Monthly Archives: September 2008

Damien Hirst: $200 Million Richer

Posted on September 16, 2008 by Felix

The final results are in: the Damien Hirst auction at Sotheby’s raised £111.5 million, which is thisclose to $200 million. (It would have been comfortably over the $200 million level at any point until the pound collapsed at the beginning … Continue reading →

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AIG: The Cramer Conspiracy Theory

Posted on September 16, 2008 by Felix

You knew that someone was going to come out and say it. But did you know it was going to be Cramer? Shorts were able to take AIG down from the $20s to $4 in a week’s time. To be … Continue reading →

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Counterparty Risk Moves to the Fore

Posted on September 16, 2008 by Felix

The best news to come out of the Fed meeting was that Tim Geithner wasn’t there. That means he was in New York, where he belongs, worrying about AIG and counterparty risk rather than macroeconomics and the Fed Funds rate. … Continue reading →

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Barclehs: It’s On

Posted on September 16, 2008 by Felix

The FT reports that Barclays is swooping in on its white horse and scooping up the distressed Lehman Brothers: The two parties reached an agreement in the New York morning that centres around Lehman’s core US broker-dealer operations, which perform … Continue reading →

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AIG Is Toast

Posted on September 16, 2008 by Felix

How dangerous is AIG? Michael Lewitt tells us, in today’s NYT: There is a substantial possibility that A.I.G. will be unable to meet its obligations and be forced into liquidation. A side effect: Its collapse would be as close to … Continue reading →

Posted in insurance | 4 Comments

Investment Banks, RIP

Posted on September 16, 2008 by Felix

The meme of the day is the end of the investment bank. Here’s John Gapper: Morgan Stanley opened on Wall Street on Monday September 16 1935 and, 73 years later, almost to the day, the institution of the broker-dealer died… … Continue reading →

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Horatio, Market Analyst

Posted on September 16, 2008 by Felix

Where to turn in days like these? Paul Wilmott had a great idea and cracked open his copy of Hamlet: And let me speak to the yet unknowing world How these things came about. So shall you hear Of carnal, … Continue reading →

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The WSJ’s Gorgeous Redesign

Posted on September 16, 2008 by Felix

I love the new WSJ.com. It’s clean, intuitive, elegant, easy to read, and blazingly fast. I should imagine that subscribers will spend a lot more time there now than they were spending up until now, just because the site is … Continue reading →

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Craziness at the Short End of the Yield Curve

Posted on September 16, 2008 by Felix

What’s going on with Libor? Painfully and predictably, overnight dollar Libor has spiked to an eye-popping 6.44%, up from 3.11% yesterday. And sterling Libor rose a lot too: it’s now at 6.79%, up from 5.4%. But look at euro Libor: … Continue reading →

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Girding for a Tumultuous Tuesday

Posted on September 16, 2008 by Felix

Yesterday I said that in order to turn this market around, we’d need to see either (a) a deal to buy Lehman Brothers, or (b) a convincing recapitalization of AIG. The latter seems as far away as ever, but the … Continue reading →

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Extra Credit, Monday Edition

Posted on September 15, 2008 by Felix

AIG’s Long-Term Debt Ratings Cut by S&P, Moody’s: This is how the world ends: not with a bang but with a downgrade. Hirst’s Art Auction Attracts Plenty of Bidders, Despite Financial Turmoil Totally Unfounded Rumors: Midday Ratings Summary Pandit Memo … Continue reading →

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Surveying the Carnage

Posted on September 15, 2008 by Felix

When the Dow falls 500 points in a day, you know that’s going to lead the news everywhere both tonight and tomorrow morning. So, being a natural contrarian, my first reaction was to put today’s action in the "not nearly … Continue reading →

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McCain vs Obama: The Lehman Responses

Posted on September 15, 2008 by Felix

John McCain and Barack Obama both have official responses up to the Lehman collapse, and McCain’s is much better than Obama’s: shorter, punchier, more to the point. I score it 6-0 to McCain. McCain first: The crisis in our financial … Continue reading →

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Was Sarah Palin at the Fed This Weekend?

Posted on September 15, 2008 by Felix

This quote, from an anonymous Fed official, worries me: "We’ve re-established ‘moral hazard,’" said a person involved in the talks, referring to the notion that the government should eschew bailouts, since financial firms might take more risks if they’re insulated … Continue reading →

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Still Not Breathing Easily

Posted on September 15, 2008 by Felix

I’ve got a feature over on the main Portfolio.com site today, which is basically an expansion of my blog entry from yesterday on when we can start breathing again. It even gets a bit wonky — I look not only … Continue reading →

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Wall Street’s New Realities

Posted on September 15, 2008 by Felix

My anonymous colleagues here at Portfolio.com have a couple of questions: With Bank of America’s $44 billion acquisition of Merrill Lynch, only two independent Wall Street firms remain: Goldman Sachs and Morgan Stanley. Will they now feel pressure to merge … Continue reading →

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Merrill-BofA: Doubts Surface

Posted on September 15, 2008 by Felix

Is Bank of America really going to buy Merrill Lynch? The stock market’s saying that it has its doubts. With stock prices having settled down a little this morning, BAC is trading at $29.36 per share (down 13%), while MER … Continue reading →

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Photo of the Day

Posted on September 15, 2008 by Felix

From the Wall Street Sweetheart:

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Why Lehman Wasn’t Saved

Posted on September 15, 2008 by Felix

If you’re going to launch a new website devoted to business news, then doing so on the biggest day for business news in living memory is probably a good thing, on balance. Naturally, The Big Money leads today with a … Continue reading →

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Hirst: Worst. Timing. Ever.

Posted on September 15, 2008 by Felix

Let’s say you’re a nouveau-riche hedge-fund manager with a penchant for splashing your cash. Even so, today, of all days, you’re really not going to have any desire to kick off work early and go drop a few million bucks … Continue reading →

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Wall Street Huddles for Safety

Posted on September 15, 2008 by Felix

Small banks, it seems, have precious few friends these days; even the big banks worry about surviving alone, and so they’re pooling their resources. $7 billion each, to be precise, from Bank of America, Barclays, Citigroup, Credit Suisse, Deutsche Bank, … Continue reading →

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Fed Taking Equities as Collateral

Posted on September 15, 2008 by Felix

Is the Fed accepting equities as collateral? Bloomberg says yes, the WSJ says yes, Reuters says yes. So, yes. But if that’s the case, why didn’t it say so? Here’s the relevant bit of the Fed statement: The collateral eligible … Continue reading →

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Lehman: No Chapter 7, Yet

Posted on September 15, 2008 by Felix

As expected, Lehman Brothers has filed for bankruptcy. But in a twist, the brokerage subsidiaries haven’t: Late Sunday night, Lehman said it intends to file for protection under Chapter 11 of the U.S. Bankruptcy Code with the United States Bankruptcy … Continue reading →

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Extra Credit, Sunday Edition

Posted on September 14, 2008 by Felix

Where Was Lehman’s Board? "About half of Lehman’s 11 directors are over the age of 70." Buffett Prediction: Will Warren help rescue AIG? Nice Work If You Can Get It: Could WaMu’s Alan Fishman end up earning $7.5 million for … Continue reading →

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Thain’s Elegant Exit

Posted on September 14, 2008 by Felix

The difference between Dick Fuld and John Thain is that Thain knows when to let go: It could not be determined if Mr. Thain will play a role in the new company, but two people briefed on the negotiations said … Continue reading →

Posted in banking, defenestrations | 1 Comment