Main News

 

 

Don't Blame The Rating Agencies
The fallout over subprime mortgages has provoked a rush to judgment, and some are now blaming the credit rating agencies for the recent market turbulence. These charges reflect both a misunderstanding of the work carried out by rating agencies, and a misrepresentation of the overall credit performance of securities backed by residential mortgages. The fundamental service provided by a rating agency such as Standard & Poor's is to issue an independent opinion on the creditworthiness of securities, which speaks to the likelihood that investors will receive payments of interest and principal on time.
To learn more, click or copy and paste the URL below:
http://standardandpoors.rsys1.net/servlet/cc5?kHiQWUTUQTVsLgHxhilpuHQJhuV2VR

 

Conduit Risks Are Hovering Over Citigroup - If the Vehicles Go Sour, Rescues Could Be Costly; Bank Has 'No Concerns'. Though few investors realize it, ...
www.eurotrib.com/story/2007/9/5/11593/49739 - 11 hours ago

 

Recent distress in financial markets has "deepened" the housing slump, but the overall economy has seen little impact so far, the Federal Reserve said Wednesday in its beige book report. That assessment suggests that while a rate cut in two weeks may still be likely, officials may not see the same need
for aggressive easing that financial markets expect.
http://online.wsj.com/article/SB118901527670718297.html?mod=djemalert

 

Richard Rumelt, a giant in the field of strategic planning, explains why
it often isn't strategic at all. He also sounds off on diversification,
how companies can capitalize on a changing business environment,
managing for share prices, and the role of the CEO. Read "Strategy's
strategist: An interview with Richard Rumelt."
http://e.mckinseyquarterly.com/W8RT02ACBA89432CE4E1936F47ACE0

 

 

Citigroup to Shut Tribeca Hedge Fund, Expand Old Lane (Update3)
Bloomberg - USA
5 (Bloomberg) -- Citigroup Inc. will close its $2 billion Tribeca Global Investments LLC hedge fund and return money to clients five months after it agreed ...
See all stories on this topic

 

New 'fat tail' risk management product to be launched on HFR platform
Wed, 05 Sep 2007, 07:30
HedgeWeek
A new risk management product for funds of hedge funds, pension funds and endowments will be launched on the HFR Asset Management platform in October by 36 South Investment Managers, a 'tail risk' hedge fund manager. The fund, 36 South Black Swan, is designed to provide protection for institutional fund portfolios in significant risk aversion periods.

 

Listed hedge funds endure a rollercoaster August
Tue, 04 Sep 2007, 17:15
Financial News
Listed hedge funds gave their investors a less predictable ride than the funds underlying them amid last month's volatility. The share price of BH Macro, listed on the London Stock Exchange, rose 4.4% in August while the net asset value of Brevan Howard's fixed income global macro fund, which it feeds into, went up by 2.2%. Shares in Third Point Offshore, also listed in London, began a four-day slide on 7 August that took them down 11%, while its net asset value fell by 2.8% over the same period, according to regulatory statements.

 

Appetite for CDOs, other risky debt, on the up
Tue, 04 Sep 2007, 13:47
Investment News
Recent market volatility is unlikely to curb investors' appetite for collateralized debt obligations and other complex securitized-debt products despite the risks, wealth management executives said. In fact, demand from ultrahigh-net-worth investors and institutional investors is expected to continue to grow for CDOs, mortgage-backed securities and other forms of securitized debt. Despite jittery markets, the investments will continue to be marketed aggressively by high-end firms such as New York-based Goldman Sachs & Co Inc, according to industry observers.

 

Open season on Bear Sterns?
Tue, 04 Sep 2007, 11:05
Institutional Investor/Hedge Fund Daily
Fifteen, as in Chapter 15, wasn't Bear Stearns' lucky number as US Bankruptcy Judge Burton Lifland has nixed the investment bank's effort to permanent to protect its two failed hedge funds from lawsuits and asset seizure. Bear Stearns had sought Chapter 15 protection arguing that the Cayman Islands was its "main jurisdiction" for the funds. Getting that protection would spare Bear the lawsuits under US law while allowing it to liquidate the funds under Cayman jurisdiction. Lifland didn't buy the primary argument, noting that the HFs' Caymans presence was merely a "letterbox," as they had no staff working there.

 

Regulators Urge Refinancing of Securitized Mortgages (Update3)
Bloomberg - USA
The recommendation underscores the federal government's concern that the subprime-mortgage market's collapse could hurt the broader US economy. ...
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The federal financial regulatory agencies and the Conference of State Bank Supervisors (CSBS) issued a statement yesterday encouraging federally regulated financial institutions and state-supervised entities that service securitized residential mortgages to review to determine the full extent of their authority under pooling and servicing agreements to identify borrowers at risk of default and pursue appropriate loss mitigation strategies designed to preserve homeownership.

Full Story...

 

In 1998 the financial world was stressed by a series of crises. Most notable, the Russian default in that August, triggered a chain reaction causing a number of large funds (like LTCM) to collapse, their counter-parties realized losses and everyone sought a safe harbor – U.S. Treasuries

Full Story...

 

UPDATE: Credit Problems Not Over Yet, US Regulators Warn
CNNMoney.com - USA
"Given recent events in the subprime mortgage and credit markets, the commission has begun a review of [rating agency] policies and procedures regarding ...
See all stories on this topic

 

US Subprime Mortgage Crisis Affects Kingdom
Arab News - Jeddah,Saudi Arabia
JEDDAH, 6 September 2007 -- The recent volatility in global financial markets due to problems in the US subprime mortgage market have taken their toll on ...
See all stories on this topic

 

Germany's image of probity shattered by US mortgage crisis
Guardian Unlimited - UK
This comes amid the shock waves caused by the multi-billion dollar exposure of at least three institutions to the US subprime mortgage crisis, ...
See all stories on this topic

 

US – The strength of the New York State Common Retirement Fund (CRF) has enabled the employer contribution rates for the Employees’ Retirement System (ERS) and the Police and Fire Retirement System (PFRS) to be lowered.

 

$500 million found missing from Sentinel's books: report
September 05, 2007 06:20 AM ET
NEW YORK (Reuters) - Regulators probing the collapse of fund
manager Sentinel said an examination had revealed that more
than $500 million was missing from its accounts, the Financial
Times reported in its online edition on Wednesday.
http://links.reuters.com/r/R0W9G/S6298/KZXSC/EDEY7/OBXKF/N9/t?a1=nl_usbusinessearly

 

Renaissance Technologies and DE Shaw, two of the biggest quantitative hedge fund managers, are raising money as they shrug off concerns over the poor performance of many computer-driven funds last month

 

Failed Bear Fund's Investors Seek Outside Liquidator
Reuters - Wednesday September 05, 09:16 BST

The Roundup of Who's Winning and Who's Losing
FINalternatives - Wednesday September 05, 09:10 BST

 

Ow! Belgian Funds Lose Half In Subprime Slaughter
Global Money Management - Wednesday September 05, 07:58 BST

 

 

NICE, France (HedgeWorld.com) - Excessive regulation, not hedge funds, should be blamed for the current subprime crisis, and the push for more regulation in France and Europe is not going to help investors navigate a market that is first and foremost plagued by illiquidity risk. ......

 

 

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Yield Curve Corner

 

UP AND DOWN WALL STREET DAILY  By RANDALL W. FORSYTH
Waiting for Bernanke, Far From Jackson Hole
Without an invite to the Fed's annual conference, I'll be hanging on the Fed chairman's words on an East Coast beach.
http://online.barrons.com/article/SB118838544902512038.html?mod=djemBF

 

NEXT UP-Are jobless claims the new payrolls?
Reuters - USA
Across the financial world, investors honed in on one particular snippet from Fed Chairman Ben Bernanke's Jackson Hole speech last week: "We will pay ...
See all stories on this topic

 

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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/FSHSusnw248_G11.jpg

 

Hurricane Felix makes landfall in Nicaragua
Reuters - USA
The center said at 8 am EDT (1200 GMT) the storm was moving westward at 16 mph (26 kph) and a hurricane warning was in effect from Puerto Cabezas, ...
See all stories on this topic

Hurricane Henriette Approaches Mexico
WSBtv.com - Atlanta,GA,USA
A hurricane warning remains in effect for the southern Baja Peninsula from Loreto southward on the East Coast and from Bahia Magdalena southward on the West ...
See all stories on this topic

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Iranian Situation

 

Iran: Rafsanjani Named Assembly of Experts Chairman
http://www.stratfor.com/products/premium/read_article.php?id=294847

 

Britain warns Iran of new UN resolution
AFP via Yahoo! News Tue, 04 Sep 2007 10:54 AM PDT
British Prime Minister Gordon Brown reiterated Tuesday that London will support a new UN resolution against Iran if Tehran does not curb its nuclear programme.

 

Hard Times Help Iran?s Leaders Tighten Their Grip
New York Times Tue, 04 Sep 2007 9:53 AM PDT
Iran?s increasing economic and political isolation is helping leaders to hold back what they see as corrupting foreign influences.

 

U.S. seizes 'Iran agent' in Iraq
CNN.com Wed, 05 Sep 2007 2:51 AM PDT
U.S.-led coalition forces say they have captured a "highly sought" individual in Iraq with alleged ties to Iran's Islamic Revolutionary Guard Corps-Quds Force.

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Opalesque’s Corner

 

- Probe reveals Sentinel missing $505m
- Failed Bear fund`s investors seek outside liquidator
- Cheyne`s Queen`s Walk encouraged by `substantial opportunities`, to buy back 10% of own shares,  Sees continued ABS market volatility
- Citigroup bets big on subprime market, Deutsche Bank Chief says markets are stabilizing, Deutsche Bank CEO: Bank doesn`t lend unsecured to hedge funds
- Opalesque Exclusive:  Money Management Group posts August as best month YTD, Danix,  Cambridge Asian FX,  Traderight CTA all positive,  Lipper: Hedge funds do better with volatility
- Renaissance, DE Shaw, others open funds to raise new money
- Opalesque Exclusive: Forsyth closure of Dubai office may caused by overzealous application by the DFSA of its
capital adequacy rules and not lack of finance in the Forsyth Group
- Opalesque Exclusive:  Salus Alpha launches  Salus Alpha Equity Hedged fund, Directional Markets Index leads Vienna listed alternative indices with 14.58% YTD
- Temasek unit Fullerton to launch  Asian multi-strategy hedge fund, Fortis Investments launches China fund,  Eos Partners sets up distressed debt fund
- Opalesque Exclusive: Alison Inafuku Edge joins Greenock Capital
- Special Report: World`s largest 300 pension funds grew 11.5% last year, assets topping $10 trillion, some swap spots
- Special Report: In search of the `one-stop-shop`: Preferences of UK pensions could  create potential windfall for some U.S. managers
- SEC seeks more input on hedge fund minimums, new comment deadline, Hedge fund registration still possibility, Bill mandates study of hedge funds, private equity,  Steinbrueck sees objection to hedge fund rules waning, to continue pushing for voluntary code of conduct,  Brown calls for transparency on risky investments
- NY Fed report says current hedge fund counterparty risk watch systdem `appropriate start`, Dallas Fed Study: Hedge fund investors tend to focus on long-term performance,  strengthening hedge fund stability
- Edhec finds hedge funds are not the subprime villains:  Excessive regulation, not hedge funds, should be blamed
- Fund of hedge funds face growing liquidity mismatch
- 130/30 managers weather the storm, London listed hedge funds endure a rollercoaster August
- Dow Jones launches rules based Barron`s 400 Index
- Chartered Alternative Investment Analyst Association to host events in Australia and Canada
- Furse ensures she is difficult to get hold of,  Qatar mulls $2 billion bid for LSE,  LSE still in demand,  Nasdaq set to extend LSE sale deadline
- Partners Group posts 27% rise in AuM
- Charlemagne marches into institutional space, Charlemagne shares rise most in 15 months on increased assets
- Opalesque Exclusive: Shore Capital`s H1 profits up 28.6%, AUM up 79% to $2.9bln
- Singapore to become one of top 3 fund management centres in Asia,  Fullerton CEO: `Despite all the volatility` portfolio did well due to well-balanced hedge fund allocations
- Sovereign wealth funds to lift Asian stocks, Fullerton says,  Singapore`s GIC wealth fund flattered by imitation, Qatar sovereign wealth fund eyes Asia to broaden assets,  Atlantis`s Liu sees China shares up 10% by year-end, ANZ: Asia should prove resilient in the wake of the US subprime lending crisis
- News Briefs: Jeffries Prime Brokerage to offer Linedata`s Longview trading order management, Arnhold and S. Bleichroeder sells stake to TA,  Franklin Templeton buys into Dubai asset manager,  AIMA Japan launches bilingual website
- ...And finally:  Hedge fund managers stage `The Million Mercedes March`, the largest chauffeur-driven demonstration in Washington`s history, clash with police
- Logon: http://www.opalesque.com/main.php?act=archive

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Misc. Items of Interest

 

"The differentiating point cannot be price alone. It
has to be service."
Valeria Maltoni, marketer
http://trax.fastcompany.com/k/w/mailman/fasttake/20070905/customertalk

 

Meet Mahalo: The New People Powered Search Engine | by Adam L. Penenberg
Serial Webmeister Jason Calacanis survived the dotcom
bust and went on to sell Weblogs Inc. to AOL for $25
million. He says his new search engine -- powered by
people, of all things -- will give Google a run for its
money. We almost believe him.
http://trax.fastcompany.com/k/w/mailman/fasttake/20070905/mahalo

 

Could President Bloomberg Keep His Company?
BY JILL GARDINER - Staff Reporter of the Sun
Would Mayor Bloomberg be pressured to relinquish his majority stake in his lucrative and beloved financial services company if he were to become the country's commander in chief? That is the question some government watchdogs and Bloomberg LP...

 

 * Three held in German terror raids *
Germany detains three men on suspicion of planning an "imminent" terrorist attack, the defence minister says.
Full story:
http://news.bbc.co.uk/go/em/-/1/hi/world/europe/6979295.stm

 

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Funnies, Facts, Quotes, etc….

 

antiquarian n-tuh-KWAIR-ee-uhn, noun:

1. One who collects, studies, or deals in objects or relics from the past.
2. Of or pertaining to antiquarians or objects or relics from the past.
3. Dealing in or concerned with old or rare books.

 

1975:  Lynette (“Squeaky”) Fromme attempted to assassinate U.S. President Gerald R. Ford.

1972:  Palestinian terrorists attacked the Olympic Village in Munich, West Germany, during the Summer Olympic Games, taking hostage and eventually killing 11 members of the Israeli team.

1882:  The first Labor Day parade was held in New York City in honour of the American worker.

1836:  Sam Houston was elected president of the Republic of Texas.

1774:  Caspar David Friedrich, a pioneering early 19th-century German Romantic painter, was born.

1725:  Marie Leszczynska of Poland was married to King Louis XV of France.

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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.