Monthly Archives: January 2009

Ecuador Craziness Datapoint of the Day

Posted on January 7, 2009 by Felix

Today is clearly "crazy things people try to do while in default on their debt" day. First Friendfinder Networks tries to IPO, and now Ecuador is trying to borrow more money: Ecuador is seeking $2.6 billion in credits from regional … Continue reading →

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John Paulson, Proud Short

Posted on January 7, 2009 by Felix

Gary Weiss has a profile of John Paulson in the February issue of Portfolio which I misread when I first came across it. He talks a bit about Paulson being "unrepentant" about the money he’s made during the market crash … Continue reading →

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Blogonomics: Wallstrip Goes From $5 Million to Zero

Posted on January 7, 2009 by Felix

The message on the Wallstrip home page is upbeat: Happy Birthday to us That’s right, two years of pure web video stock market fun. The market’s slowing down, but we’re not! Except, Wallstrip has slowed down all the way to … Continue reading →

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Meagan Chung Pleads Innocent

Posted on January 7, 2009 by Felix

In one of the longest news articles I can remember reading in the New York Post, the SEC’s Meagan Chung — the woman who investigated Bernie Madoff in 2005 and cleared him of fraud — tries, unconvincingly, to defend herself. … Continue reading →

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Taking a Bankrupt Company Public

Posted on January 7, 2009 by Felix

One of the defining features of the dot-com bubble was the long line of loss-making companies coming to market with IPOs. That all came to an end when the bubble burst, and right now nobody is coming to market with … Continue reading →

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Why the New York Times Won’t Cease Printing

Posted on January 7, 2009 by Felix

The end of the world is nigh! Or the end of the print edition of the NYT, anyway, at least according to Michael Hirschorn, in a piece which has been generally well-received by a blogosphere. For me, however, the article … Continue reading →

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Extra Credit, Tuesday Edition

Posted on January 6, 2009 by Felix

How to tackle foreclosures and unemployment at the same time: Get some desperately-needed empirical data on loan mods. Doing the Math to Find the Good Jobs: Mathematicians have the top three best jobs. Economists are in 11th place, just ahead … Continue reading →

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Quants: What Are They Doing These Days?

Posted on January 6, 2009 by Felix

I was talking about quant funds this afternoon, and got to wondering what on earth they’re doing these days, given that their m.o., up until say the summer of 2007, was to find trading ideas, backtest them, try them out … Continue reading →

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Tribune Implosion Datapoint of the Day

Posted on January 6, 2009 by Felix

How low can recovery rates go? Today the CDS auction on Tribune’s defaulted bonds settled at 1.5 cents on the dollar, which is low but in line with expectations of bondholders essentially getting nothing once the secured creditors have been … Continue reading →

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The Deaccessioning Debate

Posted on January 6, 2009 by Felix

I’ve been catching up on the art blogs this slow news day, which means catching up on a long and sometimes confusing debate about deaccessioning which was sparked by the sale of two paintings by New York’s National Academy. Ground … Continue reading →

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In Favor of Arts Spending

Posted on January 6, 2009 by Felix

Michael Kaiser makes some good arguments in favor of increased arts funding, but unfortunately he mixes them up with bad ones, and he glosses over the best ones. The result is that Tyler Cowen gets to take the moral high … Continue reading →

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The Problem of Regaining Trust

Posted on January 6, 2009 by Felix

Eric Falkenstein sums up 2008 through a ratings-agency lens: I think 2008’s problem was mainly because after the rating agencies were exposed as making an error on their AAA and AA ratings, all investors viewed such securities skeptically. What was … Continue reading →

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Extra Credit, Monday Edition

Posted on January 6, 2009 by Felix

The myth of the riskometer: "The lessons have not been learned. Risk sensitivity is expected to play a key role both in the future regulatory system and new areas such as executive compensation." Fighting Off Depression: Krugman warns that "this … Continue reading →

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From Crunch to Catatonia

Posted on January 5, 2009 by Felix

Bloomberg has a great headline this morning: Banks’ ‘Catatonic Fear’ Means Consumers Don’t Get TARP Relief While it does have a little bit of on-the-other-hand, the thrust of the story is strong and clear: we’re trying to kick-start bank lending … Continue reading →

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Broken Glass

Posted on January 5, 2009 by Felix

Is Waterford Wedgwood luxury, or "masstige"? Either way, it’s bust. Its $625 million in debt is essentially worthless, it’s been losing money before interest payments for a couple of years now, and its prospects, as we enter another grim year … Continue reading →

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How Did Madoff Fool the SEC?

Posted on January 5, 2009 by Felix

Kara Scannell has been looking at the SEC’s Madoff memos: The 2005 review and Mr. Markopolos’s report prompted the SEC to open an enforcement case, a notch more serious in the SEC’s world than the previous examination. "The staff is … Continue reading →

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Art Auction Datapoint of the Day

Posted on January 5, 2009 by Felix

Remember those furtive seller’s rebates from auction houses? Georgina Adam says that in at least one instance they might have risen to include the entire buyer’s premium: In some cases the whole of the buyer’s premium was given to the … Continue reading →

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Extra Credit, Sunday Edition

Posted on January 4, 2009 by Felix

The End of the Financial World as We Know It: Part 1, Part 2. Lewis and Einhorn are right; it’ll be interesting to see whether Tim Geithner moves in the direction they suggest. Risk Mismanagement: Nocera on VaR. A second … Continue reading →

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Remunerating Managerial Talent

Posted on January 4, 2009 by Felix

Robert Frank is quite certain about executive pay: Why not limit executive pay? The problem is that although every company wants a talented chief executive, there are only so many to go around. Relative salaries guide job choices… If C.E.O. … Continue reading →

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Financial One-Liner of the Day

Posted on January 4, 2009 by Felix

The comfort you get from a triple-A rating is like the comfort you get from locking three car doors. (Thanks to CaptainJJack for the inspiration)

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Ecuador’s Ingenious Descending Auction

Posted on January 2, 2009 by Felix

There’s something quite elegant about Ecuador’s proposed bond auction. It’s not doing a typical old-bonds-for-new-bonds exchange, which no one would tender into. And it’s not trying to buy up its debt in the secondary market, where it could be picked … Continue reading →

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Taleb vs Merton, Cont.

Posted on January 2, 2009 by Felix

Nassim Nicholas Taleb is angry. Not in the YouTube clip of the same name, but rather at Nobel laureate Bob Merton, whom Taleb attacked in a paper he co-wrote with Emanuel Derman of Columbia. In the wake of that paper … Continue reading →

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The Riskiness of Bonds

Posted on January 2, 2009 by Felix

Yesterday I questioned the wisdom of retail investors buying bonds in this market, and boy did I get an earful back, especially from many of the commenters at Seeking Alpha. They accused me of not drawing the distinction between Treasuries … Continue reading →

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Extra Credit, Thursday Edition

Posted on January 2, 2009 by Felix

Three Banks Complete Deals: BofA’s acquisition of Merrill Lynch has now closed; so has Wells Fargo’s acquisition of Wachovia. That sigh of relief you’re hearing is coming from arbitrageurs who were long MER and WB. Relitigating 1998 at the end … Continue reading →

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