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
For those with memories of more than 3 seconds, we are in a bear market. Its a bit like skiing. Sometimes you descend quickly before hitting a nice ridge and ascend up the slope before descending down the other side. You go up but you always fall further.
For those with 3 second memories, treat it as the mother of all bull markets. For the rest, look at the bear rallies after 1929. The bottom is still but a blip down there near the first ski lift.
Anyway, the mirth I suffered yesterday was to blame the people for the "mess". The emails came in the thousands [Editor: I counted 2]. Apparently the people are not to blame; it is the greedy bankers. Despite spouting out opinions everyday, I have very few. My secret? I watch a lot of TV during the moments when my quant models are being tweaked and much comes from Oprah. For many months, her program has berated the people for their lack of responsibility. Suze Orman tells it as it is. She says it was the people who were are fault. They were weak willed and gave into the temptations of credit. That is of course all those who took the debt bait. Many others including the huge Muslim population resisted and they are better off for it.
Of course there are many people who did not deserve to be caught up in this mess and are suffering badly. They need help but aren't getting any.
Old people. It is shocking the way the west has left them out to dry with pensions that produce no income. The indebted of course have been given a free option and many of these people are young and will have a second and third chance. I wouldn't be surprised if the g20 rioters are 65 year old plus. So much for looking after the old; its a case of looking after the debt lovin' greedy.
The people are angry. I am too. I have been angry at private equity, aig and excel spreadsheets long before many of you knew what I was talking about. But anger is an emotion best left to when watching sport. It is a useless emotion. But when you are hungry, frightened and helpless, you expect socialist governments to help you out. Unfortunately, the likes of Obama, Sarkozy and Brown think about themselves first and nobody else second.
Today I fell grumpy. Somebody poured white paint on my car. Nice.
Welcome to a world of envy and survival. When you feel good riding a bear market wave, then just go with it. Nihilism is fun at the time but in the long run we are all dead. [Editor: Uh?]
Huge day today! Major indices saw 7% plus moves upward. And as Bloomberg noted, this capped off the biggest 10 day rally since 1938 ...
Fintag says No wonder nobody is trading equities. With emerging market type volatility, it is like training a worm to break dance. And all because the people are excited at the prospect of their money being used to buy up toxic crap. I don't get it. 3 Seconds later and this debt will have to be paid off. And if it is written off, the Chinese and Japanese will want their money back.
Shirin Ismail, head of absolute returns investment strategies at Temasek's standalone unit Fullerton Fund Management, told the Reuters Private Equity and Hedge Funds Summit in Singapore: “This is an area we will add on because this is where we think it will give us that level of capital preservation that we need.”
Hedge fund withdrawals reached a record $159bn (£110bn) last year, according to Lipper, a unit of Thomson Reuters. Some commentators have predicted that as many as half of existing hedge fund managers could shut this year. However, the industry's supporters argue that in a period of falling stock markets investors need the more sophisticated strategies hedge funds offer.
Fintag says Somebody still loves us and I love Singapore too. Nice buildings, nice restaurant and nice manners.
That, anyway, is the conclusion of a closely watched industry survey to be published on Tuesday, which paints a sobering portrait of what was once one of the highest-flying businesses on Wall Street.
After years of explosive growth, hedge funds, those sometimes volatile pools of private capital, are undergoing a shakeout. But according to an annual survey of hedge fund investors conducted by Deutsche Bank, things may not be as bleak as many hedge fund managers fear.
The New York State attorney general, Andrew M. Cuomo, said on Monday that he had persuaded nine of the top 10 bonus recipients at the American International Group to give the money back, as the Senate retreated on plans to tax such bonuses.
Mr. Cuomo said he was working his way down a list of A.I.G. employees, ranked by the size of their bonuses, and had already won commitments to pay back $50 million out of the total $165 million awarded this month. But in a reversal of the stand he took last week, he said he did not intend to release any names.
Fintag says Fear makes you do strange things. Not that all these people deserve anything. AIG was run the way RBS was. By a bunch of greedy directors who turned a blind eye to over leverage, huge exposure and staff who prostituted the balance sheet.
Another skirmish in the war of words in the most important economic relationship in the world - that between the US and China - broke out yesterday, as the Governor of the People's Bank of China called for reform of the IMF and the promotion of the fund's own longstanding but underused "world currency"– special drawing rights (SDR).
Fintag says Well the S&P didn't have much time for this. Another example of the 3 second market ignoring fundamental news.
The RPI measure of UK inflation is expected to be negative - a sign of falling prices- when data is released later on Tuesday.
Economists expect the Retail Prices Index (RPI), which includes housing costs, to have declined for the first time in 49 years.
Fintag says I did say I would run naked down Regent Street if the UK caught deflation. Why do you think I have been going to the gym 2 hours every day since Christmas?
GLG Partners has been sued by an unidentified London businessman for allegedly failing to pay a promised commission.
According to the complaint, filed in a London court, the unnamed businessman introduced the hedge fund to Saudi sheikh that sought to invest as much as US$4 million in funds managed by GLG's then-star trader, the Evening Standard reports. The lawsuit alleges that GLG director Paul Harvey offered the businessman a 2% commission if the sheikh invested.
Fintag says Here we go again ... For those at GLG who cannot see this blog, try using gtunnel.com.
General Electric's financial health came under renewed focus on Monday as Moody's stripped the conglomerate of the triple-A rating it had held for 42 years and challenged its executives' pledge that its finance arm would be profitable this year.
A downgrade by Moody's was expected following this month's decision by its rival Standard & Poor's to lower its rating by one notch to AA-plus.
However, Moody's went a step further, cutting GE's rating by two notches from triple A to Aa2, saying the financial crisis had increased the risks associated with GE Capital.
Fintag says The beginning of the end of the MBA ...
Hedge fund investors believe the industry will see even bigger withdrawals this year than last, when record levels of cash were pulled from the sector.
A survey of investors by Deutsche Bank found a third expect more than $200bn to be withdrawn, after a net $155bn was taken out last year, according to calculations by Chicago consultancy Hedge Fund Research.
Fintag says Uh? I thought it said ...oh never mind. I never believe what I read in the news anyway.
THE BANKERS I KNOW ARE NEITHER 'EVIL' NOR 'GREEDY'
When I got laid-off over a year ago, I was devastated. Unlike many others in my firm, I hadn't lost my job before and, in fact, was one of those people who really did believe that I was irreplaceable (How naive was that ?).
It took me a while to get my self-respect back, as I tried (unsuccessfully) for months to get back in the industry. And every set-back hit me hard and pushed me closer to despair. I am fortunate, however, to have had the support of a good woman, and friends who were there when I needed them. Indeed, one came through big time, offering me a (initially part-time) position in his IT company.
Fintag says Of course not. When I was a banker, I was wet behind the ears. As time went on, I suddenly realised banks operated in a different way to any other business. I got corrupted which is why I set up a hedge fund. Today I feel cleansed and sanctimonious.
DIFFERING OUTLOOKS FOR INFLATION ASSIST BREVAN HOWARD'S ALLURE
If hedge funds have a bad name, that is no fault of Brevan Howard. Yesterday's full-year results from BH Macro - the FTSE 250 vehicle that gives ordinary investors direct access to the Brevan Howard Master Fund - demonstrated why it is now London's largest listed hedge fund. Its net asset value (NAV) rose 23.2 per cent last year, nearly twice the gain recorded by BlueCrest All Blue, its nearest competitor, taking its annualised return since float to 27 per cent. Equally impressive, the current year has also started well - up 9 per cent in January and February.
BH's outsize returns can be pinned on its strategy of taking short-term bets on two asset classes - currencies and interest rates - in which volatility has been high and whose performance is uncorrelated to equities. Further, it takes a large number of relatively small positions - meaning that no single bet has the potential to bring it down - while the extensive use of futures and options serves to limit any losses.
Fintag says Hi to those at Brevan. Having fun?
dealbook says " SAC's Stake in Sotheby's Drives Speculation "
The US Treasury's plans remind me of Weekend At Bernie's, with Timmy G and Big O getting up to all sorts of increasingly zany hi-jinx while trying to convince everyone that the corpse of Bernie is still with us.
24 Mar 09 - 08:55 gmt
damiendamien said ...
For their next trick they'll rematerialise the RMBS as bearer certificates and fire them into the sun.
24 Mar 09 - 09:07 gmt
Jaa said ...
Fin.. will you have a full body wax as well?
24 Mar 09 - 09:07 gmt
anonymous said ...
In the long run we are all dead..haha obviously another CNBC watcher
24 Mar 09 - 09:48 gmt
Jaa said ...
donkey.. its clear now we will not get new lows for several months.. the positive breadth of yesterdays move is too strong to ignore..pull back is due but this bear mkt bounce will carry spx to 1050-1100 area...
24 Mar 09 - 09:54 gmt
MsR said ...
@9.48 No I think it's fact. Possibly inaccurate though because in the short run some of us are dead. But otherwise pretty accurate.
24 Mar 09 - 09:55 gmt
Moron said ...
not so sure jaa...not so sure....this donkey makes his money through some very aggressive controversial calls ..... mad donkey:))) wait for the pullback here to end this euphoria and evaluate the pullback to decide the next course....already seeing some very sharp pullbacks in many names yesterday and today despite the indices...
24 Mar 09 - 10:20 gmt
Cole Trickle a.k.a Anon Bull said ...
@Moron might be wise to listen to Jaa...
24 Mar 09 - 10:50 gmt
Moron said ...
am listening .... loads of respect for Jaa...
24 Mar 09 - 10:52 gmt
Mr. Bean said ...
Mr. Donkey, while I'm sure we will be heading back down again, I can picture you still saying this in many years time when the DOW is back at 14,000... lol
24 Mar 09 - 10:53 gmt
Moron said ...
:))))))....unfortunately I don't think we will see Dow 14000 for a few decades now.....
24 Mar 09 - 10:54 gmt
anonymous said ...
UK inflation up so don't bother with the gym anymore.
24 Mar 09 - 11:01 gmt
Alpha60 said ...
@Fin your last story about BH... A clue to you true identity maybe?
24 Mar 09 - 11:09 gmt
Tradebot said ...
Finbar... i don't think you will be skinny dipping soon.... CPI and RPIX surprised the market to the upside again. Deflation is out, inflation is the new black. Once again, the data has made Merv look like a fool.
24 Mar 09 - 11:50 gmt
anonymous said ...
@MsR its a quote from CNBC.....'Anyone who is stupid is dead'
24 Mar 09 - 12:44 gmt
MsR said ...
@anon 12.44 you have to stop watching that station.it is very bad for you. Meanwhile I formulate plans for a Jaa, Moron and Anon Bull radio show. I think it could be very informative..i would of course mediate.
24 Mar 09 - 13:10 gmt
Moron said ...
ms R.....Moron is very reclusive bcos Moron is clinically insane:))))
24 Mar 09 - 13:14 gmt
KONG said ...
What happens if the highest bids for Toxic Assets are significantly below what the banks currently mark them at. Is there not a risk that the price discovery that the auction process creates may lead us to discover things we'd rather not know for sure (i.e. that the US banks are all insolvent)?
24 Mar 09 - 13:23 gmt
Cole Trickle a.k.a Anon Bull said ...
I second that Moron. Some of your recent calls have bordered on insanity.
Watched days of thunder last night....It's Top Gun in cars!!
24 Mar 09 - 13:26 gmt
MsR said ...
@ColeTrickle...I like Anon Bull better. Cole Trickle sounds like a country and western singer:) Days of Thunder..is that the one with Kidman and the allegedly not gay Tom Cruise?L
24 Mar 09 - 13:47 gmt
Jaa said ...
sounds like a WAG name.. I prefer billy big bollox... :))
24 Mar 09 - 14:50 gmt
Cole Trickle a.k.a Anon Bull said ...
@MsR thats right, days of thunder, a cruise and kidman cheesfest...so bad that u just have to watch it all the way to the end. When Cole overcomes the odds to achieve the american dream!!
@Jaa am only known as billy big bollox to my female friends..lol
24 Mar 09 - 15:05 gmt
Moron said ...
anon bull....are u really this dumb or are u just playing dumb....now thats the question:))))
24 Mar 09 - 15:19 gmt
Jaa said ...
what are their names billy?... dave or john perhaps..:))
24 Mar 09 - 15:22 gmt
Moron said ...
:))))))))))
24 Mar 09 - 15:30 gmt
Jaa said ...
:)) donkey.. i am looking at a couple of stocks that look interesting on the upside....i want ur opinion C us(i know, i know) and MF us.. only via opts .. any thoughts
24 Mar 09 - 15:38 gmt
Moron said ...
had a quick look at the technicals.....imho they are both shorts after this run up.....if u have to go long c us has a significantly better chart than mf us ..... mf us looking too extended......i'd short them both actually if i knew the fundamentals a bit better:))))
24 Mar 09 - 15:42 gmt
Moron said ...
know some well placed ppl at c us by the way....the internal talk is that pandit is a muppet who got lucky and the ship is sinking fast!!!
24 Mar 09 - 15:47 gmt
Jaa said ...
oops!
24 Mar 09 - 15:53 gmt
Moron said ...
c us currently a political hell hole.....being run by a lot of really sick ppl who are taking great pleasure in firing some good ppl who have done good for the firm over the years.....its panic stations from what i hear!!!
24 Mar 09 - 15:56 gmt
Jaa said ...
tks.. stupid idea...
24 Mar 09 - 16:04 gmt
Moron said ...
thats what i find a bit funny abt our business.....its so removed from reality.....the ppl on the ground in these companies know their ships are sinking.....but the market buys ceo spin and bids the stocks up as if we are on the cusp of a recovery.....mayb i am wrong...mayb the market is looking ahead as it usually does.....like 3 0r 4 years ahead:)))))))
24 Mar 09 - 16:25 gmt
KONG said ...
The market certainly appears to have temporarily detached from fundamentals. What else can explain banks rising so much just as a tidal wave NPLs is forming. Or am I just bitter at being short Aussie banks this past week?
24 Mar 09 - 16:46 gmt
Jaa said ...
the multi decade belief in a perpetual bull mkt will mean we get these buying frenzies.. the average investor is ignorant and greedy, and this will prove to be their ultimate undoing.
24 Mar 09 - 17:59 gmt
Moron said ...
yup....and the real bottom comes 2-3 years down the line....at prices i believe will be significantly lower than even the november or march lows......how much lower...it is hard to tell as yet.....
24 Mar 09 - 18:02 gmt
Jaa said ...
I will growing my own food by then...a few chickens, and a big gun..:))
24 Mar 09 - 18:16 gmt
anonymous said ...
hehe moron is losing lots of cash, market is up and those shorts are very expensive
24 Mar 09 - 18:27 gmt
Moron said ...
which market is up mate......and don't worry.....moron has lots of cash to lose unlike u:))))
24 Mar 09 - 18:30 gmt
anonymous said ...
all the markets you gas on about are up on their Nov lows and you have been telling us all day every day that you are short. if you are speaking the truth, your cumulative shorting costs will be huge too..must suck to be you
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