Main News

 

Residential Mortgage-Backed Securities
195 Subprime RMBS NIMS Classes Downgraded; Surveillance And New Issue Assumptions Revised
These rating actions affect a total of 85 U.S. subprime RMBS net interest margin securities (NIMS) transactions. The 195 downgraded classes have a current balance of $1.66 billion, which represents 30.51% of the approximately $5.44 billion currently outstanding in U.S. NIMS backed by U.S. subprime mortgage securities rated by Standard & Poor's from the beginning of October 2005 through the end of December 2006. These NIMS rating actions follow the rating actions on subprime RMBS taken on July 12, 2007.
To learn more, click or copy and paste the URL below:
http://standardandpoors.rsys1.net/servlet/cc5?kHiQWTSAQTVsLgHxhilpuHQJhuV2VT

 

“Financial market turmoil has shifted the focus away from terrorism and toward subprime and other credit problems as the most important near-term threats to the U.S. economy,” says Carl Tannenbaum, NABE President and Chief Economist, La Salle Bank/ABN-AMRO. “However, these concerns appear to be somewhat transitory, as the five-year outlook for housing remains positive.”

Full Story...

 

Credit Trends: U.S. Distressed Debt Monitor
The U.S. distress ratio experienced its largest monthly increase since February 2003. A rising distress ratio signals an increased need for capital and could act as a precursor to more defaults if accompanied by a credit crunch. Given recent market volatility, credit conditions have tightened noticeably, resulting in increased spreads and an abrupt cessation of high-yield issuance.
To learn more, click or copy and paste the URL below:
(subscription required)
http://standardandpoors.rsys1.net/servlet/cc5?kHiQWTSAQTVsLgHxhilpuHQJhuV2VY

 

Structured Finance
The Fundamentals Of Structured Finance Ratings
Structured finance has become an increasingly important tool in today's financial markets, with issuance levels growing at an extraordinary rate in the past few years both in the U.S. and Europe, as well as in most markets in Asia-Pacific. Its development has been accompanied by vocal debate from market participants and commentators alike on the manner in which credit rating agencies, including Standard & Poor's, evaluate the creditworthiness of such securities.
To learn more, click or copy and paste the URL below:
http://standardandpoors.rsys1.net/servlet/cc5?kHiQWTSAQTVsLgHxhilpuHQJhuV2VSR

 

Carlyle Rescues Its Mortgage Fund Again
Newly public fund gets second $100 million loan. Read More

 

Fed saw danger of credit crunch
Economists and investors believe the odds are rising that the Fed will lower its key interest by at least one-quarter percentage point on or before Sept.  18. 
... READ FULL STORY >>>

 

Knight Capital may return fund fees
If its Deephaven Funds suffer losses during the second half of the year, the firm may refund up to $68. 4 million in investment fees. 
... READ FULL STORY >>>

 

State Street faces exposure to conduits: report
August 28, 2007 01:56 AM ET
NEW YORK (Reuters) - Institutional money manager State Street
Corp  faces $22 billion exposure to asset-backed commercial
paper conduits, the off-balance sheet vehicles that have caused
problems for rivals in recent weeks, British newspaper The Times
reported.
http://links.reuters.com/r/Z59UA/8YQJV/MMDR2/2CVV0/7YVK7/N9/t?a1=nl_usbusinessearly

 

BNP Paribas Investment Partners resumes NAV calculation for suspended funds
Tue, 28 Aug 2007, 06:32
HedgeWeek
BNP Paribas Investment Partners has announced that it is resuming calculation of the net asset values of three funds whose suspension on August 6 was a critical point in the meltdown of the US sub-prime mortgage sector and the seizing-up of credit mechanisms in the first 10 days of the month.

 

Few withdrawal symptoms so far
Mon, 27 Aug 2007, 10:24
Institutional Investor/Hedge Fund Daily
History doesn't seem to be repeating itself as far as hedge fund redemptions are concerned, at least so far. True, it's not even two weeks since redemption day Aug. 15, but there has been nary a report of any mass exodus by investors, a situation that could hobble the mightiest of hedge funds. According to Financial Times, "there has been nothing like the level of outflows that accompanies market wobbles in 1998, 2005 and 2006." The reasons may lie in the changing dynamics of the industry, says FT, as investors are cushioning losses by allocating to a wide variety of hedge fund managers and strategies.

Hedge Fund Numbers in Japan Grow as Stocks Languish (Update1)
Bloomberg.com Tue, 28 Aug 2007 7:08 AM PDT
Aug. 28 (Bloomberg) -- Hiromichi Tsuyukubo ran the best- performing fund in Japan at Mitsubishi UFJ Asset Management Co., an arm of the nation's biggest lender. Then, after six years, he decided to join a hedge fund.

 

Another German Sub-Prime Hedge Fund Casualty,
Tax-News.com Tue, 28 Aug 2007 1:08 AM PDT
The US sub-prime loan crisis claimed a further European scalp earlier this week when German bank Sachsen LB was rescued by another state-owned bank, Landesbank Baden-Württemberg, which provided an immediate Euros 250m in liquidity, and will acquire Sachsen for a consideration of up to Euros 600m, although the deal may yet unwind if Sachsen uncovers further liabilities.

 

NOW GYM WALLOPS 'GRUNTER'
New York Post Tue, 28 Aug 2007 2:37 AM PDT
A Manhattan hedge-fund manager flung into the wall of an Upper East Side Equinox club during spin class got a surprise phone call in the hospital from the gym - canceling his membership. "He was in disbelief," said Stuart Sugarman's lawyer, Samuel...

 

Paying Off Plastic is on the Decline Moody's reports that more credit card holders forgo payment. Read More

 

Are Hedge Funds The New Dot.coms?
TheStreet.com - Tuesday August 28, 08:16 BST

 

In Volatility, Redemption for Manager
New York Times - United States
But it has been a boon to Convexity Capital Management, the giant hedge fund that makes arcane trading bets that benefit from volatility. ...
See all stories on this topic

 

New Orleans - Hurricane Katrina - Housing - Insurance - Natural ... - 12:24pm

 

NY State Pension continuing debacle

NY Post: NY State Pension continuing debacle

 

 

UK - Executives responsible for investing company final salary pension schemes still favour return seeking assets over liability matching, according to a Watson Wyatt report.

 

SWITZERLAND – Partners Group, the Swiss-based alternative asset manager, has predicted a positive outlook for the second half of this year after it released its semi-annual results as of 30 June 2007.

 

Nordic pension funds predict alternatives outsourcing
http://www.ipe.com/news/Nordic_pension_funds_predict_alternatives_outsourcing_25098.php

 

 

New research explores whether 130/30 is actually “optimal”: Citigroup’s rocket scientists examine the “X” in 1X0/X0 in this two-part posting. (part two available here)

 

NDR Credit Conditions Index Shows Decline Likely To Continue

http://usmarket.seekingalpha.com/article/45177?source=i_email&u=13532

 

Gartman: Short stocks, long gold

Dennis Gartman of the Gartman Letter was interviewed at Bloomberg yesterday. While making clear that he is not a "gold bug", he makes an astonishingly simple case for why gold is a good investment.

 

 

U.S. Subprime Fears Shake Chinese Banks

<http://seekingalpha.com/article/45601?source=i_email&u=13532>

 

Bank profits may well suffer, but credit crisis hardly leaves them ...
International Herald Tribune - France
Reserve levels reached lows at the end of 2006, according to a study by the RiskMetrics Group, which specializes in financial services. ...
See all stories on this topic

 

 

 

_________________________________________________________________________

Yield Curve Corner

_________________________________________________________________________

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/FSHSusnw240_MO.jpg

 

 

With New England stations such as Boston MA [96°F] and Concord NH [97°F] soaring to their hottest temperatures yet this Summer on August 25 coupled with 100°F+ Heat Indices from Florida to Maine, it further demonstrates that August is in fact the new July, and we still need to keep our eyes pealed for some final spikes of the Season.

Full Story...

 

_________________________________________________________________________

Iranian Situation

 

Bush warns Iran against meddling in Iraq
Reuters via Yahoo! News Tue, 28 Aug 2007 12:10 PM PDT
U.S. President George W. Bush on Tuesday accused Iran, like al Qaeda, of fomenting instability in the Middle East, and said one way to counter Tehran's ambitions was to win the Iraq war.

 

Iran dismisses attack warning by 'inexperienced' Sarkozy
AFP via Yahoo! News Tue, 28 Aug 2007 8:09 AM PDT
President Mahmoud Ahmadinejad on Tuesday brushed off a warning by Nicolas Sarkozy that Iran risked being bombed over its nuclear drive, saying his "inexperienced" French counterpart did not know what he was talking about.

 

IRAN:  Iranian President Mahmoud Ahmadinejad said his country is
ready to fill the power vacuum in Iraq. Addressing a press
conference in Tehran, Ahmadinejad said the United States' power
there is collapsing and that Iran will fill the resulting vacuum
"with the help of neighbors and regional friends like Saudi Arabia,
and with the help of the Iraqi nation."

 

_________________________________________________________________________

Opalesque’s Corner

 

- Renaissance Technologies shrugs off concerns, said to consider selling minority stake
- Sentinel moved $135m before collapse
- State Street finds `record` $22bln exposure to debt conduits, 17% of total assets, Carlyle bails out its $20bn Dutch fund
- State Street institutional `enhanced cash` fund falls 42%,  US hedge fund losses seen adding up in August: Cantillon, SAC, Citadel, Lone Pine, SAC Capital falls 6% while few hedge funds gain, Deephaven, Knight Capital fund unit, may refund performance fees it it posts losses in H2
- Bear Stearns judge delays ruling on banning U.S suits, questioning whether Cayman should be the principal liquidation site, UK investors may join Bear suit
- Market turmoil a test for Citadel as two of three high-profile deals develop complications, Beazer books may be cooked
- Standard & Poor`s on Ten Key Operational Risks for Hedge Funds
- Deutsche Bank`s John Dyment, global head of the hedge fund capital group, joins Shumway hedge fund, Mark Melchiorre joins UBS  O`Connor as head of credit strategies
- Hennessee forms alliance with marketing expert Leland Hardy to expand advisory services to domestic, international HNI and institutions
- Opalesque Exclusive: Buffett follower starts activist fund
- Opalesque Exclusive: Iraq fund rises as foreigners enter domestic market
- Swedish Väring Capital launches emerging market hedge fund
- Update: The hedge fund contagion chart `looks a little like the British Airways route map`
- Research: Can analysis of firm financial data reliably identify future underperformers?
- Selling 130/30 to CFOs just got a lot harder
- Temasek approaches Nasdaq to buy LSE stake, Germans may be offered NASDAQ LSE stake, Nasdaq may sell LSE for alliance with Dubai, Dubai closer to OMX win,  Borse Dubai expresses interest in Karachi exchange
- Ethanol projects may falter as margins fall, financing slows, Korea to open carbon exchange market by year`s end, Global warming has opened a $30bln market for carbon trading,  ETFs for clean energy fans
- Ship stocks set for 20% return as industry eludes subprime rout
- Man Group, the beaten hedge fund king: However a close look shows Man has a more secure revenue stream and is less dependent on performance than many investors may realize
- London`s Forsyth Partners loses Dubai licence over capital requirement provision
- HK`s Qi Capital shut down
- Subprime impact in Asia: ripple or tsunami?
- Hedge funds grow in Japan as stocks languish, only limited impact of global credit crunch,  Japan`s overseas investments stable amid subprime chaos
- News Briefs: SEC names new market surveillance chief, Stéphane Grégoir appointed director of EDHEC economics research centre
- Activist News: Dutch judge refuses hedge funds` request to block Mittal-Arcelor steel merger,  H&R Block dissident Breeden wins more support
- ...And finally: NY dogs to take over swimming pools in raving pool party, `smaller dogs used the kiddie pool, while larger dogs plunged in the main pool`
- Logon: http://www.opalesque.com/main.php?act=archive

 

_________________________________________________________________________

Misc. Items of Interest

 

Hedgehogs join 'protection' list *
Hedgehogs and house sparrows are on an updated list of species and habitats which need protection.
Full story:
http://news.bbc.co.uk/go/em/-/1/hi/sci/tech/6965681.stm

 

_____________________________________________________________________

Funnies, Facts, Quotes, etc….

 

pukka PUHK-uh, adjective:

1. Authentic; genuine.
2. Good of its kind; first-class.

 

1993:  The spacecraft Galileo took pictures of the asteroid Ida.

1952:  Writer and teacher Rita Dove, poet laureate of the United States (1993–95) and winner of the 1987 Pulitzer Prize for Thomas and Beulah (1986), was born in Akron, Ohio.

1914:  The first major engagement of the British and German navies during World War I occurred at the Battle of Helgoland Bight.

1850:  Richard Wagner's opera Lohengrin was performed for the first time, at Weimar, Germany.

1793:  The Siege of Toulon in the French Revolutionary Wars began.

476:  The fall of the Western Roman Empire was completed as Emperor Romulus Augustulus was deposed by the German warrior Odoacer.

_________________________________________________________________________

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:

 

_________________________________________________________________________

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

_________________________________________________________________________

Regulatory Info

 

 

_________________________________________________________________________

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.