Archive for October, 2006

Our first nomination to our site scraper hall of shame:  We’re getting a bit tired of this.  From time to time we’ve noticed that websites have been using our ideas / news finds without the customary attribution.  We’ve tried to deal with it privately when it’s happened, and that’s mostly been successful.  However, now it’s time to go public with one of them, where emailing hasn’t gotten results.   We (and several of our readers) have noticed that many of the items that we post wind up on Dealbreaker after we post them.  We know that they visit our site often — we see their footprints all over our detailed blog logs.  We believe that many of their news items originate here and they don’t own up to it; instead, they attribute the original source as if they’ve found the news on their own.  Of course there’s bound to be some natural overlap because we tend to be attracted to much of the same material from many of the same sites; clearly just because they put up news after us doesn’t mean they’ve gotten it from our site even if we know they saw it here before they posted it; they could have seen it elsewhere first and just not had the time to blog on it.  But the frequency with which they choose to blog on the same items that we do after visiting us, seems beyond coincidence, especially if the news we’ve found has come from an esoteric site or is on a wacky subject.   And yes, Dealbreaker provides some attribution.  But not nearly as often as we believe is deserved.

Here’s one example, of many we could cite: Take the Halloween mask link that Bess Levin posted late this afternoon from Forbes.  We posted the same link earlier in the day in our post: "Eleventh hour Halloween ideas"   We noted from Dealbreaker’s multiple late afternoon visits to our site, hitting our link to that post over and over, that they were fascinated with it.  We actually noticed it as it was happening.  And they kept coming back to it.  And only earlier in the day John Carney, on Dealbreaker, lamented the lack of good Halloween ideas:

Finally, there are no good Wall Street themed costumes this year. Discernable visages such as Ivan Boesky and Michael Milken are dated. How do you dress like Amaranth or Backdating? Isn’t natural gas invisible?

We guess you could do “A.J.” or “Lucy Gao” or “Aleksey Vayner” but those folks lack a certain, uhm, visual presence required for a good costume. Who can tell the difference between an Aleksey Vayner costume and that douchebag who hated Ralph Macchio in the Karate Kid.

We thought the Forbes masks were cute Halloween ideas. Dealbreaker apparently did too, later on, with their "Last minute Halloween options" link, after the earlier lament.  It’s pretty clear to us that they got the idea and the link on WSF.  Yet they didn’t happen to provide that information. 

Bottom line: We think that’s just wrong.  When we find news, we cite our source.  If it comes from a blog, we cite the blog as well as the original source if they provide it.  And we think Dealbreaker should be doing the same. All the time. So, SHAME ON YOU DEALBREAKER.  If you’re going to use our stuff, please own up to where it came from.  Don’t just scrape and run. That’s just rude.

Interestingly, there’s been a recent case at Harvard regarding a Harvard Crimson columnist’s failure to attribute part of her story to Slate, bypassing them and quoting only from the original source.  She and her column were given the boot….

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Eleventh hour Halloween ideas

Posted by WSF On October - 31 - 2006

Still wondering what to be for Halloween?  Costume pickings are pretty slim at this late hour, but not to worry.  Forbes has plenty of masks for you to download and we show a few of our picks here.  That’s the Jim Cramer model below.  Further below you can see their version of Pattie Dunn, and if you have a really ghoulish bent, you can also be Ken Lay.

Jimcramermask001

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Hedge Fund Headline Roundup

Posted by WSF On October - 31 - 2006
  • Targeting Hedge Funds
  • Cerberus’s Snow Says `Lighter’ Regulation Best for Hedge Funds
  • Equity funds trading credit derivatives seen risky
  • Morgan Stanley increases its exposure to hedge fund sector
  • Morgan Stanley Buys Minority Stake in Avenue Capital
  • Morgan Stanley buys two hedge funds to plug gap
  • Senior hedge fund exec to leave Lehman unit
  • Man Investments Posts Double Digit Growth to Lead Alpha Magazine’s Fund of Funds 50

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$5 billion hedge fund DB Zwirn is under fire from its investors over loose financial controls at the firm according to the New York Post.  Apparently it’s held a series of conference calls where Zwirn "discussed how a former finance executive with the fund inappropriately expensed ‘items’ " to its investors over a number of years.  Zwirn woudln’t say what the inappropriately expensed "items" were.

Another source familiar with the calls said there was a lot of discussion of "whether these internal accounting problems extended further to issues that directly affected client capital," such as valuation of its holdings and allocation of its investors’ money…

One source close to Zwirn told The Post that while there were calls made over the weekend about its accounting issues, the problems did not affect the fund’s asset valuations.

Since Zwirn woudln’t divulge the "items", we can only have fun guessing at what the expenses were, and how they might have been disguised.  Maybe due diligence visits to Scores?  Stress/massage therapy provided by hookers? Personal trips disguised as business? 

The firm’s name has been in the press fairly recently.  It was one of the firms that hired former Citibank commodities hotshot David Becker after he was fired from that firm for cooking the books to influence his bonus.  Becker recently pleaded guilty to fraud.  Zwirn had no clue that he was embroiled in legal problems when they hired him.  Great due diligence they did.

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Murdoch gonna pay his own $50K/month rent

Posted by WSF On October - 31 - 2006

Rupertmurdoch02_1Last month news came out in an SEC filing that Rupert Murdoch was sticking News Corp shareholders with the $50,000 a month rent on the transitional Trump Park Avenue apartment that he and his wife Wendi Deng are sharing while their $44 million Fifth Avenue apartment is being renovated.  After the furor that disclosure caused, Murdoch has had a change of heart about who will foot the bill.

"On reflection, Mr. Murdoch concluded it was more appropriate to cover the apartment expense himself," said a spokesman for Murdoch by way of confirmation. The company is expected to disclose the reimbursement in a future filing with the Securities and Exchange Commission.

Mogul rent control – Fortune

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Hong Kong Institute of CPAs is trying to show how cool it is to be an accountant… (2:04)

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Garykilbergpeterhirscharcheuscapital001Archeus Capital, a New York based hedge fund running nearly $700 million in assets, is closing up at the end of 2006 after some bad trades and record-keeping failures led to investor redemptions according to a letter sent to investors.  The firm was founded in 2003 by Salomon Brothers alums Gary Kilberg (immortalized in "Liar’s Poker" and on the right in the picture) and Peter Hirsch (on the left). The multi-strategy firm, with $3 billion in assets last year at its high, focused on trading bonds and derivatives.

"This failure, and their subsequent inability to properly re-reconcile the fund’s records, led to a series of investor withdrawals from which we have not been able to recover," the two men wrote in the letter.

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Wall Street Folly Headline Roundup – 10/31/06

Posted by WSF On October - 31 - 2006
  • Goldman Builds Ambitious Role In Buyout Realm
  • A boom in Goldman partners in Asia
  • SEC’s Cox sees more backdating, reform gripes
  • Carlyle, Unison to Lead Buyout of Toshiba Ceramics
  • ABN Amro sacrifices 500 jobs to cut costs
  • Despite $105M Loss, Officials Still Favor Alpha Engine Vehicles
  • Barclays Capital Hires Five Bankers to Start Energy Practice
  • UBS Reports 21% Decline in Profit on Trading Slump
  • Cantor Fitzgerald spin-off close to New York flotation
  • FSA expects to slim workforce
  • Buffett’s Berkshire buys Target, more J&J stock
  • Pickens’ Son Guilty Of Stock Scam Fraud
  • Microsoft Files Suits Globally Over Pirated Software
  • U.S. Justice Dept to question Sony in SRAM probe
  • To the Media, YouTube Is a Threat and a Tool
  • MySpace takes steps against copyright infringement
  • Monster’s Founder Quits Board Amid Options Probe
  • Merck to acquire S.F.-based Sirna
  • S.E.C. Sues Ex-Officials of Delphi
  • Parts Maker Is Fifth to File for Bankruptcy [Dura Automotive]
  • Wal-Mart eyes banking – Financial services in Canada: It’s a way to strengthen ties with its customers: analyst
  • CB Richard Ellis Buys Trammell Crow for $1.8 Billion

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New York Magazine on Billionaires

Posted by WSF On October - 30 - 2006

Jeffreyepstein004_2Another interesting article from New York Magazine’s money focused issue is on billionaires in the city, now almost a dime a dozen.  They’re everywhere.  And can do just about anything that they want, although they’re often under a microscope.  The article visits some of the more infamous billionaires including investment manager and accused letch Jeffrey Epstein who, despite his legal problems is said to be "doing well and working steadily—between massages"(defined below).

At the very pinnacle of the New York social scene these days is the billionaire, once a reclusive character who secretively moved world markets from his castle on the hill but now is more likely to be dining at a booth next to you. They’re everywhere: This year, for the first time, everyone on the Forbes 400 list was a billionaire, up from thirteen billionaires in the early eighties. One can imagine them, swathed in Pyrex, looking down from their apartments in new designer buildings at our tenement buildings and bobbing umbrellas, as though the world outside were some vast boho terrarium.

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Spendingdiary001As part of this week’s New York Magazine cover story on money, they show five weekly spending diaries from different income levels — from a subsidized grad student with limited income at the bottom of the income food chain , to an investment banker (where much of her spending is on an expense account) and trader at the top end.  Here are the spending diaries for the investment banker and trader:

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New York Magazine: Money

Posted by WSF On October - 30 - 2006

Newyorkmagazinemoneyinthecityofhavenots0This week New York Magazine focuses on everything Money — the ‘Have-Lots and Have-Nots" — with a cover article penned by Henry Blodget and many more sub-articles with a money focus.

The Have-Lots and the Have-Nots – New York Magazine

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Brucewassersteinbusinessweek001

Businessweek20061026wassersteincover"I am trying to be fit": The current issue of BusinessWeek has Lazard’s Bruce Wasserstein featured as the cover story in an excellent piece entitled "The Taking of Lazard".  In the article he addresses the rumors of health issues.  While he didn’t specifically say "NO, I AM NOT SICK", sure to be seized upon by some, he says of the talk: "It’s just silly".  That’s a picture of him from the BW piece which we scanned from the magazine, since it didn’t appear to be published on the site.  From the article, the relevant passages regarding his health:

For Wasserstein, the strain of transforming Lazard was exacerbated by the terminal illness of his younger sister, the famed playwright Wendy Wasserstein, who died of lymphoma in January at age 55. Bruce assumed responsibility for raising Wendy’s only child, a 7-year-old daughter. Wasserstein has two young sons of his own with his wife, Claude, and also is father to three adult children by an earlier marriage.

The once-portly Wasserstein lost so much weight in recent months that rumors began circulating that he was gravely ill. "It’s just silly," says Wasserstein, who adds that he began exercising with a personal trainer to shed the pounds he piled on after joining Lazard. "I’m exactly the same weight I was 10 years ago. I go through these cycles. I am trying to be fit."

About 45 minutes into an interview, Wasserstein jumps up and walks across his office to fetch an elaborate coffee-and-ice-cream concoction melting on a table. "My secretary gave it to me," he says, attacking the drink with a plastic spoon.

"Is it your birthday?" I ask.

"No, no, it’s to fortify me for my first press interview," he says, a bit sheepishly. "Oh, the horrors!"

The Taking Of Lazard – BusinessWeek

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Tightwad03_1Just as  news comes out that Goldman Sachs has elevated 115 of its chosen as PMDs and another 282 as managing directors, all of whom will be handsomely paid, a brouhaha is developing in the UK showing just how wide the gulf is between Goldman management and the ones who clean up their messes — the cleaning staff.  The cleaners are trying to get the firm to give them raises to £8 an hour:

Abiola Arowolo, a cleaner at City investment bank Goldman Sachs, is fighting to win a living wage from the firm that has just lavished £5m bonuses on its best-paid London staff.

Arowolo, who is 57 and lives in Stockwell, south London, vacuums and dusts Goldman’s offices from 10pm to 6am, five days a week, and earns just £6.20 an hour. After finishing her shift, she goes off to another cleaning job.

She is part of the ‘Justice for Cleaners’ campaign, set up by the Transport and General Worker’s Union, to urge Goldman and other City employers to take responsibility for the welfare of their cleaners and other low-paid workers.

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Probe002 The SEC is looking into possible Treasury bond price manipulation by UBS and Credit Suisse.  UBS is said to be cooperating with the probe:

The Securities and Exchange Commission is investigating whether UBS AG was involved in improper manipulation of Treasury-securities prices. And a Credit Suisse Group bond trader has left the firm amid broad regulatory scrutiny of the $4 trillion Treasury market, people familiar with the matters say.

The developments mark potentially important steps in a government inquiry into trading in the Treasury market that has been quietly unfolding for several weeks….

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Lucasvanpraaggs002jpgGoldman Sach’s elevation of P.R. guy Lucas Van Praag to PMD has envious tongues wagging in the P.R. world because of how much dough he’s gonna be pulling down:

Van Praag, who splits his time between London and New York, is likely bring home a salary of at least $3 million a year – plus an annual bonus, according to sources at Goldman.

After hearing the news, spin-meisters at other investment banks fired off e-mails to their bosses – some directed as high as the CEO, according to sources – making the brass aware of Van Praag’s pay package.

Salaries for public relations jobs on Wall Street vary widely, but experienced p.r. people can pocket between $250,000 and $650,000 a year.

"Good for him," said one p.r. pro at a large Wall Street investment bank. "My parents begged me to get into finance – maybe I’ll prove them wrong yet!"

Goldman P.R. Dude Sets New Standard – New York Post

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Leonahelmsleypeterlugersteakhouse001From Page Six:  Leona Helmsley, the notorious "Queen of Mean", has been in a giving state of mind.  Also, Peter Luger, one of Wall Street’s favorite steak houses, has spawned new competiton:

We Hear . . . THAT Leona Helmsley made a rare appearance at her hotel, the Park Lane, yesterday to give a whopping $25 million to New York-Presbyterian Hospital for expansion of its comprehensive digestive diseases program.  THAT another veteran of Peter Luger has ventured across the river to open up a steak place of his own. The latest, Arturo, is the owner/chef of Benjamin’s in the Dylan Hotel . . .

We Hear . . . - Page Six New York Post

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London bonuses could be up 18% to £8.8 billion

Posted by WSF On October - 30 - 2006

Potofgold02_1According to the Centre for Economics and Business Research Ltd., bonuses for London investment bankers and hedge fund managers could be up 18% to £8.8 billion $16.7 billion) for 2006.  And around 4,200 financial services and law firm employees could reap bonuses of more than £1 million, up from 3,000 people last year.

“Looking forward, City bonuses are likely” to rise though at a slower growth rate as private-equity firms and hedge funds “find their U.S. home markets saturated and are increasingly looking for opportunities on this side of the pond,” Jonathan Said, senior economist at CEBR in London, said in an interview.

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Manonshortleash001People have short memories, 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….

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Wall Street Folly Headline Roundup – 10/30/06

Posted by WSF On October - 30 - 2006
  • Jon Moulton, founder, Alchemy Partners: Dicing with the debt meister
  • Leveraged-Loan Game Is Set for More Growth
  • UBS, Credit Suisse May Post Lower Profits on Investment Banking
  • Goldman Asked To Revisit Chilean Land Donation
  • Lehman and I.B.M. to Start Chinese Private Equity Fund
  • Cantor Nears Public Offering of Unit
  • Why Citi Doesn’t Need Shopping Spree
  • NYSE hits snags in bid for Euronext
  • Merger talk lifts Montreal Exchange
  • Investors ‘lack basic rights’ on US boards
  • CME to launch credit derivative
  • Clifford Chance moves admin work to India
  • Merger Frenzy Among Exchanges Could Be Making Its Way to Asia
  • U.S. Supreme Court to review Microsoft patent case
  • YouTube Is Purging Copyrighted Clips
  • A Dot-Com Survivor’s Long Road
  • Web distributor Brightcove seeks to make video pay
  • Yahoo’s dilemma: Deal or no deal? [Yahoo flirting with AOL?]
  • Qualcomm Faces EU Probe Into Cell-Phone Patent Fees, People Say
  • Sanjay Kumar Awaits His Sentence
  • Intersil Falls on Departure Of President, Operating Chief
  • Carlos Ghosn, Fast Lane Gets Bumpy
  • Emirates sends its engineers to audit Airbus
  • Schneider to Purchase American Power for $6.1 Billion
  • MTV founder at front of queue to buy Hard Rock
  • Diller plans to buy up British travel websites
  • Trumpeting The Donald’s Stock
  • Starbucks to grow `a latte’
  • Time Inc. Picks Its Web Winners — And Its Flagship Isn’t One

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Selected Barron’s Headlines

Posted by WSF On October - 28 - 2006
Barronscover20061029
  • Technology Outlook
  • An Awkward Marriage
  • China Funds’ Shell Game
  • Airbus’ Double-Edged Deal
  • Sleeper Value in Dell Shares
  • Enduring Lessons
  • For Some Funds of Funds, Public Is Peachy

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Fourmusketeers002All for one and one for all!  Four very sharing guys (three models and an investment banker thrown in for good measure) are looking for their very own little sister who would "belong" to all of them….

Sounds like a dream come true for the right woman!

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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.

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Texas Pacific Group founder David Bonderman’s excellent 10/11/2006 keynote speech at the CED’s 2006 Tech conference discussing the rise of private equity.  Part 1 of 2 (9:17)

The two parts run about 18 minutes in total and are well worth watching.

Here’s Part 2:

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Merrill may be back in business in OC

Posted by WSF On October - 27 - 2006

Merrilllynchfacade02_1Merrill Lynch, blamed in part for the 1994 bankruptcy of Orange County, California and banned from underwritings there since then, may soon be back in business there.

With little public discussion, Merrill Lynch & Co. on Thursday joined 23 other financial services firms approved by a county finance committee for a four-year stint on its "business list" of available underwriters.

"There’s a point where you have to say, ‘OK, let’s move on,’ " said Treasurer-Tax Collector John Moorlach, who sits on the panel. …

The Board of Supervisors will vote on the committee’s recommendation Nov. 14.

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CNBC.com getting December remake

Posted by WSF On October - 27 - 2006

Cnbclogo01_3It amazed us years ago when CNBC management shoved their CNBC.com website into the closet (along with their live video feed that competed with Bloomberg’s) in favor of the listless MSN site where their presense virtually disappeared.  Now it seems that the site is about to be revived, and will be getting a makeover in December according to BusinessWeek.  Let’s hope that the site revamp will be better than the dreadful network extreme makeover introduced in late December of last year.  (Ya, almost a year later we still think it sucks).

NBC’s Script Needs A Rewrite – BusinessWeek

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