30JUN08:
Oil to be USD200 by 30OCT08
USA Inflation to be 7.5% by 30OCT08 23APR08:
Next Rights Issue:
HBOS...yes
All & Lec ... 17APR08: Oil to be USD127 by 30SEP08
...16MAY08 losing my touch 27FEB08:
2 Banks go bust by 30JUN08
BS down, Lehman (a bit late I know) 20NOV07: Northern Crock to be sold for 15p
Nationalized 01NOV07: Oil to be USD103 EOM
...peaked too soon The Big Crash: 17OCT07
...well it's here 08OCT07:
SEC to fine Goldman for pricing issues
...still waiting 15JUN07: ML to buy-out BS
JPM got there first
I am always uncomfortable telling you tales of woe that happened to people I know but here goes (and that includes Refco man who is an old business colleague but my lawyers have told me that under no circumstances must this be known; however since it's July 4 and the FBI are eating turkey, why not?)
Around 1991 when the last nasty recession hit us all, people behaved appropriately for the times. It began by cash poor people draining bargain bins in supermarkets, bartering and ramping up their insurance claims. For example, if you wanted some cash you paid someone in a pub to "lose the car" for the insurance money. Well my "friend" took it more seriously.
The early 1990's was a big time for the fire brigade. In those days firemen drove fire engines. Today they call them something politically correct like fire operatives who drive fire tenders, but they still do the same job. This so called friend, let us call him Jimmy, decided that his grade 1 listed house and surrounding outbuildings were worth more as a pile of ash than standing up. So Jimmy took his family to France for the day and hired the "Nobody Fcks With Us" crew from the local pub to torch his estate and to hide the evidence.
All went to plan. The family came back and the estate looked like it had been hit by a nuclear bomb. Unfortunately, when the loss adjusters came to check out this accidental fire, the police gave them some evidence that suggested it wasn't caused by an electrical fault.
After setting alight the house the "NFWU" crew, who had taken a shining to the 911 in the garage, drove off. They took it for a spin before doing a James Dean. The police found the hand written instructions in the glove compartment.
His wife then told her children that their father was on an 18 month business trip.
After that long and rambling story you wondered why you read it? Well that is what is happening to us all. We have the brain capacity of a gold fish and can just about cope with a you tube clip. I understand that more people watch the trailers for films than the actual films. Well that is soon to end.
I predict that You Tube will be defunct within 12 months. Google makes no money, is being sued by Viacom and every visitor is being logged and sent to the US government for analysis. To even up my viewing habits I spent all night watching small children singing non copyrighted songs and film trailers.
News is a drug. It really is for many of you and without a continual drip feeding of news you cannot function. It also reinforces previous stories. So when I said many months ago that Bradford & Bingley was bust, you registered it and then eventually realised it was true when the conventional press said it was.
So where are we going with this? Last year on July 4, I had a massive surge in hit rates. Holidays are not always cracked up to be what they should be. Still, it is better taking your news drug than accidentally setting fire to that gas guzzling SUV on the drive. Until tomorrow that is.
Good news on the laptop front. I bought a new one as my old one mysteriously fell onto the floor and smashed into pieces. I am filling in the insurance claim right now ...
ECB RATE OUTLOOK FROM IRISH BANK ECONOMISTS - AUSTIN HUGHES SOMERSAULTS FROM 3 INTEREST RATE CUTS IN 2008 TO "STRONG POSSIBILITY OF A FURTHER ECB RATE RISE IN SEPTEMBER OR OCTOBER"
ECB Rate Outlook from Irish Bank Economists - John Nance Garner, Franklin D. Roosevelt's first vice president, is most noted for saying that the vice presidency wasn't worth "a warm bucket of spit." Those who track the punditry of economists on interest rates, have reason to think likewise on the many prognostications in recent years. In the art of punditry from the spectrum of politics to sport, a brass neck is more important than prescience. In April 1973, Time Magazine reported that "White House Press Secretary Ronald Ziegler enlarged the vocabulary last week, declaring that all of Nixon's previous statements on Watergate were "inoperative." Not incorrect, not misinformed, not untrue—simply inoperative, like batteries gone dead." So how reliable are the "operative" statements on the ECB rate outlook?
Fintag says Poor old Ben Bernanke. He must have even less hair than before.
Bradford & Bingley's largest shareholders on Thursday night stepped in to rescue the ailing mortgage lender after TPG Capital, the private equity group, pulled out of a £400m capital increase.
The emergency rescue was triggered after Moody's, the credit rating agency, on Thursday night informed B&B it was planning to cut the bank's credit rating.
The move gave TPG the legal right to abandon the deal, which would have seen the private equity group inject £179m into B&B in return for a 23 per cent stake. The decision prompted the Financial Services Authority, the financial watchdog, to activate a back-up plan under which some of the bank's largest investors will give their backing to the capital increase.
Fintag says TPG only had to look at the following to make the final decision:
1/ B&B - heavily exposed to buy to let 2/ Buy to let in unemployment high Midlands 3/ Model says house prices fall 10% and loans > assets 4/ FSA are more interested in people filling in forms than saving the banks 5/ Credit Rating Agencies have downgraded, even if its after the horse has bolted 6/ The consultants (accenture mostly) trawling through the books and records (those they can find) are shocked at the almost non existent risk management
GLG Partners, London's second-biggest hedge fund, has limited withdrawals from its flagship emerging markets fund after the announcement that star manager Greg Coffey was leaving prompted a rush for the door by investors.
In a letter to investors on Tuesday, GLG said the fund had also put hard-to-sell assets into a special parallel fund, amounting to 12.4 per cent of the main $4.6bn (£2.3bn) fund, and begun to cash in big chunks of the portfolio, ready to pay out money in November.
Fintag says Is it me or is Firefox 3 not as good as the old one? I have some strange search box at the top. When I click on it, I am taken to a German spy site. And I cannot get rid of it? It takes me to www.websearchking.com.
GLG is in a mess. Tell me again, why did Coffey want to leave USD250m behind to set up a fund with Jabre the Crook? Something doesn't smell right.
BRITISH BROKERAGE BOSS IS JAILED FOR 'DEPRAVED' FRAUD
The former head of the brokerage firm Refco was sentenced yesterday to 16 years in prison for the $1.5bn (£750m) fraud he engineered that ultimately destroyed the company.
Phillip Bennett, a 60-year-old from Gloucestershire and a former Cambridge rugby player, was worth more than $1bn at the height of the fraud.
In February Bennett pleaded guilty in a New York city federal court to 20 counts of conspiracy and fraud, two-and-a-half years after his arrest. Prosecutors said losses connected to the fraud topped $1.5bn. Beginning in the 1990s, Refco extended credit to customers so they could trade in accounts with the brokerage, which dealt in the fixed-income, commodities and foreign exchange markets.
Fintag says He got off lightly. His partner in crime is stuck in Angola.
BEAR STEARNS FACES REVISED SUIT OVER COLLAPSE OF HEDGE FUNDS
- Bear Stearns Cos., two of its former managers, and auditor Deloitte & Touche are accused in an amended lawsuit seeking $1.5 billion in damages of engaging in fraud before the collapse of two hedge funds.
Two investors and the liquidators of two Cayman Islands funds filed an amended complaint that broadened the scope of an April 4 suit seeking $1 billion in damages. The defendants include Ralph Cioffi, 52, and Matthew Tannin, 46, who were indicted June 19 and accused of misleading investors about the hedge funds, which invested in subprime mortgages.
Fintag says This is going to run and run. I hope JP Morgan have expensed this because they will be writing out the cheque.
For those who keep assuming that what has been taking place over the past year or so is either temporary or "normal" (in the sense that economic activity tends to ebb and flow), there's plenty of things that they probably haven't factored into their "models." Like the fact that desperate times can lead to a rash of desperate acts, even among normally upstanding citizens.
Unfortunately, such episodes are not all that unusual -- think, for example, about the chaos and lawlessness that erupted in New Orleans following the Hurricane Katrina disaster. More recently, reports indicate that there has been an increase in shoplifting as families struggle to make ends meet.
In Arson Surges for Foreclosed Homes Lost to Subprime," Bloomberg's Kathleen M. Howley details another opportunistic crime trend that appears to be gaining ground in the wake of the bursting housing bubble.
Fintag says Mind you, at current gas prices arson is not a cheap option. Better to drive to California and lose the SUV in the fires that are raging there at present.
PAULSON SEEKS A SYSTEM TO HANDLE ORDERLY FAILURE OF FINANCIAL FIRMS
Treasury Secretary Henry Paulson said the near-collapse of Bear Stearns Cos. highlights the need for a formal procedure that allows large, nonbank financial institutions to fail without wreaking havoc on the broader financial markets and the U.S. economy.
Taking aim at the mindset that some financial institutions are too big to fail, Mr. Paulson said Wall Street can't expect the government to step in and lend money or support every time there is a crisis. That perception exists, he said in a speech in London, because the government is limited in its ability to help unwind the complicated trading relations, ...
Fintag says I never thought I would live to hear this sort of talk.
UBS on Friday confirmed it faced further heavy write-downs on exposures to troubled US credits, meaning earnings for the second quarter would be “at or slightly below” break even.
Europe's biggest casualty of the US subprime crisis did not quantify its latest write-downs, which analysts have estimated at up to $7.5bn. The Swiss bank said it had continued to make money in wealth and asset management, but suffered renewed losses in investment banking.
Fintag says Rumors are the trading floor in Stamford is to be sold. The Useless Bank of Switzerland has defied even me. Tax evasion, sub prime, incompetence. Here are some of my pictures to remind us of the good and bad times:
For Sale:
The Board no more:
Sub prime:
Rebuilding:
20 comments
anonymous said ...
Seriously - couldn't you find a better picture of starting a fire?
04 Jul 08 - 08:43 gmt
MsR said ...
Anon: it's like when newspapers try to find a picture of a spliff..they always use a pic of one that's really badly rolled. Why is that?
04 Jul 08 - 08:50 gmt
anonymous said ...
Perhaps showing a good picture demonstrates too much knowledge and familiarity...
04 Jul 08 - 09:13 gmt
anonymous said ...
There was a classic one a few years ago of a US firecrew who had formed up for a team photo while a house was left burning to a crisp behind them......much more appropriate for the current situation.
04 Jul 08 - 09:15 gmt
HJ said ...
so when do you expect ben to raise rates and all the money that's getting cashed up moving as a tsunami to US
04 Jul 08 - 09:18 gmt
anonymous said ...
Was it really a good idea to spend all night watching small children performing on YouTube?
04 Jul 08 - 09:36 gmt
anonymous said ...
How much of GLG's revenues come from fund linked structured products based on Coffey's funds I wonder?
04 Jul 08 - 09:38 gmt
anonymous said ...
Euroweek:
CDS market skips to squash $62tr notional as Fed cracks the whip
Creditex and Markit this week announced a new method of compressing the notional principal of CDS portfolios, in a move that makes clear just how hard regulators are breathing down the CDS market's neck to reduce its huge headline size of $62tr.
04 Jul 08 - 09:46 gmt
anonymous said ...
www.euroweek.com/Article.aspx?articleID=1967080"
04 Jul 08 - 09:47 gmt
anonymous said ...
You're bang on about YouTube - the bandwith costs a million dollars a day with neglible ad revenue - Google is way overpriced for the revenue it generates.
04 Jul 08 - 09:50 gmt
anonymous said ...
Problems with XP, problems with Firefox... you should definitely change your IT providers. NO you shouldn't be seeing that on the top right... try clicking on the icon next to it and change the search engine to something else like google or ... mhh I cannot think of anything else!
Let me know if that worked!
04 Jul 08 - 10:21 gmt
GalwayBoy said ...
So is Darling going to have step in to shore up Bungle and Bingley? That will be a very unpopular prospect politically
04 Jul 08 - 12:29 gmt
Finbar said ...
04 Jul 08 - 14:42 gmt
anonymous said ...
Just saw that Cityboy Glastonbury YouTube video - could he be any more annoying!?
04 Jul 08 - 15:20 gmt
MsR said ...
Anon: Cityboy can't write for shit and his attempts to be artless and cool are nothing short of nauseating. He is so desperately uncool in every way, especially that sad little manicured beard (ugh). That is so much a man who talks about getting laid instead of doing it. Correct: A boy.
Sorry I just can't stand him.
04 Jul 08 - 16:13 gmt
Moron said ...
he has the eyes of a lunatic...sad and disillusioned....he deserves sympathy
04 Jul 08 - 19:25 gmt
MsR said ...
Moron I think the thing is the City has been good to him and it's fine to write (if you can call it that) a book about it. However it's his guise as 'reformed former bastard' and his holier than thou attitude that I cannot stand. He seems like he's an awful character.
04 Jul 08 - 19:50 gmt
Moron said ...
Dunno if the city has been good to him really....seems that the poor guy sold his soul for peanuts....life can be cruel sometimes
04 Jul 08 - 19:55 gmt
anonymous said ...
And all the while, in amongst the irreverant chatter, the markets burn
This is it, this is the Big One
So sad, in hindsight, that you will miss it, looking at the trees while the woods burn
05 Jul 08 - 06:11 gmt
Moron said ...
nope...just the opposite....we r gonna rally now....another bear market rally...but a good one through the q2 results before the next leg down
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ECB Rate Outlook from Irish Bank Economists - John Nance Garner, Franklin D. Roosevelt's first vice president, is most noted for saying that the vice presidency wasn't worth "a warm bucket of spit." Those who track the punditry of economists on interest rates, have reason to think likewise on the many prognostications in recent years. In the art of punditry from the spectrum of politics to sport, a brass neck is more important than prescience. In April 1973, Time Magazine reported that "White House Press Secretary Ronald Ziegler enlarged the vocabulary last week, declaring that all of Nixon's previous statements on Watergate were "inoperative." Not incorrect, not misinformed, not untrue—simply inoperative, like batteries gone dead." So how reliable are the "operative" statements on the ECB rate outlook?