Andrew Cuomo

Wall Street's Latest Investment: Ex-Convicts

Either the Volcker Rule is making Wall Street's menu of investment choices so unbearably limited, or traditional assets are so overpriced Wall Street won't even touch them with other people's money, but when it comes to allocating capital the smartest conmen in the room are coming up with some truly unorthodox products. Such as investing in ex-convicts in the form of 2000 newly released prisoners.

Frontrunning: July 17

  • Bernanke Seeks to Divorce QE Tapering From Interest Rates (BBG)
  • China launches crackdown on pharmaceutical sector (Reuters)
  • Barclays, Traders Fined $487.9 Million by U.S. Regulator (BBG) - or a few days profit
  • Barclays to fight $453 million power fine in U.S. court (Reuters)
  • When an IPO fails, raise money privately: Ally Said to Weigh Raising $1 Billion to Pass Fed Stress Tests (BBG)
  • Bank of England signals retreat from quantitative easing (FT) ... Let's refresh on this headline in 6 months, shall we.
  • Russia's Putin puts U.S. ties above Snowden (Reuters)
  • Smartphone Upgrades Slow as 'Wow' Factor Fades (WSJ)
  • Snowden could leave Moscow airport in next few days (FT)
  • New Egypt government may promote welfare, not economic reform (Reuters)

Frontrunning: January 14

  • Guess who doesn't believe in the "great rotation out of bonds and into stocks": Abe Aids Bernanke as Japan Seen Buying Foreign Debt (BBG)
  • AIG Sues Federal Reserve Vehicle in Dispute Over Lawsuit Rights (WSJ)
  • JPMorgan Said to Weigh Disclosing Whale Report Faulting Dimon (BBG)
  • Ugly Choices Loom Over Debt Clash (WSJ)
  • Credit Suisse to cut bonus pool by 20 percent (Reuters)
  • Brazilian Bikini Waxes Make Crab Lice Endangered Species (BBG)
  • EU redrafts plan for bank rescue funding (FT)
  • JCPenney stock plunges after bad holiday (NY Post)
  • Regulator Comments Buoy Shanghai Stocks (WSJ)
  • Japan voters back PM Abe's efforts to spur growth, beat deflation (Reuters)
  • Cameron averts row over Europe speech (FT)
  • Swatch Buys Harry Winston Jewelry Brand for $1 Billion (BBG)

Guest Post: Feinstein's Gun Control Bill Will Trigger The Next American Revolution

To put this in the most basic terms: registration and restriction equals revolution.  Count on it.  It is not a matter of what we "want", it is a matter of what is necessary.  Without a citizenry armed with weapons of military application, we lose our last deterrent to tyranny, and thus, we lose everything.  When backed into a corner, a victim has two options: he can lie down and die, or, he can fight regardless of the odds.  Sadly, this is where we are in America; fear, servitude, subservience, or civil war.

 

After The Flood Comes The Freeze: "Tens Of Thousands Need Housing" Says Cuomo, As Nor'Easter Approaches

First the flood, now the freeze (and the lack of fuel and gas and heating just making it much worse). And for tens of thousands of residents of New York and New Jersey this means that as many as 40,000 will need to find alternative housing, especially ahead of Wednesday when a Nor'easter formation is expected to hit the Tristate area and bring even more freezing rain and cold to the region. From Reuters: "Tens of thousands of people affected by superstorm Sandy could soon need housing as cold weather descends on the state of New York, Governor Andrew Cuomo said on Sunday. Cuomo, in a televised press conference nearly a week after the storm hit the U.S. East Coast, said the fuel shortages are improving but problems will persist for "a number of days."" Elsewhere, and also from Reuters: "Victims of superstorm Sandy on the U.S. East Coast struggled against the cold early on Sunday amid fuel shortages and power outages even as officials fretted about getting voters displaced by the storm to polling stations for Tuesday's presidential election. Overnight, near-freezing temperatures gripped the U.S. northeast. At least two more victims were found in New Jersey, one dead of hypothermia, as the overall death toll from one of worst storms in U.S. history climbed to at least 112. Fuel supplies continued to rumble toward disaster zones and electricity was slowly returning to darkened neighborhoods after a storm that hit the coast last Monday. New York Mayor Michael Bloomberg said it would be days before power is fully restored and fuel shortages end."

Video Of The MTA In Action: How Whitehall Station Went From Flooded To Dry In 4 Days

On October 30, the day after the worst natural disaster in New York history struck and flooded virtually all of downtown, Governor Andrew Cuomo tweeted the following dramatic picture of Whitehall station, which was then completely submerged underwater. A few days later, Whitehall station is almost dry. Watch this MTA video to see how they did it in 3 short days.

Escape From New York Becoming Problematic As Holland, Brooklyn Battery Tunnels Close

Remember the wetsuit purchased many years ago for that trip to Hawaii and never used once? It may be time to find where it is and clean it up, as "escaping from New York", in a worst case scenario is getting so problematic, swimming through the Hudson or East Rivers may soon be the only option. Moments ago, in a press conference, Andrew Cuomo reported that while the storm is behaving as predicted, as of 2pm today both the Holland and Brooklyn Battery tunnels will be closed. And if these are down, the Lincoln and Queens-Midtown can't be far behind, especially if the flood continues as expected.

 

Frontrunning: October 1

  • Trade Slows Around World (WSJ)
  • Debt limit lurks in fiscal cliff talks (FT)
  • Welcome back to the eurozone crisis (FT, Wolfgang Munchau)
  • Euro Leaders Face October of Unrest After September Rally (Bloomberg)
  • Dad, you were right (FT)
  • 25% unemployment, 25% bad loans, 5% drop in Industrial Production, and IMF finally lowers its 2013 Greek GDP forecast (WSJ)
  • Global IPOs Slump to Second-Lowest Level Since Financial Crisis (Bloomberg)
  • France's Hollande faces street protest over EU fiscal pact (Reuters)
  • EU Working to Resolve Difference on Bank Plan, Rehn Says (Bloomberg)
  • China manufacturing remains sluggish (FT)
  • Samaras vows to fight Greek corruption (FT) ... and one of these days he just may do it
  • Leap of Faith (Hssman)
  • Germany told to 'come clean’ over Greece (AEP)

JPM Admits CIO Group Consistently Mismarked Hundreds Of Billions In CDS In Effort To Artificially Boost Profits

Back on May 30 we wrote "The Second Act Of The JPM CIO Fiasco Has Arrived - Mismarking Hundreds Of Billions In Credit Default Swaps" in which we made it abundantly clear that due to the Over The Counter nature of CDS one can easily make up whatever marks one wants in order to boost the P&L impact of a given position, this is precisely  what JPM was doing in order to boost its P&L? As of moments ago this too has been proven to be the case. From a just filed very shocking 8K which takes the "Whale" saga to a whole new level. To wit: 'the recently discovered information raises questions about the integrity of the trader marks, and suggests that certain individuals may have been seeking to avoid showing the full amount of the losses being incurred in the portfolio during the first quarter. As a result, the Firm is no longer confident that the trader marks used to prepare the Firm's reported first quarter results (although within the established thresholds) reflect good faith estimates of fair value at quarter end."

The Second Act Of The JPM CIO Fiasco Has Arrived - Mismarking Hundreds Of Billions In Credit Default Swaps

As anyone who has ever traded CDS (or any other OTC, non-exchange traded product) knows, when you have a short risk position, unless compliance tells you to and they rarely do as they have no idea what CDS is most of the time, you always mark the EOD price at the offer, and vice versa, on long risk positions, you always use the bid. That way the P&L always looks better. And for portfolios in which the DV01 is in the hundreds of thousands of dollars (or much, much more if your name was Bruno Iksil), marking at either side of an illiquid market can result in tens if not hundreds of millions of unrealistic profits booked in advance, simply to make one's book look better, mostly for year end bonus purposes. Apparently JPM's soon to be fired Bruno Iksil was no stranger to this: as Bloomberg reports, JPM's CIO unit "was valuing some of its trades at  prices that differed from those of its investment bank, according to people familiar with the matter. The discrepancy between prices used by the chief investment office and JPMorgan’s credit-swaps dealer, the biggest in the U.S., may have obscured by hundreds of millions of dollars the magnitude of the loss before it was disclosed May 10, said one of the people, who asked not to be identified because they aren’t authorized to discuss the matter. "I’ve never run into anything like that,” said Sanford C. Bernstein & Co.’s Brad Hintz in New York. “That’s why you have a centralized accounting group that’s comparing marks” between different parts of the bank “to make sure you don’t have any outliers” .... Jamie Dimon's "tempest in a teapot" just became a fully-formed, perfect storm which suddenly threatens his very position, and could potentially lead to billions more in losses for his firm.

Guest Post: The Corruption Of America

The numbers tell us America is in decline... if not outright collapse. I say "the numbers tell us" because I've become very sensitive to the impact this kind of statement has on people. When I warned about the impending bankruptcy of General Motors in 2006 and 2007, readers actually blamed me for the company's problems – as if my warnings to the public were the real problem, rather than GM's $400 billion in debt. The claim was absurd. But the resentment my work engendered was real. So please... before you read this issue, which makes several arresting claims about the future of our country... understand I am only writing about the facts as I find them today. I am only drawing conclusions based on the situation as it stands. I am not saying that these conditions can't improve. Or that they won't improve. The truth is, I am optimistic. I believe our country is heading into a crisis. But I also believe that... sooner or later... Americans will make the right choices and put our country back on sound footing.

American Anger: 58% Say Are "Furious About America's Politics" Compared To 49% In January, 37% Support #OWS

The Arab Spring, which yesterday claimed its first brutal televized murder, confirming that the new regime is unfortunately in no way more civilized or humane than the old one, is slowly gaining ever more traction, and those in power who think they are immune from the basest of human emotions like Gadaffi thought, even in so-called civilized countries, may be surprised to discover otherwise. According to a new AP-GfK poll, 37% of respondents back "Occupy Wall Street" and its various offshoot variants. As can be expected, "A majority of those protest supporters are Democrats, but the anger about politics in general is much more widespread, the poll indicates." What is more disturbing is that nearly two thirds of respondents are openly expressing anger with everything that is wrong in America, even if they can't quite place their affiliation with either the Tea-Party of the #OWS movement. "58 percent say they are furious about America's politics. The number of angry people is growing as deep reservoirs of resentment grip the country." The number was 49% in January - in other words it is rising with meteoric speed. And with the topic of Marxism lately quite prevalent if for purely intellectual masturbation purposes, perhaps the practical implications of Marxist "discontent" should also be considered, and the defining question becomes what will be the tipping point beyond which silent protest and peaceful occupation morphs into something far worse.

State Of Emergency Issued For New York

Hopefully, this is as bad as it will get. Per Reuters, New York Governor Andrew Cuomo on Thursday declared a state of emergency to prepare for the potential impact of Hurricane Irene, which could hit the state this weekend. The formal declaration allows the state to aid counties, cities and towns "more effectively and quickly," get help from the national Emergency Management Assistance Compact and get federal help earlier, the Democratic governor said in a statement. "We are communicating with our federal and local partners to track the storm and to plan a coordinated response, and we will deploy resources as needed to the areas expected to be hit the hardest," Cuomo said.

Brian Moynihan, Other Current And Former Bank Of America Execs Subpoenaed By NY Attorney General

Bank of America just can't catch a break. First it gets caught in a trap of a "non-settlement" settlement which will only expose it to billions more in legal fees and other reserve fund increases, and now this. From the WSJ: "New York state Attorney General Eric Schneiderman has issued subpoenas seeking new depositions from the Charlotte, N.C., bank's chief executive and other current and former executives, according to people familiar with the situation. The subpoenas are a sign that Mr. Schneiderman, who became New York's top law-enforcement official this year, doesn't intend to drop the civil-fraud investigation of Bank of America begun more than a year ago under predecessor Andrew Cuomo." Perhaps it is about time Ken Lewis finally get some primetime TV exposure where he belongs: on the defendant's chair. "Mr. Lewis, who retired partly because of rancor over the Merrill deal, declined comment through his lawyer. Mr. Price's lawyer couldn't be reached to comment." Considering the complete disaster New York prosecutors have now completed with the DSK arrest, they will need a very high profile arrest and conviction to make up for it. Kenny boy sounds like just the type to fit the bill.