Wall $treet Folly

S&P president given the boot

The latest subprime victim: Standard and Poor's president Kathleen Corbet has resigned  / been shown the door as criticism grows over that company's role in the subprime meltdown.  Devin Sharma is her replacement:

McGraw-Hill Cos., the parent of Standard & Poor's, said in a statement yesterday that Corbet, 47, resigned to spend more time with her family. Her exit isn't related to the current credit- market turmoil, Steven Weiss, a New York-based spokesman for the company, said in an interview. Sharma, 51, is executive vice president of investment services and global sales.

Wall Street Folly Headline Roundup - 8/31/07 - Bush plan to help homeowners; More Barclays reassurances as they borrow from BOE; H&R Block tries for a do over; CME vs CBOE; Putnam leaving NYSE; Dell beats; TXU deal getting done?

Hips don't lie: "Dancing with the Stars" latest cast includes: Mark Cuban

Can Mark Cuban dance?  We're all gonna find out on this season's "Dancing With the Stars". The latest cast was announced yesterday and it included the always outspoken billionaire / Dallas Mavericks owner, even after his having undergone recent hip replacement surgery.  Rumor has it he taught disco dancing in college though, so maybe he really can dance.  According to the Dallas Morning News:

He's our first billionaire!" is how the show's host, Tom Bergeron, preferred to put it.

Hey, Tom: Don't be fooled by the hip replacement. Cuban isn't simply Warren Buffett with an attitude.

You TV types have no idea what you've gotten yourself into this time. On American Idol, they occasionally toss Simon Cowell a no-talent schlub he can eviscerate, just to keep his teeth sharp.

If that's what they intended in Cuban's case, they need to know that the intended sacrifice will bite back.

DELAYED BREAKING NEWS FROM CNBC: Nerve gas at the UN!!!!!!!!

Asleep at the switch?:  Contgratulations to CNBC for its timely reporting (NOT!).  Here's some of the sequence of events:

12:18     *NERVE GAS DISCOVERED IN OFFICE DESK AT U.N., EVADUATION UNDERWAY ABC SAYS  (Bloomberg)
12:19     *VIALS OF NERVE GASA DISCOVERED IN OFFICE DESK AT U.N>, ABC SAYS      (Bloomberg)
12:19     Nerve gas discovered at UN, evacuation underway, ABC says - Bloomberg     (Briefing.com)
12:20     Mkt averages drop on 12:19 nerve gas headline... Dow comes in 40 pts, SPX drops 4 in past few minutes (Briefing.com)
12:23     Follow up on nerve gas story -- equity markets coming down as story circulates... Dow -70 points since story hit ABC, Naz -16 points

    ABC reported on their website blog about 20 min ago that United Nations weapons inspectors discovered six to eight vials of a dangerous nerve gas, phosgene, as they were cleaning out offices at a U.N. building in New York this morning, federal authorities tell the Blotter on ABCNews.com. The federal authorities said the office, in a U.N. building near headquarters, was being evacuated and the White House had been notified at 10 a.m. New York police and fire officials said federal authorities had not notified them of any problem at the U.N. building, as of 11 a.m. A U.N. spokesperson said a statement would be issued shortly.    (Briefing.com)

12:40  CNBC Fiiiiiinally reports the story.   

A Happy Birthday shout to Warren Buffett!

Warren Buffett is another year older today --- 77 years young.

Happy Birthday!

Royal Bank of Scotland handing out pink slips to US CDO staff

In a sign of how quickly investment banks are moving to scale back businesses hit by the turmoil, RBS said it had shed a quarter of the just over 20 staff on its collateralised debt obligation team, which repackages mortgage-backed securities and other instruments. Rick Caplan, co-head of CDOs at RBS Greenwich Capital, the bank’s US capital markets subsidiary, left two weeks ago as a result of the cutbacks.

The reductions at RBS mark a sharp reversal from the expansion of recent years, when the bank beefed up its CDO team to take advantage of demand from investors for new structures. CDO volumes jumped 134 per cent in 2006, according to RBS Greenwich’s annual review, and the bank ranked in the top three underwriters of CDOs based on asset-backed securities.

RBS staff in US hit by subprime turmoil - Financial Times

Frank Quattrone is finally in the clear

After being a good boy for the year required by the government, all remaining charges against former Credit Suisse banker Frank Quattrone have been officially dismissed:

The decision today came four years after Quattrone was accused of obstructing justice and 17 months after his conviction for the crime was reversed. Last August, the government agreed to drop its case if Quattrone, 51, didn't break the law for a year.

``The fed's criminal casebook is now closed,'' said Jacob Frenkel, a former federal prosecutor now in private practice in Rockville, Maryland. ``With the one-year clock having run, there is nothing left hanging over Mr. Quattrone's head.''

Frank Quattrone's Criminal Case Is Formally Dismissed - Bloomberg

 

Wall Street Folly Headline Roundup - 8/30/07 - First Data $24B financing battle; Thornburg plans pfd sale; Bernanke on Fannie/Freddie; Dubai OMX bid scrutinized; H&R Block subprime loss; Rio raises $40B for Alcan buy; Pritzkers selling $1B Hyatt stake

The end: Basis Yield Alpha Fund files for bankruptcy

After weeks of bad to worse news over subprime losses, Basis Capital pulled the plug on its Basis Yield Alpha Fund and put it into bankruptcy.  Liquidation to follow.  Creditors include JP Morgan, Goldman, Citigroup, Morgan Stanley, Lehman and Merrill, all of which had filed notices of default against Basis in June:

The Sydney-based firm's fund asked a court in the Cayman Islands for permission to liquidate its assets, according to a petition filed in New York yesterday. The George Town, Grand Cayman-based fund has assets and liabilities of more than $100 million, according to the petition, which asked a federal bankruptcy judge to bar lawsuits in the U.S. while it liquidates in the Caymans.

Basis Yield Alpha has fewer than 49 creditors, according to the petition, which was filed under Chapter 15 of the U.S. bankruptcy law. Using Chapter 15, a foreign-based company can win protection from U.S. creditors while it liquidates or reorganizes overseas.

Judge Robert Gerber in Manhattan will hear a request on Sept. 6. to temporarily bar U.S. lawsuits while the company makes its case for permanent Chapter 15 protection. Today, Basis was granted a restraining order protecting it from lawsuits until that hearing.

Basis Files for Bankruptcy Protection Over Subprime Losses - Bloomberg

Renaissance denies plans to sell a minority stake

Throwing water on a Financial Times report that they were planning to sell a minority stake, Renaissance Technologies issued a denial:

"We are not in discussions and there are no plans," a spokesman for the firm said. "There is no truth to the story."

So much for that.  At least for now.
Renaissance Tech says no plans for stake sale - Reuters