Free Republic

Everyone's talking about Sarah Palin. Thank goodness for investors, she is pro Wall Street. Her Wednesday night RNC speech struck a cord with businesses across the country. This self proclaimed 'gal from Alaska' is already shaking things up with the substance that she offered up on important economic issues.1) Oil (USO) is heading lower, much lower.  As Governor she began a forty billion dollar natural gas pipeline to help lead America to energy independence. She said, "Families cannot throw away more and more of their paychecks on gas and heating oil... When a hurricane strikes in the Gulf of Mexico,...

Hedge funds face struggle for survival LORI McLEOD AND ANDREW WILLIS Monday, September 01, 2008 Black clouds have been building over the hedge fund industry for much of the year, and a storm could break in coming weeks as investors receive their second set of lousy monthly results from funds that are meant to do well in good markets and bad. A series of challenges, some unrelated to the hedge funds' investment strategies, have combined to create lower returns and investor redemptions. Industry experts expect some funds will be forced to close down as clients walk away. The single biggest...

On July 1, California entered fiscal 2009 without having enacted a state budget. Nothing new in that: Budgets have been late in 16 of the past 20 fiscal years. The cause was also not unusual: There was a budget gap, generated partly by the slump in housing, partly by the absence of enormous stock-market profits and partly by the ongoing boom in state spending. Nothing new in that, either. Meanwhile, the productive, private part of California's economy has been cyclical for decades, while the unproductive government part keeps growing, and spending money it doesn't have. The size of the gap...

Pakistani convicted for plot to bomb New York subway05-25-2006, 00h32 NEW YORK (AFP) In this courtroom illustration, James Elshafay (C) and Shahawar Matin Siraj (R) appear August 2004 in Federal District Court in New York, before Magistrate Kiyo Matsumoto (R rear) during an arraignment on charges related to an alleged plot to bomb a New York City subway station. Standing at left are Assistant US attorneys John Nathanson (L) and Kelly Currie (2nd L). (AFP/Getty Images/File) A Pakistani man was convicted of planning to blow up a New York subway station ahead of the Republican National Convention held before the...

Investment bank Merrill Lynch may not have to pay UK tax for decades. The Wall Street giant, which employs 5,500 in the City of London, could be eligible for a tax holiday of more than 50 years after making billions of pounds of losses on 'exotic investments.' The possibility of such a business escaping tax will astonish households struggling with their personal finances. The collapse of profits among all the banks have led to a dramatic fall in their tax burden --which means a big hole in the Treasury's books. Merrill Lynch racked up losses of £15.5billion because of the...

DAVID WEIDNER'S WRITING ON THE WALL Whoops, there goes our profit Commentary: Merrill and J.P. Morgan hint at the scale of coming damage By David Weidner, MarketWatch Last update: 12:01 a.m. EDT Aug. 14, 2008NEW YORK (MarketWatch) -- Big deal: the other day, J.P. Morgan Chase & Co. filed its quarterly report with the Securities and Exchange Commission. Nothing unusual in that. The bank had already done the dirty work by announcing its second-quarter results on July 17. And in that report, everything was looking up. J.P. Morgan had a $2 billion profit to show. The only apparent downer was...

Lehman Brothers, the Wall Street investment bank, is understood to be in talks to sell its entire $40 billion (£21.5 billion) real estate portfolio in a move to stem losses incurred during one of the worst property slumps since the Great Depression. The bank – whose stock has fallen 69 per cent since the credit crisis erupted just over a year ago – is believed to be prepared to take a $5 billion hit on the sale of the assets and securities. Lehman is believed to have begun sale negotiations with firms such as Blackstone, the private equity group, and...

The Securities and Exchange Commission voted to extend the temporary rules it put in place to restrict short-selling of a handful of financial stocks. The SEC commissioners didn't take additional steps opposed by Wall Street to expand the number of stocks affected by the rules or make them permanent. The temporary rules were set to expire Tuesday, and the SEC extended the order on the 19 stocks until Aug. 12. It won't be extended beyond then. In a short sale, a trader sells borrowed stock in a bet the price will decline and the stock can be profitably repurchased at...

Wall Street executives expect the Securities and Exchange Commission to extend the temporary limits it has placed on short-selling and expand them to cover additional stocks beyond the 19 financial companies it targeted two weeks ago. The limits are set to expire Tuesday, and executives, lobbyists and hedge-fund representatives of the Managed Funds Association, the biggest hedge-fund industry group, have been talking throughout the weekend, trying to come up with possible approaches to asking the SEC to reconsider expanding the rules, according to people familiar with the talks. A call with regulators on Friday gave the funds group "a fair...

WASHINGTON -- U.S. Senate lawmakers on Saturday overwhelmingly passed a broad package of housing legislation, hoping to send a calming message to financial markets and voters amid the ongoing deterioration of the housing market and a growing number of bank failures. Meeting in a rare weekend session, the Senate voted 72-13 in favor of the bill, which includes tax breaks for homeowners, a $300 billion program to refinance loans for struggling borrowers, and a dramatic rescue plan for embattled mortgage finance firms Fannie Mae and Freddie Mac. Other provisions include an increase in the federal debt limit to $10.6 trillion...

When I was a young woman married to a Delta Airline pilot - there was a great story that went around Coweta County, Georgia. A veterinarian told it to me. The story went: ‘”what are the two most dangerous things in rural Georgia?” The answer: an out-of-control loaded pulp wood truck careening down hill, and … a pilot in search of an investment. In the 70s, airline pilots with Delta or Eastern often lived in rural Coweta, Carroll or other Georgia boonies outside of Atlanta. Some pilots and airline personnel, at that time, made a good bit more money than...

Remarks at Pete Olson Fundraiser (Partial) July 18, 2008(View clip on YouTube) ... It's uncertain, there's no question about it. Wall Street got drunk, it got drunk, (it’s one of the reasons I asked you to turn off your tv cameras.) It got drunk and now it’s got a hangover. The question is how long will it sober up, and not try to do all these fancy financial instruments. And then we got a housing issue, not in Houston, and evidently, not in Dallas, because Laura was over there trying to buy a house today. (laugher.. Crawford!)VOICE:  What about Crawford?...

WASHINGTON - President George W. Bush has an explanation for the housing-market meltdown that has thrown the global economy into turmoil: Wall Street got drunk. “There’s no question about it. Wall Street got drunk,” Bush said at a private event in Houston on Friday. “It got drunk and now it’s got a hangover. The question is, how long will it sober up and not try to do all these fancy financial instruments?”

When he talks about why the economy is ailing, President Bush often turns to euphemism, citing “challenges in the housing and financial markets.” But Mr. Bush offered a far blunter assessment last week at a closed Republican fund-raiser in Houston: “Wall Street got drunk.” Despite the president’s request that those present turn their cameras off, his comments were captured on videotape that made its way into the hands of Miya Shay, a reporter at the Houston television affiliate of ABC. The video, which also included the newsy tidbit that Laura Bush had begun shopping for houses in Dallas, was broadcast...

Explaining the status of the economy to a closed-door fundraiser last week, President Bush said, "Wall Street got drunk." "There's no question about it," Bush said. "Wall Street got drunk, that's one of the reasons I asked you to turn off the TV cameras. It got drunk and now it's got a hangover. The question is how long will it sober up and not try to do all these fancy financial instruments." Bush made the remark at a closed-door fundraiser for Republican Pete Olson, who is challenging Rep. Nick Lampson (D-Texas) No cameras were allowed in the fundraiser, but an...

Sgt. Frank Lugo leads a double life. In the United States, he was a successful hedge fund trader with condos in New York and South Beach, Fla. Now he is in an unlikely spot -- Iraq, where he lives in the sprawling slum of Sadr City. "My lifestyle's obviously drastically different back home than it is here," Lugo said. "But there are things that can't be replicated back home that are here. This belief that we're trying to accomplish something that's greater than oneself." Lugo is an Army reservist. At 36, he has re-enlisted four times, swapping fast cars and...

" NEW YORK (Reuters) - Merrill Lynch & Co posted a much larger-than-expected $4.89 billion quarterly loss on Thursday after writing down soured debt, and unveiled plans to sell billions of dollars of assets -- including a part of its lucrative brokerage business -- to shore up capital. The loss was the fourth straight for Wall Street's third-largest investment bank, and was more than twice as big as analysts expected. Chief Executive John Thain called the quarter "difficult and disappointing." Thain joined Merrill in November to turn around a company that had been rocked by massive write-downs of complex debt...

The demise of IndyMac, coming on the heels of Bear Stearns' desperate sale to JPMorgan Chase, is a sure sign of the fragility of today's markets. What's needed now, more than ever, is reliable information for investors and confidence that trading can be conducted without the illegal influence of manipulation.Because financial institutions depend on confidence, they are uniquely vulnerable in the current climate. A "run on the bank" can take hold quickly, and can be fatal. But stampedes are not always rational. When an irrational panic is fueled by a sense of urgency, false rumors that must be acted on...

Investors this summer have been placing their bets on an Obama presidency, and for the most part that hasn't been good for the market. Without giving him a chance to explain himself in detail on the campaign trail or at the Democratic National Convention, they are voting with their shares by tossing financial, health insurance, manufacturing and high-dividend stocks into the ash can, and are growing skeptical about energy companies as well. It's not that major institutional investors don't like the man -- far from it. He has many backers among the financial elite, including multibillionaires George Soros and Ron...

Investors this summer have been placing their bets on an Obama presidency, and for the most part that hasn't been good for the market. Without giving him a chance to explain himself in detail on the campaign trail or at the Democratic National Convention, they are voting with their shares by tossing financial, health insurance, manufacturing and high-dividend stocks into the ash can, and are growing skeptical about energy companies as well. It's not that major institutional investors don't like the man -- far from it. He has many backers among the financial elite, including multibillionaires George Soros and Ron...

Three years ago, Deep Capture reporter and Overstock CEO Patrick Byrne gave a famous conference call that he titled, “The Miscreant’s Ball.” His thesis was simple: Some short-selling hedge funds collude to destroy public companies by spreading misinformation, orchestrating government witch hunts, filing bogus class-action lawsuits, and, most egregiously, selling billions of dollars worth of phantom stock. In the months that followed “The Miscreants Ball” presentation, a clique of journalists with close ties to short-selling hedge funds and CNBC’s Jim Cramer (himself a former hedge fund manager), set out to sully the reputations of Patrick and everyone else who sought...

Jamie Dimon Goes Insane: "People Who Pass On Rumors Should Go To Jail"* Hilary Lewis | Jul 8, 2008 3:09 AM JP Morgan CEO Jamie Dimon is usually a font of wisdom, but if he actually means what he's quoted as saying on Charlie Rose, he has gone temporarily insane: Reuters: JP Morgan Chase & Co Chief Executive Jamie Dimon said U.S. regulators should investigate whether people betting on Bear Stearns' stock falling deliberately brought down the investment bank. "Where there is smoke, there's fire," Dimon said in an interview with Charlie Rose on PBS, televised on Monday. "I think...

NEW YORK (Reuters) - Former New York Stock Exchange chief Richard Grasso won a knockout victory on Tuesday in his four-year fight to keep every last penny of his $187.5 million pay package, as an appeals court threw out the state's remaining claims against him. The ruling, Grasso's second court victory in the past week, prompted New York Attorney General Andrew Cuomo to throw in the towel. The New York Supreme Court's appellate division, in a 3-1 vote, dismissed two legal claims against Grasso brought by former Attorney General Eliot Spitzer in 2004. The ruling follows a decision last week...

Spitzer "actually enjoyed destroying people," said a former NYSE managing director, Richard Riker. "Spitzer's legacy is tarnished and trashed because of [the prostitution scandal that led to his resignation] and the Richard Grasso lawsuit suit." "[The Court of Appeals decision upholding Grasso's pay package] becomes part of the realization that Spitzer was no more than a legal lightweight who bullied and slashed his way through Wall Street using the power of his office," Riker said. Spitzer's personal reputation was already in tatters. Revelations that Spitzer had a years-long addiction to high-priced prostitutes - and that he might be indicted himself...

EVERY few years, the conflicts of interest so deeply embedded in the Wall Street business model emerge from the shadows for all to see. Coming to light last week, courtesy of Massachusetts regulators, was UBS’s dual roles in the auction-rate securities market, which have had devastating effects on the people and institutions that invested in them. Because every big brokerage firm that participated in this market faced the same conflicts as both underwriters of the securities and managers of the auctions that set their prices, similar ugliness will likely turn up elsewhere as regulators continue their digging..... The problem UBS...

Brace Yourselves.

NEW YORK (CNNMoney.com) -- Why is General Motors still in the Dow? GM (GM, Fortune 500) may still be the biggest of the Big Three. But it's getting more and more difficult to justify keeping GM in the Dow Jones Industrial Average, an exclusive list of what's supposed to be the 30 leaders in the U.S. markets and economy. GM confirmed on Monday that it is looking into selling its Hummer brand of monstrously-sized vehicles. And in a major sign of desperation, it also announced that it would offer six-year, zero-percent loans for 2008 models until the end of June...

Commodities analysts leaving Wall Street By Francesco Guerrera and Deborah Brewster in New York Published: June 18 2008 02:10 | Last updated: June 18 2008 02:10 Wall Street is witnessing an exodus of analysts covering oil, gas and other commodities as the credit crunch and lucrative offers from hedge funds drive research experts away from investment banks. Over the past few months, highly regarded oil analysts such as Citigroup’s Doug Leggate and Geoff Kieburtz, Morgan Stanley’s Douglas Terreson and Bank of America’s Robert Morris have left. Recruitment experts say the moves are prompted partly by investment banks’ need to slash...

Wall St rattled by inflation, credit crisis and weak housing sector Wednesday June 18, 2008, 7:37 am Wall Street investors have been rattled overnight by inflation fears, the credit crisis and the weak housing sector with its implications for economic growth. There has been a surge in business price inflation, with the Producer Price Index jumping 1.4 per cent in May, exacerbated by energy and food costs. Also in May, housing starts across America have fallen 3.3 per cent to their lowest level in 17 years. Investment firm Goldman Sachs has warned that US banks will collectively need to raise...

NEW YORK -- Lehman Brothers Holdings Inc.'s fiscal second-quarter loss of $2.8 billion matched its preannounced forecast a week ago, in results Chairman and Chief Executive Richard S. Fuld Jr. said were "totally unacceptable." ...losses were caused "in hindsight" by poor choices in its plunge into making high-risk loans for leveraged buyouts and accumulating mortgages for packaging into securities. ... In a sign of how worried investors are about a company's ability to finance its operations with debt, Lehman boasted that its leverage ratio fell to 24.3 from 31.7 at the end of the first quarter and 28.7 last year....

For the second time in three years, the board at American International Group, the giant insurance company, has [replaced] its chief executive. Martin J. Sullivan, who was named chief executive in 2005 after an accounting scandal claimed his predecessor, was removed by the board at a closed-door meeting on Sunday.... The change at the top comes as pressure has mounted on the company to respond to a steady stream of bad news, including record losses, that has pounded down the stock price more than 40 percent since December. AIG’s shares closed at $34.18 on Friday, down from $57.05 in December....

Republican presidential candidate John McCain's tax policies have given him an edge as the better man for the economy, various Wall Street experts said at this week's Reuters Investment Outlook Summit. McCain plans to extend the Bush administration's tax cuts, eliminate the Alternative Minimum Tax, and slash corporate taxes. Obama, who has derided the Arizona senator's plans, has pledged to raise taxes on the wealthy and introduce a broad range of refundable tax credits. "My personal opinion is I would argue that McCain is probably the better candidate for the economy and that is more or less because of his...

Facing a credibility crisis with investors, Lehman Brothers Holdings has replaced its president and chief financial officer, showing that the bloodletting on Wall Street is far from over. Lehman chief executive Richard Fuld, the longest-serving head of a major Wall Street firm, removed Joseph Gregory, a life-long friend, as his No2 and demoted Erin Callan, Lehman's finance chief and the highest-ranking woman on Wall Street. Ms Callan had taken over as chief financial officer only in December and quickly assumed a high-profile role, countering Lehman's critics by going on TV and eagerly engaging questions about the firm. But instead of...

Speaking on Wall Street last night, Senator McCain of Arizona sounded more like an economic populist than a proponent of the kind of unbridled free-market capitalism promoted by many who work on the trading floors nearby. At a town hall meeting in Federal Hall, the presumptive Republican nominee for president endorsed a federal probe into speculation in the oil markets, a phenomenon that some analysts contend accounts for about a third of the escalating cost of crude. "I believe there needs to be a thorough and complete investigation of speculators to find out whether speculation has been going on and,...

The Dow took a 325 point plunge on Friday as Wall Street reacts to an unprecedented $10 surge in crude oil prices and the largest one-month rise in the nation's unemployment rate in two decades. Today's Market As of 2:46 p.m. EDT, the Dow Jones Industrial Average slid 317.46 points, or 2.52% to 12286.26, the Standard & Poor’s 500 index dropped 31.88 points, or 2.27%, to 1372.17 and the Nasdaq Composite Index lost 61.54 points, or 2.41%, to 2488.40. The consumer-friendly Fox 50 fell 21.92 points, or 2.22%, to 964.53. It didn't take long for Wall Street to erase all...

The signs of the super rich in Reykjavik are as clear as the snow on the black volcanic mountains beyond its harbour.

German leaders are to propose a worldwide ban on oil trading by speculators, blaming the latest spike in crude prices on manipulation by hedge funds. It is the most drastic proposal to date amid escalating calls from Europe, the US and Asia for controls on market forces, underscoring the profound shift in the political climate since the credit crunch began. India has already suspended futures trading of five commodities. Car lights are seen streaking past an oil rig extracting petroleum Speculators are split, with some betting that oil will fall Uwe Beckmeyer, transport chief for Germany's Social Democrats, said his...

NEW YORK (CNNMoney.com) -- There's no question about it, a new breed of speculator is pouring money into the oil market and helping drive prices to record levels. What's less certain is if this new money is essential to a healthy market. Many blame record prices on Wall Street investors new to the oil market, saying they're bidding up gas prices to artificially high levels - and soaking drivers. As oil nears $130 a barrel, some say $10 to $70 of that price is due to Wall Street speculation. A slippery debate But that's not the whole story. Nearly everyone...

Topeka, Kan. and Washington - At its best, America's infrastructure has powered our economic prosperity, created well-paying jobs, and served the public interest. Today, however, it has fallen into a dangerous state of disrepair. The Minnesota bridge collapse last summer brought home the urgency of repairing and modernizing our nation's system of highways, bridges, tunnels, power plants, transmission lines, and airports. But doing so will be prohibitively expensive. Current plans seek to exploit the nation's need for private profit. But there's a better source of capital at hand: public pension funds. The American Society of Civil Engineers estimates that $1.6...

Hillary Rodham Clinton attacked the financial backbone of her home state when she told Indiana voters it's time to hit the "Wall Street money brokers" over the nationwide recession. Clinton leveled the comment - one of a series of increasingly populist remarks she has made - just hours after also targeting OPEC, vowing to bust its "cartel, a monopoly that gets together once every couple of months in some conference room in some plush place in the world." ~~~ SNIP ~~~ "Why don't we hold these Wall Street money brokers responsible for their role in this recession?" Clinton thundered to...

The global credit crunch has eased for bankers, says Warren Buffett. “The worst of the crisis on Wall Street is over,” Buffett said. “In terms of people with individual mortgages, there’s a lot of pain left to come...

Dow Industrials Move Close To Wiping Out Year's Losses May 1, 2008 4:26 p.m. Investors bet heavily on consumers rather than commodities Thursday, spurring a heated stock rally that pushed the Dow Jones Industrial Average near break-even for the year. The Dow ended up 189.87 points, or 1.5%, at 13010.00, despite a 3.6% drop in component Exxon Mobil. The energy giant posted a 17% rise1 in first-quarter net income but missed analysts' expectations, as high crude-oil prices faced off against lower refining and chemical margins, lower production volumes and higher operating costs. The blue-chip average's year-to-date loss dwindled to 1.9%....

Investors were unimpressed by the Federal Reserve's relatively small interest-rate cut and downright spooked that the central bank's long-running cycle of pouring cheaper money into the U.S. economy may soon be over altogether. The result: A day-long stock rally sparked by profit news and economic data disintegrated following the Fed's announcement Wednesday, leaving major indicators in the red. The Dow Jones Industrial Average, which had posted a gain of more than 120 points prior to the Fed announcement, finished down 11.81 points, or 0.1%, at 12820.13. A 9.4% rise in its component General Motors helped the blue-chip avoid an even...

Despite recent market volatility, millionaire investors still plan to increase their exposure to stocks over the next 12 months, according to a survey released today by Fidelity Investments. The millionaires expect an economic recovery to begin about a year from now. The group of more than 1,000 respondents with household investable assets of $1 million or more were surveyed by the Boston-based fund firm in January. A full 27% of those surveyed said they planned to increase their exposure to stocks, while only 7% planned to decrease it. Also, 31% planned to allocate more money to fixed income, and 14%...

BANK AND OTHER FINANCIAL STOCKS rallied strongly Thursday on further optimism that the corner has been turned in the credit crisis. ...Ironically, financials jumped following a Wall Street Journal story Thursday suggesting the Federal Reserve will lower its key interest rate target only another 25 basis points (a quarter percentage pointLower interest rates are the traditional tonic for financials. But the stock market seems to have inferred that, if the Fed trims the overnight federal funds rate only one more time, it would signal it signals its work is done... After all, the Fed under Chairman Ben Bernanke not only...

AND NOW, FOR SOME GOOD NEWS: THE OTHER SHOE isn't going to drop. After a winter of discontent marked by massive write-offs on Wall Street and a wilting economy on Main, America's portfolio managers have declared that the worst is over. More than half of the institutional investors participating in our latest Big Money poll say they're bullish... More than 55% of pros think stocks are undervalued, and most plan to boost their holdings... Much has changed since we took the pros' pulse last October, little for the better. Oil is up, profits are down, credit's constrained and a major...

FRANKFURT (Thomson Financial) - UBS AG. plans to cut about 8,000 jobs and will likely announce the move when it presents its first-quarter financial results on May 6, Swiss weekly newspaper Sonntag reported, without saying where it got the information. Some 3,000 cuts will initially affect the company's operations in the United States and in western Europe, with the remaining 5,000 jobs to be eliminated this autumn, primarily in administrative functions, the newspaper said.

I have a theory that if you took all the money in the world and divided it equally among all the people's of the world, it would end up in the same pockets as it left 5-10 years from now. The rule here is that money goes where it can earn it's highest return and be guaranteed to return. That clearly isn't Wall Street. The sub prime stuff made the underwriters and issuers a fortune and the investors nothing. Investors like pension funds and super wealthy individuals have been there and done that and my sense is they are not...

TheStreet.com Video - Microsoft's Vista OS is just plain awful, says Michael Comeau. (Contains some profanity. Viewer discretion is advised.)

Hard times may have settled over Wall Street, but campaign cash from banks and securities firms has flooded Washington as Congress and the White House gird for a regulatory revamp of the financial industry. The Democrats' 2006 retaking of Congress and perhaps the heated presidential race have sharply tilted Wall Street donations toward Democrats, though nearly every politician and both major parties are recipients... Data gathered by the Center For Responsive Politics, a nonpartisan Washington group whose opensecrets.org Web site tracks political giving, reckons that the banking-and-investment industry is giving nearly twice as much to Democrats as to Republicans in...