There is a much larger structural risk for markets and investors than HFT and the whole Flash Boys brouhaha, it’s just totally under the radar and hasn’t surfaced yet. Investors may not know better yet, but they will soon, one way or another. Tomorrow a handful of governments will influence aggregate political behaviors by triggering small communications that Big Data tells them will be voluntarily magnified by individual citizens, snowballing into outsized, long-lasting, and untraceable “popular” actions. Tomorrow a handful of hedge funds will influence aggregate market behaviors by triggering small trades that Big Data tells them will be voluntarily magnified by individual traders, snowballing into outsized, long-lasting, and untraceable “market” actions. Tomorrow Big Data will be primarily an instrument of social control, with a powerful and ubiquitous impact on all citizens and all investors.
In 2014, the Firm launched the Point72 Academy. The Academy develops undergrads straight out of college into highly-skilled investors on an accelerated timeline.
From the day they start, Academy members have substantial responsibility and opportunities to contribute in a small team setting.
Today, more than half of Point72’s current Portfolio Managers started as Analysts and the Point72 Academy will grow that number over time.
In recent years Geoffrey Raymond's annotating opportunities have slowed to a trickle courtesy of every central bank going all-in on some $11 trillion in QE (and rising fast) to create the artificial impression that the financial system is stable (because in some parallel universe 6 years of endless bailouts somehow is equivalent to stability and is expected to "boost confidence"), although if recent market volatility is any indication, he may soon be making a repeat appearance, if only in front of energy trading desks at first. And while we await Raymond to once again make mainstream media headlines, he has a special holiday gift idea for all those Zero Hedgers who have not yet parlayed their trillions (if Joe LaVorgna is correct) in savings from plunging crude prices into even more consumerism. Presenting "Existential Rage in the Workplace" from Geoffrey Raymond.
In a stunning rebuke of Preet Bharara's insider-trading prosecutions record, Businessweek reports a federal appeals court overturned and threw out the guilty verdicts of two hedge fund managers, Todd Newman and Anthony Chiasson, ruling jury instructions tainted their verdicts and imperiling other cases brought in his multiyear probe. In a 28-page decision that could rewrite the course of insider trading law, sharply curtailing its boundaries, the United States Court of Appeals for the Second Circuit in Manhattan tossed out the case on technicalities which could also lead to the release of SAC's Michael Steinberg - Bharara's signature prosecution - as Steinberg's lawyer remarked, "it sends a loud and clear message that the government will be rebuked when it tries to turn innocent conduct into a crime." So insider-trading is legal now... with the right lawyer and judge. We wonder how many shipments of Picassos to the three appeals court judges did the verdict cost Steve Cohen?
"... Shortly after returning from a trip in late 2009, Farmer erased electronic notes, in Microsoft Word format, that were stored on thumb drives, Zip drives and a shared drive at Citadel, agents wrote in a summary of one of the interviews with him. Farmer also threw away his handwritten notes because that was his normal practice and because they were incriminating, agents wrote. Farmer got rid of e-mails as well, according to their summary. “This,” they wrote, “wiped the slate clean."
Could we have imagined anything more far-fetched and unlikely as this practice by the SEC itself? We’ll answer this question. No.
The key question now is “Can the U.S./global economy handle a meaningful downturn in financial asset prices?” The short answer is that it may not have a choice. The Federal Reserve has done what it can to juice the American economy and has the balance sheet to prove it. Central banks, for all their power, do not control long term capital allocation or corporate hiring practices. Fed Funds have been below 2% for six years. If the U.S. economy can’t continue to grow in 2015 as the Federal Reserve inches rates higher, there are clearly larger issues at play. And those private sector problems will need private sector solutions.
- Showtime for Apple: Big phones, smart watches and high expectations (Reuters)
- Bank of England Gov. Mark Carney Signals Spring Rate Rise (WSJ)
- Quebec Shows Scots Question Returns Even If Answer Is No (BBG)
- Hush money with a 9 year vesting period: Ex-SAC Fund Manager Martoma Sentenced to Nine Years in Prison (BBG)
- Dreams on hold, Brazil's 'new middle class' turns on Rousseff (Reuters)
- Fed to Hit Biggest U.S. Banks With Tougher Capital Surcharge (WSJ)
- Egypt court sentences Brotherhood leader, cleric to 20 years in jail (Reuters)
- Jackson Hole Theme: Labor Markets Can’t Take Higher Rates (BBG), or anything else for that matter
- Kidnappers free American missing in Syria since 2012 (Reuters)
- More unpatriots: Burger King in merger talks with Canada's Tim Hortons (Reuters)
- California Quake to Cost Insurers Up to $1 Billion, Eqecat Says (BBG)
- Congo declares Ebola outbreak in northern Equateur province (Reuters)
- Missouri Governor Defends Ferguson Prosecutor (BBG)
- Kuroda Douses Japan Stimulus Expectations (WSJ)
- London Jihadi Call Vies With Banks in Canary Wharf Shadow (BBG)
- Netanyahu Signals Expansion of Air Attacks in Gaza (WSJ)
- Libya's Islamist Militias Claim Control of Tripoli (WSJ)
- Yellen Dashboard Warning Light Glows as Millions Work Part Time (BBG)
- More US drones boosting global GDP: Unidentified war planes, explosions heard in Libyan capital (Reuters)
- London Home Asking Prices Plunge Most in More Than Six Years (BBG)
- Carney - Rate Hike before Pay Recovers (Times)
- No Fed fireworks, but plenty of clues, expected at Jackson Hole (Reuters)
- Kurdish, Iraqi forces in control of Mosul dam (Reuters)
- China Pushes Cleanup of Banks (WSJ)
- Russia Widens Ruble Trading Band in Move Away From Managed Rate (BBG)
- Dollar General Makes $9.7 Billion Family Dollar Counterbid (BBG)
- Autopsy finds unarmed teen killed by police was shot six times (NYT)
- Bull Market Waning as Barclays Sees 1% Gain for S&P 500 (BBG)
- Credit Suisse Caught Up in Espírito Santo Mess (WSJ)
- Fed Decision-Day Guide: QE Tapering to Inflation Debate (BBG)
- Obama says strains over Ukraine not leading to new Cold War with Russia (Reuters)
- Siemens to BP Prepare for Downward Russia Business Spiral (BBG)
- Paying Ransoms, Europe Bankrolls Qaeda Terror (NYT)
- Argentina Banks Preparing Bid to Help Argentina Avoid Default (WSJ)
- Obama Weighs Fewer Deportations of Illegal Immigrants Living in U.S. (WSJ)
- India Warships Off Japan Show Rising Lure as China Counterweight (BBG)
- Hong Kong Popping Housing Bubbles London Can’t Handle (BBG)
- Carnage at U.N. school as Israel pounds Gaza refugee camp (Reuters)
- Currency Probe Widens as U.S. Said to Target Markups (BBG)
- Battle for Iraq refinery as U.S. hesitates to strike (Reuters)
- Ukraine forces battle separatists after truce 'refused' (Reuters)
- Fed Dots Ignored as Investors Focus on Yellen’s Message (BBG)
- Retirees Suffer as $300 Billion 401(k) Rollover Boom Enriches Brokers (BBG)
- American Apparel ousts CEO; source says Dov Charney 'will fight like hell' (LA Times)
- House Panel Is Subpoenaed as Trading Probe Heats Up (WSJ)
- GM Officials Ignored Alert on Car Stalling (WSJ)
- Russia’s $20 Billion Bond Void Filled by China to Mexico (BBG)
- EU Court: Google Must Remove Certain Links on Request (WSJ), people have right to be forgotten on Internet (Reuters)
- Harsh weather: German Investor Confidence Drops for Fifth Straight Month (BBG)
- More harsh weather: China Slowdown Deepens (BBG)
- Harsh weather as far as the eye can see: China’s New Credit Declines (BBG)
- "Alien" artist, surrealist H.R. Giger dies aged 74 (Reuters)
- Pfizer urges AstraZeneca to talk as UK lawmakers slam offer (Reuters)
- Property sector slowdown adds to China fears (FT)
- Russia says EU sanctions will hurt Ukraine peace efforts (Reuters)
- U.S. Considers Relaxing Crude Oil Export Restrictions (WSJ)
It seems Goldman Sachs is willing to do pretty much anything when it comes to maintaining SAC Capital (now Point72) Steve Cohen's liquidity. On the heels of last year's "stand by your man" moment in the midst of the insider-trading scandal, Goldman has kindly offered to provide Cohen another lifeline of liquidity - this time backed by his $1 billion art collection. As Bloomberg reports, Cohen pledged “certain items of fine art” under a security agreement which didn’t specify how much money was borrowed. As one art "investor" noted, this is not unusual, "hedge fund guys who manage their money wisely... look to put their art collections to work... If you can get liquidity out of your collection and pay only 250 basis points...it just makes sense." Sense, indeed!
The following story by David Sirota at PandoDaily is simply excellent. It zeros in on the secretive and rapidly expanding relationship between private equity firms and the public pensions that invest in them. It shows a crony capitalist love affair greased by lobbyist influence peddlers known as “placement agents”, as well as non-public agreements between PE firms and public pensions chock full of conflicts of interest, extremely high fees and underperformance. Unbelievably, in many instances the trustees of the public pensions are not allowed to know what funds the “fund of funds” invest in. This makes due diligence impossible, and in one particularly egregious example it led the Kentucky Retirement Systems to unknowingly invest in SAC Capital despite the fact it was under SEC investigation at the time.The chief villain in this article will be no stranger to readers of this site. It is Blackstone...