The Rich really are Different….

Now that it seems you need a million dollars just to stay alive, the cultural imagination has been captured by a billion. “I’ve met six billionaires!” crowed a friend of mine, counting them on his hands, and then correcting himself—“Seven!” Our mayor, of course, is a billionaire five times over, with seven homes, a few worth $10 million, and a Florida estate he bought for his daughter to strengthen her equestrian training. Over brunch on a recent Sunday, my girlfriends and I chatted about their Saturday night out—this one talked to one of the Dells; that one sat next to Stewart Rahr, the pharmaceutical mogul and owner of the most expensive home in the Hamptons; and everyone saw Ian Schrager.

“He’s not a billionaire!” huffed one of my friends, outraged at our ignorance.

To be a billionaire is to be radically free. You are your own galaxy. You make your own rules, hang out with the former president, send tourists to space. Billionaire investor Jeffrey Epstein, who lives in the largest dwelling in Manhattan, a 51,000-square-foot palace on 71st Street—though his business, naturally, is located on a 70-acre private island in the Virgin Islands—was humiliated this summer when his lifestyle was made public. Epstein was known to be a womanizer: He usually travels with three women, who are “strictly not of our class, darling,” says a friend. They serve his guests dinner on his private 727, and are also there for touching.

But it seems that he was also interested in younger women: Over the past few years, a then-17-year-old Olive Garden waitress, Haley Robson, brought at least five high-school girls between the ages of 14 and 16 over to Epstein’s house in Palm Beach to “massage” him, which meant watching him masturbate and even allegedly having sex. Epstein’s defense seems to be that he didn’t know the girls were minors, and that he is “very passionate about massage,” as one of his lawyers says.

Those who know Epstein say he’s unfazed by his travails. “He’s totally open about his life: His life is about making money and living an erotic life, and his escape isn’t alcohol or drugs—it’s sex,” says a friend. “I was talking to him the other day, and he said to me that he was doing well and working steadily—between massages.”

But art falls short when describing the lives of billionaires. Steve Wynn is free enough to afford to buy a Picasso, even when his eyesight is famously challenged, and to rip a hole in that Picasso with his elbow while distractedly showing the painting before he closed the deal with hedge-fund billionaire Steve Cohen to buy it for $139 million, which would have been the highest price ever paid for a work of art. Convinced that the elbow gaffe was fate, Wynn decided to keep the picture—what’s $139 million, after all, to a man like him?

A billionaire has the wherewithal to match his moral vanity: While the rest of us struggle to keep our heads above water, billionaires are saving the world. There’s Branson’s pledge to invest the next ten years of profit from his Virgin Group’s airline and train businesses in renewable-energy initiatives, worth $3 billion. Bing, along with Burkle and others, has pledged $1 billion to do the same. In June, Warren Buffett, the thrifty bridge player with the five-bedroom house in Nebraska, donated $31 billion to the Bill and Melinda Gates Foundation for education and global development. Buffett plans to give away 70 percent of his fortune. “If I wanted to,” he has said, “I could hire 10,000 people to do nothing but paint my picture every day for the rest of my life. And the gross national product would go up.” But “there’s no reason future generations of Buffetts should command society just because they came from the right womb. Where’s the justice in that?”

http://newyorkmetro.com/guides/money/2006/23463/index.html

Is Brian Hunter b-a-a-a-c-k in business?

You gotta be kidding. Some people have zilch for short term memory, but isn't it a little soon? Brian Hunter, the Amaranth trader at the center of the big $6 billion natural gas loser trade that caused the implosion of the fund, is said to be exploring whether to get back in business. He's apparently put out feelers with Wall Street contacts to see if there's any appetite for backing him.

If he does end up in the game again, whoever is brave enough to roll the dice might want to consider keeping him on a very short leash – not to mention teaching the dude to heel.

His decision on whether to start a new energy fund could depend on the outcome of regulatory inquiries and litigation over Amaranth's collapse....

An executive recruiter in contact with Mr. Hunter says he has offered to help introduce the once-highflying trader to investors. The recruiter sees opportunities for Mr. Hunter to make a fresh start with high-net-worth investors, possibly in Russia and the Middle East.

http://wallstfolly.typepad.com/wallstfolly/2006/10/amaranths_brian_1.html#more

The French entrepreneurial spirit is not dead!

Why let high tuition bills get you down? Do what the French do. Increasing numbers of young women in France are turning to sex work to help pay the bills while they are at university, according to one of the country's leading students' unions. According to the SUD-Etudiant union, 40,000 students in France - or nearly 2 per cent - fund their studies through the sex trade.

The union says jobs taken by female students include hostess work and freelancing for escort agencies - as well as pavement prostitution. Many, it says, use secure payment sites on the internet through which they offer webcam striptease.

The students' union admits the phenomenon is hard to quantify. But when its members carried out a sample survey at Paul Sabatier University in Toulouse, they concluded that 545 out of 30,000 students had at some point worked in the sex industry.

The union quotes the case of "Julie", 35, who worked in the Belgian sex industry during seven successive summer vacations while studying to become a vet in France. She started as a window model in Brussels and moved on to erotic massage and escort work.

SUD-Etudiant - which campaigns for the French state to pay all students the minimum wage - said the sex trend was a result of falling subsidies and rising consumerism.

Guillaume Houzel, president of the Observatoire de la Vie Etudiante (OVE), which charts students' living conditions and income, said: "The phenomenon exists. More and more students are having trouble making ends meet because property prices are increasing while grants are staying the same." A major study of the French under-25 population in 2000 found that 100,000 students were living below the poverty threshold and 51 per cent had jobs in term time.

One vice squad officer said there was little the authorities could do to combat the trade and that some young women would always be attracted to the supposed glitter and glamour of the escort world. He added that most student prostitutes did not solicit through pimps but "through small ads, erotic photos and webcams - areas which are difficult to police and which generally are not linked to vice".

Police are sceptical about the figures quoted by the student union. They say there are many more prostitutes pretending to be French students than there are students selling sex in pursuit of their degrees.

http://news.independent.co.uk/europe/article1943299.ece

Merrill's "nuts or sluts" defense: Sex bias case par excellence

We’re betting that Merrill is going to have to cough up big bucks for this one. And it’s about time. We admit we’re prejudiced, given the major jerking around the Bull has given many talented acquaintances of ours.

In a legal scuffle that dates back to 1997 where 900 women filed a sex discrimination against Merrill Lynch, only six of them took it all the way through the arbitration process. One of the litigants, Nancy Thomas, duked it out with Merrill in front of a panel of three judges over 37 days with closing arguments ending last Tuesday. The panel heard her story of how "she was appalled by office episodes that included an obscene photo dropped at her desk; a dildo and lubricating cream left for her in the mailroom; and an office incident in which a male broker allegedly pulled down the underwear of a Merrill woman." Thomas is asking for $22 million plus compensation for emotional distress as well as punitive damages. There's no word on when the panel of judges will rule.

To hear Merrill Lynch & Co. tell it, Nancy Thomas was a lovesick stockbroker whose broken engagement 17 years ago turned her into a branch-office loser from a Wall Street success story.

In a prickly case that may cost Merrill millions -- Thomas is asking for $22 million, plus payment for emotional distress and punitive damages -- arbitrators will have to buy into Merrill's soap-opera tale if the brokerage firm is to walk away with its wallet intact.

Or, alternatively, the arbitrators could be persuaded that the law favors Thomas, who endured a crude, hostile workplace long on retaliation and vulgar humor and short on the perks and support that went to her male colleagues.

After 37 hearing days, 15 volumes of exhibits, and 8,000 pages of testimony, lawyers for Merrill and Thomas gave closing arguments Tuesday to a panel of three poker-faced arbitrators.

Thomas, 52, is one of only a half-dozen women in a 1997 class-action lawsuit who took her challenge to Merrill all the way through the arbitration process. Most of the 900 litigants in the sex discrimination lawsuit known as Cremin versus Merrill Lynch settled before any hearing took place. Thomas was one of eight named plaintiffs in the suit.

No one seems to know when the panel will deliver a decision; the panel chair asked for an extension of the two-week deadline given the complexity of the case. What is clear, though, is that Merrill's legal team made a decision to follow an age-old strategy used in sex discrimination cases: the ``nuts or sluts'' defense, in which a female plaintiff is characterized either as crazy, or a little on the loose side. In non-legal terms, these dudes are desperate.

http://wallstfolly.typepad.com/wallstfolly/2006/10/merrill_sex_bia.html

Hedges love affairs with wine, whiskey and movies turn sour. What’s next?

Hedge funds have invested in wine, whiskey and movies in pursuit of returns that outpace stocks and bonds. Now they're taking on an even riskier bet: the search for soccer's next Wayne Rooney.

For £250 000 (R3.5 million), investors will have the chance to buy a piece of the next potential superstar. The two UK-registered funds, Hero Investments and Sports Asset Capital, plan to buy stakes in the contracts of younger athletes, then grab a slice of the transfer fees clubs pay for players.

The funds expect to profit from a buying spree led by Chelsea's billionaire owner, Roman Abramovich, who has helped lift transfer spending by English clubs to a record £330 million this year. By taking part ownership of a player, they will also help smaller clubs compete for talent with larger rivals, the funds say.

Rich soccer teams often buy the rights to players for a one-time transfer fee that nets the selling club a profit. In 2001, Real Madrid paid a record $64.5 million (R495 million) to Italy's Juventus for French midfielder Zinedine Zidane. Manchester United paid £27 million to buy Rooney from Everton in 2004.

Nick Hely-Henderson, the founder of Hero Investments, says his fund will allow well-heeled soccer fans to profit while helping to bring more competition to the sport. Hero has raised £100 million to spend on contracts, Hely-Henderson says. The fund plans to invest for at least five years, and will probably acquire the rights of between 20 percent and 50 percent of the transfer values for each player.

Sports Asset Capital, set up by player-turned-financier Ray Ranson, has £50 million to invest. Ranson, a defender who had a 14-year career at clubs such as Manchester City, says his fund will buy insurance to protect it against career-ending injuries as it strives to deliver a 20 percent annual return.

http://www.busrep.co.za/index.php?fSectionId=553&fArticleId=3508539

Bonus Panic! More Credit Suisse Rumors

How bad have the losses from derivatives trading hurt Credit Suisse? That’s the question that is making the rounds at the Swiss bank, as hard working bankers toss and turn at night, fretting that their year-end bonuses might be hurt.

An additional source at Credit Suisse has told us that if the bank reports worse than expected numbers with its third quarter financials—due next Thursday—some bankers will be dusting off their resumes in expectation of “getting fucked over” at bonus time. Credit Suisse’s equity-trading arm has lagged behind industry leaders like Goldman Sachs and Morgan Stanley for much of 2006, and at least one top executive has reportedly been ousted over the poor performance.

Keep in mind that what we’re reporting here are internal rumors at Credit Suisse, and it is entirely possible that these rumors lack any basis in reality. But we think our readers—and even the gnomes who run the Swiss bank—deserve to know what the folks in the New York office are talking about.

Merrill's "nuts or sluts" defense: Sex bias by any other name.....

We’re betting that Merrill is going to have to pay up big time for this one. And it’s about time. We admit we’re prejudiced, given the major jerking around the Bull has given many talented acquaintances of ours, we've got a right to be.

In a legal scuffle that dates back to 1997 where 900 women filed a sex discrimination against Merrill Lynch, only six of them took it all the way through the arbitration process. One of the litigants, Nancy Thomas, duked it out with Merrill in front of a panel of three judges over 37 days with closing arguments ending last Tuesday. The panel heard her story of how "she was appalled by office episodes that included an obscene photo dropped at her desk; a dildo and lubricating cream left for her in the mailroom; and an office incident in which a male broker allegedly pulled down the underwear of a Merrill woman." Thomas is asking for $22 million plus compensation for emotional distress as well as punitive damages. There's no word on when the panel of judges will rule.

To hear Merrill Lynch & Co. tell it, Nancy Thomas was a lovesick stockbroker whose broken engagement 17 years ago turned her into a branch-office loser from a Wall Street success story.

In a prickly case that may cost Merrill millions (this should only go from our lips to God's ear) -- Thomas is asking for $22 million, plus payment for emotional distress and punitive damages -- arbitrators will have to buy into Merrill's soap-opera tale if the brokerage firm is to walk away with its wallet intact.

Or, alternatively, the arbitrators could be persuaded that the law favors Thomas, who endured a crude, hostile workplace long on retaliation and vulgar humor and short on the perks and support that went to her male colleagues. After 37 hearing days, 15 volumes of exhibits, and 8,000 pages of testimony, lawyers for Merrill and Thomas gave closing arguments Tuesday to a panel of three poker-faced arbitrators.

Thomas, 52, is one of only a half-dozen women in a 1997 class-action lawsuit who took her challenge to Merrill all the way through the arbitration process. Most of the 900 litigants in the sex discrimination lawsuit known as Cremin versus Merrill Lynch settled before any hearing took place. Thomas was one of eight named plaintiffs in the suit.

It isn't clear when the panel will deliver a decision; the panel chairman asked for an extension of the two-week deadline given the complexity of the case. What is clear, though, is that Merrill's legal team made a decision to follow an age-old strategy used in sex discrimination cases: the ``nuts or sluts'' defense, in which a female plaintiff is characterized either as crazy, or a little on the loose side.

Thomas, who favors a buttoned-down look, would be an unlikely contender for the ``sluts'' designation. Even Merrill's lawyer, Andrew J. Schaffran, described Thomas as ``impeccably honest.'' Thomas says she was appalled by office episodes that included an obscene photo dropped at her desk; a dildo and lubricating cream left for her in the mailroom; and an office incident in which a male broker allegedly pulled down the underwear of a Merrill woman.

With the ``slut'' defense off the table, Schaffran's remarks in closing arguments veered toward the ``nuts'' argument.

She was ``hard to get along with,'' and had a ``fixation'' about being assigned lousy clerical help, he told the arbitrators. Besides, ``We know from the record that Ms. Thomas has a personality disorder,'' he said.....

http://wallstfolly.typepad.com/wallstfolly/2006/10/merrill_sex_bia.html

Washington's Secret Weapon or What’s up with Paulson and the Plunge Protectors?

It sounds like a loser band or at best a one-hit wonder . But someone - and we don't know who - wants us all to know that since July Henry Paulson, the new secretary of the U.S. Treasury, has spent a lot of time on a little known Washington operation called the President's Working Group on Financial Markets.

That was the major message in a prominent piece this past Monday in The Wall Street Journal. The big mystery is why do these people want us to know this? And why now? We wrote about the Working Group on Financial Markets back in June when Paulson left Wall Street powerhouse Goldman Sachs to accept the top job at Treasury.

The group was supposed to - you know - solve financial problems, although the scope of its authority and its powers were never clearly defined. The group soon became known as the Plunge Protection Team, and for those who were following its stealthy pursuits, the Working Group seemed to be using a blueprint set down by a former Federal Reserve official named Robert Heller.

The Plunge Protection Team - a. k. a. Working Group - probably remained mostly dormant during the good years. But there were sneaking suspicions that it came out of its shell a couple of times, especially after 9/11. So it's interesting that now - seemingly out of the blue and far removed from any obvious crisis - Paulson is activating the Plunge Protection Team and someone wants us to know about it.

The Journal's Monday piece started: "With just two years to make his mark, new Treasury Secretary Henry Paulson is focusing much of his attention on making American financial markets more competitive . . .

Among other things, Paulson and the Plunge Protection gang discuss the problems that might occur with hedge funds and derivatives, plus the "government's ability to respond to a financial crisis," according to a source quoted by the Wall St Journal .

Stocks have been moving steadily upward since July, when Paulson took over the Plunge Protection Team (and the Treasury). And one of the reasons could be that - as I mentioned back then - there is less risk in stocks if the government is providing a safety net. Less risk until something bad comes out of left field.and clobbers us.

Maybe this has to do with providing a safety net for the Republicans in the mid-term elections? Insuring that we sail to November without a financial mishap. You got a better idea - Email us at Geoffp7@juno.com.

http://www.nypost.com/seven/10262006/business/treasurys_paulson_plays_with_the_plunge_protectors_business_john_crudele.htm

What? New York Isn’t the World’s Undisputed Financial Capital?

Go friggin’ figure. At a black-tie event this summer, some of the world’s most powerful bankers and business executives gathered for a toast: “We are the international finance and business capital of the world, the world’s greatest global financial center, without question,” the mayor told the assembled crowd. But that was not Michael R. Bloomberg talking. The city was not New York — it was London.

Even as the Dow Jones industrial average reaches new highs and Wall Street companies report robust profits, by some measures New York’s long-held crown as the financial capital of the world may be slipping.

London, whose lord mayor, David Brewer, made the summertime boast at the city’s annual merchants and bankers dinner, has had a heady resurgence in banking and lending. In recent years, its stock market has attracted a growing number of companies that once would have sought to list in the United States. And London is drawing an increasing tide of hedge fund assets.

Other financial centers are growing, too: Chicago will be the home of the world’s largest derivatives market when the Chicago Mercantile Exchange and the Chicago Board of Trade merge, while Hong Kong is poised to be the biggest market for initial public offerings this year, with today’s pricing of the huge offering of the Industrial and Commercial Bank of China.

“There’s a genuine recognition that we need to make some changes,” said Laure Aubuchon, head of international business development for the New York City Economic Development Corporation. Winning financial business is “so important to New York City,” she said. The financial services industry makes up 9 percent of the city’s work force and provides 31 percent of the tax base, she said.

The rise of London has been particularly notable as a reflection of its geography. Some of the most rapidly developing markets and fastest-growing companies can be found in Asia and Russia, which are within time zones that can do business easily with London but not with New York. “In the 1980s and 1990s, large transactions did not get done without the United States capital markets,” said Michael Cole-Fontayn, a managing director with the Bank of New York in London. That is no longer true, he said.

“The European and Asian capital markets are becoming deeper and more liquid by the day,” he said. “You can get a $5 billion stock global depository receipt offering or a $10 billion privatization satisfied outside the United States S.E.C.-registered markets.”

London “is the world’s biggest financial center and very internationally flavored,” Vladimir Shmatovich, the chief financial officer, said in a telephone interview. And, he said, London is a closer flight to Moscow. Not to mention easier on the security business as well - which allows a lot more mobility. American paranoia has it's price - and it seems Wall Street is paying it.

http://www.nytimes.com/2006/10/27/business/worldbusiness/27london.html?_r=1&oref=slogin

Is All this Goldman Hype a Total Crock ?

We've had almost as much hype this week about Goldman Sachs and those 115 new Partner Managing Directors (PMDs) as we can stomach. These are the super folk who are tipped to receive another $10m for their troubles this year - in addition to their base salaries and bonuses. But are these people actually more than mere mortals, and are their careers at Goldman, rather than taking off, actually coming close to an end ?

For sure, the new PMDs would have worked their asses off, got the politics right, and done all the expected things to obtain their promotions. And good luck to them. But we are led to believe that Goldman's continued success is down in good part to the efforts of the 300-odd PMDs (and wannabees looking for promotion next time around). In truth, that is probably not the case - certainly not in investment banking, where the Goldman name will guarantee a certain amount of business each year. As any decent CEO knows, he or she will never get the sack for hiring Goldman (even if a deal doesn't do as well as expected). So, some of the success these PMDs will have enjoyed would have been down to the Goldman franchise, and not all to them personally.

And how long are these PMDs likely to stay around at Goldman anyway ? With only around 300 of them at the firm any one time, it doesn't take an Einstein to realize that the life of a Goldman PMD is not always a long one. Many leave, of course of their own volition (to start their own firms, or for public service), but some are tapped again and told that their time is up.

The Goldman PMD selection process is, of course, a highly competitive business for those concerned. By Tuesday afternoon, the whole firm had been e-mailed a list containing the names of all the new partners. For those who didn't make the cut, it was a difficult time. The Financial Times reported that many who didn't make it are likely to not show up for work until the fuss dies down. The humiliation is tough to take.

http://news.hereisthecity.com/news/business_news/6136.cntns

Hedge fund apocalypse? ... Not

Stop worrying about hedge funds already. You know what I mean. The deep, deep dread that they will somehow wreck the market for the rest of us.

Over the years I have been in the grips of that dread. I'd lie awake at night thinking about Long Term Capital Management, the hedge fund that nearly brought down all the world's markets in 1998 on a bad bond bet. But, despite the scare, hedge funds kept growing and are popping up in other sectors. They make real estate bets. They lend money. And, most recently, they're making commodity plays.

Yes, close the doors, they're coming throught the windows, they're everywhere. And there are a lot of them. And that's exactly why I've stopped worrying. There are so many of them in so many different areas, no single one is likely to rock the boat. And they are cannibals ... one of them trips, the rest of them eat the loser up. Look at Amaranth. It's holdings were gobbled up as it tried to weather its $6 billion face-plant.

Some people think hedge funds are rocking the boat in the Dow now, pushing money into big caps after parking cash in the oil sector for a while hoping for hurricanes to boost prices. But could one fund rock the market itself? Seems unlikely as time passes and the number of funds grows. Eventually the hedge fund sector will just be a smaller version of the investing public at large.

Maybe hedge funds can rock some niche markets big time ... but so could any big investor. And there will be scandals, like Bayou, and failure, like Amaranth. That's dangerous for the wealthy people who feed the hedge funds. More important for the average investor, there have been reports that some hedge funds may be trading stocks based on inside info gleaned from their newfound lending activities. And there are some worries in Congress that pension funds may be investing in hedge funds without appreciating the risks involved.

Serious problems, yes, but not the Apocalypse I've been dreading. I'm done with that. Now I'm trying to figure out where all the funds will stampede next. That's where the money will be made.

http://money.cnn.com/2006/10/26/commentary/wastler/index.htm?postversion=2006102617

Craigslustspotting: Busty blond saint seeks Wall Street Commando

This was spotted on Craigslist early this morning, but alas, you commandoes out there, it has been pulled.

Recent Ivy grad, college athlete, and all around great girl seeks a Wall Street type professional. I am fascinated with the world of law and high finance. Lawyers, deal makers, hedge fund, LBO fund are the boys I dig.

I am pretty, swimmer body, cool green eyes, and pouty lips. I also travel in circles of lots of gorgeous, single girls in their 20s. I am a very good girl to know ;)

Make sure that your response is in good taste because I will not respond to shirtless losers pictured in bleak surroundings. Good luck boys!

America's high hedge fund hopes: Are they smoking crack?

Americans are betting that hedge funds will make them rich even at a time when these once high-flying portfolios are lagging behind the broader market, which once again brings us to a basic question: what are Americans smoking or worse, snorting these days?

Research firm Morningstar Inc. polled 600 advisers in August and found that 65 percent of them expect more than double-digit growth in alternative investments, which include hedge funds; and 67 percent of them report that more than 10 percent of their clients are already using alternative investments.

"We were surprised to find that the majority of advisers expect double-digit growth in alternative assets under management every year for the next five years," said Steve Deutsch, director of separate accounts and managed investments at Morningstar.

This year hedge funds returned roughly 7 percent in the first nine months of the year, lagging behind the average stock mutual fund, which is up roughly 8 percent and the broader Standard & Poor's stock average, which is up about 12 percent. Expectations for high returns might be unrealistic (No shit Sherlock!) .

http://today.reuters.com/news/articlenews.aspx?type=reutersEdge&storyID=2006-10-24T192419Z_01_N24208661_RTRUKOC_0_US-FINANCIAL-FUND-HEDGES.xml

The Comma That Cost 1 Million Dollars

Hell, we don't want to rub it in or anything, but if there is a moral to this story about a contract dispute between Canadian companies, this is it: Pay attention in grammar class or it can cost you big time, ass wipe!

The dispute between Rogers Communications of Toronto, Canada’s largest cable television provider, and a telephone company in Atlantic Canada, Bell Aliant, is over the phone company’s attempt to cancel a contract governing Rogers’ use of telephone poles. But the argument turns on a single comma in the 14-page contract. The answer is worth 1 million Canadian dollars ($888,000).

Citing the “rules of punctuation,” Canada’s telecommunications regulator recently ruled that the comma allowed Bell Aliant to end its five-year agreement with Rogers at any time with notice.
Rogers argues that pole contracts run for five years and automatically renew for another five years, unless a telephone company cancels the agreement before the start of the final 12 months.

The contract is a standard one for the use of utility poles, negotiated between a cable television trade association and an alliance of telephone companies. French and English versions were approved by a government regulator about six years ago.

The dispute is over this sentence: “This agreement shall be effective from the date it is made and shall continue in force for a period of five (5) years from the date it is made, and thereafter for successive five (5) year terms, unless and until terminated by one year prior notice in writing by either party.”

The regulator concluded that the second comma meant that the part of the sentence describing the one-year notice for cancellation applied to both the five-year term as well as its renewal. Therefore, the regulator found, the phone company could escape the contract after as little as one year.

“The meaning of the clause was clear and unambiguous,” the regulator wrote in a ruling in July.

But Kenneth G. Engelhart, vice president for regulatory affairs at Rogers, disagreed. “Why they feel that a comma should somehow overrule the plain meaning of the words is beyond me,” he said. “I don’t think it makes any sense.”

He admitted that his lawyers just might have underestimated the regulator’s interest in grammar. Just a tad.

http://www.nytimes.com/2006/10/25/business/worldbusiness/25comma.html

Dudes, Listen Up, Your swimmers may be a stake….

The number of hours a man talks on a cellular phone each day may affect his fertility, with sperm count and quality deteriorating as the duration of calls increases, according to researchers in reproductive medicine.

Scientists in Cleveland, Mumbai and New Orleans tracked 364 men who were being evaluated for infertility, and split them into three groups based on sperm count. In the group whose sperm counts were within the normal range, those who used a cell phone more than four hours a day produced on average 66 million sperm per milliliter, 23 percent less than those in the group who didn't use the phones at all.

The proportion of the cell-phone users' sperm that possessed ``normal forms'' was 21 percent, almost half the 40 percent of normal sperm produced by men who didn't use the phones, said the researchers, who presented their conclusions this week in New Orleans at the annual convention of the American Society for Reproductive Medicine.

``The effect of cell phones on sperm parameters may be due to the electromagnetic radiation the devices emit or to the heat they generate,'' the group said in a summary of the research. ``Further studies will be necessary to identify the mechanism involved in the reduction of sperm quality due to cell phones.''

The researchers involved in the study are from Ohio's Cleveland Clinic, the Karthekeya Medical Research and Diagnostic Center in Mumbai and the Tulane University Health Science Center in New Orleans. They said they received no outside financial support for the study. Which when you think really about it is no big surprise. But can you imagine what your BlackBerry is doing to you? Now there's something that will give Wall Street pause.....

http://www.bloomberg.com/apps/news?pid=20601085&sid=a4VAKgj2MTKo&refer=europe

Hollywood to Hedges: Hello Suckers!

Lloyd Grove of the Hollywood Reporter looks at the zillions of bucks flowing from Wall Street to film makers. He doesn't think it's necessarily a good thing for the industry, since it means that far too many movies are getting funded.

Although Hollywood's enjoying a tidal wave of production funding from Wall Street, it's not necessarily a good thing for the film industry. As crazy as that sounds, the fact is that the flood of private equity funding that studios and high profile producers are enjoying these days brings with it some hidden problems. On the face of it, the hundreds of millions of dollars that are going into production -- the total by now may actually be in the billions -- are a blessing because without them a lot of movies wouldn't be getting made.

Wall Street isn't stupid, so why would so many investment managers who've made so much money in other industries jump at the chance to risk hundreds of millions of dollars to make movies? The easy answer is that Hollywood has always had the allure that comes from being a glamorous business. Guys who have, for instance, made their fortunes in industrial waste or pork bellies or peddling fertilizer or selling farm equipment respond energetically when they can suddenly bankroll a piece of a new movie and know that they and their spouse (or somebody else's spouse) will be wined and dined at the film's premiere and get to rub shoulders with A List stars and directors.

And it's not just glamour. There's also greed. Wall Street reads the same box office reports that Hollywood does about movies grossing $1 billion or close to it in the global theatrical marketplace and about the riches from DVD sales even in today's so-called mature marketplace. At the end of the day, the Street believes the upside potential of investing in Hollywood is greater than just about anything else there is -- except, perhaps, drilling for oil!

http://wallstfolly.typepad.com/wallstfolly/2006/10/movie_industy_t.html#more

The Real Deal: Think it’s easy to collect on any of H-wood’s golden promises?

Warner Bros. stands accused of making empty promises to provide prosthetic limbs to orphaned African amputees and then reneging so that the studio's movie "Blood Diamond" could get extra publicity.

During filming of the flick, which stars Leonardo DiCaprio, Jennifer Connelly and Djimon Hounsou, producers shipped in 27 teenage and child amputees - victims of tribal warfare - from surrounding hospitals to appear as extras.

In addition to paying the children day rates for their work, the producers - touched by the kids' tragic circumstances - promised to fit all of them with prosthetic limbs after shooting wrapped in June. But they're still waiting.

Young Nkululo Mnisi - whose arms and legs were cut off by machete-wielding rebels - used to be taunted by cruel classmates as "baboon" because of the way he ran on his stumps and crutches. Mnisi told a South African newspaper that the dream that kept him going was the promise of getting artificial limbs so he'd be able to play soccer like a normal child.

But months after filming ended, Mnisi and his fellow amputees were still waiting. When they asked Warner Bros. about the promised prosthetics, they were allegedly told, "You will have to wait for December, when the movie comes out, so we can get some publicity out of it."

Jesus, talk about being cold-blooded......

http://www.nypost.com/seven/10232006/gossip/pagesix/pagesix.htm

You can’t hurry love? Tell it to Goldman!

The demand for shares in last week's IPO of Industrial & Commercial Bank of China (ICBC) was truly mind blowing. A deal worth $21.9bn attracted $350bn from global investors hoping to get in on the action. But hey, that's not the real news.

The real news deal concerns Goldman Sachs. The canny Wall Street firm, of course, invested $2.6bn for a 5% stake in ICBC just 6 months ago. And, as the Chinese bank now has a market value of around $129bn, Goldman has made a cool $3.85bn paper profit for its troubles. As Bloomberg points out, almost $4bn in 6 months has got to rate as probably the best investment of all time.

It's not, of course, the first time Goldman has done well in China. Both Goldman and Morgan Stanley raked in $500m each last year when they sold their stakes in China's Ping An Insurance Co. The stakes were acquired in 1994 for $70m each. But Goldman has really pushed the boat out in China, and stolen a big march on its rivals. Spending $200m in 2004 to help set-up brokerage and investment banking firm Beijing Gao Hua Securities, Goldman now has a firm foundation upon which to build in a country which is thought likely to see its stock market value quadruple from $402bn at the end of last year to $1.9 trillion by 2010.

And Goldman's China pilgrimage is, more than anything, down to one man. Former CEO and current US Treasury Secretary Hank Paulson saw the potential of China in the mid-1980s, and made over 70 visits to the country, building up relationships with key government officials. Way-to-go, Hank - you got China in Goldman's hands.

http://news.hereisthecity.com/news/business_news/6120.cntns

Stock seer sees no reason Dow won't continue steady growth (Has he been hitting the bong again?)

Like most of us last week, Christopher Channer gave passing attention to the Dow Jones industrial average exceeding 12,000, and then went on to other concerns. But the crossing of that threshold prompted me to seek his counsel because of his credentials as a Dow diviner. Channer correctly predicted when the Dow would first top 10,000, which happened in 1999. A lot of people got that right as a short-term call, but Channer's judgment was in another league. He made his prediction in June 1990 in an interview with the late Edwin Darby that ran in the Sun-Times, nearly nine years ahead of the fact. At the time, it was so bullish as to strike some as daft; in June 1990, the Dow was around 2,800.

The obvious question was when the Dow would cross the next meaningful marker of 20,000. Channer, who used to work for the old Chicago Corp. and then for Morgan Stanley, is a cautious man and had to be coaxed into an answer. But he's also confident in himself, having ditched life in big firms to found Channer Investment Management in Inverness, a two-person boutique.

So he gave one, but here's a shameless preface to keep you reading. He doesn't have the rip-roaring outlook of 16 years ago, but believes in the steady profit performance of American companies. Channer is 60, and the years have taught him not to play with sectors. "Look at only those companies that have shown the best 10-year financial growth, and only if their stock prices come to you," he said. Channer mentioned Walgreen as an example, but he otherwise stays away from stock picks for mass consumption.

He said that while the market is due for a correction, he's happy that there was little euphoria over Dow 12,000. That would be like a mother measuring her 12-year-old son and being surprised that he's taller than ever. "The conditions are right, so the index will grow," he said.

Now to the prediction: He calls Dow 20,000 as occurring eight years hence, October 2014. If he's right, he's projecting steady but historically average returns in the index over that period.

http://www.suntimes.com/business/roeder/105368,CST-FIN-curious22.article

Hot and heavy inter-office affairs, making millions in funny money trading, this story has everything even a surprise ending!

Amid allegations of extramarital affairs with female employees, illegal activity in trading accounts, and the misuse of company aircraft, Robert O'Connell was unceremoniously fired for cause as chief executive of Massachusetts Mutual Life Insurance by its directors in June 2005.

Now a three-person arbitration panel has found that O'Connell did not breach his fiduciary duties to MassMutual and that he is owed benefits that could reach $50 million, his lawyers say.

The seats filled by corporate directors have never been hotter. Directors have come under fire for not being vigilant enough when it comes to accounting practices or sky-high pay packages for executives. In the wake of the Hewlett-Packard upheaval, directors are in the spotlight over how they conduct investigations. The MassMutual episode, though, could illustrate how boards, in an effort to appear tough on corporate malfeasance, might need to pay more attention to the process of dismissal.

The arbitration panel said that O'Connell had in fact had affairs with two female employees, made millions in profit in a deferred compensation account by trading using closing prices from the day before, and perhaps even stepped over the line in use of the company aircraft.

But none of these acts constituted "willful gross misconduct" on his part or resulted in "material harm" to the company, the arbitration panel ruled.

MassMutual executives declared the panel's findings "incomprehensible" and inconsistent with good corporate governance. On Friday, the company filed suit in a Massachusetts court to appeal the panel's finding, which was made last month but not disclosed until Friday.

O'Connell's lawyers declared victory.

http://www.iht.com/articles/2006/10/22/business/ceo.php

Morgan changed US China policy – How pushy can banks get?

A Morgan Stanley economist bragged to his bosses about playing a "key role" in getting the U.S. Treasury to change a key position in its dealings with China, and paved the way for the firm to do more deals in the booming economy, a document obtained by The Post indicates.

An e-mail from Morgan Stanley's veteran chief economist, Stephen Roach, to senior executives in September 2003 boasts of Morgan Stanley's role in getting Treasury Secretary John Snow to back off the Bush administration's vow to pressure China over the value of its currency.

In the e-mail, Roach told Stephan Newhouse and Vikram Pandit, the then bosses of Morgan Stanley's international and institutional securities units, that "I helped him script rather carefully" key lines of a policy announcement in Beijing.

Roach wrote to Newhouse and Pandit that the Chinese might be very appreciative for the help Morgan Stanley provided in changing Secretary Snow's mind.

"I do believe we should make every effort to let the Chinese know that we played a decisive role in shaping the outcome on a key issue of great strategic importance for them," Roach wrote.
Referring to Newhouse's scheduled October 2004 meeting with the Chinese Minister of Finance, Roach noted that Morgan Stanley's help "might be an appropriate point of discussion."

Morgan Stanley, long one of the biggest underwriters in the Chinese market, recently was awarded the right to take over Nan Tung Bank which the firm a much sought after commercial banking license, something no other investment bank has acquired on the Chinese mainland. An accident? Chance opportunity? In a pig's ass!

http://www.nypost.com/seven/10202006/business/morgan_stanley_in_chinese_snow_job_business_roddy_boyd.htm

Karma Capitalism

Go ahead, read this and then tell us there’s no God and he or she doesn’t have an terrific ironic sense of humor.

Boy have times changed since Gordon Gekko quoted Sun Tzu in the movie Wall Street! Has the Bhagavad Gita replaced The Art of War as the hip new ancient Eastern management text?

Signs of worldly success abounded as members of the Young Presidents' Organization met at a mansion in a tony New Jersey suburb. BMWs, Lexuses, and Mercedes-Benzes lined the manicured lawn. Waiters in starched shirts and bow ties passed out vegetarian canapés. And about 20 executives--heads of midsize outfits selling everything from custom audiovisual systems to personal grooming products--mingled poolside with their spouses on a late September evening.

After heading inside their host's sprawling hillside house--replete with glittering chandeliers, marble floors, and gilded rococo mirrors--the guests retreated to a basement room, shed their designer loafers and sandals, and sat in a semicircle on the carpet.

The speaker that evening was Swami Parthasarathy, one of India's best-selling authors on Vedanta, an ancient school of Hindu philosophy. With an entourage of disciples at his side, all dressed in flowing white garments known as kurtas and dhotis, the lanky 80-year-old scribbled the secrets to business success ("concentration, consistency, and cooperation") on an easel pad. The executives sat rapt. "You can't succeed in business unless you develop the intellect, which controls the mind and body," the swami said in his mellow baritone.

At the Wharton School a few days earlier, Parthasarathy talked about managing stress. During the same trip, he counseled hedge fund managers and venture capitalists in Rye, N.Y., about balancing the compulsion to amass wealth with the desire for inner happiness. And during an auditorium lecture at Lehman Brothers Inc.'s (LEH ) Lower Manhattan headquarters, a young investment banker sought advice on dealing with nasty colleagues. Banish them from your mind, advised Parthasarathy. "You are the architect of your misfortune," he said. "You are the architect of your fortune."

The swami's whirlwind East Coast tour was just one small manifestation of a significant but sometimes quirky new trend: Big Business is embracing Indian philosophy. Suddenly, phrases from ancient Hindu texts such as the Bhagavad Gita are popping up in management tomes and on Web sites of consultants. Top business schools have introduced "self-mastery" classes that use Indian methods to help managers boost their leadership skills and find inner peace in lives dominated by work.

More important, Indian-born strategists also are helping transform corporations. Academics and consultants such as C. K. Prahalad, Ram Charan, and Vijay Govindrajan are among the world's hottest business gurus. About 10% of the professors at places such as Harvard Business School, Northwestern's Kellogg School of Business, and the University of Michigan's Ross School of Business are of Indian descent--a far higher percentage than other ethnic groups. "When senior executives come to Kellogg, Wharton, Harvard, or [Dartmouth's] Tuck, they are exposed to Indian values that are reflected in the way we think and articulate," says Dipak C. Jain, dean of the Kellogg School.

Indian theorists, of course, have a wide range of backgrounds and philosophies. But many of the most influential acknowledge that common themes pervade their work. One is the conviction that executives should be motivated by a broader purpose than money. Another is the belief that companies should take a more holistic approach to business--one that takes into account the needs of shareholders, employees, customers, society, and the environment. Some can even foresee the development of a management theory that replaces the shareholder-driven agenda with a more stakeholder-focused approach. "The best way to describe it is inclusive capitalism," says Prahalad, a consultant and University of Michigan professor who ranked third in a recent Times of London poll about the world's most influential business thinkers. "It's the idea that corporations can simultaneously create value and social justice."

Really? Readers, I wouldn’t hold my breath, waiting for this to happen. You might turn blue.

http://www.businessweek.com/magazine/content/06_44/b4007091.htm?campaign_id=nws_insdr_oct20&link_position=link2

Nothing is Impossible: More on the Most Incredible (and most mocked) Resume Ever!

With his name and image appearing on the “Today” show, in The New York Post and all over the Web site Gawker, Aleksey Vayner may be the most famous investment-banking job applicant in recent memory. But he says his new celebrity is less blessing than curse.

“This has been an extremely stressful time,” Mr. Vayner, a senior at Yale University, told DealBook over steak in a northern New Jersey restaurant Thursday.

It was his first face-to-face meeting with a reporter since an 11-page resume and elaborate video clip that he submitted to securities firm UBS showed up on two blogs, and then quickly spread to every corner of the Internet. The clip, staged to look like a job interview spliced with shots of Mr. Vayner’s athletic prowess, flooded e-mail inboxes across Wall Street and eventually appeared on the video-sharing site YouTube. And the overwhelming reaction was mocking laughter.

Mr. Vayner is not amused. Instead, he said he feels like a victim. The job materials that were leaked and posted for public view included detailed information about him that allowed strangers to scrutinize and harass him, he said. His e-mail inbox quickly filled up, with most of the messages deriding him and, in certain cases, threatening him. Since the video surfaced on the Internet, Mr. Vayner said he has deleted at least 2,000 pieces of e-mail.

It was Mr. Vayner’s highly produced video that appears to have make his job application such a viral sensation.

A Zen-like koan — “Impossible is nothing” — introduces the seven-minute clip, which shows Mr. Vayner performing various feats of physical strength and skill, interspersed with inspirational maxims. Viewers are presented with images of Mr. Vayner bench-pressing weights (a caption suggests it is 495 pounds), playing tennis (firing off what is said to be a 140 mile-per-hour serve) and performing martial arts (he breaks seven bricks with his palm).

The tone of the video seems too serious to be parody, yet too over-the-top to be credible. After sharing the clip, fellow students at Yale began to share their favorite Aleksey-style tall tales, notably involving reminiscences of bare-handed killings and nuclear waste.

“I felt demonstrating competency in athletics is a good way to stand out, because the same characteristics are the same in business,” said Mr. Vayner, who legally changed his name from Aleksey Garber when he was 18. “The need to set and achieve goals, to have the dedication and competitive drive that’s required in business success.”

Despite all the mockery that the video has inspired, he still speaks proudly of his athleticism. Nearly all the feats in the video are his, he said, and they are real. (The only doubt in his mind lies in the skiing segment, which he says is probably him.) When asked about a posting Mr. Vayner had placed on the classifieds site Craigslist soliciting skiing videos — a posting that was reproduced on a blog that questioned whether the skier was him — Mr. Vayner said he was simply looking for the cameramen who shot his ski-jump efforts.

Trust us, you just had to be there…..

http://dealbook.blogs.nytimes.com/?p=8562

Two Ex-Treasury secretaries leap to the hedges

Sure everybody knocks the hedges and even calls them names, even these guys when they were in office, but former Treasury secretaries John Snow and Larry Summers both went for the gold. They joined hedge funds on Thursday, which just goes to show you.

Cerberus Capital Management LP said Snow joined the $16.5 billion hedge fund firm as chairman. Cerberus, which also specializes in buyouts and corporate restructuring, will benefit from Snow's political and business contacts. Before heading the Treasury, he was chief executive officer of CSX Corp. and was a director at Johnson & Johnson , USX and Verizon, Cerberus noted.

D.E. Shaw said it hired Summers, the former president of Harvard as a managing director. Summers will work part time advising the $25 billion hedge fund firm on strategy, portfolio management and operations. There’ll certainly be no one around to criticize his politically incorrect comments on women etc.

http://www.marketwatch.com/News/Story/Story.aspx?dist=newsfinder&siteid=google&guid=%7B10102E00-2B69-4A46-83EA-6A2F9B6963D3%7D&keyword

Maybe there's more to this Korean thing than they're telling us!

A “doll experience room” is a place punters rent for some W25,000(US$1=W958) an hour, a fee that includes a bed, a computer, and an inflatable sex doll. Gyeonggi Provincial Police take a dim view of such operations. “We understand that there are four doll experience operations currently open for business in the city of Suwon,” they said. “We are currently looking into whether these businesses violate the law.”

Known as a “real doll” or “dirty wife” in the West, the sex toys come in vaguely humanoid shape and have skin that manufacturers say is almost the same to the touch as the real thing. They were introduced to the Korean mainstream at the Sexpo at the Seoul Trade Exhibition Center in August. After the Special Law on Prostitution went into effect in 2004, the press reported that certain motels were providing the dolls to customers to bridge the gap, but this is the first time establishments dedicated to the experience have sprung up in the city. Ads looking for others who are interested in running their own sex doll rooms are springing up on the Internet, a development that leads police to suspect that more such establishments exists across the country.

But rubber is rubber and flesh is flesh, so it remains unclear if selling one violates laws against the sale of the other. “Since the sex acts are occurring with a doll and not a human being, it is unclear whether the Special Law on Prostitution applies.” a police officer lamented.

Wait, wait...Are we so evolved that inflatable rubber dolls now have consenting privileges?

http://english.chosun.com/w21data/html/news/200610/200610120018.html

Move over Tony Soprano! Hedge comedy makes it to HBO

Another day in the glam life of hedgies.? OK OK, we can already hear the groans of “Oh, Puh-leze” and :”Give us a friggin’ break!” But this time, premature ejaculators, you are too late. Doug Ellin has sold HBO his next comedy series, which explores the question, "What if the guys on 'Entourage' grew up?"

"Entourage" creator-exec producer Ellin is writing an untitled half-hour he described to Daily Variety as a "mature version of 'Entourage' set on Wall Street." The action revolves around a fortysomething hedge fund trader and his circle of guy pals.

The project is the first to emerge from Ellin's overall development deal with HBO, which renewed "Entourage" for a fourth season last month.

Ellin will exec produce the pilot with Stephen Levinson. Idea was hatched by the pair after they realized several of their friends from college -- "regular, fraternity brother-type guys," Ellin said -- were banking $40 million-$50 million a year on Wall Street.

"They make Vince look like a peasant," Ellin joked.

"I wanted to do a show that deals with these men who are making obscene amounts of money at a young age," he said. "It's a comedy, but it will be more mature than 'Entourage.' The characters will be dealing with grown-up issues such as marriage, getting older and working within the professional ranks."

http://www.variety.com/article/VR1117951668.html?cs=1&s=h&p=0

Living the Hedge High Life: The Party, the Elbow and the $140 Million Mishap

Some folks have more money than they have brains - never mind taste. But where to begin this brazen tale of chutzpah and over-reaching? How about at the beginning? Probably the closest you ever got to “Le Rêve,” Picasso’s 1932 portrait of his mistress, was in your college art-history textbook. The painting is owned by Steve Wynn, the casino magnate and collector of masterpieces. He acquired it in a private sale in 2001 from an anonymous collector, who had bought it at auction in 1997 for $48.4 million. Recently, Wynn decided that he’d like to sell it, along with several other museum-quality paintings that he owns. A friend of his, the hedge-fund mogul and avid collector Steven Cohen, had coveted “Le Rêve” for years, so he and Wynn and their intermediaries worked out a deal. Cohen agreed to pay a hundred and thirty-nine million dollars for it, the highest known price ever paid for a work of art.

One recent weekend, Wynn had some friends visiting from New York—David and Mary Boies, Nora Ephron and Nick Pileggi, Louise Grunwald, and Barbara Walters. They came at five-thirty, and Wynn ushered them in. On the wall to his left and right were several paintings, including a Matisse, a Renoir, and “Le Rêve.”

He began to tell the story of the Picasso’s provenance. As he talked, he had his back to the picture. He was wearing jeans and a golf shirt. Wynn suffers from an eye disease, retinitis pigmentosa, which affects his peripheral vision and therefore, occasionally, his interaction with proximate objects, and, without realizing it, he backed up a step or two as he talked. “So then I made a gesture with my right hand,” Wynn said, “and my right elbow hit the picture. It punctured the picture.” There was a distinct ripping sound. Wynn turned around and saw, on Marie-Thérèse Walter’s left forearm, in the lower-right quadrant of the painting, “a slight puncture, a two-inch tear. We all just stopped. I said, ‘I can’t believe I just did that. Oh, shit. Oh, man.’”

Wynn turned around again. He put his pinkie in the hole and observed that a flap of canvas had been pushed back. He told his guests, “Well, I’m glad I did it and not you.” He said that he’d have to call Cohen and William Acquavella, his dealer in New York, to tell them that the deal was off. Then he resumed talking about his paintings, almost, but not quite, as though he hadn’t just delivered what one of the guests would later call, in an impromptu stab at actuarial math, a “forty-million-dollar elbow.”

A few hours later, they all met for dinner, and Wynn was in a cheerful mood. “My feeling was, It’s a picture, it’s my picture, we’ll fix it. Nobody got sick or died. It’s a picture. It took Picasso five hours to paint it.” Mary Boies ordered a six-litre bottle of Bordeaux, and when it was empty she had everyone sign the label, to commemorate the calamitous afternoon. Wynn signed it “Mary, it’s all about scale—Steve.” Nothing like a little perspective we always say.....

http://www.newyorker.com/talk/content/articles/061023ta_talk_paumgarten

ON EA$Y STREET: Wall Street Pay is 5 times NYC Average

Yes, Virginia, there is a Santa Claus or maybe Wall Street really is paved with gold. The great unwashed who toil in the securities industry earn five times more than other workers in the Big Apple - or an average of $289,664 - says a report by the state's chief numbers man, Comptroller Alan Hevesi.

Outside the world of Wall Street, typical New York workers earned $56,634 last year, up about 8.2 percent over the two prior years, said Hevesi's report.

Pay raises on Wall Street grew three times faster, said Hevesi, with wages jumping 36 percent between 2003 and 2005.

This year alone, bonuses are expected to soar more than 15 percent, according to compensation experts.

Hevesi said that bonus payments awarded to Wall Street last year totaled a record $21.5 billion - growing to an average $125,500 windfall per person.

The rich compensation packages at Wall Street firms reflect the banner years that the financial services giants keep racking up.

Merrill Lynch yesterday reported that third-quarter earnings rose 41 percent to a record, with revenue up 19 percent to $7.93 billion for the three months. About half the revenue is spent on wages and bonuses.

For the first nine months this year, Wall Street's top five brokerage firms posted total profit of $21.4 billion - a leap of 56 percent from the prior year's like period.

Hevesi said those perks also carry heavy tax bites for employers and employees alike. He added that Wall Street "accounts for 5 percent of the jobs but over 20 percent of the city's wage."

http://www.nypost.com/seven/10182006/business/on_eay_street_business_paul_tharp.htm

How to blow $120 million and have almost nobody notice

You have to love the way Credit Suisse Group lost around $120m trading South Korean derivatives in the third quarter, and then phrased the news as “equity traders 'failed to protect (themselves) against swings in the value of Korean stock options'. It’s a cute trick if you can pull it off, particularly when the loss is said to represent around 13% of Credit Suisse's revenues.

Credit Suisse investment banking CEO Brady Dougan, himself a former derivatives trader, announced recently that Jim Kreitman, the unit's co-head of equities, would be leaving. Kreitman's departure has prompted a restructuring of the equities management team, and Bloomberg quotes Andreas Vendetti, an analyst at Zurich-based Zuercher Kantonalbank, who said that 'they've been underperforming in equities, and if they've made a loss, that could be one last problem that forced them to change management'.

With equity derivatives likely to be delivering good returns for canny investment banks in the next two years, Credit Suisse has been trying to beef up in this area. As Bloomberg points out, however, the firm's efforts have been hampered by several key departures. And, although Credit Suisse's revenues from equity trading rose 63% in the first half, Merrill Lynch posted a 77% gain, and Goldman's figures were up 81% in the same period.

http://news.hereisthecity.com/news/business_news/6098.cntns

Ready for their closeup: Hedge Funds go Hollywood

It’s not exactly news that ever since Hollywood was born , studio chiefs have been makers and breakers of careers, arbiters of taste and gatekeepers who decide which movies are made. But as Hollywood power shifts more to Wall Street investors, financiers are starting to bypass studio bosses by dealing directly with successful producers.

Now, instead of deals being cut over lunch at Spago or the Grill, movies are increasingly being greenlighted in conference calls to New York. The reason is a simple desire for more control. Wall Street financiers want a greater say over what movies they finance and who makes them; producers want more artistic independence and a larger share of the profits.
The studios themselves are nudging the trend along, too, since they are making fewer movies. A result for moviegoers is that they could begin to see even more thrillers, comedies and horror movies at the multiplex — the types of movies Wall Street likes, because of their more predictable payoff.

Joel Silver, the producer of the “Lethal Weapon” and “The Matrix” movies, is the latest and most important Hollywood figure to cut a big deal with Wall Street.

He has just joined forces with a consortium of financiers who have agreed to provide $220 million to produce 15 films over the next six years. Mr. Silver will not only have creative control, he will own the movies outright.

“I’ve spent 20 years working for studios,” Mr. Silver said in a recent interview beside an L-shaped azure swimming pool at his Brentwood mansion, a home he referred to as the house ‘The Matrix’ built. “It was always their call.”

To his new partners, Mr. Silver seems like a good bet. In more than two decades as a producer on the Warner Brothers lot, he has produced 46 movies, which have generated $5.6 billion in global ticket sales.

“Hedge funds are picking out who they want to be in business with,” said Rob Moore, president for worldwide marketing, distribution and home entertainment at Paramount Pictures, who gets calls weekly from producers lining up money. “They don’t claim to know how to make movies. They are investing in a track record.” But such investments are not risk-free, as others have learned.

http://www.nytimes.com/2006/10/14/business/media/14studio.html?_r=1&ref=business&oref=slogin

How to blow $120mm and have almost nobody know……

You have to love the way Credit Suisse Group lost around $120mm trading South Korean derivatives in the third quarter, and then phrased the news as “equity traders 'failed to protect (themselves) against swings in the value of Korean stock options'. It’s a cute trick if you can pull it off, particularly when the loss is said to represent around 13% of Credit Suisse's revenues.

Credit Suisse investment banking CEO Brady Dougan, himself a former derivatives trader, announced recently that Jim Kreitman, the unit's co-head of equities, would be leaving. Kreitman's departure has prompted a restructuring of the equities management team, and Bloomberg quotes Andreas Vendetti, an analyst at Zurich-based Zuercher Kantonalbank, who said that 'they've been underperforming in equities, and if they've made a loss, that could be one last problem that forced them to change management'.

With equity derivatives likely to be delivering good returns for canny investment banks in the next two years, Credit Suisse has been trying to beef up in this area. As Bloomberg points out, however, the firm's efforts have been hampered by several key departures. And, although Credit Suisse's revenues from equity trading rose 63% in the first half, Merrill Lynch posted a 77% gain, and Goldman's figures were up 81% in the same period.

http://news.hereisthecity.com/news/business_news/6098.cntns

When a Wall Street star flickers and dies

The shit hits the fan. Legg Mason's stock posted its biggest one-day fall in at least 20 years on Thursday after the money manager forecast disappointing quarterly earnings. Breakingviews said the shortfall shows how dependent the Baltimore investment firm remains on its star fund manager, Bill Miller, who is having a bad year. Legg Mason's stock posted its biggest one-day fall in at least 20 years.

Legg Mason’s earnings warning took the market by surprise. Miller’s record of market-beating returns helped Legg’s assets under management soar more than tenfold from just $35bn in 1996. With the acquisition of Citi’s asset management business last year, Legg now manages $890bn, making it one of the planet’s largest asset managers. Even though Miller is only responsible for less than 7% of that, he still remains the firm’s public face. That was terrific for business when Miller was hitting home runs, but this year, his performance has been abysmal. His flagship Legg Mason Value Trust is down 1.7% this year due to poor returns and outflows due to the firm’s ownership change

http://today.reuters.com/news/articleinvesting.aspx?view=CN&storyID=2006-10-11T192106Z_01_N11184616_RTRIDST_0_FINANCIAL-FUND-LEGGMASON-UPDATE-1.XML&rpc=66&type=qcna

The Most Awesome Job Application - Ever

Gag us with a spoon! We've been following this story on dealbreaker.com and wallstreetfolly.com for the last few days, wondering whether it really had legs. We were initially a little dubious, but now we're convinced. What you are going to read about is probably the most incredible investment banking or any job application - ever.

It all started earlier this month when Aleksey Vayner, a Yale University Senior, forwarded his 11 page resume and a video to UBS Investment Bank's Human Resources department in New York. Vayner was apparently after a job.

Now an eleven page resume is a tad excessive, but not real news. It's the video (titled - 'Impossible Is Nothing') that has provoked the interest. Viewers of the video are treated to Vayner lifting a 495-pound weight, karate-chopping six bricks with one hit, serving a tennis ball at 140 miles per hour, and ballroom dancing with a scantily clad female. One of Vayner's most corny lines goes: 'Failure cannot be considered an option. To achieve success you must first conceive it and believe in it. Remember : impossible is nothing'. The video, which was shown on YouTube and a variety of other sites, has apparently made Vayner the laughing stock of the Street, doing the rounds at Credit Suisse, Goldman, JP Morgan, Lehman, Wachovia and a host of other firms.

Vayner also claims to run his own investment advisory firm (although some say that this is strange as his SEC qualifications are thought to be pending). He says that he has established his own charity (which some allege is fabricated). The would-be banker has also apparently written a book about the Holocaust, 'Women's Silent Tears', which some claim has been partially plagiarized from an online encyclopedia.

In the meantime, folks are getting a little nervous over at UBS; the firm is worried that Vayner might sue, claiming that the bank leaked his resume and video to the public. UBS spokesperson Kris Kagel said that 'we're looking at whether it did come from UBS and, if so, we'll take action. As a firm we obviously don't circulate (job applications) to the public'.

Sure, sure. It got onto the net by itself.

http://news.hereisthecity.com/news/business_news/6080.cntns

Plan B for Wall Street

You gotta love the sheer chutzpah of it. A group of Pennsylvanians says they're not stealing from the Big Apple. They hope New York City's financial giants will open disaster-ready offices in the Keystone state. Their word for it? Augmenting.

"We're not looking to steal away the business of Wall Street," developer Lawerence Simon told two dozen executives yesterday he'd shuttled by helicopter to a posh Poconos resort on the Delaware River. "We are trying to make a ‘Mini-Me' of Wall Street."

Whether it's stealing, augmenting, or something else, Mr. Simon tried to woo New York firms to augment their headquarters in a corporate park he's calling Wall Street West by convincing them to establish backroom offices they could staff with top executives to quickly resuscitate their operations following a catastrophe like a hurricane, blackout, or terrorist attack.

"What you have worked so hard to make cannot be swept from you because of some psychotic individual," Mr. Simon told the executives after showing a dramatic montage, played to dramatic minor-chord music, of New York during its 2003 blackout and after the September 11, 2001, terrorist attacks.

Opening a corporate office in his Pennsylvania development is close enough to New York City, supporters said, but distant enough that the site has a different power supply in case of a blackout and a different water source in case reservoirs that serve the city are poisoned.

Great scenario, guys!

http://www.nysun.com/article/41317

The 10 Best-paid execs (Read it and eat your heart out)

Talk about working hard for their money, some of these dudes make more money before lunch on Monday than you do all year.

Corporate women made impressive strides in 2006, taking charge at a slew of giant companies, and bringing in big paychecks to boot.

The top-earning woman executive is Safra Catz, president and CFO of Oracle (Charts), who took home a cool $26.1 million in total compensation last year, according to Equilar, Inc., a San Mateo, Calif.-based compensation research firm, which calculated the results for Fortune magazine. Second-highest paid is Susan Decker, CFO of Yahoo! (Charts), who brought in $24.3 million. Handsome sums indeed, but not nearly enough to land them on Fortune's list of 10 highest-paid executives overall.

The 10 execs who enjoy that distinction each collected more than $48 million in total compensation last year - much of it coming in the form of restrictive stock or stock options - and all of them are men.

No. 1 earner Eugene Isenberg, CEO of Nabors Industries (Charts), brought home $71.4 million in 2005, according to Equilar. Other members of the top 10 include Occidental Petroleum (Charts) CEO Ray Irani, who made $70 million; Yahoo chairman and CEO Terry Semel, who earned $56.8 million (more than double CFO Decker's pay); and Oracle CEO Larry Ellison, who made $52.3 million (double what Catz, the company's president and CFO, took home).

http://money.cnn.com/2006/10/03/news/newsmakers/mpwpay/index.htm?source=yahoo_quote

Is that an algorithm in your pocket or are you glad to see me?

Want to get married and run a hedge fund together? - 33
Reply to: pers-218557942@craigslist.org

It would require an industry shift for me so don't worry I'm not sitting across from you on the trading floor.

I attended a Wharton reception recently where two of the guys told this absolutely hilarious story about a couple that ran an extremely successful hedge fund. And then a good ten minute side bar occurred about how effective those hedge fund couples are...

Think of me as the girl who got away during grad school or b-school and drop me an email. Who knows? Maybe we could satisfy our investors need for high ROI and satisfy our parents’ desire for grandchildren.

(A burning desire to run a hedge fund is not necessary. A desire to be part of a couple that COULD run a hedge fund is more important.)

Ages 28 to 36 and no one previously married, please.

http://newyork.craigslist.org/mnh/w4m/218557942.html

A bull market storms ahead?

Forget the falling housing market and warnings of an economic downturn; forget that the stock market took six years to arrive where it was roughly six years ago, analysts remain confident that the stock market will stay strong in the months ahead. Pardon us if we’re a tad skeptical.

Unless they were heavily involved in energy funds, mutual fund investors won't have much to grumble about when they open their latest quarterly statements. While few may clap their hands and cheer, many investors will be pleased at the broad-based - albeit modest - gains in their stock portfolios. After swooning in the spring, most stock-fund portfolios benefited from a late-summer rally, the strength of which surprised Wall Street professionals and boosted the S&P 500 index to its highest level in five years.

The market's run-up was sparked by the Federal Reserve's decision in August to pause its two-year-long monetary tightening campaign. That move, together with a sharp drop in oil prices, dispelled Wall Street's fears that an extended bull market, now entering its fourth year, would soon end. With corporate profits still on an uptrend and long-term interest rates easing, many fund managers shrugged off worries about strained consumer finances and a housing slump.

Widespread predictions of a "soft landing" scenario for the economy encouraged managers to put cash reserves to work, mostly in large-cap, blue-chip issues. The blue-chip revival was confirmed when the Dow Jones Industrials index, representing 30 of the largest US companies, had record-high closes for three days straight last week.

http://www.csmonitor.com/2006/1011/p13s01-wmgn.html

Legal, Schmegal: Buffett orders crackdown on unethical practices

Let's have a big hand for Warren Buffett! The big guy may be in his dotage, but obviously the mind is still razor sharp. Buffett says Berkshire should "start with what is legal, but always go on to what we would feel comfortable about being printed on the front page of our local paper".

Buffett has ordered top managers at his Berkshire Hathaway group to redouble efforts to crack down on unethical behaviour, warning that practices such as stock options backdating cannot be justified because "everybody else is doing it".

In a strongly-worded memo dated September 27 and sent to an elite group of Berkshire managers dubbed "The All-Stars", the veteran investor says "bad behaviour" among the insurance and energy conglomerate's 200,000-plus employees is "inevitable".

"But we can have a huge effect in minimising such activities by jumping on anything immediately when there is the slightest odour of impropriety… Berkshire's reputation is in your hands," the memo – obtained by the Financial Times – says.

The "Sage of Omaha" warns that poor corporate governance cannot be forgiven just because the practice is widespread. "The five most dangerous words in business may be 'everybody else is doing it'," wrote Mr Buffett, who has long been sceptical of stock options as a means of remunerating executives.

http://msnbc.msn.com/id/15199920/

6 Billion Dollar Trader has to hire bodyguards!

Kowabunga! This isn't a case of celeb paranoia or anything. People actually want a pound of flesh. Seriously folks, Brian Hunter, the Canadian-based trader with the heavy finger, the one who made those losing $6bn bets on the gas market which brought down hedge fund Amaranth, has had to hire two bodyguards after 'several attempted attacks - not from investors, but from (former) colleagues!

And why not, you might ask. The terminally injured hedge fund is winding down. As many as 250 of the firm's 420 employees will be canned this week. According to Bloomberg, Amananth is contacting several financial institutions, including rival hedge funds Citadel Investments, Pequot Capital Management and SAC Capital Advisors, hoping to find employees new positions. The firm is said to have 353 staff in Greenwich, 26 in London, 18 in Toronto, 11 in Singapore, 9 in Calgary and 3 in Houston.

Amaranth is hoping, however, that rivals will wait before poaching the staff it needs to successfully wind down. The Times quotes from an e-mail, titled 'Amaranth Talent Acquisition', sent out by the firm's Head of Human Resources, Stan Friedman, which said that 'my goal is to see every employee placed in another job. I would like to give you access to our entire employee population in an organised manner that benefits both Amaranth employees and you'.

Hunter himself might find it a little difficult to obtain a new job. Having said that, as he is believed to have earned around $100m last year, he probably won't mind.

http://news.hereisthecity.com/news/business_news/6072.cntns

How the Foley Scandal Could Maul the Market

Although we really doubt the Foley Fallout will be a huge factor come November, forgetting that, this news piece purports to be a warning about upcoming stock market performance, it makes us realize for the first time that a Dem victory will affect like more than just DC politics. Though with the Bush veto a wild card, we’ll believe that when we see it.

Add a sex scandal to the impending battle between the donkeys and elephants. Importantly for the nation's 78 million stock players, it could change the political dynamics, significantly affect the upcoming elections (now 29 days away) and have major market implications.

In fact, the scandal, known as the "Foley fallout," is already influencing stock activity. For example, money manager Raymond Stahler of London-based Stahler, Dearborn, Ltd., and a bull on energy stocks, did an about-face over the past week by lightening up on his holdings of Chevron, Marathon Oil, and ExxonMobil. He also unloaded some shares of pharmaceutical biggies Wyeth and Pfizer, even though he says both are undervalued.

His reasoning, he told me, was chiefly political. He expects that the Democrats will take control of the House in the midterm elections and have an outside shot of grabbing the Senate, as well. As a result, he thinks both energy and oil shares could come under heavy pressure.

Actually, Mr. Stahler began selling these stocks a few months ago because of his political concerns. In the past week, though, he stepped up his sales in some of the same companies. "Because of the Foley affair, the chances of my being right about the Democrats have greatly increased," he says.

The Foley affair centers on Rep. Mark Foley, the Republican who was caught up in a sex scandal involving congressional pages. Adding to the pressure on Republicans are calls for the resignation of the speaker of the House, Dennis Hastert, amid allegations that he was aware of Mr. Foley's sexual interest in the pages. (Mr. Hastert has denied the allegations and said he wouldn't resign.) Adding further to Republican woes are the troubles of Senator Allen of Virginia.

"Some friends in New York tell me I'm making a mountain out of a molehill, but I don't think so," Mr. Stahler says. "I think the market could suffer a lot more than people might imagine if the Democrats achieve meaningful gains in the election — which I'm sure they will. And if they win both the House and Senate, which I now believe is a distinct possibility, I think that could stall or beat up the market the last two months of the year."

Among legitimate matters of market concern he points to if the Democrats do make substantial headway in Congress:

• The Bush tax cuts may not survive going forward.
• The prospects of a windfall tax for the energy industry.
• Pricing pressures on drug companies.
• Significant cutbacks in defense expenditures.
• An accelerated pullback from Iraq.
• The possibility of a big shift to the left.

Mr. Stahler says he's not oblivious to the possible uses of presidential vetoes, but notes that any sizable Democratic gains would invariably create a lot of noise and worry, which, he observes, could produce a period of declining stock prices and pressure on a number of key industries. The key political question, of course, as far as the market goes: What are the chances of the Democrats snaring both the House and Senate?

How the Foley Scandal Could Hurt the Stock Market [NewYorkSun]