Main News

 

Rogue trader costs Société Générale EUR5bn - back office controls skirted
French banking group Société Générale (SocGen) is reporting a massive EUR4.9 billion in losses perpetrated by a rogue trader who used to work in its middle office division and who used loopholes in controls and risk management procedures to conceal fictitious transactions.

 

Societe Generale 'AA' Long-Term Rating Placed On CreditWatch Negative On Trading Loss News
The rating action on France-based Société Générale (SocGen; AA/Watch Neg/A-1+) follows the announcement by the bank of a EUR4.9 billion trading loss generated by a rogue trader, as well as a EUR2 billion write-down on the bank's collateralized debt obligation and indirect bond insurer exposure, all of which will trigger a more than 80% fall in net profit for 2007. Excluding the announced losses, SocGen's underlying profitability remains strong for 2007, supported by the sound performance of most business lines.
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Huge Fraud Rocks Banking
Confidence in banks, already fragile as a result of the huge subprime losses, has been shaken further by a shocking fraud at one of Europe's biggest banks. Read More

 

Fitch Ratings expects that fair value measurement will continue as the central accounting focus for analysts and investors, according to its 2008 accounting and financial reporting global outlook report published yesterday.

Full Story...

 

Komercni exposure to equity markets limited, CDO exposure at 11 ...
Forbes - NY,USA
PRAGUE (Thomson Financial) - Czech lender Komercni Banka said it has very limited exposure to equity markets and its CDO exposure is at a very low level of ...

Atonement Comes to Wall Street as Exiled Risk Guardians Return

 http://www.bloomberg.com/apps/news?pid=email_en&refer=home&sid=aimq1nA9fIpI 

Debunking the Myth of Decoupling Global Markets <http://seekingalpha.com/article/61524-debunking-the-myth-of-decoupling-global-markets?source=i_email>

 

UP AND DOWN WALL STREET DAILY  By RANDALL W. FORSYTH
Bear-Market Rally: An Oxymoron, Not an Opportunity
Don't confuse short-covering with a cure for the credit crisis.
http://online.barrons.com/article/SB120113139293811633.html?mod=djemBF

 

 

Asset managers trail banks on climate change says investor report
http://www.responsible-investor.com/home/article/asset_managers_trail_banks_on_climate_change_says_investor_report/

 

Global Fixed Income Annual Wrap-Up And 2008 Outlook: The Credit Cycle Bares Its Teeth
At the close of 2007, global bond markets had cause to be nervous on many fronts, such as from rising risk premiums, higher probability of downgrades, and the looming specter of an eventual upswing in the default cycle from all-time lows. While factors such as globalization, more sophisticated methods of risk transfer, and the entry of new players may have succeeded in prolonging the duration of the market upturn, we believe that 2008 will be a year in which a credit adjustment begins, though it will not necessarily conclude.
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Prominent hedge funds nurse heavy losses in 2008
Reuters - USA
By Svea Herbst-Bayliss BOSTON, Jan 23 (Reuters) - Recent stock market drops hurt some of the world's most famous hedge fund managers, who have long ...

 

Jefferies, the US mid-market investment bank, has cut its hedge fund investments by a fifth this year as losses in ...
eFinancial News Wed, 23 Jan 2008 9:04 PM PST
Jefferies, the US mid-market investment bank, has cut its hedge fund investments by a fifth this year as losses in asset management contributed to a $24m (€16m) hit in the fourth quarter.

 

Fund Insight
Where the Pros Are
Rob Wherry,Dan Burrows
How four fund managers are trying to beat the recent market turmoil.
http://www.smartmoney.com/t.cfm?pId=7&mID=356&mDt=01/24/2008&ui=1157312&ctu=%2Ffundinsight%2Findex%2Ecfm%3Fstory%3D20080124%2Dfund%2Dmanagers

 

EU: Consequences of the Carbon-Cap Experiment
January 23, 2008 2220 GMT
The European Commission submitted proposals Jan. 23 for expanding the EU carbon cap-and-trade system.
http://www.stratfor.com/analysis/eu_consequences_carbon_cap_experiment

 

Saudi Arabia: Considering A Sovereign Wealth Fund
January 24, 2008 1419 GMT
Saudi Arabia is considering the creation of a $6 billion sovereign wealth fund to invest its...
http://www.stratfor.com/sitrep/saudi_arabia_considering_sovereign_wealth_fund

 

Mayor Bloomberg blames White House hopefuls on subprime mortgage ...
New York Daily News - New York,NY,USA
Appearing before the US Conference of Mayors, Bloomberg - who once bluntly blamed the buyers rather than the lenders in the subprime mortgage crisis - said ...

The Emergence of Convergence
The effort to combine governance, risk, and compliance into a single software platform marches on.

 

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Yield Curve Corner

 

Bernanke's Fed shows that it can be nimble
Financial Times - London,England,UK
Starting with Mr Bernanke's speech on January 10, 2008 it is clear that policymakers felt they had failed to keep the financial crisis from influencing the ...

Bernanke's Schools in `Corridor of Shame' Roil Obama (Update2)
Bloomberg - USA
24 (Bloomberg) -- Ben Bernanke's public school education in Dillon, South Carolina, was his steppingstone to Harvard University.

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Natural Disaster Corner

 

Climate Prediction  http://www.nws.noaa.gov/predictions.php

World Meterological Organization http://severe.worldweather.org/

Tornadoes: http://www.disastercenter.com/tornado.htm

Great Sat Pictures of events: http://www.osei.noaa.gov/Events/Current/DSTafrica024_MT.jpg

 

 

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Iranian Situation and Other Man Made Disasters

 

 

Sixth nuclear fuel batch lands in Iran
AP via Yahoo! News Thu, 24 Jan 2008 3:37 AM PST
Iran received a sixth shipment of nuclear fuel Thursday from Russia, destined for a power plant being constructed in the southern port of Bushehr, the official IRNA news agency reported.

 

 

 

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Opalesque’s Corner

 

- Performance: Odey hedge fund up 54.8% in 2007 `without breaking into sweat`, 1,000% subprime short seller Lahde off to the races
- Opalesque Exclusive: Pure water focus pays for water fund, up 169% since May 2007 launch
- Opalesque Exclusive: Update: Barton Biggs` market commentary, Traxis down in January, U.S. stocks surge on talk of bank help, rate cut, ECB`s Trichet stays hawkish despite Fed`s rate cut, Hong Kong Monetary Authority lowers base rate, reassures investors
- Prominent hedge funds nurse heavy losses in 2008, Roundtable Capital suffers heavy losses, assets down from $1m to $750,000
- Caxton`s main hedge fund stops strategic, long-term investments, Update: RAB Capital under pressure, Old Mutual to close Prosper 80 FoHFs after deciding to pull out of the absolute return market, Jefferies cuts hedge fund investments
- AUM: Opalesque Exclusive: Australian hedge fund, mostly up when markets down, looks to increase assets, Gottex says assets more than doubled in 2007, Liontrust Asset Management reports GBP5.020bln funds under management
- Fund launches: Galaxy to launch new China-themed hedge fund, Belgravia Capital debuts European L/S hedge fund
- Opalesque Exclusive: FoHFs manager says hedge fund consultants often clueless, understaffed: `When you actually peak behind the curtain, there is not a whole lot there`
- Hedge funds try to penetrate retail market but high fees could lessen their impact
- HFWG Update: Hedge Fund Working Group members Man Group, GLG plan increased disclosure
- Outlook: Silver lining for hedge funds in turbulent market, Video: Man`s hedge funds outlook
- Ratings firm calls diversified FoFs for inclusion in the SkyRank Top Diversified Fund of Funds Report
- SEI wins hedge fund operational outsourcing mandate from Graham Capital, Advisers not ready to recommend 130/30 to clients
- GAIM 2008 conference report: Too many HFs to chose from, too much work for investors, Krusen predicts managers will be forced to learn how to short
- Institutions: Dutch pension scheme could switch to life-cycle management, HF allocation to increase 5% by 2009, Korea Teachers Pension to invest W500 bln in stocks and alternatives overseas in 2008
- Research:  Negative correlation between stocks and commodities has disappeared, Inverse, leveraged commodities ETFs launched in Canada
- Private equity AUM over $2tln, Preqin predicts $5tln next 5 - 7 years
- People:  RAB Capital hires Gary Pitts as Chief Compliance Officer,  Citi Alternative Investments names Shakil Ahmed head of quantitative strategies, Finisterre Capital hires David Jonas for U.S. marketing, Hedge fund consultant Carne appoints Lechartier as business development manager
- Credit Crunch Update: Carry trade collapses, dollar strengthens, MBIA and Ambac` stock prices skyrocket on rumors of M&A, Pershing had bet on their downfall, AIG bails out $2.5bln Nightingale SIV
- Opinion: Soros says recession `almost inevitable`, Soros accuses Fed of panic cut,  Cerberus` John Snow says banks must `purge` loans before LBOs resume
- Davos: SWFs face growing US pressure
- Analysis: Art market bubble reached peak in November 07, speculators find crossing a border makes it easy to speculate from one auction room to another
- Legal: Fortis, ABN confirm US SEC request for information over insider trading probe,  Judge Gerber follows Lifland`s lead on Chapter 15 in Basis case: secrecy not an excuse
- Deutsche bullish on agricultural commodities in China
- Events: IAFE`s Financial Engineer of the Year Award Dinner on 7th February, NYC
- Activist News: Regulators ok Jana`s stake in Cnet, UK soccer centre firm drops down the table despite hedge fund interest
- News Briefs: Two hedge-fund heavies host Obama in Greenwich, Bank of America cuts 25% of stock analysts, Citigroup cuts London jobs on UK recession fears, Swiss Re says Berkshire acquires 3% stake, shares up, UBS to add 50 employees in Taiwan for wealth management operations, Investors in China get nod to trade in SGX shares, Hong Kong stock addicts expected to surge
- ...And finally:  Kid`s science tests reveals new, surprising truth behind water`s make-up
- Logon: http://www.opalesque.com/main.php?act=archive

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Misc. Items of Interest

 

 

 

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Funnies, Facts, Quotes, etc….

 

nolens volens NO-lenz-VO-lenz:

Whether unwilling or willing.

 

 

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Conference, Courses, Books, Papers

 

Great Research Sites:

 

Merrill Lynch research Link to full report including important disclosures see example

 

John Mauldin’s Weekly Analysis

 

James Altucher’s Website:

 

Other useful sites:

 

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Index Corner

 

The CSFB/Tremont Hedge Fund Index www.hedgeindex.com.

The Cogent Dynamic Averages http://www.cogenthedge.com/home/inv_strategy.asphttp://www.cogenthedge.com/home/inv_strategy.asp

The Dow Jones Indices: http://www.djhedgefundindexes.com/index.cfm?event=viewPremiumContent (free registration)

HFRX Indices https://www.hedgefundresearch.com/hfrx_reg/index.php?fuse=login&1170880431

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Regulatory Info

 

 

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Disclaimer

 

The information contained in this document does not constitute an offer or solicitation to sell any security or other type of vehicles to or by anyone in any jurisdictions, nor should it be regarded as a contractual document. Under no circumstances should the information provided on this document be considered as financial advice, or as a sufficient basis on which to make investment decisions. The information contained herein has been gathered by Investor DNA, LLC from sources deemed reliable as of the date of publication, but no warranty of accuracy or completeness is given. Investor DNA, LLC is not responsible for and provides no guarantee with respect to any of the information provided herein or through the use of any hypertext link. Past results are no indication of future performance. All information in this newsletter is for educational and informational purposes and does not constitute investment, legal, tax or accounting advice. All materials are the property of the respective publishers, as referenced by header and appropriate hypertext links.