Archive - Jul 19, 2009
CIT: L+1000 Bridge Financing
Submitted by Tyler Durden on 07/19/2009 21:55 -0500Sunday night edition of America's favorite game: kick the can down the street, better known as "someone else's problem."
State Street On Electronic Trading And The Liquidity Hazard
Submitted by Tyler Durden on 07/19/2009 19:38 -0500Continuing the series of State Street presentations on relevant market topics, the latest piece "What are the Implications of the Growing Use of Electronic Trading" focuses on the nuanced difference between "real liquidity" and "liquidity hazard", depending on whether one is a price taker or market maker. Yet based on limited available public disclosure, non-premium clients of the NYSE and other PT-espousing exchanges have no visibility of who and under what conditions any given broker/dealer and quant become one or the other. And while merely a few years ago HFT was less than half of traded stock volume, recent data indicates high frequency trading now accounts for over 70% of US volume, and thus it is important to reasses what is the relevant set of data disclosure by dominating broker/dealers. The risk is palpable - as State Street itself notes, there is "equity capital at risk."
UK Weekend Focus: 19 July 2009
Submitted by Raymond Shaw on 07/19/2009 17:40 -0500Here is a set of articles worth reading and pondering about over the weekend. It seems that Swine Flu has shifted into high gear with an increasing number of people conking out and GSK to make heavy dough in the process. The UK government is lining up vultures banks to flog off its Llyods and RBS stake; handsome cheddar has already been distributed to the punters managing these stakes.
The Truth About Asia
Submitted by Tyler Durden on 07/19/2009 15:53 -0500The most recent report out of CLSA is out: easily the best and most comprehensive overview piece of all that is happening in Asia, but provides extensive Western insight as well. Here is the link direct from the Company's website.
Sunday Reading
Submitted by Tyler Durden on 07/19/2009 15:10 -0500The Dangers Of High Frequency Trading... As Predicted By Lawrence H. Summers
Submitted by Tyler Durden on 07/19/2009 11:52 -0500When discussing high-frequency trading, Zero Hedge recently asked
"As Goldman is becoming the primary conduit of trading
(whether principal or agency) in virtually all markets, the risk of a
massive liquidity drain becomes exponentially larger, and the risk of
an exogenous event approaches LTCM and Lehman levels. It is this key risk driver that regulators should be focusing on,
instead of chasing and attempting to punish the perpetrators of the
most recent market crash (we are not saying they should not, but they
should prioritize and now should focus on what is
most critical to maintaining a functioning market topology). " It seems we were wrong about authoritarian figures never predicting the implicit risk of this subset of program
trading - ironically, it was well over 20 years ago and none other than
the future Chairman of the Federal Reserve Larry Summers who had some
prophetic words of caution. In a paper titled "Commentary on 'Policies to Curb Stock Market Volatility" in which Larry was discussing the cause and effect of Black Monday (about which he is quite wrong that nobody had seen coming), he lays out some oddly forward looking observations about program trading, or positive-feedback trading as high frequency trading was yet to become a staple market diet.
Jones Day's Chrysler Charge To Taxpayers: $12,702,190.19
Submitted by Tyler Durden on 07/19/2009 11:01 -0500Chrysler's little parade in bankruptcy court to make sure a few hundred thousand unionized workers retain their jobs for another year or two is finished. And here is the bill to you, dear taxpayer (or rather the first of many): Jones Day's invoice is in the mail. Everyone take out their wallets and please split the $12,702,190.19 equally. After all, now that we are allbenefiting form having a much leaner, much more competitive Chrysler around, we should all be happy to pay each and every lawyer who made it possible.
Unemployment Rate By State: June Update
Submitted by Tyler Durden on 07/19/2009 09:04 -0500
The most recent BLS State unemployment data is out. At this rate of job loss, Michigan will see 100% unemployment in about one year (give or take). Otherwise, state by state unemployment increased by 2.8% on average (unweighted) from May until June.



