Main News

 

The Bailout's Back Again<http://app.en25.com/e/er.aspx?s=795&lid=8035&elq=D2488779814A48DFA65D3F61CA74EAB3> <http://app.en25.com/e/er.aspx?s=795&lid=7828&elq=D2488779814A48DFA65D3F61CA74EAB3>  (October 1, 2008)

 

A majority of institutional investors think the U.S. Securities and Exchange Commission, the U.K. Financial Services Authority and other global regulators should permit the short-selling of financial stocks, but most large companies support the ban imposed earlier this month.

Full Story...

 

Sigma sinking. The $27B London-based investment fund Sigma Finance Corp. is facing imminent liquidation after a sharp fall in the value of its investments, which included Lehman Brothers debt. Forced to default on its borrowing agreements because of the drop in value, investors in the fund's debt holding paper could be left with as little as $0.15 on the dollar, and banks that lent to Sigma will be able to sell $25B in collateral, adding to credit market pain. A list of Sigma assets has already circulated amongst potential buyers to start getting a sense of their worth. Sigma is the last major survivor of the structured investment vehicles breed of investment funds.

 

Credit FAQ: How Is The Lehman Brothers Holdings Inc. Bankruptcy Progressing?<http://now.eloqua.com/e/er.aspx?s=795&lid=8025&elq=D2488779814A48DFA65D3F61CA74EAB3>

 

Special Report
The Bailout and  Beyond:  Citi's Vikram Pandit and Others on What's Next in the Global Crisis
The financial sector's performance over the last month had Wall Street and Main Street alike fretting over the near collapse of several large financial institutions and the ongoing debate in Washington over how the government should react. After rescuing Fannie Mae, Freddie Mac and insurance giant AIG, one solution is the Bush administration's proposed $700 billion plan to buy the troubled securities that are clogging the credit markets -- with potentially devastating results to the global economy. In a Special Section, Knowledge@Wharton shares insights into the crisis from Wharton faculty and others, including Citigroup CEO Vikram Pandit, who spoke to Wharton students just days before his company agreed to buy the assets of Wachovia.
http://knowledge.wharton.upenn.edu/special_sections/market_crisis/

 

Why Hank Paulson Has Failed As Treasury Secretary
As Hank Paulson seeks to resubmit his action plan to save the US financial system, Euromoney questions whether he was ever the right man for the job.Read more

 

WYSER-PRATTE BLOCKS WITHDRAWALS FROM FUND By James Mackintosh in LondonPublished:

 

Of all the outcomes likely to be tossed up by the hurricane sweeping through the world's financial system, one of the most necessary is the need to migrate credit trading to a transparent, exchange-listed and independently cleared forum.

 

SEC stretches short-selling ban. The SEC, while conceding "short selling plays an important role in the market for a variety of reasons" - extended its short-selling ban to Oct. 17. It hopes to have permanent legislation in place by the time the extension expires.

 

The credit squeeze that culminated in a major financial meltdown last week has been impacting U.S. consumers, as well as retail businesses, throughout 2008. According to a new study by BDO Seidman, LLP, nearly half (41%) of CFOs at U.S. retailers have experienced a tightening of credit by their lenders.

Full Story...

 

Outrage

Oct 1, 2008 ... -temporary increase in coal excise tax; funding of black lung disability trust fund -tax credit for carbon sequestration ...
news.aol.com/political-machine/2008/10/01/senate-bailout-bill-sweet-spots-congress-economy/

 

Millions held in hedge funds lockdown
Oct 01 2008 23:43
An increasing number of hedge funds are telling customers they cannot have their money back as rising withdrawals and exposure to Lehman Brothers hit the industry Read more »

 

BlackRock Buys Brazilian Stocks
U.S. asset manager BlackRock Inc. has bought Brazilian stocks including Petroleo Brasileiro SA after prices dropped.

 

Announcing a new hedge fund

 

Wyser-Pratte Blocks Withdrawals From His Hedge Fund, FT Reports
Bloomberg Wed, 01 Oct 2008 9:44 PM PDT
Oct. 2 (Bloomberg) -- U.S. financial investor Guy Wyser- Pratte has blocked withdrawals from his hedge fund and warned that the ``calamitous'' market turmoil is the worst since he started trading in the 1960s, the Financial Times reported, citing the financier.

 

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Buffet on Charlie rose

 

 

Diversification reduces the risk of a portfolio. It does not necessarily reduce the returns. This is why diversification is referred to as the only free lunch in finance. More...<http://www.hedgefund-index.com/d_diversification.asp>

 

Pace among colleges whose funds are frozen

The university had $48 million invested in a popular investment fund for universities that Wachovia Bank is liquidating. 

 

Short Sales Pumped up T2 Partners' September Gains
By: Reuters
Posted: 10/02/2008 2:20:05 PM ET
http://www.hedgeworld.com/news/read_news.cgi?section=dail&story=dail15300.html

 

Hedge funds temporarily block redemptions
A number of hedge funds, including Amber Capital and a fund managed by Cheyne Capital of London, told clients that they cannot withdraw their money. Exposure to Lehman Brothers and increasing withdrawals are hindering the industry. The development is also forcing funds of hedge funds to inform clients that their money is temporarily unavailable. Financial Times (01 Oct.)

 

Wednesday , 01 Oct 2008
Expert laments “the continued credit crisis gripping the US and its impact on the world economy, including the uranium market”; uranium oxide price drops to two-year low.

 

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Yield Curve Corner

 

Bernanke Just Makes It Worse
Motley Fool - USA
By Chuck Saletta In the 2002 speech that earned him the nickname "Helicopter," Federal Reserve Chairman Ben Bernanke warned about the dangers of deflation. ...

 

FDIC's Bair Gets Bigger Role in Rescue as Bernanke Steps Back
Bloomberg - USA
Bair, 54, is being pressed into service as Fed Chairman Ben S. Bernanke and his colleagues try to extricate themselves from the business of using the ...

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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/TRCmarie276_G11.jpg

 

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Iranian Situation and Other Man Made Disasters

 

Iran asks for $7B for fuel imports
UPI Thu, 02 Oct 2008 10:45 AM PDT
TEHRAN, Oct. 2 (UPI) -- Iran is looking to bolster ties with regional energy-producing nations while seeking a $7 billion supplemental to cover gas imports, officials said.

 

Iran to Refrain From Purchasing Wheat From U.S., Fars Says
Bloomberg Thu, 02 Oct 2008 2:11 AM PDT
Oct. 2 (Bloomberg) -- Iran will import as much as 6 million metric tons of wheat in the Iranian year ending March 2009 and no purchase will be made from the U.S.,

 

Iran: Will Keep Enriching Uranium Without Guarantee Of Fuel Supply
October 2, 2008 1430 GMT
As long as there is no legally binding international assurance of a nuclear fuel supply, Iran...
http://www.stratfor.com/sitrep/20081002_iran_will_keep_enriching_uranium_without_guarantee_fuel_supply

 

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Opalesque’s Corner

 

- Fund launches - Star Hedge Managers launches fund of Canadian hedge funds, Lincoln Vale prepares trio of alternative investment funds, Blackstone said to delay start of Asian Event fund
- Performance - Paulson Advantage Plus fund up 19.44% YTD, one of the best performers so far, Greenlight`s Einhorn suffers loss of 11.5% in September, -12.9% YTD, Wolver Hill Japan hedge fund resists slumping Topix, down 1.4%, Lone Pine Capital stung by September losses, down 11%, Hedge fund Trafalgar doubled revenue last year
- Indices - Dow Jones Hedge Fund indices show single digit losses for September (est.), double digit for convertible arbitrage, Nordic Hedge Index down 0.39% in August, -2.98% YTD (est.)
- Redemptions - Millions held in hedge funds lockdown: Amber, Wyser-Pratte, Cheyne Capital, Absolute Return Partners, Olivant block redemptions, Guy Wyser-Pratte blocks client withdrawals
- Hedge funds Camels Capital, Ore Hill are trimming fees to keep investors
- Closures - Opalesque Exclusive: Gottex closes ABL FoHFs due to exposure to Petters Co., suspends ABI Fund`s NAV and share redemption
- Legal - Hedge fund Interlachen sues Petters Group in $60m phony deal, Acorn Capital sues Petters, seeking repayment of loans, CFTC charges Michael Derrick Peninger and CSA Trading Group with fraud and misappropriation in $1m commodity pool scam, MBIA sues Countrywide Financial for fraud
- Bailout Plan Update - Senate backs $700bln rescue plan, new House vote expected on Friday, Soros says Paulson`s financial-rescue plan is `ill-conceived`, Investors battle fair value accounting suspension, which is part of bailout package, Comment: Hedge fund nation
- Opalesque Exclusive:  SEC Emergency ban on shorting financials extended to 17 October, HF manager Malloy believes SEC is walking a dangerous road, Greenwich Survey: 60% against ban
- Credit Crunch Update - Sigma collapse marks end of SIV era, AIG prepares large asset sale, Standard Life to back HBOS takeover, More job cuts expected as UBS signals new writedowns, UBS faces US private client account headache, Credit-default swaps get messier as traders still using them to bet against banks and lenders
- Comment - So, is October the cruelest month?, What we have learned from a painful nine months, Look to the Nordic bubble, not the Great Depression
- Regulatory - Iosco launches task force with CFTC, FSA to study commodity markets, Mitsubishi UFJ gets regulatory boost for US expansion, French market regulator investigates Natixis trading
- Other voices - The end of the single prime broker model
- Prime Brokerage - Opalesque Exclusive: SEB sees surge of hedge fund business, has Eur64m exposure to Lehman, One thousand hedge funds scramble for new prime brokers, Funds try to lose ties to Lehman, BNP Paribas completes acquisition of Bank of America`s equity prime brokerage business, Bank of America`s purchase of Merrill`s brokerage will make it the world`s largest brokerage, investment advisers persuaded to stay
- People - Thames River appoints ex FSA technical specialist Graeme Pollok as compliance and risk manager, Timothy Bryan Wilkinson, John Alexander Goodridge and Alex Maddox to Join Citadel global fixed income business
- Europe - EU divided over bank fund plan, Landsbanki Bank sells off units amid Iceland woes
- Asia - Quadrangle opens Hong Kong office, Credit crisis may spark China rethink on QDII, Tour of the derivatives markets across the Asia-Pacific region
- Commodities - Gold declines in London as dollar strengthens, crude oil drops, Read Opalesque`s free daily commodities publication, the Opalesque Commodities Briefings
- Opalesque Real Estate Briefing now open
- Events - Mid-Atlantic Hedge Fund Association hosts `Credit Market Shakeout: Where are we in the cycle? Which Strategies will benefit?` October 23, Philadelphia, 100 Women in Hedge Funds` 2008 Gala for Harold P. Freeman Patient Navigation Institute, NYC, November 19, NYC
- Activist News - Borders issues warrants to shareholder Pershing, Elliott Associates seeks to buy Epicor Software in $560m bid, Hedge fund nominated by Elliott International fail to make Telecom board
- News Briefs - Harbour Litigation Funding pledges liquidation of MKM Longboat fund will not affect business, Man Investments opens Calgary office, Buffett signs up to $15bln GE plan
- ...And finally - Put some music into your moaning: the world`s largest `complaint choir` is a surprise hit in Germany
- Logon: http://www.opalesque.com/index.php?act=archive

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Misc. Items of Interest

 

US election
Everything you need to know in a 20-page briefing

 

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Funnies, Facts, Quotes, etc….

 

donnybrook DON-ee-brook, noun:

1. A brawl; a free-for-all.
2. A heated quarrel or dispute.

 

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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.