanke could get burnt
Federal Reserve Chairman Ben Bernanke will have to do more than announce an interest rate cut to pump up the economy.
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FRIDAY DECEMBER 07
Mippin feed validation KEY=82ad0d13
Mippin feed validation KEY=82ad0d13
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FRIDAY DECEMBER 07
Three Rules: All Bets Are On
Early in his prop-equity career, Schottenfeld’s Lucas Rosen realized something rather important: “I wasn’t good,” he says. How that admission, made quietly to himself six years ago, led him straight to the fast track.
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FRIDAY DECEMBER 07
Friday Levity: Your Name = Your Fate?
Turns out a rose by any other name might not really smell as sweet. Take that pseudoscience a step further: if the results of recent research are to be believed, your name, the order in which you were born and even your astrological sign affects your I.Q., academic performance, even tendency toward accidents (watch out, you merging Libras).
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FRIDAY DECEMBER 07
Money Is Costly, But Souls Come Cheap
Blaine Lourd got rich picking stocks. But then he realized that everything he thought he knew about the markets was dead wrong.
Like a lot of people who end up on Wall Street, Blaine Lourd just sort of stumbled into it.
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FRIDAY DECEMBER 07
Paulie Weighs In
Because we were pretty blistering in our critique above – and still feel those vestigial loyalty pangs for Paulson from his Goldman days – we believe it’s only right to include his Op-Ed piece in The Wall Street Journal today defending his plan. (While you’re at it, check out his dot pic – ever notice that the Journal can’t help but editorialize by making the people it likes look hot and the people it doesn’t like fat whales? (Think Al Gore during his one presidential election.) We’re just sayin’.)
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FRIDAY DECEMBER 07
Dumb And Dumber
Admit it, when Dubya (let’s face it, not the sharpest knife in the drawer) teams up with the former head of Goldman Sachs, you knew the rules of the classroom would invariably prevail: this is one plan that can go no further than the slowest kid in the room (read: not Paulson). Come to think of it, how did they even talk to each other? Probably through the obligatory flaxen-haired minions, per usual. One good reason why, in the government’s bank-backed bailout of more than one million struggling homeowners, everyone seems to be finding something to hate.
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FRIDAY DECEMBER 07
New Hedgie Mecca?
Why open a hedge fund in Singapore? We’ll tell you why: money management companies with fewer than 30 institutional clients are exempt from most regulations, ding, ding, ding! With almost no regulatory overhead and taxes waaay below the industry average, you can keep your hard-earned money to yourself while being assured of becoming fully operational in less than 60 days. So, where do you sign up?
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THURSDAY DECEMBER 06
If Money Were No Object…
…And let’s face it, if you’re a really good trader, it isn’t…which among the following items would you buy and in what order? No, this is not a rat experiment; we’re serious.
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THURSDAY DECEMBER 06
Head Coach: Gist Of Fate
Trading need not always be so complicated. The biggest key to keeping it simple is accepting one basic fact: You never know…
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THURSDAY DECEMBER 06
It’s A...Start?
With 775,000 homes and $143 billion of mortgage debt poised to go into foreclosure in the next two years, Dubya and Henry Paulson today will reveal in dual announcements how they will plug the holes in this leaky dike. A breakdown of their master plan.
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THURSDAY DECEMBER 06
No Small Thing: England Cuts Rate
For the first time in two years, the Brits have sliced their key interest rate, proving that the fissures that began with the U.S. subprime crisis are fast spreading across the pond. But how bad is it and how long might it continue?
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THURSDAY DECEMBER 06
Too Little, Too Late?
Inside Moody’s dire prediction that defaults by speculative-grade companies will quadruple next year as economic growth slows and the era of ``easy credit'' comes to a screeching halt.
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THURSDAY DECEMBER 06
India’s Achilles Heel
India’s white-hot, right? Not so fast, says that nation’s biggest bull, Sanjiv Duggal, manager of the world's largest holding of Indian equities. In fact, he’s not only considering urging his investors to pull up stakes – he may be on the verge of becoming the country’s biggest bear.
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THURSDAY DECEMBER 06
Ben Stein’s Eager Converts
So, it’s official: Mr. Wonder Years has The New York Times under his thumb. And how do we know this? Because the Gray Lady has now attempted to pull together a journalistic treatise backing Stein’s opinion piece that roundly excoriated Wall Street for, as we understand it, selling the stuff it didn’t want. (Wow, who ever heard of that? Last we checked, we ONLY sold the stuff we didn’t want. Isn’t that why e-Bay’s full of crap like Garbage Pail Kid cards and Joey Lawrence key chains? But who are we to question the good and the great at the venerable Times? Surely they are privy to a deep intuition that we are not. Thank you, Times, for showing us the way.) Behold, the definitive scold.
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WEDNESDAY DECEMBER 05
If Money Were No Object…
(And let’s face it, if you’re a really good trader, it isn’t) which among the following items would you buy and in what order? No, this is not a rat experiment; we’re serious…
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WEDNESDAY DECEMBER 05
Ahead Of The Fed
A Bloomberg/Los Angeles Times survey now says Americans are expecting a recession within a year by a margin of 71% to 23%. The same poll includes shockingly eloquent remarks from none other than Sherry Bossie, an accountant in Dunbar, West Virginia, on the hazards of a sagging housing market and “escalating” oil prices. So, what’s the Fed gonna’ do for Sherry next week? Market musings on that issue of an extra quarter point.
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WEDNESDAY DECEMBER 05
Berating The Raters
The jig may soon be up for the credit-rating agencies, one of the most conflicted industries ever concocted.
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WEDNESDAY DECEMBER 05
November Rain
Why hedge funds are set to record their worst returns since 2000, according to the latest data from Hedge Fund Research. As always, we give the numbers and name the names.
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WEDNESDAY DECEMBER 05
Insider Trading (Especially If You Are A Couple With A Baby) Is Bad
The bleak endgame for a former financial analyst at Morgan Stanley and a former hedge fund analyst at ING. (“Former” meaning that if this wayward couple had learned to keep their hands out of the till, we reckon they’d still have jobs.)
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WEDNESDAY DECEMBER 05
Witch Hunt!
It appears that despite the very public lambasting of economist, lawyer and sometime financial harpy Ben Stein in recent days, his New York Times column hit its mark. No sooner did lawmakers, authorities and the usual suspects read his Op-Ed piece soundly drubbing Goldman than the city’s dusty, old, belching subpoena machine suddenly sputtered to life. Read on for the laundry list of firms that are now being targeted by the likes of the increasingly Eliot Spitzer-like Andrew Cuomo.
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WEDNESDAY DECEMBER 05
The Wrath Of ‘Ranth?
Forget about Brian Hunter…he’s sooo 2006. This year, the ex-Amaranth trader of the moment is Manos Vourkoutiotis (and if you can pronounce that surname correctly, there’s a free car wash in it for you). Turns out Louis Bacon yanked him from the detritus of Amaranth to start up a Canadian hedge fund. But has the Amaranth curse already come back to bite him?
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TUESDAY DECEMBER 04
Super Bowl Showdown
Just 61 days to what some would call the best day of the year – and us with our pair of Super Bowl tickets just itching to be given away. Check out this week’s winners from our Pick ‘Em and Survival games to see if you’re still in the running for the grand prize.
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TUESDAY DECEMBER 04
Performance: Hold It Now
As the NYMEX transitions from open-outcry to the world’s biggest electronic arcade, here’s the whiz-bang gadget locals are increasingly using to execute trades.
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TUESDAY DECEMBER 04
Wall Street Bashes Get Shiv
Bank of America, which reported a steep plunge in third-quarter income, issued a painfully specific internal memo making clear it would brook no frivolous expenses – not even for the oh-so-frivolous holidays. Here, your one-stop tattler on which bah humbugs will be urging you to ‘Deck the halls on your own dime.’ (Should you be cruelly orphaned, feel free to write to us at Trader Daily for this year’s free pamphlet on how to get through the season by crashing other banks’ parties.)
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TUESDAY DECEMBER 04
Coffee Conundrum – Or Battle Of Sexes?
Do men drink more coffee than women due to socio-cultural differences? Or is it just that women avoid coffee shops because they treat women like, you know, dirt? Cutting edge research rips the lid off this long-brewing question.
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TUESDAY DECEMBER 04
The ‘Pleasure’ Marriage: It’s Money, Baby
Price of an opulent wedding got you down? Muslims who have fallen on hard times in Lebanon can relate. And, as it turns out, they can also innovate like hell. How to get your spouse with none of the high cost – and all the benefits. (Why didn’t we think of this?)
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TUESDAY DECEMBER 04
Futures To Save Our Democracy?
Are political debates really the scripted, staged meaningless snakeoil extravaganzas they appear to be? And, even scarier, do voters actually get swayed by them? Metaphysical questions all, until you take a closer look at data from the Intrade political futures market. The results are not only surprising – we dare say they give us a smidgen of hope.
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TUESDAY DECEMBER 04
Peg Reneg
Er, that would be a de-pegging (right?)...All eyes are on the Persian Gulf this week, as a number of states consider unmooring their currencies from the limping dollar, which is weighing down everybody. Not to be outdone, currency traders are already casting their ballots as to what the outcome might be. A peek at what lies in store and what this will mean for the grossly beleaguered greenback.
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TUESDAY DECEMBER 04
Wild In Life, Wilder In Death
Drama boils over in the shocking blitzkrieg over the riches of wealthy investment manager Seth Tobias, whose brothers have gone so far as to accuse his bereaved wife of murder after he was found floating face down in the swimming pool beside his mansion. A lurid account of fast money and even faster living in the volatile world of hedge funds.
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MONDAY DECEMBER 03
Awesome August: My Best/Worst Trade
The month was four weeks to forget for much of the trading world, but this past August brought sorely missed market volatility — and one equity options trader’s best month of performance ever.
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MONDAY DECEMBER 03
Bond Traders: New Masters Of Universe?
We thought He-Man was the Master of the Universe, but whatever. Here is one columnist’s take on bond traders’ collective push to retake their 1980s mantle.
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MONDAY DECEMBER 03
Razor’s Edge
On the back of brutal SIV ratings-slashings of $14 billion last week (not that that value means anything, given what we know about the mark to market nightmare still going on) guess how much Moody’s plans to hack away this week? Let’s just say it’s the most ambitious ratings-slicing since the subprime snafu got under way.
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MONDAY DECEMBER 03
Lemons Into Lemonade?
After soundly trashing the credit markets this summer, Wall Street is dusting itself off to embrace not only new and refreshing investment ideas, but also clean-up efforts. As JPMorgan sets aside a chunk of its $1.4 trillion balance sheet for Hollywood films (and why not? in days of yore, it once bankrolled silent movies) another top bank (not Goldman) snaps up roughly 11,000 home sites in hopes it might turn the mortgage crisis into a fat paycheck. Behold, the fires sales you missed while cat-napping this weekend.
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MONDAY DECEMBER 03
Foul!
Wow, anybody else think it’s damn weird that while nary a top-ranked Wall Street analyst has had the cojones to downgrade a single company in the securities industry to “sell” this year, the subprime debacle rages on, driving corporate profits into deeper doldrums? Inside this grave new world.
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MONDAY DECEMBER 03
Ben Stein Gives Goldman Some Lip
The economist, actor and gameshow namesake says that over the years his fans have rabidly warned him of the dangers of a secret government running the world, the Trilateral Commission, the Ford Foundation, Big Oil and – of course – world Jewry. But none of their machinations give him the same night sweats as the wrath of one rather formidable investment bank. Here, Benny gets personal with the G-men.
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MONDAY DECEMBER 03
Apologies To Giselle, Jay-Z, But…
We need not stress that we are hardly the elitists over here at TraderDaily. We are many, many things (we really are) but we are not that. And yet…and yet…when the lithe supermodel Giselle Bundchen and rapper Shawn Corey Carter – better known as Jay-Z – start issuing loose-cannon prognostications about the death of the dollar, it’s kind of hard to not see it as a big, red flag forcing you to reconsider whether you should really be so bearish after all. A closer look at the greenback – and its prospects for a 2008 resurgence.
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FRIDAY SEPTEMBER 28
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