TABLE OF CONTENTS July 2008

THURSDAY JULY 31
"HE HAS NO IDEA! NONE!"
By Chris Gillick
Remember Jim Cramer's rant on the credit crunch one year ago this week? > read more

THURSDAY JULY 31
Schwartz Moving On
By Chris Gillick
After falling from atop the house of cards that was Bear Stearns, Alan Schwartz will be moving on from Bear's new home, JP Morgan. Word on the street is that he might end up at KKR, which announced earlier this week that is going public. > read more

THURSDAY JULY 31
Hamptons: Time To Cut Losses?

When one of the biggest investments of your life – your home – is declining in value by up to 12% a quarter, what do you do? If you’re smart, you think like a trader. > read more

THURSDAY JULY 31
Selling…Yourself

Speaking of jobs, ever wonder why you didn’t get that plumb position you thought you’d nailed, or how well you’d do if you had to go out and start all over again? These days, everybody’s trying to finagle a better financial station, so don’t get left in the lurch. Some tips from the pros. > read more

THURSDAY JULY 31
Morgan Stanley: Where The Jobs Are

With the $1 billion this bank reportedly saved by slashing nearly 5,000 positions earlier this year burning a hole in its pocket, it looks like Morgan’s levering up its newfound in-the-money status to score some fresh hires – specifically, senior executives on its derivatives, risk-management and proprietary-trading teams How one man’s pink slip is another man’s treasure. > read more

THURSDAY JULY 31
Rebates: Coincidence – Or Psychic Phenomena?

It’s got to be one of those, because we are not even considering that a flash-in-the pan taxpayer rebate of up to $600 singlehandedly revived the U.S. economy in the second quarter (ahead of the GNP report out today, not to mention two others covering labor costs and jobless claims). C’mon. You know what our families did with their rebates? They spent them on European vacations. That’s right, the money went into someone else’s country. And contrary to popular belief, $600 is not enough to get you that home you’ve been wanting in Malibu if you otherwise can’t afford it. (Not that you won’t buy it anyway.) Never mind what economists suggest in the following story. > read more

THURSDAY JULY 31
Deutsche’s Dog Days

Deutsche Bank CEO Josef Ackermann may have steered his bank clear of the worst of the subprime slime, but that didn’t save him from posting a bigger-than-expected pretax loss and debt writedown in the latest quarter. Given that the bank is starting to look a lot more exposed to mortgage-backed securities, monolines, commercial real estate investments and declining net revenues than first thought, is it time for a wholesale slime reassessment? > read more

THURSDAY JULY 31
Fight Or Flight?

That’s easy, say federal prosecutors. Any Wall Street broker being targeted by them for criminal activity in the markets clearly isn’t so much missing as fleeing. Particularly, if said broker happens to be the following Bulgarian-born, former Credit Suisse employee who, they suspect, may have chosen this key moment to pop back into his native land for what they augur could be permanent vacation. So, what chances do foreign prosecutors have of nabbing him? > read more

WEDNESDAY JULY 30
What's David Shaw Doing Now?
By Chris Gillick
> read more

WEDNESDAY JULY 30
Shocking ‘Buffoonery’ Overtakes DrunkTrader.com

Will you ever need a better headline than that? It seems that this Web site, contrary to popular belief and all that is right in the world, actually exists. That said, we understand it’s best to imbibe the usual questionable substances while viewing it, though that’s not strictly safe for work. Good thing the following is. > read more

WEDNESDAY JULY 30
Energy Market: Foot Off Pedal?

While still extraordinarily high, oil prices have dropped more than $23 a barrel, or 16%, since peaking July 3, as American drivers rein in heavily on their formerly out-of-control fuel consumption. The key question now is, how much further does demand destruction have to go? > read more

WEDNESDAY JULY 30
Someone Else Is Always Worse Off Than You

Even better if that someone else happens to be a famous billionaire trader, like, oh, say, T. Boone Pickens. Here’s how the world-renowned oilman got a profound drubbing by betting alongside one of his old cronies (which, by the way, we recommend you only do if you’re sure you’re going to make a killing, which, we can attest, he did not). > read more

WEDNESDAY JULY 30
Wisdom Of Lone Star?

Of course, we could only be talking about that thing that dare not speak its name: the nothing-if-not-malodorous toxic mortgage-backed asset – and those wild and wooly enough to not only dive headlong into them (much like Superman dives into vats of boiling acid) but actually devote spanking-new, multibillion-dollar hedge funds to them. Like this guy. > read more

WEDNESDAY JULY 30
Insider Trading Scandals Rock London

Always cool: being an insider. Never cool: insider trading. The list of those acting, well, not very cool in Old Blighty is growing apace, with the U.K.’s Financial Services Authority taking swings at a Swiss bank (three guesses and the first two don’t count which one that is) and one of London’s oldest trading firms, which, incidentally, it already targeted less than a week ago. As office premises are duly raided and nearly a dozen traders are arrested, here are a few more reasons why it’s important to consider that just because you’re paranoid, doesn’t mean they’re not after you. > read more

WEDNESDAY JULY 30
Enron: Still Going

Let’s be 100% honest: it’s always super duper badass to be able to say you once traded at Enron. It’s like being the kid who graduated at the top of his class at HBS, but did a little jail time on the side for stealing sports cars or writing hot checks. It’s just a phase you went through, but it gives you an edge. And now everyone you meet secretly wonders if you still know how to hotwire things or hang paper. As long as you clean up and act respectable, no one really cares. Except for this group. (Hint: its name starts with an S and ends with a C and it just put another notch on its trader-hammering gavel.) > read more

WEDNESDAY JULY 30
Short-Selling Rules Extended

Big surprise, but at least the Securities and Exchange Commission tipped its hand against adding another ten thousand or so stocks to the list of the 19 already restricted (though we wouldn’t be terribly stunned if we eventually saw the day when it’s the other way around, with stocks you can short-sell sans all the highfalutin red tape being the exception). There is, however, a great big silver lining to this. And, of course, a pat, little chest-thumping quote about a job-well-done-or-other from our pal Christopher Cox. > read more

TUESDAY JULY 29
Hedge Fund Startup Dream Fading
By Chris Gillick
> read more

TUESDAY JULY 29
Food Crisis Hits Overeaters Hardest

Especially in the overeating capital of the world. And you know where that is – don’t you? > read more

TUESDAY JULY 29
IMF: Credit Meltdown May Never End

OK, not strictly true. But we figure that by preparing you for the worst you’ll be…uh, pleasantly surprised when things start to brighten up around the time you retire. In any case, listen not to us, but to what the International Monetary Fund has to say. > read more

TUESDAY JULY 29
Oil Punches Back Above $125

After years of fighting, the Movement for the Emancipation of the Niger Delta is STILL trying to force the Nigeria’s government to share the joy when it comes to the bountiful oil riches it’s mining out of the country’s deeply impoverished south. So, you’d think that by now the two sides would have gotten it together, right? Wrong. > read more

TUESDAY JULY 29
Covered Bonds…Or More Rat Poison?

Why a popular method of financing in Europe is now being taken up by none other than Bank of America, Citigroup, Wells Fargo and J.P. Morgan Chase. But are you buying it? > read more

TUESDAY JULY 29
Don’t Buy The Hype – Firms Are Still Hiring

Alongside the nightmare that is the global credit crunch has been an all-out scramble by Wall Street’s denizens gunning for the very best jobs that remain open. But who’s hiring in which strategic areas and how to make contact with them? At long last, here’s your answer. > read more

TUESDAY JULY 29
Fire Sales Not Over Yet

Fire-eating has always been a very tricky business – just go to any circus and see for yourself. Generally speaking, we think that if you can get someone else to eat the fire for you, that’s preferable. Luckily, Merrill knows a fund that seems like it was born to eat fire: Singapore’s Temasek Holdings. Despite its having bought the biggest chunk of shares now owned in the bank last December, it still hasn’t had its fill and has now agreed to buy another $3.4 billion. Meanwhile, Merrill is also offloading more than $30 billion of bonds at a steep loss. Can the bank finally kill its subprime disease without killing the patient? > read more

MONDAY JULY 28
Need a Job? Play Lacrosse.

Bear Stearns as we know it no longer exists, but its lacrosse team still does! > read more

MONDAY JULY 28
Again, Mixed Results for TCI, CSX Corp.
By Chris Gillick
> read more

MONDAY JULY 28
Whipsawed!
By Chris Gillick
> read more

MONDAY JULY 28
Who's Bailing Out GM?
By Chris Gillick
> read more

MONDAY JULY 28
How To Talk To An Investment Banker – If You Must

Admittedly, much research has been done on this subject throughout the years, but no one has ever come up with a definitive cheat sheet. Prepare to be in the dark no more. Take a gander at this, the Deal Journal’s final word (this 20 seconds, anyway) on this burning topic. > read more

MONDAY JULY 28
Zimbabweconomics, Part II

Just because it’s not for you doesn’t mean it’s not for everyone. Here’s the upside we never thought of. (And neither have you.) > read more

MONDAY JULY 28
Quoth Of Noth: Falcone

"We continue to be very bullish on commodities, both iron ore and coal, but we think there are better ways to capitalize on this other than by acquiring Alpha," pronounces Harbinger Capital’s hedge-fund chief Philip Falcone, who’s opposing the proposed $10 billion takeover of Alpha Natural Resources by Cleveland-Cliffs Inc. Read on for his plans to meet with the iron-ore provider to broker a solution. > read more

MONDAY JULY 28
KKR IPO: Coup Or Anticlimax?

It’s official: Cousins Henry Kravis and George Roberts plan to convert their gargantuan leveraged-buyout firm, KKR & Co., into a publicly traded company by the end of the year so they can more easily expand their fixed-income and capital markets units. How? By way of a fancy-schmancy transaction involving 1) an Amsterdam-based fund 2) a listing on the New York Stock Exchange and 3) no new capital raised. Given that last element, why bother at all? Well…it’s complicated. > read more

MONDAY JULY 28
What Global Markets Could Learn From Hitler

They say in his final days, Hitler obsessively consulted his horoscope. (Of course, J.P. Morgan also did this, but they say it turned out better for him.) Not surprisingly, the rise of uncertainty among traders and investors is similarly leaving them more prone to rumor, speculation and downright superstition. Considering the factors underlying Bear Stearns’s felling and Lehman’s troubles of late is this no big deal – or a scary trend? > read more

MONDAY JULY 28
Shorts’ Leash To Further Shorten?

While our hedge fund contacts spoke optimistically only days ago about the prospect of the Securities and Exchange Commission lifting its restrictions on short sales of 19 targeted financial companies, it seems that talks over the weekend between the agency and the Managed Funds Association took a turn for the worse, leaving the door open not only to an extension of the so-called “emergency period” but also the stocks it covers. > read more

FRIDAY JULY 25
Money Honeys
By Chris Gillick
In light of the blockbuster success of ~Charlie Wilson's War~, starring Tom Hanks and Julia Roberts, it is clear that the former playboy Congressman from Texas was adamant about only hiring genetically blessed women to staff his office. Lately, hedge fund managers are going the same route. You can teach any smart young marketer how to talk about fund strategy and fee structure, but you cannot teach them how to grow breasts. > read more

FRIDAY JULY 25
Vive Le Work?
By Chris Gillick
> read more

FRIDAY JULY 25
East Hampton in Need of Municipal Philanthropy
By Chris Gillick
> read more

FRIDAY JULY 25
Penthouse: A Bear’s Lair

One lesson Jimmy Cayne seems to have learned from the stunning downfall of his beloved Bear Stearns: Stay away from mortgages. > read more

FRIDAY JULY 25
Friday Levity: A Simple Problem Of Addition

Family of four weighs 900 pounds. Amusement park ride holds 700 pounds. Check the tag, do the math, show your work. > read more

FRIDAY JULY 25
Yen Perks Up

Check out how the yen's rising as the dollar (as usual) declines on the back of traders’ trimming of holdings of higher-yielding assets funded in Japan ahead of U.S. reports on durable-goods orders and new-home sales. > read more

FRIDAY JULY 25
SemGroup: How It Lost

It wasn't exactly Amaranth, but a loss of $2.4 billion wasn't negligible, either. Now, as details of the energy company’s downfall emerge in court hearings, some nettlesome questions are being asked. > read more

FRIDAY JULY 25
Washed-Update: Kerviel

It's the high-stakes bank-versus-trader showdown that just won't die. Particularly because the head lawyer for so-called "rogue trader" Jerome Kerviel is spearheading yet another coruscating legal strategy to prove his client's innocence. His latest plan? Attack the former employer of Kerviel, Societe Generale, with all his might. Specifically, its internal controls on trading, for which the bank has been duly fined but remain, he says, "set in stone." Could such a strategy end up backfiring, though? > read more

FRIDAY JULY 25
Done Deal…Unless You Forgot To Ask Falcone

Just as Cleveland-Cliffs was getting ready uncork the champagne after inking its $10 billion deal with Alpha Natural Resources, who should step out of the shadows but Harbinger Capital's activist trader Phil Falcone brandishing, uh, entirely different ideas. How an iron-ore company that thought it just nabbed pole position suddenly found itself (possibly) in play. > read more

FRIDAY JULY 25
Famous Last Words

"I don't expect any problems regarding market manipulation, I think we are still just providing liquidity, but you never know," wrote Optiver trader Christopher Dowson in a right breezy e-mail he should have never considered sending. That's right; you never do know. Until you allegedly dub your trading strategy "the Hammer" and the U.S. regulatory watchdogs come knocking. A cautionary tale that’s going to make you want to dredge up and delete every e-mail you’ve ever sent. > read more

THURSDAY JULY 24
Wachovia CFO Resigns

Wachovia Corp, which posted a record $8.86 billion second-quarter loss Tuesday, said Chief Financial Officer Thomas Wurtz will resign from the fourth-largest U.S. bank after a successor is named. > read more

THURSDAY JULY 24
Los Angeles Sues Wall St Banks, Bond Insurers

The city of Los Angeles sued more than 30 municipal bond insurers and Wall Street investment banks, accusing them of fraud and antitrust that it said cost taxpayers millions of dollars. > read more

THURSDAY JULY 24
N.Y. Sues UBS

New York Attorney General Andrew Cuomo filed a lawsuit against UBS AG over its role in the sale of auction-rate securities, five months after the market collapsed, stranding investors. > read more

THURSDAY JULY 24
Optiver Holding BV Charged with Oil Market Manipulation

Commodity Futures Trading Commission on Thursday charged global trading fund Optiver Holding BV with manipulating the NYMEX oil market in March 2007. > read more

THURSDAY JULY 24
Road Show: Spur Of The Moment

Introducing the new Bentley Flying Spur – a serious car for people who like to drive seriously fast. > read more

THURSDAY JULY 24
Greatest Thing Since Sliced Bread? Arctic Oil

ith energy prices skyrocketing and global warming depleting the polar icecaps to the extent that new shipping routes are opening up, geological surveys of an area of the world once off-limits to exploration are suddenly showing a black goldmine of what might lie beneath. As “undiscovered” things go, could this perhaps be a significant discovery? > read more

THURSDAY JULY 24
Icahn: Getting It Off His Chest

On his blog, billionaire investor Carl Icahn gets very explicit about why he decided to bury the hatchet with Yahoo – and how he plans to address the attacks recently made on him over his trademark “bluster.” > read more

THURSDAY JULY 24
Liquidity Play

By now, we’ve all heard the dire prognostications about water being a hot commodity. But even we didn’t think we’d be hearing so soon about hedge funds actually sluicing water from the glaciers with the industry of impoverished Nigerians ladling oil from leaky pipelines. We were wrong. > read more

THURSDAY JULY 24
Mortality: Still Breeding Sick Returns

What’s Stevie Cohen's monster hedge fund SAC Capital Advisors doing getting mixed up with the U.S. funeral-home and cemetery industry? Hmmn…Could it have something to do with the imminent demise of the Baby Boomer generation? > read more

THURSDAY JULY 24
The Upside Of Dumpster Diving

Warren Buffett and John Paulson aren’t the only ones garbage-picking the subprime crisis. Now arguably the world’s most formidable bank is tilting at the same windmill. And $10 billion dollars says it can make a killing on the senior loans backing leveraged buyouts, positioning itself to fill in the financing void created by the credit crunch. Oh, yeah, and did we happen to mention that this would be in the form of a massive fund? > read more

WEDNESDAY JULY 23
A Taste Of Napa

> read more

WEDNESDAY JULY 23
'Other' Paulson Bolsters Dollar

The greenback climbed to a four-week high against the yen after Treasury Secretary Henry Paulson threw his support behind it (though we are close to pretty sure he’s done this before) and the Federal Reserve Bank of Philadelphia president said interest rates should go up (aren’t we again hearing an echo)? Nonetheless, when the dollar wants to rise, it rises. Meanwhile, the yen hit a record low against another major currency. > read more

WEDNESDAY JULY 23
Now, A Word (Or Two) From Our President

First, we are “addicted” to oil. Now, Wall Street’s in the tank and needs to get “sober” after ending up “drunk” and contracting a “hangover.” Interesting choice of words from our fearless leader, captured saying the following (there’s more) on YouTube after asking reporters to turn off their cameras. Where’s the trust? > read more

WEDNESDAY JULY 23
Quest For $80 Oil

Almost there! Legislators are so on it. And you know how you can trust them? Because they are part of the U.S. government. Appalled to learn that some traders actually buy and sell financial products representing assets they, in fact, do not want to own (or plan on taking delivery of) Congress is determined to set things right by changing position limits. Aren’t you feeling better already? > read more

WEDNESDAY JULY 23
Specs: Not To Blame After All?

Surprise, surprise, it seems the U.S. task force given the incredibly simple task of identifying the energy traders everyone claims are systemically driving up the price of oil has come up with... drum roll, please…nothing! More on this futile mission – and what the latest preliminary study has pinpointed as the real culprit. > read more

WEDNESDAY JULY 23
Paulson: The Next Generation

Paulson & Co.'s all-star trader John Paulson – the man behind perhaps the biggest trading coup of all time, having racked up an estimated $3.7 billion by betting on the collapse of the U.S. housing market – is raising money for a brand-new fund. But what kind of fund could properly encore the world’s largest payday ever? Something, it turns out, that utilizes Paulson’s deep knowledge of the subprime market and his expectations that the credit crunch could lead to losses of up to $1.3 trillion. It also has a slightly altruistic bent. Give up? > read more

TUESDAY JULY 22
New Schwab CEO

The Board of Directors of The Charles Schwab Corporation today appointed Walter W. Bettinger II as president and chief executive officer and a member of the board of directors effective October 1, 2008. > read more

TUESDAY JULY 22
Billionaire Junior
By Chris Gillick
Just as his father plastered the family name all over New York City and Palm Beach real estate, making billions in the process, Donald Trump Jr. hopes to do the same in Mumbai. > read more

TUESDAY JULY 22
Wachovia Posts $8.9 Billion Loss

Moving quickly to put an end to the constant spill of red ink, the Wachovia Corporation, the banking giant, booked an $8.9 billion loss and slashed its dividend in its first quarter under new leadership. > read more

TUESDAY JULY 22
Blue Sky: Just Right

Not too big, not too small, here’s why the Embraer Legacy 600 should fit your business – and your travel. > read more

TUESDAY JULY 22
Do As They Say, Not What They Do

It’s finally happened: A Florida bank is suing a Wall Street analyst over issuing a report on potential bank failures titled “Who’s Next?” – and naming the bank. > read more

TUESDAY JULY 22
Nothing’s Shocking

U.S. federal officials are incensed that the nation’s lenders failed to stop giving out high-cost home loans to borrowers who couldn’t afford to pay for them, thus helping touch off the subprime crisis heard round the world. Now, it turns out the U.S. government’s own Federal Deposit Insurance Corp. may have been doing exactly the same thing, which is…uh…awkward. But here’s the coup de grace: Apparently, the FDIC’s chairman, Sheila Bair, actually wrote a children’s book awhile back called “Rock, Brock and the Savings Shock.” We wish we were kidding. It’s right on the FDIC’s Web site. Didn’t we just say like two days ago you cannot make this stuff up? > read more

TUESDAY JULY 22
Icahn: A Weak Long He’s Not

Props to the billionaire activist investor, who, armed with little more than a piddly minority stake, managed to grumpy-old-man his way onto Yahoo’s board (where CEO Jerry Yang, we presume, will be none too quick to welcome him, as Icahn’s made no secret of wanting Yang out on the street). Read on for your cheat sheet of the blood wars we expect will soon begin. > read more

TUESDAY JULY 22
Mobius Spills Best Buys

Templeton Asset Management’s Mark Mobius notes Chinese stocks have tumbled 46% this year and that, along with India, the nation is among the worst performers of the world's 20 top stock markets. And that’s exactly why he’s waist-deep in them. > read more

TUESDAY JULY 22
Heavyweight Hedgies: Update 2008

How have the best of last year’s top traders fared in successfully navigating the narrows of this year’s nightmarish markets? What’s the record so far of Paulson & Co.’s now-legendary John Paulson, Harbinger Capital’s Philip Falcone, Clarium Capital’s Peter Thiel and Everest Capital’s Marko Dimitrijevic? Read on for all that and a bag o’ chips. > read more

MONDAY JULY 21
The Business of Burnett
By Chris Gillick
> read more

MONDAY JULY 21
Home Equity: Borough Hall

Lower Manhattan is finally gaining traction as a big mover in the residential real-estate market, but across the river, more than just a tree is growing in Brooklyn. > read more

MONDAY JULY 21
Oil Bounces Back

So, what could make oil spring back from its six-week low? How about the one-two punch of a Gulf of Mexico storm and yet more skirmishes with one of our country’s biggest menaces, which, not so luckily, also happens to hold title as the world’s fourth-largest oil supplier? Yeah! We sure know how to pick ‘em. > read more

MONDAY JULY 21
When $40 Billion Is Just Not Enough

Inflation’s a killer. Especially when you pony up that kind of lumber and your shares still fall. But we expect a suitor as mammoth as Roche Holding, the world's biggest maker of cancer drugs, won’t be put off so easily. If you’re a bettor (and we are betting that you are) here’s all you need to know about this gigantic merger-in-the-making. > read more

MONDAY JULY 21
B of A, Bravo

A less-than-expected net income drop? We’ll take it. Not only that, the bank now says it will actually earn money this year from its purchase of Countrywide (yes, “earn,” as in not a typo). More from the banking titan on its latest derring-do – and how it’s affecting its stock price. > read more

MONDAY JULY 21
Short-Seller Mania Boils Over

Never have so many short-sellers made so much on stocks, according to this incisive story out today from Bloomberg highlighting how investors worldwide are betting more than $1 trillion on a collapse in stock prices. (Could this have something to do with all those new-fangled short-selling rules?) > read more

MONDAY JULY 21
More Crazy Weirdness? More Crazy Weirdness

The best of what we are hearing so far: overseas institutions in China, Japan and Europe are freaking out about holding billions of securities in Freddie Mac and Fannie Mae; Treasury Secretary Henry Paulson is “temporarily” roping in Goldman’s Ken Wilson to help him sort out the banking crisis; the U.K.’s growing ranks of feral jobless are getting so unruly, the government may have to put benefits claimants to work picking up litter (no word yet on whether they are also accepting American jobless) and best of all the FDIC – yup, the U.S. government – was reportedly a predatory lender. Zounds. Now, for a bit on why Wall Street’s meltdown may put even Wilson’s experience as a special-forces officer in the Vietnam War to shame. > read more

FRIDAY JULY 18
Wheels: Exotic Derivative

When is a $47,000 Corvette not a Corvette? When it's a souped-up, 600-horsepower, 200-mph Callaway 'Vette. Let the senselessly risky road show begin! > read more

FRIDAY JULY 18
Friday Levity: It Doesn’t Matter If It’s The Real Donald Or Not

Introducing…the Donald Trump I-Love-My-Country-But-I'm-Getting-Out-Now-Dollar-to-Euro-Conversion-Kit. > read more

FRIDAY JULY 18
Why Oil Prices Won’t Be Falling Anytime Soon

We meant to highlight this when it came out midweek. The U.S. Senate is officially backing away from raising margins on oil traders. And why? Because, as much as they’d like to lower high energy prices for poor old Aunt Bertha in Black Shear, Georgia, they would like to not tick off their deeper-pocketed constituencies more. Read on for a true look at the men behind the curtain. > read more

FRIDAY JULY 18
Freddie: Whatever, Just Buy It

Say what you will about Freddie Mac, known for turning into a total dog of an investment before the government decided Sunday to bail it out (seeing as it’s bailing out just about any other comer in need of fast cash after getting stung by the subprime snafu – hey, the taxpayers can pay for it, so why be choosy?). Now European and Asian traders can’t get enough of Freddie, as $3 billion of its bonds go flying off the shelves at superior yields. What’s up? Oh, that, says Treasurer Timothy Bitsberger, is just “business as usual.” Uh, huh. > read more

FRIDAY JULY 18
Citi: Over The Hump?

Sometimes, the best you can hope for is a giant avalanche of net income. Other times, it’s a smaller avalanche of net income. Then there are the derivative forms: better-than-expected income, better-than-a-year-ago income, better-than-the-last-quarter income and, finally, narrower-than-a-year-ago (or-last-quarter) income. Whew. Unfortunately, none of these things are actually happening right now for many banks. That’s OK. You know what? We’re the glass-half-full-type. At this stage, we’ll take a smaller-than-expected loss anytime. Just as long as it happens between the second half of 2007 and the last half of 2008. Hey, we’re forgiving, but we never said we were flexible. Now for the details of Citigroup’s 2Q, which, given our revised standards, did not disappoint. > read more

FRIDAY JULY 18
Harbinger’s Iron-Clad Ire

Why Philip Falcone’s hedge fund, a faithful investor in Cleveland-Cliffs Inc., is on the war path after the iron-ore mining company agreed to buy Alpha Natural Resources for a cool $8 billion. > read more

FRIDAY JULY 18
Sam Israel III: Like Him, A Case That Just Won’t Die

Feeling even more victimized, no doubt, after having watched the former Bayou Group hedge fund manager fake his suicide for a weeks-long wild and wooly joyride on the lam before finally surrendering to authorities July 2, the investors cheated out of $250 million by this devil-may-care ex-trader are now suing one of Wall Street’s biggest banks to recover their losses. > read more

THURSDAY JULY 17
SEC Regulators Raid Wachovia Securities' Headquarters

Securities regulators from six U.S. states mounted a surprise inspection of the St. Louis headquarters of Wachovia Securities on Thursday as part of a probe into the firm's sales and marketing of auction-rate debt, Missouri officials said. > read more

THURSDAY JULY 17
According to Whom?
By Chris Gillick
> read more

THURSDAY JULY 17
Gadgets: Stable Platform

How the golf shoe already good enough for the most exacting man in the game has just gotten better. > read more

THURSDAY JULY 17
How To Annoy Others With Your Yacht

Yeah, we went there. Why enjoy your gazillions in peace, when you can enjoy your gazillions – and piss people off? > read more

THURSDAY JULY 17
Traders’ Bank Bets Tell All

Remember when emerging market equities were all the rage? So much so, that traders with long/short emerging market equities funds were forced to switch them to long-only funds to keep the investor inflows – and returns – coming? What a difference a year makes. Now check out how your “butterfly” trades in money markets are laying the groundwork for how long banks are likely to feel the subprime pain. > read more

THURSDAY JULY 17
‘Cloak Of Secrecy’…Er, Uncloaked?

Calling all U.S. traders who in the past have perhaps let UBS take care of their more – how to say it? – complicated tax work: today, U.S. Congressional investigators in Washington will release a 100-page report detailing the ills of the bank’s alleged “collusion” with U.S. clients in supposedly helping them dodge taxes. Certainly, chasing after other nations’ banks and energy markets is far easier for Washington to handle right now than, oh, maybe actually doing something constructive about oil prices? (We’re just sayin’.) > read more

THURSDAY JULY 17
China Paces Itself

After years of overheating, China looks like it’s finally cooling off, as data indicates its economy grew at the weakest pace since the second quarter of 2005. Ergo, guess what dollar-like move the yuan made? > read more

THURSDAY JULY 17
Short-Selling Saga: A Thing Of Unmitigated Awfulness

Whenever SEC Chairman Christopher Cox speaks, we just have to get under our desks to hide. It’s like the old “duck and cover” reflex from our childhood war days kicks back in. So, if we correctly understand the methodology behind his latest move to change short-selling rules, Cox isn't opposed to legitimate short selling, but he is opposed to “unlawful manipulation through 'naked' short selling” that might undermine the stability of financial institutions. OK, fine. But if it’s now being acknowledged that no such uptick in naked short selling took place (click here for the full story) isn’t that sort of the same thing as admitting this particular emergency action is toothless? > read more

THURSDAY JULY 17
Best Foot Forward

The closing meeting is much like a first date: Stride into the room, and the first things they'll notice are your winning personality...and your shoes. Why run the risk of undoing the deal by donning a pair of desultory loafers? These high-end Oxfords will help ensure that you've got a leg (or two) up on the competition. > read more

THURSDAY JULY 17
How To Annoy Others With Your Yacht

Yeah, we went there. Why enjoy your gazillions in peace, when you can have so much more fun than that? > read more

THURSDAY JULY 17
Somerfield’s Happy Ending?

The sale of Somerfield to the Co-operative Group at a lowered, £1.57 billion sale price lays bare the plight these days of those looking to broker plush deals. A look at why the consortium of Apax Partners, Barclays Capital, property tycoon Robert Tchenguiz and the Icelandic bank Kaupthing finally had to back off their £2.5 billion price tag. > read more

THURSDAY JULY 17
Merrill Hocks Bloomberg Stake

As talks to sell off a chunk of asset manager BlackRock unraveled, it seems Merrill Lynch still stands to make roughly $4.5 billion off the sale of its 20% stake in news and data provider Bloomberg. While the pecuniary shot in the arm is, no doubt, a welcome development, are market observers correct in that these moves are primarily meant to offset a $1.91 a share loss the bank is predicted to post? > read more

THURSDAY JULY 17
Traders’ Bank Bets Tell All

So, just how long are global banks expected to feel the subprime pain? The latest wave of traders’ so-called “butterfly” bets seems to be as good an indication as any. > read more

THURSDAY JULY 17
‘Cloak Of Secrecy’...Er, Uncloaked?

Even as UBS helps lead the rebound in bank stocks today (while oil prices sag) the Swiss monolith has yet to see the end of its many watchdog woes. Today, U.S. Congressional investigators in Washington will release a 100-page report detailing the ills of the bank’s alleged “collusion” with clients in supposedly helping them dodge their taxes. Certainly, chasing after other nations’ banks and energy markets is far easier for Washington to handle right now than, oh, maybe actually doing something constructive about skyrocketing oil prices? We’re just sayin’. > read more

WEDNESDAY JULY 16
FBI Investigates IndyMac For Fraud

IndyMac is under investigation by the FBI for possible fraud involving home loans made to risky borrowers, The Associated Press reported on Wednesday, citing an unnamed law enforcement official. > read more

WEDNESDAY JULY 16
Targeting More Profits
By Chris Gillick
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WEDNESDAY JULY 16
High Flyer: Big Props

Behold the magical, multitasking, new and improved Next Generation Pilatus PC-12 turboprop. > read more

WEDNESDAY JULY 16
The Truth Is Out There

And the truth is...ready for this?...drum roll please...the truth is that there is plenty of money to be had -- PLENTY -- if you know how to wiggle the worm. So quit whining and get out there and start pounding the pavement and pressing the flesh. You sick of your fellow traders losing money faster than you can make it? Fine, launch your own fund. Need inspiration? We present Exhibit A for your edification: BlueBay Asset Management, which runs a handful of funds, has had excellent inflows despite the woeful market conditions. Take their long/short fund assets, up nearly 14% for the past 12 months. And their long-only fund, which soared 40.2% for the same period. Their secret? If they told you, they would have to kill you. Still, we managed to finagle the following. > read more

WEDNESDAY JULY 16
UK: 'London Loophole' Our Arses

Perhaps you've noticed all the hubbub over oil markets lately. That is, if your head hasn't been under a rock. But are you paying attention to U.S. lawmakers' meddlesome attempts to mess with the august and hallowed rules of ICE, the electronic energy market beloved by traders for its lack of position limits and, uh, let's be honest, overall opaqueness? They've tried it before, but now, with significant heat on their backs from snarling U.S. citizens outraged at having to pay more than $4 a gallon for gas, they’re taking aim again -- and putting a knot in the knickers of the British regulators. So who stands to win this years-long standoff? You might end up caring more than you think. > read more

WEDNESDAY JULY 16
Quoth Of Noth: Long Or Short Capital

"The root of everything isn't awful management, poorly calculated risk assumptions, no-no, just like with Overstock (NASDAQ: OSTK), the real problem is that the stock price is low and that's due to market manipulation and that large Death Star that the market manipulators have been using to target certain financial stocks." A mouthful, to be sure, but you get the gist of it. Click below for more utterly entertaining LoS insights. > read more

WEDNESDAY JULY 16
Mac Attack Strikes Back

These days, we're basically afraid to open the newspaper, because it just keeps getting freakier and freakier. In the latest monster-mash mash-up, Treasury Secretary Hank Paulson [ex-Goldman] and Securities and Exchange Commission Chairman Christopher ["I'm-the-decider"] Cox, decided to impose a 30-day curb on the short selling of Fannie Mae, Freddie Mac, Lehman, Goldman, Merrill Lynch and Morgan Stanley. But considering how hard it is to keep a good short-seller down, will this plan really work? Somewhere, David Trone must be cheering. > read more

WEDNESDAY JULY 16
Snap! Goldman Finally Pushed Into Subprime Snake Pit?

We've gotta' hand it to them, the G-men have done a fantastic job of keeping their noses clean throughout the sordid subprime ordeal. They even managed to dodge the bullet that Wall Street's other reigning clean-noser, JPMorgan, couldn’t avoid: being strong-armed by the Fed into buying Bear Stearns. But as the gossip machine that preceded Bear’s collapse now threatens Lehman, Goldman CEO Lloyd Blankfein and the bank’s traders are increasingly being pressured to explain whether they played any role in the alleged hijinks. As the SEC issues more subpoenas than the queen has teas, the Wall Street Journal takes an in-depth look at who's being asked what -- and what, so far, are the answers. > read more

TUESDAY JULY 15
Callan to Join Credit Suisse

Erin Callan, whose rise and fall at Lehman Brothers transfixed Wall Street, has resigned to join Credit Suisse. > read more

TUESDAY JULY 15
How To Save Fannie and Freddie
By Chris Gillick
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TUESDAY JULY 15
They Can't Short Us Now!
By Chris Gillick
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TUESDAY JULY 15
Liquidity: Crush Spread

Brunello di Montalcino is the highest-priced, most famous vino rosso in Tuscany. Now, brace yourself for the finest of its highly liquid 2003 vintage. > read more

TUESDAY JULY 15
Pssst! Confidential To Samuel Israel III...

Hey champ, what is up? Oh, yeah. We heard you had kind of a bad week two weeks back. We know how it feels. Equities were puking on us around the same time. It wasn’t like going to jail for the rest of our lives, but we still think we felt sort of a poignant solidarity. Not helping? Okay. Look at it this way…you did the right thing. You just waited kind of a long time to do it. So, now we have something for you. We know you’ll like it. Heck, we didn’t even know about the "post-conviction specialist" before reading this. > read more

TUESDAY JULY 15
The Allure Of Diamonds

Forget Marilyn Monroe... A few reasons why diamonds are now a fund’s best friend. > read more

TUESDAY JULY 15
Gas Now So High, Stations Are Running Out Of 4s

With gas prices shooting well past $4 a gallon in the U.S., filling-stations are facing a fresh crisis: even after upending their storage closets, they are experiencing a shortage of extra 4s to display on their pumps. You cannot make this stuff up. > read more

TUESDAY JULY 15
Quoth Of Noth: Dollar Vs The Loo

This, from one of our faithful readers yesterday: “The prospect for my loo roll's brighter than for the greenback. Maybe we should price oil in my soiled bog paper?” It just seemed like the best way to introduce today’s news of the dollar tanking to a 25-year low versus the Australian dollar. Why? Au contraire, at this point, you should probably be asking why not. > read more

TUESDAY JULY 15
TCI Loses $1 Billion In Equities Blitzkrieg

First the J-Power debacle – now this? Lesson learned: Sometimes, when snapping up stocks on the cheap, you’re only nabbing them on the way down into a much deeper sinkhole. As you can imagine, The Children’s Investment Fund wasn’t the only one snagged in this undertow. > read more

TUESDAY JULY 15
The Witch Hunt Is Real

In addition to speculators supposedly being responsible for high oil prices, the downfall of Bear Stearns and the foundering of Lehman, we have also just caught wind they are behind cancer, melancholy and chronic granulomatous communicable disease. Who’da’ thunk it? Here is your cheat sheet (naming names) of the subpoenas now being issued by the SEC to more than 50 hedge funds as part of a probe into whether the propagation of rumor and conjecture on Wall Street led to the felling of certain titanic firms. > read more

MONDAY JULY 14
Gossip Meets Boxing
By Chris Gillick
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MONDAY JULY 14
Back Issue: Fool’s Gold!

We scoured the Trader Monthly "archives" to unearth this 1849 issue – and excerpted just a few of its many timeless insights. > read more

MONDAY JULY 14
Taming ‘King Of Beers’ For, Oh, Just $52 Billion

It took a pretty penny, but just three months after Anheuser-Busch CEO August Busch IV pounded his chest and vowed a sale wouldn’t happen "on my watch,” Belgium’s InBev has succeeded in luring its prey to the marital bed. A look at how this about-face took place (hint: a $5-a-share boost in the offering price probably didn’t hurt any) and what it means for a further consolidation of the rest of this old-guard industry. > read more

MONDAY JULY 14
On Things Insolvent

Do you ever have one of those days? When you feel like you might just default any second? Some tips on what you can do. > read more

MONDAY JULY 14
Fat Chance

Looks like the IndyMac debacle (from which, we hear, Sen. Chuck Schumer is still recovering the most) may just be a foretaste of the feast to come. While The Wall Street Journal is rosily proclaiming that “fewer banks are expected to fail than the 834 that went under from 1990 to 1992” (so much for the Monday morning pick-me-up) it seems little can stop this train wreck from happening other than a full-scale rebound of the economy and housing market. Cool. We’ll just wait for that, then. > read more

MONDAY JULY 14
TCI Gets Medieval

Leave it to the hard-driving, activist Children’s Investment Fund to dive headlong into the kind of investment that would cause Japan to invoke a never-before-used law to prevent the purchase of more than 10% of a native company by an overseas acquirer. Not to be outdone, the $10 billion fund had some parting shots for the government of the world’s second-biggest economy, calling its decision-making process “flawed by erroneous fact-finding, unsound economic reasoning, misinterpretations of law and a lack of transparency.” All in all, a serious mincing of words for a Chris Hohn-backed trading vehicle. > read more

MONDAY JULY 14
‘Last Days Of The Roman Empire’?

With banks assiduously foundering (see headlines out today on Lehman and IndyMac, not to mention Freddie Mac and Fannie Mae – but we digress, lest we depress you) financial scandals raging, speculators getting spanked and massive bailouts ruling the day, what’s a trader to do? For her part, fund manager Nicola Horlick has some choice words: “Greed has taken over and there's no rationality any more in people's decision making; it's just all about instant gratification, and no one's really thinking straight.” Here, she elaborates. > read more

MONDAY JULY 14
Brace For Impact

As airlines ground their fleets due to high oil prices, a chain of events is likely to be set into motion that could shred the jet fuel premium rather swiftly (see the makings of this comely mess in the following story). Not only that, we at TraderDaily just got an “open letter” e-mail signed by all the CEOs of all the top airlines urging us to complain to Congress about “unchecked market speculation and manipulation” and check out Web site www.StopOilSpeculationNow.com. ‘Scuse us, but isn’t Southwest Airlines and several of the others hedged to the hilt in the speculative market? Who do they think their counterparties are? > read more

FRIDAY JULY 11
We Are Going to Hell in a Handbasket but at least Henry Kaufman is on the Case
By Michael Martin
As the imminence of total financial chaos in this country looms closer, it's good to know that we have noted economist/analyst Henry Kaufman thinking about such calamities coolly and shrewdly. He's given it some thought and says he has devised a couple solutions (see below) and at this stage of the game whether or not they make sense almost feels beside the point. If anyone has anything else, send it along and Mr. Treasury Secretary if you read TraderDaily and I know you do -- feel free to write in with some feedback. > read more

FRIDAY JULY 11
Bigger Than the Louisiana Purchase

If the government steps in and bails out Fannie Mae and Freddie Mac, something Hank Paulson has thus far declined to do, it could represent the government's biggest acquisition since buying the Louisiana territory for $15 million in 1803. Inflation is a killer though. The cost to guarantee Fannie and Freddie's mortgages? Over $5 TRILLION. > read more

FRIDAY JULY 11
Cash is King?
By Michael Martin
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FRIDAY JULY 11
It Takes Two to Contango
By Michael Martin
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FRIDAY JULY 11
Subliminal Secretary
By Michael Martin
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FRIDAY JULY 11
Friday Levity: Like Father, Like Son?
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