Main News

 

Let the GSE writedowns begin. Wells Fargo (WFC) said it's taking a $500M writedown on its holdings of Fannie and Freddie preferred shares. Last month JPMorgan (JPM) disclosed a potential $600M writedown, which has likely since grown after the government's explicit takeover this past weekend. E*TRADE Financial (ETFC) and Sovereign Bancorp (SOV) also recently disclosed stakes.

 

US move triggers CDS default
Sep 08 2008 19:21
One of the largest defaults in the history of the $62,000bn credit derivatives market has been triggered by the US government's seizure of Fannie Mae and Freddie Mac, raising questions about how dealers will unwind billions of dollars worth of contracts Read more »

 

The end is nigh for Freddie and Fannie
Sep 08 2008 19:59
It was the right decision. It will save the world from a financial catastrophe and it means that the absurd quasi-private structure of Fannie and Freddie can now be put to bed. This is a welcome rescue, but the events of this week highlight that we now live in a world of extreme moral hazard Read more »

Fannie & Freddie: effects on US economy
Sep 08 2008 19:07
The word from all three big ratings agencies is that, while not as flush as it used to be, the US Treasury is deserving of its top credit rating, even after Fannie and Freddie Read more »

 

Analysis: Watershed Event for $8 trillion in MBS, Agencies Unfolds
09/08/2008 1:42:28 PM ET
NEW YORK (Reuters)—A vast $8 trillion portion of the U.S. credit markets is expecting a big jolt this week after investors in mortgage-related debt on Sunday [Sept.

 

Mortgage Rates Plunge After Federal Takeover of Fannie and Freddie
A Boost for New York Real Estate Market Is Predicted
BY CANDACE TAYLOR - Staff Reporter of the Sun
The drop in mortgage rates by as much as half a percentage point following news of the federal takeover of Fannie Mae and Freddie Mac will provide a boost to the New York City housing market. The national average interest rate on a 30-year fixed…

 

Dollar Power From Freddie/Fannie Bad for Commodities
By: Reuters
Posted: 09/09/2008 11:32:54 AM ET
http://www.hedgeworld.com/news/read_news.cgi?section=mfad&story=mfad1393.html

 

The Seize Play  The markets rally on Treasury takeover. How long can relief last? Read More

 

2008 turning out to be tough year for hedge funds, but assets ...
Newsweek - USA
By MARK JEWELL AP Business Writer | AP (BOSTON) The economic downturn has spread to hedge funds, according to survey results that show slowing growth in ...

 

Six Situations to Monitor for the Remainder of 2008 by Michael J. Kosares

 

Will 2 and 20 Soon Be Gone? by Susan M. Mangiero

 

Saudi Arabia: OPEC and Stabilizing Oil Output. September 9, 2008 | 1723 GMT. Saudi Oil Minister Ali al-Nuaimi. FETHI BELAID/AFP/Getty Images ...

 

Spain's economic woes are a more extreme version of what's happened in the past year in the U.S. and U.K. A strong rebound isn't out the question if the government undertakes key reforms, but it's unlikely to happen anytime soon.

 

Inflation-Linked Bonds And Sovereign Credit Risk: An Update<http://now.eloqua.com/e/er.aspx?s=795&lid=7172&elq=E0EEB6F1F3614780A6816C31B93E29BB>

 

Sep 9, 2008 ... Hedge funds - the daredevils of Wall Street - are backing away from risk, fearful of getting beaten up by the market's persistent turbulence ...
www.nypost.com/seven/09092008/business/hedge_hogs_hunker_128180.htm - 50k - 12

 

Sep 9, 2008 ... BOSTON (Reuters) - Some of the world's biggest hedge funds suffered a dramatic drop in assets in the first half of 2008 as financial markets ...

 

Volatility Hedge Funds Outperform Industry First Time Since '03
Bloomberg - Tuesday September 09, 09:17 BST

 

2002's News, Yesterday's Sell-Off
A six-year-old article mistakenly seen by Bloomberg financial news users yesterday reported the bankruptcy of United Airlines and triggered a massive sell-off that nearly obliterated the company's stock in a matter of minutes.

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Yield Curve Corner

 

Senator Bunning Says Paulson Acts Like Socialist, Should Resign
Bloomberg - USA
``I sincerely believe that Henry Paulson and Ben Bernanke should resign,'' said Bunning, a Republican from Kentucky on the Senate Banking Committee. ...

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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/TRCike253_G12.jpg

 

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Iranian Situation and Other Man Made Disasters

 

International help needed in Iran-UAE islands row
AFP via Yahoo! News Tue, 09 Sep 2008 3:44 AM PDT
A senior Gulf official urged Iran to accept international arbitration in its dispute with the United Arab Emirates over three islands in the strategic waterway, in an interview published on Tuesday.

 

Qaeda Deputy Says Iran Collaborated With U.S.
New York Times Mon, 08 Sep 2008 7:32 PM PDT
The second in command of Al Qaeda accused Iran of collaborating with the United States in Afghanistan and Iraq in a video broadcast on the Al Jazeera cable channel.

 

Qaeda Deputy Says Iran Collaborated With U.S.
New York Times Mon, 08 Sep 2008 7:32 PM PDT
The second in command of Al Qaeda accused Iran of collaborating with the United States in Afghanistan and Iraq in a video broadcast on the Al Jazeera cable channel.

 

Outside the Box: The economic bill comes due for Iran's Ahmadinejad
Market Watch Tue, 09 Sep 2008 3:25 AM PDT
History is presenting Iran's president with the bill for the Islamist Revolution's three decades of economic populism.

 

Israeli minister: It's OK to kidnap Iran president
WHO-TV 13 Des Moines Tue, 09 Sep 2008 10:55 AM PDT
Associated Press - September 9, 2008 12:13 PM ET JERUSALEM (AP) - An Israeli Cabinet minister who helped kidnap Nazi mastermind Adolf Eichmann says the same tactic could be used on Iran's...

 

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Opalesque’s Corner

 

- Opalesque Exclusive:  Parker Global Strategies launching $500m energy infrastructure fund
- Fund Launches - Platypus unveils Asian long/short hedge fund at $10m, Lehman/Credit Suisse vet Andrew Ellner preps market-neutral strat at newly formed LightBox Capital Management, Zurich` Systematic Absolute Return rolls out volatility FoF
- Performance - Opalesque Exclusive: Solaris Opportunity Fund`s estimated return for August at +1.27%, YTD +6.50% (est.)
- Indices - HFR: Average hedge fund lost 4.83% YTD, Greenwich Global Hedge Fund Index: Hedge funds post modest losses amongst mixed markets in August, Newedge Volatility Trading Index: Volatility hedge funds outperform (up 7.3% YTD) industry first time since 2003
- Assets - Billion dollar hedge fund club: Largest hedge fund managers control assets near $1.7tln, but 35% of firms lost assets in H1-2008, Renaissance Technologies` assets shrunk by 14.71% in H1-2008
- Camulos offers to cut fees on $2bln if investors stay another year
- M&A - BlackRock co-founder Ralph Schlosstein joins with Evercore and Stone Point Capital to found  $600m launch of HighView Investment Group, will acquire minority interests in alternative managers, Canada`s Sentry Select buys hedge fund Waterfall Investments
- Asset Alliance announces launch of investment placement specialist business Hedgeharbor
- Strategies - CQS latest fund to look to profit from banks` recovery, GAM seeks trading strategies for FoHFs
- Manager Profile - Josh Fink head of Enso Capital and son of BlackRock CEO
- Survey reveals how UCITS has translated into global business opportunities for fund managers with innovative products and strong performance
- Regulatory - Moore Credit Fund`s former manager Steven Harrison sanctioned by FSA for market abuse
- Fannie/Freddie Update - Douglas Kass (Seabreeze), William Ackman (Pershing Square) win big with Fannie, Freddie bets, Fannie, Freddie bailout greeted with cautious optimism, Fannie/Freddie move triggers CDS default, exact amount unknown but likely to be significant, Fallout set to spare foreign investors, small regional US banks could bear the brunt of bailout, Few stand to gain on this bailout, CEOs could make millions in compensation, Comment: Jim Rogers says US is `more communist than China` after bailout, Paulson on Fannie Mae/Freddie Mac (video), Warren Buffett on Fannie/Freddie (video), Bond kings` reaction to bailout (video)
- Credit Crunch Update - Numbers for Lehman and Merrill Lynch show main businesses to have little worth, South Korea`s regulator warns KDB against Lehman stake, Goldman Sachs will report earnings on Sept 16th, analysts keep slashing estimates due to low trade volume, John Mack retools Morgan Stanley after year of sputtering, JPMorgan cuts Bear`s headcount, more than half UK lawyers have been axed since takeover, Dr Doom: More gloom, be prepared for a slump in all asset classes
- Institutions - Denmark BankPension mandates $200m to State Street Global Advisors
- Events - Opalesque Exclusive: Renaissance Technology founder Jim Simons to be guest speaker at fundraiser for charity Autism Speaks, Hedge Funds for Habitat NY to build in Brooklyn on Friday Sept 19th
- People - GLG Partners appoints Andrew Knott to start new global energy product, GLG Partners appoints new portfolio manager Anthony Burton to co-manage global tech investments, Merville succeeds Massad as CEO of Middle East arm of Man Investments, Citadel expands mortgage team with Glenn Perillo and three mortgage portfolio managers, Former Bear Stearns exec Victoria Aston-Duff named Head of Europe for Angelo, Gordon & Co, Wachovia names former Carlyle exec Zwiener CFO, After senior shakeup, Lehman appoints Riccardo Banchetti and Christian Meissner co-CEOs of Europe and the Middle East, XL Capital Ltd appoints Jacob D. Rosengarten as Chief Enterprise Risk Officer, Former Fortis CIO Peter Branner new Head of SEB Investment Management, Chicago Climate Exchange appoints Satish Nandapurkar as President, Killinger ousted as CEO at WaMu
- SCM seeks DD analyst for Hong Kong team, Large funds scope up trading and middle-office staff at less substantial compensation rates, Traders` fears of discretionary bonuses drive September defections, worries on diluted share and stock payouts
- Europe - London and NY tie in finance ranking, Russian equities benchmark has fallen 30% since June, fears ripple out to Ukraine and Poland
- Asia - New Pakistan President will face `struggling` economy
- North America - As Wall Street plows headlong into booming shipping markets, risks need to be weighed or next down cycle will come harder still, Google leads drop in companies owned by hedge funds
- LatAm - Seven useful tips for how starting up a hedge fund in Latin America, especially Brazil
- Opalesque Exclusive: Opalesque launches free daily commodities publication, the Opalesque Commodities Briefings
- Commodities - US official says Russia aims to corner energy market, Shell in Iraqi gas deal worth up to $4bn, to make use of gas burned off daily for safety, Oil prices edges higher with hurricane Ike still aiming for Gulf of Mexico, market expected to zig zag with storm, Corn slightly higher as Fannie/Freddie bailout expected to boost economy and demand for grains
- Exchanges - London Stock Exchange electronic failure shuts down for seven hours, Malaysia halts derivative trades over computer glitches, NYSE will introduce pan-European system in November, taking aim at LSE and Deutsche Boerse, Prague bourse pays out record dividend, Citi launches FX trading platform
- Activist Investing - Update: TCI wants Boerse to sell cash unit to LSE, Cleveland-Cliffs fights Harbinger Capital over acquiring ANR
- News Briefs - More than 40% of large businesses have cut tech budgets, Industrial Alliance to acquire Sarbit Asset Management, Conifer Securities completes SAS 70 compliance review of hedge fund services, Robert `The Hawk` Dorfman publishes first book on hedge fund trading, Russian hedge fund founder Andrei Vavilov sues NYC's Plaza over $53m triplex penthouse with tiny windows, ugly air conditioners, Calyon reported to plan 1,200 job cuts, Opening of Soudi Arabia`s Tadawul Stock Exchange to foreigners requires use of authorized local firm
- ...And finally: The joys of surfing: Aussie surf shop manager gets a `jet ski` tow by powerful, but scared shark
- Logon: http://www.opalesque.com/index.php?act=archive

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Misc. Items of Interest

 

September 4, 2008

The Words They Used

The words that speakers used at the two political conventions show the themes that the parties have highlighted. Republican speakers have talked about reform and character far more frequently than the Democrats. And Republicans were more likely to talk about businesses and taxes, while Democrats were more likely to mention jobs or the economy. http://www.nytimes.com/interactive/2008/09/04/us/politics/20080905_WORDS_GRAPHIC.html

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Funnies, Facts, Quotes, etc….

 

regale ih-GAY(uh)L, transitive verb:

1. To entertain with something that delights.
2. To entertain sumptuously with fine food and drink.
3. To feast.
4. A sumptuous feast.
5. A choice food; a delicacy.
6. Refreshment.

 

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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.