Perusing this morning's Financial Times online, I saw evidence this blog has another silent reader. It's really remarkable how much one can read here in advance of other more prominent people saying the same thing. How can I conclude otherwise than they read this blog ? [joke]
***quote begins ***
The financial crisis has exposed greed, predatory behaviour and conflicts of interest in Wall Street banks and investment firms, one of the top investors in the US has said. David Swensen, the chief investment officer of Yale University’s endowment who has achieved near-legendary fame, said he hoped some “moderation of compensation” on Wall Street would be a result of the crisis.
He said: "Even if the returns they generated were real, they were paid too much, and in the context of the absolutely disastrous performance of these institutions their pay was obscene".
Fortress, Goldman Sachs, Microsoft, Morgan Stanley and large buy-out funds are among those which he criticises for self-interested actions at the expense of their investors.
He said: “Look at investment banks and how they price swap transactions. Instead of being symmetric and using the same discount rate when selling and buying, they will say that on the cash flows you owe us, we’re going to use a low discount rate, and on the cash flows we owe you, we’re going to use a high discount rate.
“It’s stunning that anyone could say something like that with a straight face.
“This bad, predatory behaviour – unilaterally changing marks, asking for more collateral, etc – it seems the financial crisis stripped off this veneer and caused them all to behave in more venal ways.
“The overwhelming number of investors fail because the fees charged by the investment management industry are egregious relative to the amount of value that is added. It is really quite stunning.“
Mr Swensen said nobody should use hedge funds of funds, which take investor money and, for an additional fee, allocate it to a range of hedge funds.
“You can’t make sensible investment decisions with fund of funds or consultants. Madoff is just a great example of the dangers of making an investment and not understanding where the money is going.”
He said the $17bn Yale endowment was shifting as much available money as possible into distressed debt.
*** quote ends ***
More ...
Davos is coming .... arghhhhhhhhh. I think I have an old post about that rat's nest.
Actions - The Fido Fund
I re-bought some GE on Friday around 12. This is a very long term account - not part of Obama Fund. It's now fully invested until I put more money into it in the Spring. The fund holds CCJ, RIG, JPM, GE, DVN, AAPL, and GOOG. Those are my old favorites - so I've named the fund the Fido Fund, after my first dog, Fido.
Word of the Day
"Flagitious" - adjective [$10]; a reprise of a good one.
Flagitious means criminal, utterly villianous.
Original usage noted from a super book, "The Battle for North America" by Francis Parkham
"The Duke of New Castle used flagitious patronage to win elections."
Sentence: That Wall Street trading desks have inherently flagitious behavior has been known for years. The entertaining book, "Liar's Poker", had numerous sketches from the venal 1980s firm, Salomon Brothers. David Swensen in today's FT mentions more modern versions of Wall Street sleaze in the swaps markets.
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Bunkerman what time does your flight leave for Switzerland?
JERUSALEM (CNN) -- Jewish officials in Israel and abroad are outraged that Pope Benedict XVI has decided to lift the excommunication of a British bishop who denies that Jews were killed in Nazi gas chambers.
a fine institution indeed. anti semtic, pepophiles.........
arghhhhh ... If they paid me $100K I would go ... otherwise nfw.
mern taking mondays off?....well played sir
nah, im going to see bobby in jamaica this week.
my friends from pitt arrive friday.
they got tixs, for free! 3 of em
GE...you buy the skim is safe rap...GS with the 13 price target, don't know their 10-30 yr GE forecast.
GS ... ugh. scum. Hope you wash your hands after touching them.
I figure that even if they cut it to 5%, I get 10% the first year and then the stock can go to 25 IFF the world doesn't end.
So my hold Y-T-Hold is good.
IFF it recovers, the stock goes to 40.
Fido Fund is not greedy, just wants a 100% gain over 2 years.
yes 100% over 2 years seems reasonable...
On doit avoir rêves.
"One must have dreams"
"I figure that even if they cut it to 5%"...exactly what you said about BAC...hhhmmm...did Mrs B sign off on that GE purchase....she's the best.
lolol GE is different - good industrial assets.
lolol Mrs. B. was silent when I told her. Not in her Sky Fund - she doesn't like the company - they sold her a crappy washing machine.
joe torre
what a f'ng cry baby..............bein paid 6m a year to manage a 200m team
f'ng dego guinea pussy
"A Fraud"....
lmaooooo...that is comedy....
"a single white female like obsession with Derek Jeter"
lmaoooooooooo.....how could such a talented guy be such a complete joke?
Bunkerman is there a stop on any of your funds sir? not necessarily a hard price but rather a point where you think the downside risk is much greater?
Bman your thoughts on the protectionist talk comin from the new administration and congress ?? surely that is a horrible sign for the obama fund
that's hysterical mfl
PS.......i believe spin has a single white female obssession with Arod.....but a good one......you know.....i mean spin wacked off for a month when the yankees locked up Arod for 300m
so far I think it's boob bait for Homo Booboise.
just talk for the voters back home.
However, certainly stimulus money should be spent in the US.
That was a problem with the rebate last Spring - it mostly went to China via Wal-mart.
is there a stop on any of my funds ? Do you mean on my stocks, or when I'll sell out the Obama Fund or the Sky Fund ?
I sell when I think I'm wrong - in both cases.
I don't left the beefer scum run stops on me.
bud sure does talk about gay stuff alot.....now that hes good to go...get Dr Melphi's # from merny..
The lady doth protest too much, methinks.
What would have to happen to make you become bearish and not bullish?
--------------------------------------------------------------------------------
Bob Wiley: Excuse me, Phil, but with these particular symptoms, is Prozac the right choice?
Lily Marvin: You think Prozac is a mistake?
Bob Wiley: Well, with this kind of manic episode, I would think Librium might be a more effective management tool.
Phil: You could be right. I'll rewrite the prescription.
grand lido has a nude beach! and to think i was worried i mite get kicked out of this place.......
lol
looool...will you be mushrooming??
pass the paper!
;-)
Strychnine is underated!
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