Author Archives: Felix

WealthPorn Day Arrives

Posted on April 16, 2008 by Felix

It’s WealthPorn Day today, also known as the day that Alpha magazine releases its annual list of the top-earning hedge fund managers. Of course, that also makes it a great day for politicians, including Hank Paulson, to call for greater … Continue reading →

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The Latest Victim of the Credit Crunch: Libor

Posted on April 16, 2008 by Felix

Carrick Mollenkamp has a worrying piece in the WSJ today about Libor in general, and the much-benchmarked three-month Libor fixing in particular. Jitters have made many banks unwilling to extend loans to each other for more than one week. As … Continue reading →

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Why Bush Doesn’t Like Cap-and-Trade

Posted on April 16, 2008 by Felix

You want an argument for why a cap-and-trade system makes more sense than a carbon tax if you want to reduce carbon emissions? Take a look at all the noise surrounding the Bush speech on the subject today. Bush’s goal, … Continue reading →

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Extra Credit, Tuesday Edition

Posted on April 15, 2008 by Felix

John McCain’s gas-tax pander A Recluse Lifts the Veil a Little: Sorkin gets an interview with Stephen Feinberg. Apparently he’s no stickler for fine carpeting. Exxon Mobil investor says: stop wasting our time! The activist investor agitating against activist investors. … Continue reading →

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Blogonomics: Herb Greenberg Quits Blogging

Posted on April 15, 2008 by Felix

The insightful Herb Greenberg is leaving journalism to start up "an independent equity research boutique". And all power to him: as Paul Kedrosky says, "he deserves the broadest possible playing field to display and, yes, benefit financially from his talents". … Continue reading →

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How to Respond to a Cease & Desist Letter

Posted on April 15, 2008 by Felix

Kurt Denke, the president of Blue Jeans Cable, is the Andre Agassi of the audio/video cable industry: he has an absolutely devastating return of serve. You know in the movies where the bully picks a fight with the wrong guy? … Continue reading →

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Why Wachovia Needs That $7 Billion

Posted on April 15, 2008 by Felix

Yesterday, I asked why Wachovia needed another $7 billion in fresh equity, and suggested it might be because it overpaid for Golden West Financial and was considering writing down part of the $25.5 billion acquisition cost. There’s a big problem … Continue reading →

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Blogonomics: Ad Network Valuations

Posted on April 15, 2008 by Felix

Erick Schonfeld reports today that Federated Media, a network which sells ad space on a network of blogs, is raising $50 million at an eye-popping valuation of $200 million. That’s a hell of a lot of money: it’s nine times … Continue reading →

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How Holdbacks Brought Down Frontier Airlines

Posted on April 15, 2008 by Felix

On Friday I got a bit confused about something called credit card holdbacks, and how they could be used to drive an airline into bankruptcy. It turns out that it all goes back to something known as the Fair Credit … Continue reading →

Posted in bankruptcy | 1 Comment

When the Fed Gave Up on Bear Stearns

Posted on April 15, 2008 by Felix

If you have a few minutes to spare, it’s worth reading the official background to the JP Morgan – Bear Stearns merger, as filed with the SEC. The bit which jumps out at me is that after throwing Bear a … Continue reading →

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Spinning Deutsche’s Loan Sale

Posted on April 15, 2008 by Felix

I’m having something of a Rashomon moment with respect to Deutsche Bank’s sale of leveraged loans. Dana Cimilluca and Peter Lattman, in the WSJ, say that the mooted sale by Deutsche Bank "could bolster its own health as well as … Continue reading →

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Private Equity Debt Buybacks: A Second Bite at the Cherry?

Posted on April 15, 2008 by Felix

Here’s one for Dear John Thain or anybody else wondering about what happens when a private-equity shop buys the debt of its own portfolio companies. Let’s say that the portfolio company in question goes bankrupt, and is taken over by … Continue reading →

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Extra Credit, Monday Edition

Posted on April 14, 2008 by Felix

HELOC Nonsense: Tanta on how HELOCs work in the real world. The Muffie Benson-Perella Show: Fox Business invites a fictional character onto their 5pm show. Spiers, Cox Get New Titles For Same Jobs: A first, I’m pretty sure: a reasonably … Continue reading →

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Iceland: Victimized by its Tiny Currency

Posted on April 14, 2008 by Felix

Jim Surowiecki has a good piece on Iceland this week. "When we look at Iceland’s predicament," he says, "we should say that there but for the grace of China go we." It’s a good point. If Iceland risks becoming the … Continue reading →

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Blogonomics: Selling Wonkette

Posted on April 14, 2008 by Felix

Wonkette has been sold, to its managing editor, Ken Layne. In the memo, Nick Denton explains that Gawker Media just wasn’t very good at selling political ads. "Political advertisers are a strange breed; they don’t come through the same agencies … Continue reading →

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Recession: What can the President do?

Posted on April 14, 2008 by Felix

Paul Krugman and Jesse Eisinger both have new columns out today, and they’re remarkably similar, dealing as they do with what, if anything, the next president is going to be able to do about the economic malaise facing the USA. … Continue reading →

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The Problem With Private Equity Buying Leveraged Loans

Posted on April 14, 2008 by Felix

Remember how those private-equity companies are buying back a bunch of their own debt at 90 cents on the dollar? Well, if it’s literally their own debt, rather than simply a bunch of leveraged loans in general, then Equity Private … Continue reading →

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Bidding Sotheby’s Down

Posted on April 14, 2008 by Felix

Robert Frank is worried about the accounts receivable at Sotheby’s, which more than doubled to $835 million in 2007. This means that the "clients of Sotheby’s appear to be falling behind on their bills," he says – which could be … Continue reading →

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Buffett Caves

Posted on April 14, 2008 by Felix

Well, that didn’t take long. A week ago the WSJ reported that Federal prosecutors were requesting the resignation of General Re CEO Joe Brandon; today it happened, despite Brandon’s having the strong support of his boss, Warren Buffett. I don’t … Continue reading →

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Neutra Houses for Sale

Posted on April 14, 2008 by Felix

Arts blogger extraordinaire Tyler Green has a piece in the May issue of Portfolio on Richard Neutra’s Kaufmann House, which is being sold by Christie’s with an estimate of $15 million to $25 million; I blogged the house myself, back … Continue reading →

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Ngozi Okonjo-Iweala is Brilliant

Posted on April 14, 2008 by Felix

It’s the Brilliant issue of Portfolio this month, and under "Game Changers" one finds a lot of big-deal CEOs: Rupert Murdoch, Jamie Dimon, Lloyd Blankfein, Ratan Tata. And right there next to them is Ngozi Okonjo-Iweala. I went down to … Continue reading →

Posted in world bank | 2 Comments

Why Wachovia Needs Another $7 Billion

Posted on April 14, 2008 by Felix

Why does Wachovia need another $7 billion of equity capital, on top of the $8.3 billion it raised earlier this year? It’s not like its capital ratios are particularly gruesome: as of March 31, its Tier 1 capital ratio was … Continue reading →

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Ben Stein Watch: April 13, 2008

Posted on April 13, 2008 by Felix

Ben Stein has a lot of money invested in the stock market, and tends to think of the stock market as a proxy for financial markets as a whole. So last summer, when the credit crunch first hit, he was … Continue reading →

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Frontier Airlines, The Latest Credit Card Victim

Posted on April 11, 2008 by Felix

I’m well aware that there’s no such thing as a free lunch. But some things come close, at least to the untrained eye, and one of them is the insurance that you get whenever you buy something on a credit … Continue reading →

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Annals of Stupid Philanthropy, BB&T Edition

Posted on April 11, 2008 by Felix

What is it with ill-advised million-dollar charitable donations by banks? First of course there was Citigroup giving $1 million to the 92nd Street Y so that Jack Grubman’s twin girls could get into the preschool there. And now, well, I’ll … Continue reading →

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