Category Archives: banking

Citi: Looking Weak

Never mind the Rubin news; that was all but a given. And the Bischoff news is not that much of a big deal either: the chap is the classic safe pair of hands who will be competent enough at managing … Continue reading

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Chuck Prince Deathwatch: Keep an Eye on Medina-Mora

The WSJ is reporting that Citigroup is holding an emergency board meeting this weekend, and that Chuck Prince’s ouster might be on the agenda: It wasn’t clear precisely what the meeting would address, but the subject of further writedowns could … Continue reading

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Why Wall Street CEOs Get Paid So Much

Robert Reich thinks that Wall Street CEOs get paid more than their Main Street counterparts because they’re liars: There’s no reason to believe Wall Street executives have been smarter than executives in the real, non-financial economy. They’ve been paid more … Continue reading

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Investment Banks: Much Room to Fall Further

Floyd Norris has a chart today which puts the recent share-price drops at Merrill, Citi, Bear and the like in context. Yes, they’re down from their highs, but the broker-dealers in general have massively outperformed the rest of the stock … Continue reading

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Merrill: The Latest Victim of a WSJ Attack

There’s definitely a sensationalist edge to the WSJ these days. It’s banging the Jimmy Cayne drum for the second day running, with a story misleadingly headlined "CEO of Crisis-Hit Bear Denies He Used Marijuana": for one thing, the Bear Stearns … Continue reading

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Jimmy Cayne Declares Victory Over WSJ

Cayne, on CNBC, via Dealbreaker: "It’s unbelievable. The phones are ringing off the hook, and everyone wants to play golf with me now." I’m glad it seems to have worked out this way. There are good reasons for a CEO … Continue reading

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Merrill’s Board: Asleep at the Wheel

With Stan O’Neal out the door, whither the board which supported all of his decisions? Peter Eavis has a good point today: Merrill Lynch’s board is arguably just as culpable for the firm’s atrocious results as the erstwhile CEO was. … Continue reading

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How Jimmy Cayne Can Survive the WSJ Attack

The WSJ is splashing Kate Kelly’s story about Jimmy Cayne’s part-time leadership of Bear Stearns this summer all over the front page of its newspaper and website. There’s a full spectrum of reactions, ranging from the hoped-for push towards Cayne’s … Continue reading

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Insider Trading at Goldman? Very Unlikely

Did people named Paulson have all the best information about the mortgage crisis this summer? The Paulson Credit Opportunities fund was up 410% as of the end of August (that’s John Paulson), while now the SEC is reportedly investigating possible … Continue reading

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Finding a New Merrill CEO

As John Carney notes, it’s a little bit weird that Merrill Lynch is now headless – and just as the all-important bonus decisions are being made, too. Why no interim CEO? Carney speculates that no one is willing to do … Continue reading

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Wall Street Bonus Update

As someone who’s personally invested in this year’s Wall Street bonus pool – I have a bottle of Scotch on the line – I was quite happy to turn to page B5A of this morning’s WSJ. (Please, Mr Murdoch, can … Continue reading

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Northern Rock: The Bidding Heats Up

If Chris Flowers thought he was going to have little competition in his quest to buy Northern Rock, he’s been comprehensively disabused of that notion at this point. The Virgin bid might sound a bit lightweight (a rebranding to Virgin … Continue reading

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Merrill: Your Questions Answered

A very loyal reader writes: Why did O’Neal defenestrate while Cayne at Bear and Prince at Citi have managed to hang on to their jobs? Is a takeover of Merrill realistic, considering the handicaps of the few firms big enough … Continue reading

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Who Will Rescue Merrill?

Peter Eavis joins the Tim Price/Lily Tomlin school of investment-banking analysis: It doesn’t look good that O’Neal was allegedly raising the possibility of a sale at a time when the brokerage was about to report over $8.3 billion of losses … Continue reading

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Merrill’s Board Turns on O’Neal

Who told the NYT’s Jenny Anderson about Stan O’Neal’s abortive attempt to float a merger with Wachovia? She sources her scoop to "people close to the beleaguered Wall Street firm," which is not very helpful, but it seems clear that … Continue reading

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The Globalization of Goldman Sachs

The New York Post tells us today that 57% of Goldman Sachs’s 299 new managing directors work outside the US. But how does that compare to the present cohort? I asked Goldman if they could give me the goegraphical breakdown … Continue reading

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Solly, 1987: Hero or Villain?

Traders never pay much attention to strategists, and are generally much the richer for it.
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Lily Tomlin, Market Strategist

Tim Price sums up the state of contemporary investment banking in two quotes: “I’ve had all the fun I can stand in investment banking” – Ken Lewis, (current) chief executive, Bank of America. “Things are going to get a lot … Continue reading

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The End of the Merrill Myth

There is absolutely no silver lining to the $8.4 billion in writedowns that Merrill Lynch announced today. Merrill is being hit from all sides: sell-side analysts, on the conference call; journalists; ratings agencies; and, of course, the stock market. Dana … Continue reading

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The Irony of Matt Ridley

So it turns out that the Matt Ridley who writes popular bestsellers on genomics is the same Matt Ridley who was chairman of Northern Rock until last Friday. He also was a columnist for the Londont Telegraph, where he used … Continue reading

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Watching SIVs’ Assets Decline

Sam Jones has a fascinating chart showing the evolution of SIVs’ net asset values over the past three months. The best SIVs are doing fine, no problem there at all. The worst are doing atrociously: "Axon Financial, managed by TPC-Axon … Continue reading

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The Citic Flip-Flop

On Friday, things seemed clear enough, with Citic issuing a clear denial that it would take an ownership stake in Bear Stearns. China Citic Bank, meanwhile, also denied that it was in talks to buy a stake in Bear Stearns. … Continue reading

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How the Rich get Richer, Epicurean Edition

Why does Goldman Sachs always top the M&A league tables, when other banks’ ideas are just as good? Why is Jessica (Mrs Jerry) Seinfeld’s new book suffering from too much demand, when an almost identical book by Missy Chase Lapine … Continue reading

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Goldman Simpson?

In the world of M&A, you need a financial adviser (an investment bank) and you need a legal adviser (a law firm). Legal advisers make lots of money. Financial advisors make much, much more – despite the fact that senior … Continue reading

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Bank of America: Not Glamorous

Bank of America CEO Ken Lewis seems to have finally woken up to the fact that he is not, and never will be, an investment banker: Lewis said during a conference call that the company plans to scale back its … Continue reading

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