An Investment Banker's Take On Life

Derivatives Debate: On Which Side Are You?

2010-03-11T15:11:00.001+08:00

On the occasion of the Pittsburgh summit of the Group of 20 (G20) last September--the third since the inglorious collapse of Lehman Brothers--I wrote here on the need for the G20 to hurry up its work on reforming financial regulations because of some evident "red flags" that I thought could trigger the next financial crisis. Honestly, the Greek debt problem was not the kind of crisis that I had

Greek Debt Crisis: Wake-up Call For Goldman

2010-03-02T21:23:00.001+08:00

Are you up to speed on the ongoing Greek debt crisis? It has taken an interesting turn after the role of Wall Street in the run-up to the crisis was exposed. Based on media reports, Goldman Sachs, in double whammy fashion, first helped Greece conceal some of its debt from budget overseers in Brussels after it was admitted into the EU, and then helped exacerbate Greece's fiscal troubles by

Musings On Leaving One's Comfort Zone

2010-02-01T16:32:00.002+08:00

If you are too engrossed with work and the business of living, maybe this story could make you pause and reflect on your own life: UBS AG senior currency strategist Benedikt Germanier decided that he had become just another factory hen on a trading floor where money was everything that counted. So he ditched his bonus and banker life in the U.S. for a pair of handmade skis. “I feel much more

Wall Street's Derivatives "Casino" On A Roll Again

2010-01-28T22:12:00.001+08:00

The role played by arcane financial instruments like CDOs and credit default swaps during the 2008 financial meltdown should, by now, be a well-worn story full of valuable lessons for regulators and market players alike. If that were so, what then does the following recent Bloomberg report mean? Wall Street is marketing derivatives last seen before credit markets froze in 2007, as the record

Will The Volcker Rule Abet The Next Financial Innovation?

2010-01-23T00:23:00.001+08:00

Yesterday, President Barack Obama announced a surprise proposal that would impose new restrictions on the size and scope of banks and other financial institutions, in a move designed to rein in excessive risk taking and to protect taxpayers. This comes on the heels of a new tax or, more appropriately, a "financial crisis responsibility fee" to be charged on banks, aimed at recovering all

Wall Street Bonuses As Financial Tea Leaves

2010-01-19T22:43:00.001+08:00

Today I came across an article written by Prof. Karen Z. Ho, University of Minnesota, on Wall Street bonuses. It is a timely find given the current outrage over the reported multi-million dollar bonuses that will be handed out by Wall Street banks to its executives and employees early this year for performance achieved last year. Prof. Ho sees a link between Wall Street's bonus and compensation

Are Investment Bankers Overpaid?

2010-01-15T23:17:00.002+08:00

Sorry guys, but it's a question one is bound to ask after reading about Lusha, who outperformed 94% of Russia's investment funds in 2009! The interesting part ? Lusha is a female circus chimpanzee (shown in above photo), owned by legendary Russian trainer Lev Dorov. From a possible field of 30 companies (represented by 30 cubes), the money-wise chimp picked eight where to invest her one

What Will The New Year Bring?

2010-01-12T23:00:00.002+08:00

I live in a country where we celebrate two New Years--January 1st and the Chinese Lunar New Year, whose exact timing changes from year to year. For this year, the Chinese New Year happily coincides with Valentine's Day, February 14th. In the Chinese lunar calendar, 2010 is the Year of the Metal Tiger. According to this Chinese geomancer, Tiger years bring adventure, exploration and

Dubai World Debt Crisis: Keynes Was Right

2009-12-12T18:35:00.000+08:00

“If I owe you a pound, I have a problem; but if I owe you a million, the problem is yours”, so said John Maynard Keynes. That’s the exact same predicament the creditors of Dubai World and its property unit, Nakheel, find themselves in right now. Only that here we are not talking of just a million, but a cool $26 billion in the aggregate. Worse, if we factor in all creditor risks, including the

A Hat Tip to Facetime.com

2009-11-16T21:59:00.001+08:00

I noticed a couple of visits from Face-time.com yesterday, so I checked out this new site which appeared in my blog stats. As it turned out Face-time.com included this blog in its Blogroll, together with the likes of Bankers Ball, Deal Breaker, Wall Street Oasis, Leveraged Sellout, Mergers & Inquisitions, and seven other ibanking blogs. To say the least, I find it humbling to find my blog in

Free Email Trading Course For You

2009-10-15T22:27:00.003+08:00

I want to make it up to blog readers who stumble upon this blog, expecting that they could get advice or pointers that may be useful to their trading activities, either as a career or as a personal interest, but often walk away empty handed. Well, I occasionally have trading-related posts, but these are admittedly far between and mostly macro issue-oriented in nature, hardly useful to a

A Parable On How Wall Street Works

2009-09-29T21:52:00.000+08:00

My good friend Vic shared this with me today. Somebody else forwarded it to him, so I don't know where the original came from and whom to give the real credit to (hopefully, I'm not infringing on any copyright restrictions). Regardless, enjoy the story:Once upon a time, in a village, a man appeared and announced to the villagers that he would buy monkeys for $10 each.The villagers, seeing that

Crude Oil And Straight Lines

2009-09-28T19:13:00.002+08:00

A number of readers found my earlier post on Crude and Energy (click here) useful and educational. In particular, Investment Advisor, one my blog readers, had encouraged me to follow it up with similar write-ups. I've been busy thereafter, so I really have not had time to do further research on the oil market. Fortunately, Brad of INO.com saved me from such research. I received today an email

G20 Should Hurry Up On Financial Reregulation

2009-09-25T23:56:00.001+08:00

The two-day summit meeting of world leaders from the Group of Twenty (G20) kicked off yesterday in Pittsburgh. This is the third of such summit held since the the collapse of Lehman Brothers, the largest bankruptcy in U.S. history, a year ago. High on the summit’s agenda is the urgent need to reach agreement on financial reregulation, in order to prevent a repeat of the global financial crisis

Crude Oil & Energy Update - Interview with the CME Group's Joseph Ria

2009-07-14T22:57:00.002+08:00

I don't actively monitor the world energy market, but I could tell from the frequent changes in our local pump prices this year (the oil sector has long been deregulated) that world oil prices have become volatile--again. True enough, Chris Cermak filed the following report yesterday:Politicians are beginning to fear a repeat of the summer of 2008, when the price hit $140 per barrel, sending

A Hat Tip to InvestmentBankingReturns.com

2009-07-13T17:19:00.004+08:00

I'm unable to trace from my stats when my blog started receiving visitor traffic from InvestmentBankingReturns.com, but I did notice some activity coming from that website after I blogged about the Goldman Sachs trading code fiasco, so my curiosity led me to do a reverse search. InvestmentBankingReturns.com looks to me like a brand-new (apparently Australia-based) investment banking website with

New "World Currency": A Misleading Report

2009-07-11T23:42:00.004+08:00

At least two online news organizations (here and here) picked up that bit on Russian President Dmitry Medvedev showing off to media at the recent G-8 meeting in L'Aquila a gold coin, which purportedly is a sample of the new "world currency". Between the two, I'm disturbed by the news published by Telegraph.co.uk whose headline and lead sentence are both written in a matter-of-fact manner that

A Reminder from the Sergey Aleynikov Affair

2009-07-10T13:21:00.006+08:00

I’ve sat on the Sergey Aleynikov news for a week now, but with Reuters reporting today that Citadel, the $11-billion hedge fund firm, has joined the fray, I thought that this industrial espionage story has entered a more interesting phase. Here's the excerpt from Reuters:Citadel Investment Group, one of the world's most powerful hedge fund firms, sued a former top executive in its highly

Are You Ready For A Life Like This?

2009-06-09T23:28:00.006+08:00

I'm neck-deep in work on an important project but I couldn't resist the pull of the touching story of Carlos Araya, an ex-crude oil trader on the New York Mercantile Exchange who used to order lobster, filet mignon and $200 bottles of red wine at the Palm Restaurant in midtown Manhattan, but who now seats customers as a host at its Tribeca branch. Here are excerpts from Mary Pilon's WSJ report on

Layoff Tracker

2009-05-17T14:23:00.001+08:00

Philippines: Blacklist Black Eye

2009-04-06T23:51:00.004+08:00

“The time of banking secrecy has passed,” so declared French President Nicholas Sarkozy as he referred to the agreement reached at the recently concluded G-20 summit in London to name and shame the countries, tagged as "tax havens," that refuse to exchange tax information.This concern over so-called tax havens snowballed amidst allegations that banking secrecy and opaqueness in tax regimes have

Where The Financial Sector Jobs Are

2009-03-31T18:15:00.000+08:00

Jennifer Reingold, a senior writer at Fortune, recently spoke to financial services recruiters and pay experts to find out where the jobs are in this post-bailout world. I'm sure this would interest you, whether you are still gainfully employed or you are now in transition to your next incarnation. Here's the substantive portion of Ms. Reingold's report:Goodbye, average Joe. Time was, any "B" or

This Oxymoron Could Be Your Parachute

2009-03-25T12:30:00.002+08:00

Risk-free entrepreneur. That sounds very much like an oxymoron, right? Risk and entrepreneurship go hand in hand, that's why Don Debelak's book, "The Risk-free Entrepreneur," intrigued me enough yesterday into buying the volume I'm reading now.I thought I'd share with you just enough flavor of what to expect between the covers of this book based on its introductory chapter, in case you're

How Much Would Make You Happy?

2009-03-25T06:24:00.001+08:00

Let me take your mind off whatever anxieties you may have at the moment about your job by asking you this question: How would you like receiving $43 million as severance pay? To put that amount in context, consider that James Cayne, the former CEO of the now defunct investment bank Bear Stearns, got a severance package of $13 million. On the other hand, Kennedy Thompson, the former CEO of

AIG Bonus: Somebody Should Get Fired

2009-03-17T16:38:00.002+08:00

The media really went to town with the public outrage over the $165 million bonus paid to AIG's financial products unit. This is the same unit that wrote the credit default swaps (CDS) that precipitated AIG's eventual downfall, and led to its subsequent bailout by the U.S. government using $170 billion in taxpayers' money. Have you taken sides in the highly-charged AIG-bashing still going on in