The Sure Bet Turns Bad
- Wall Street Journal
Just a few months ago, bets against securities backed by shaky subprime-mortgage loans were among the most alluring trades on Wall Street.
But the market for those securities has since stabilized, potentially hurting those who bet against it, and left a messy squabble in its wake.
A band of hedge-fund managers accuse Wall Street’s Bear Stearns Cos. of attempting to manipulate the market for securities backed by subprime loans by purchasing shaky mortgages. Bear retorts that it has the right to repurchase mortgages and that sometimes it can help a struggling borrower. Meanwhile, an industry association that oversees derivatives trading has been drawn into the middle of the matter….
JPMorgan Chase & Co., the third- largest U.S. bank, plans to increase its commodity-trading staff worldwide by more than 30 percent in the next year to help clients protect against swings in energy and metal prices.
The bank intends to add 40 people to the 110 in commodities trading and marketing, said Catherine Flax, 42, co-head of JPMorgan’s global energy business. The biggest expansion within the bank’s currencies and commodities group is in energy, she said.
“There’s a lot of difficulty in getting staff at the moment and they will be a fair amount of poaching going on,” said Clive Furness, managing director of Contango Markets Ltd., a commodity-consulting company based in South Godstone, U.K. “It’s not going to be cheap.”…..
Firms’ Big India Aims Have Mostly Been Scaled Back – Wall Street Journal
In recent years, the world’s largest private-equity firms have rushed to India. Their big idea: invest lots of money to tap into one of the world’s fastest-growing economies.
So far, it’s not working out that way.
Even though billions of dollars have been raised for investing in India, hardly any big deals are being done. The few that have happened are much less sophisticated and lucrative than the deals that the private-equity business is renowned for world-wide.WHERE’S THE ACTION?
Rather than full-blown buyouts — where private-equity firms purchase publicly listed companies, take them private, restructure them and sell them two or three years later for a fat profit — big private-equity deals in India so far have involved the purchase of small, passive stakes in companies. That’s a strategy more common among plain-vanilla mutual funds….