28JAN09:
Q1-09 DOW: 8900
Q2-09 DOW: 7250
Q3-09 DOW: 5810
Q4-09 DOW: 3960
CITI NATIONALIZED
OBAMA GETS SICK 27AUG09:
Mini Crash 21SEP09 Predicted correctly:
Bailout=Bonuses
Demise of Bear Stearns
Demise of Lehman Bros.
Demise of AIG
Subprime would cause problems
Date of 2007 crash
CRAs were to blame
G20 riots were a party
Northern Rock run
Northern Rock Nationalization
HBOS and RBS demise
UBS really was Useless
This week we will witness more lay offs and firings. It will be worse than last week. The hits on redundancy based websites will rise and the roads will be quieter as ex workers stay at home and plan for the future. Families will enjoy extended periods of being together and no longer will knitted sweaters be sent to Oxfam on boxing day.
The Food Standards Agency (FSA) issued the advice after it emerged that nine farms in Northern Ireland have used the same feed substance that prompted a recall of all pork products processed in the Republic following its discovery in pig farms south of the border.
However, the FSA stressed its notice was precautionary and reassured people that the affected meat did not pose any significant health risk.
An FSA statement said: "The Food Standards Agency is today advising consumers not to eat pork or pork products, such as sausages, bacon, salami and ham, which are labelled as being from the Irish Republic or Northern Ireland, while it continues to investigate whether any products contaminated with dioxins have been distributed in the UK.
Fintag says Sorry about that. My web crawler picked this news item because it has the letters FSA in it. But not to worry, for here is an appropriate photo taken when I was investigating the high street to see whether consumers were out buying. Sad to say but most of the 25% off shops were offloading junk. Few people were noted as carrying bags of any sort and like a bail out fund, we are all waiting til next week when we demand more for less.
The severity of the economic slowdown is underlined today by the sharply deteriorating outlook for the services and commercial property sec-tors. Job losses in the services industry are expected to accelerate after business slumped in the three months to November, a Confederation of Brit-ish Industry (CBI) report shows. Consumer and business services companies were both hit hard by falls in volumes and profitability as customers reined in their spending.
Employment in services has so far weathered the economic slowdown better than other industries such as financial services. But with companies predicting faster falls in business and profitability, bigger job losses are on the way.
Fintag says So why am I still paying GBP85 a square foot for my Curzon Street office? The air con doesn't work, the lifts are never serviced and the windows rattle?
CITADEL FUNDS DOWN 47%; FIRM SUED OVER SENTINEL TRANSFERS
Hedge fund giant Citadel Investment Group has had better weeks. And years, for that matter.
Citadel's two largest funds have lost almost half their value this year. The Kensington and Wellington funds, which manage a total of $10 billion, lost 13% in November, bringing their year-to-date losses to some 47%.
The firm has received redemption requests for about $1 billion from the funds. Chicago-based Citadel, which at the start of the year managed some $20 billion, will be left with just $12 billion by the end of the year, according to estimates.
Fintag says Imagine that. 50% down. That means management fees are 50% down, no performance fee and some very pissed investors. Still, at least they were correlated with the main stock indices. They must have got their shorts and longs the wrong way round. Or maybe they forgot how to short? Oh, it was the wrong type of longs. Illiquid longs.
finalternatives says " Hedge Funds Shed 1.4% In Nov., Down 17.7% In '08 "
financial times says " A Survivor In The Dwindling Hedge Fund Universe (pdf)"
Two former Bear Stearns hedge fund managers will finally stand trial in September, and are unlikely to face additional charges as was previously expected.
The trial of Ralph Cioffi and Matthew Tannin, who managed a pair of hedge funds that invested in subprime mortgages that collapsed last year, helping sink Bear, will begin on Sept. 28, 2009, a judge determined at a pretrial conference on Friday. The two have been charged with conspiracy and securities fraud, with Cioffi, the funds' senior portfolio manager, also charged with insider trading. Cioffi faces as much as 40 years in prison if convicted, with Tannin looking at 20 years.
Fintag says The trial of the decade. Were they just innocent bystanders? Or really nasty crooks? I hope its not the latter because Cioffi is a really nice guy and we don't like to see nice guys losing.
The financial crisis is imposing heavy burdens on the hedge-fund industry, and the strain has become more visible. By the end of last week, about 100 hedge funds imposed restrictions on withdrawals. Many funds have become financial roach motels: Investors can put their money in, but they can't get it out.
Deregulation has taken a lot of blame for this financial crisis, but an interesting footnote is that the lightly regulated hedge-fund industry has stayed healthy enough to avoid the bailout game.
But are rising redemptions a sign that hedge funds may need a handout, too?
Fintag says Yes please. [Editor: It says handout, not handjob]. A bit of leverage would be really helpful.
financial times says " Hedge funds are going down with dignity "
With time on their hands and excitement and risk ebbing from their work lives, bored bankers and finance workers are looking for more than hugs, writes Lucy Kellaway .
OVER THE past month, I have picked up 247 men. Fast work in just four weeks but I've been putting my back into it. During my sabbatical from the Financial Times , I have obsessively e-mailed strangers on an adultery website, thereby taking part in what I find is the hottest recessionary activity in town.
Among my new boyfriends are a formerly powerful hedge fund manager, scores of newly idle bankers, a few entrepreneurs, various company directors, a well-known musician, some corporate lawyers, a couple of barristers and a rather dishy builder.
Fintag says Thank the lord that hairy cash sitting hedge fund managers are not included ...
The reality of low interest rates and deep economic recession should finally start to catch up with the U.S. dollar in 2009, after risk aversion and de-leveraging helped push the currency to multi-year highs.
The advance -- which has pushed the dollar up almost 20 percent against a basket of six currencies .DXY since July -- is "artificial" and may subside once extreme risk aversion eases and global markets stabilize, analysts said.
Fintag says History, i.e. Japan, shows that after a quick rally, the currency will then fall. But this time most other currencies will be doing exactly the same so it will all even itself out. Except GBP which will fall. And fall more.
There was Gordon Brown's new rescue scheme for people struggling to pay their mortgage and the promise by the regulatory authorities to beef up regulations to ensure that banks lend at reasonable rates and charge borrowers fairly.
Lenders will have to open their books and those crippled banks now largely owned by the taxpayer - Lloyds TSB, Halifax, Royal Bank of Scotland and Northern Rock - will have to demonstrate they are not being tight-fisted with credit.
Fintag says Throwing good tax payers money at bad banks was never a good idea. Forcing banks to give me leverage was a much better idea.
Hedge funds, which are experiencing their worst year on record, are desperately trying to keep investors from running for the exits by retooling their funds to prevent a mass exodus of withdrawals.
But investors in British hedge fund Centaurus Capital have rejected the firm's restructuring plans for its $1.2 billion Alpha fund, forcing a gradual liquidation.
The firm had proposed giving investors 30 percent of their cash back and then locking up the rest for two years with reduced fees. The locked-up money was to be deployed in different investment strategies such as credit and distressed debt, Reuters reported.
Fintag says It is tough out there. Investors just want cash. Irrespective of perfomance, counterparty or long term view, they all want cash. Cash is king and it is causing us all a real headache. Unemployed Investment Bankers are looking to work in the Hedge Fund Industry. Well it looks like the industry is going to be trashed so I would say don't bother. Become a monk, do an MBA, learn to knit.
BlackRock has warned that a proposed watering down of European Union solvency regulations would encourage insurance companies to continue buying securitised assets they do not understand.
Under the EU's Solvency II project, outlining insurance companies' capital requirements, insurers would have to conduct extensive due diligence of securitised debt assets, both before purchase and on an ongoing basis.
Fintag says Imagine that. Buying stuff you don't understand.
23 comments
anonymous said ...
But Graham Turner, of consultancy GFC Economics, says the rising cost of corporate debt is now flashing a red warning signal that far worse is to come over the next few months and job losses are heading for levels last seen in the 1930s Great Depression.
08 Dec 08 - 08:09 gmt
Tradebot said ...
GBPeso. Officially the World's worst currency. 6 months from now when the EURGBPeso is trading at parity we all wish we had joined the euro when Bliar was lobbying to to join. Once again Brown's decision to stay out proved wrong.
08 Dec 08 - 09:47 gmt
Alessandro Pantaloni said ...
Seems like Moron may be hurting again today
08 Dec 08 - 10:52 gmt
Moron said ...
Yup i hurt everytime we get a mickey mouse rally that lasts a few hours or days
08 Dec 08 - 10:59 gmt
Bart Simpson said ...
Moron, eat my shorts !!!
08 Dec 08 - 11:31 gmt
panta said ...
who is hiding behind Alessandro Pantaloni....(that is me) Anyway you are a prick...and I know you....So next time just give your real name instead of signing with mine...
08 Dec 08 - 12:20 gmt
Moron bashing society said ...
@Bart Simpson v good. Look Moron made his medium/long term call about the mkts last week and it should be respected, even though being proved wrong at mo. There's gonna be a raging rally on the dow open today.
08 Dec 08 - 12:43 gmt
Finbar Saunders said ...
Is that a Heidegger XF5 Bear Ski-Lift in the photo?
08 Dec 08 - 13:02 gmt
Z said ...
SPX approaching 50 day moving average, that will tell the story over the short term. A break above I think we could see a rally to 1,000. The market needs to sort of flush out some of the shorts. And then when people realize that companies are still trading at abnormally high P/E's based on next year's earnings because consumers will not spend anymore, the market will get another downleg. As for now, we'll see if enough resistance comes off that moving average.
08 Dec 08 - 14:58 gmt
Moron said ...
anyone wanna bet this mickey mouse rally is a one day wonder:)))
08 Dec 08 - 15:02 gmt
Z said ...
Why do people feel like they have to buy stocks that seem so cheap under $5 like Citi? If we had a bunch of reverse splits, then it wouldn't be a problem and everyone would be able to see that they may not be so cheap.
08 Dec 08 - 15:04 gmt
MiC said ...
Fin-
bought 2 copies of your crappy cartoon book (should that be "Crappy Cartoons" book?), one for me and one for the guy who works around the corner, Ken Griffin. I figure he could use some cheering up.
08 Dec 08 - 15:45 gmt
Sweet & Sour said ...
Mr Fin, I assume this cash you're sitting on is yours only, why would anyone else pay you fees to sit on their cash?
08 Dec 08 - 16:02 gmt
anonymous said ...
@ Finbar Saunders @12:43 - Hi false Fin - if you had read Heidegger you would not associate his name with a "skilift" - you probably wanted to make it sound Austrian, Heidegger was German...
08 Dec 08 - 16:17 gmt
Z said ...
Hey Fin,
Quick question. Now that the world economy is in ruin, should I be looking more into an MBA or an MSF, or even an MS in Quant Finance. What do you prefer when looking for candidates? Already started CFA, as I hear some value that more highly than any of the above.
08 Dec 08 - 16:18 gmt
Watcher said ...
Hey Z, whatever you do you won't get a job in finance for 5 yrs, so i would enrol in burger flipping school
08 Dec 08 - 16:45 gmt
Z said ...
you'd be surprised at how good I can flip a burger
08 Dec 08 - 16:53 gmt
Watcher said ...
keep it up .... maybe you can also supplment your income as a London Lite distributor
08 Dec 08 - 17:05 gmt
M said ...
cash sitting...hm. send some my way, I've just drove my car into a wall (unintentionally, of course).
08 Dec 08 - 19:31 gmt
M said ...
just driven:)
08 Dec 08 - 19:31 gmt
Goldhosen said ...
@ 'abnonumous' @ 16:17 - Heidegger is Austrian, not German. Zieg Geil...
As an Englishman is not a Scott.
08 Dec 08 - 20:36 gmt
Moron said ...
just finished digesting the spate of profit warnings out of the us after the bell tonight....this mickey mouse rally is well and truly donald ducked:)))).....short like world is coming to an end!!!!
09 Dec 08 - 02:57 gmt
Mo said ...
time to go upmarket hippy, join the self sustaining permaculture communes in the outback and start hugging trees and eating scrambled eggs with whitchety grubs and avocado on sourdough
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