Main News

 

Morgan Stanley in rogue trade probe
Jun 18 2008 21:03
Morgan Stanley became the latest financial group to be hit by the actions of a suspected rogue trader after revealing that a London-based credit derivatives trader had incorrectly valued his positions, forcing the company to take a $120m revenue hit Read more »

 

Morgan Stanley's results were tripped up by bad trades, poor management and investments, as well as less-than-stellar risk management.
http://online.wsj.com/article/SB121384579058187769.html?mod=djemheard

 

Hedge fund chief pessimistic about UK property
Jun 18 2008 22:01
John Paulson, the US hedge fund manager who made a fortune for his investors by anticipating the debacle in subprime mortgages, said it was too early to look for bargains in the financial sector and predicted the worst was yet to come for the UK housing market Read more »

 

Force of credit crunch made plain as 170 hedge funds crash in ...
Times Online - UK
Hedge funds are continuing to feel the full force of the credit crunch, with 170 funds forced into liquidation during the first quarter, a Chicago research ...

 

Hedge Funds Learn to Profit from Higher Volatility
By: Reuters
Posted: 06/19/2008 3:23:18 PM ET
http://www.hedgeworld.com/news/read_news.cgi?section=peop&story=peop3518.html

 

Former Bear hedge fund duo charged
Financial Times - London,England,UK
By Joanna Chung in New York Two former Bear Stearns hedge fund managers were on Thursday indicted on federal charges that they intentionally misled ...

 

Two Former Bear Stearns Fund Managers Arrested
By: Reuters
Posted: 06/19/2008 9:58:53 AM ET
http://www.hedgeworld.com/news/read_news.cgi?section=dail&story=dail15075.html

 

'Bear' of a Battle Looms in HF Fraud Case
By: Christopher Faille, Senior Financial Correspondent, and Chidem Kurdas, New York Bureau Chief
Posted: 06/19/2008 5:45:50 PM ET
http://www.hedgeworld.com/news/read_news.cgi?section=legl&story=legl2240.html

 

Paulson to push for oversight reforms: reports
June 19, 2008 08:05 AM ET
WASHINGTON (Reuters) - Treasury Secretary Henry Paulson is expected
to urge that the Federal Reserve be given new powers to regulate
Wall Street after the collapse of brokerage Bear Stearns Cos.
Inc., U.S. media reported on Wednesday.
http://links.reuters.com/r/MBZD1/CJC1I/0R1OQ/RTLSR/L7PSJ/YT/t

 

The Committee of European Banking Supervisors (CEBS) published its findings on issues relating to the valuation of complex and illiquid financial instruments yesterday. The report puts forward a set of issues that should be addressed by institutions and accounting and auditing standard setters in order to improve the reliability of the values ascribed to these instruments. CEBS has prepared this in response to a request set out in the October 2007 roadmap of the ECOFIN on the financial market situation.

Full Story...

 

 

Bad hedges to prove costly. Analysts at Cazenove say European I-banks, including Credit Suisse (CS) and Deutsche Bank (DB), will take Q2 losses of $726M and $916M respectily due to ineffective hedging strategies. The derivatives used to hedge cash positions don't always move in step with the underlying assets.

 

What you don't see can hurt you. WSJ says banks are becoming increasingly creative at masking loan losses, by doing things such as lengthening its time thresholds at which point debt is considered troubled, and moving toxic assets over to non-balance-sheet subsidiaries. "Spending all the time gaming the system rather than addressing the problems doesn't reflect well on the institutions," Moody's David Fanger says. Banks cited include AF, BBX, WB, WM and CNB.

 

Absolute Capital Shares Plummet after Shareholders Approve Argo Demerger
Hedgeweek - Thursday June 19, 10:00 BST

 

Manhunt for hedge fund felon goes global
Jun 18 2008 22:04
The 10-day long search for missing hedge fund manager Samuel Israel is entering a critical phase, with law enforcement agencies sparing no expense to ensure they "get the body back" before the trail goes cold Read more »

 

Girlfriend Of Missing Hedge Fund Swindler Arrested
The girlfriend of the missing hedge fund executive who faked his death has been
arrested for allegedly aiding his escape from authorities, federal
investigators said.
MORE DETAILS: <http://www.wnbc.com/tu/5yHBQC6Dd.html>

 

Wednesday , 18 Jun 2008
“Disinterested equity markets” may “cease funding uranium exploration and development”.

 

Global Market Brief: Bush's Oil Supply Plan
June 19, 2008 1526 GMT
U.S. President George W. Bush's proposals for lowering U.S. gasoline prices could have some effect, but it would not be immediate. Reducing demand is the only relatively quick and easy option.
http://www.stratfor.com/analysis/global_market_brief_bushs_oil_supply_plan

 

 

Thu, 19 Jun 2008, 05:04

FinAlternatives
The American behind a USD46.5 million hedge fund fraud will be spending some more time in a Chinese jail. Charles Schmitt's sentence was extended by 26 months, the South China Morning Post reports, after the Hong Kong Court of Appeal ruled his original four-and-a-half year sentence was "manifestly inadequate." The 63-year-old pleaded guilty to 19 counts of false accounting in 2006. His CSA Absolute Return fund collapsed in 2004, with Schmitt admitting that he illegally diverted USD195 million of investor funds into dummy companies he controlled.

 

Jamestown Releases a New Occasional Paper on
Turkey’s Arms Industry and Asymmetric Warfare

Paper by Dr. Andrew McGregor

WASHINGTON, DC (6/19/08)--The Jamestown Foundation has released a new Occasional Paper entitled “Arming for Asymmetric Warfare: Turkey’s Arms Industry in the 21st Century.” The paper is authored by Dr. Andrew McGregor, Director of Aberfoyle International Security. This report examines the transition underway in the Turkish Armed Forces (TSK) as it responds to its own structural deficiencies and adapts to asymmetric threats.
The full paper can be downloaded here.

 

Texas Oil Tycoon Tackles Renewable Energy | by David Case
T. Boone Pickens has been dubbed the "Oracle of Oil."
So why is he building the world's largest wind farm?
http://trax.fastcompany.com/k/w/mailman/fasttake/20080618/oil_tycoon

 

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Yield Curve Corner

 

CAPITAL, By David Wessel

Bernanke is determined to avoid a repeat of the mistakes that contributed to the Great Depression. But he's also mindful of how Fed mistakes contributed to the Great Inflation in the 1970s, and he wants to show he's determined to avoid those as well.

 

BERNANKE Says Worst May Be Over - Royal Bank Of Scotland Disagrees
OpEdNews - Newtown,PA,USA
by William Cormier Page 1 of 2 page(s) We know that Federal Reserve Chairman Ben Bernanke has stated "The worst may be over"-, and he may be right, ...

 

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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/TRCfengshen171_GJ.jpg

 

Report Says Severe Weather to Increase as Earth Warms
Washington Post - United States
Warning that extreme weather events "are among the most serious challenges to society in coping with a changing climate," the report finds that "recent and ...

 

 * Arctic sea ice melt 'even faster' *
After a cold winter, Arctic sea ice has melted quickly, suggesting that summers could be ice-free within five to 10 years.
Full story:
http://news.bbc.co.uk/go/em/-/1/hi/sci/tech/7461707.stm

 

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Iranian Situation and Other Man Made Disasters

 

Britain pushes EU nations on sanctions against Iran
AP via Yahoo! News Thu, 19 Jun 2008 9:40 AM PDT
Britain pushed other nations at an EU summit Thursday to explore tougher sanctions against Iran, but European diplomats say a decision on targeting the country's oil and gas sectors was unlikely to be taken for months.

 

IRAN PRESIDENT: US TRIED TO ASSASSINATE ME
New York Post Thu, 19 Jun 2008 11:15 AM PDT
TEHRAN,Iran -- Iranian President Mahmoud Ahmadinejad on Thursday accused the United States of plotting to kidnap and assassinate him during a visit this year to Iraq, state media reported. The hardline president told a meeting of clerics in the...

 

Iran on Its Heels
Foreign Relations Thu, 19 Jun 2008 12:16 PM PDT
For the first time since 2003, Iran has stumbled in Iraq. Prime Minister Nouri al-Maliki’s decision to confront Moqtada al-Sadr’s Mahdi Army in Basra and Sadr City last month caught Tehran off guard.

 

Saudi Arabia: Fear of an Iranian Presence in Bahrain
June 18, 2008 2254 GMT
Despite official denials that eight Bahrainis have been detained in Saudi Arabia for allegedly spying for Iran, the incident could exacerbate regional tensions.
http://www.stratfor.com/analysis/saudi_arabia_fear_iranian_presence_bahrain

 

 

 

 

 

Bridging the Iran-West divide to save cheetahs
June 19, 2008 05:30 AM ET
KUH-E BAFGH PROTECTED AREA, Iran (Reuters) - Iranian and Western
wildlife experts are working together to save rare cheetahs
from extinction in this arid, mountainous region, despite a
nuclear row between their governments.
http://links.reuters.com/r/04S1Z/7IGQM/HV5E6/65MLR/MMPC9/YT/t

 

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Opalesque’s Corner

 

Opalesque Exclusive: The race is on: At least three teams compete to create the `Facebook for hedge funds`
- Opalesque Exclusive: GAIM Monaco day 2 - Thinking macro to find ideas, debating FoHFs, Paulson reveals all, economic forecast
- Fund launches: Egypt investment bank Naeem plans hedge fund and gold fund, China`s KBC-Goldstate Fund wins approval to issue new fund, First ever publicly listed diamond fund poised to launch
- Assets: Ex-Lehman trader Rieder brought $5bln of assets to new hedge fund R3 Capital Partners
- Opalesque Exclusive: Survey unveils Switzerland as evolving hedge fund centre: $15.2bln assets across 116 funds run by 74 managers, expected to grow
- Indices: EDHEC Alternative Indexes: All strategies except for Short Selling were positive in May, Barclay CTA Index up 1.37% in May, 7.39% YTD, exceeds gain for all of 2007
- Listings: MVP FoF lists on the Luxembourg Stock Exchange
- Credit Crunch Update: Morgan Stanley profits drop more than 60%, Morgan Stanley asset unit loses $227m, RBS sees global stock and credit crash over the next three months, HBOS sees GBP1bln writedown in first-half, UBS clients probably withdrew SF41bln ($39.3bln) in assets, analyst says
- Insurers: Ambac asks Fitch to withdraw ratings
- People: SGAM names Olivier Leclerc as new head of alternative investments, Morgan Stanley disbands `award-winning` ETF team, Research company RGE Monitor names new CEO and head of alternatives
- Regulatory: Hedge fund regulation inevitable, says Kynikos Associates founder Jim Chanos,  FSA rushes to close short selling loophole, FSA publishes Q&A on short selling requirements, AIMA asks for more time to accommodate short-selling rules, gets support by former hedge fund regulator Shrimpton
- Legal: Manhunt for hedge fund felon Israel becomes global, American hedge fund fraudster Charles Schmitt gets longer sentence in Hong Kong, Prosecutors in Bear fund probe focus on private email
- Institutions: San Bernardino commits 35% to alternatives, Somerset pension fund picks private equity over hedge funds for diversification
- Commodities: CFTC to impose checks on UK oil traders, Soros says oil prices set to rise more,  Senators propose ban on commodities investing
- Environmental Trading: UK economist Nicholas Stern to launch carbon credit rating agency
- Tech Update: New software helps hedge fund managers to analyze investor base
- Middle East: Dubai invests $250m in shariah commoditiy FoHF, How to make hedge funds comply with Islamic rules
- Asia: MFA and CME meet Chinese officials to talk about role of alternative investments, strengthen relationships, FoHF manager Financial Risk Management to increase investment in Asia
- Events: IAFE Quant Congress USA, New York, July 8-10
- Activist News: CSX calls proxy group`s view `superficial`
- News Briefs: MFA spent $660,000 lobbying on taxes, regulatory issues in Q1, Goldman Sachs veteran lured by Harvard
- ... And Finally: Why you should keep away from drivers with bumper stickers - study
- Logon: http://www.opalesque.com/index.php?act=archive

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Misc. Items of Interest

 

Slideshow: 10 Rules of Effective Brainstorming | by Fast
Company Staff
This is the traffic cop of the session, and should be
an outsider. It is more a matter of personality than
formal training, but it can't hurt to bring in people
to watch a well-run brainstorming session to see how it
works.
http://trax.fastcompany.com/k/w/mailman/fasttake/20080618/effective_rules_brainstorming

 

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Funnies, Facts, Quotes, etc….

 

What's less funny: spending $100 to own a mediocre joke,
only to risk looking like a sociopath when you're hosting
parties.
http://trax.fastcompany.com/k/w/mailman/fasttake/20080618/fabulous_notbuy

 

defenestrate dee-FEN-uh-strayt, transitive verb:

To throw out of a window.

 

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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.