Daily Archives: October 29, 2015

At Republican Debate, Fantasy Sports Got More Attention Than Wall Street

And that is true. Nada on the candidates’ take on the federal reserve’s monetary policies, housing issues, Glass-Steagall, etc.

It’s easy to miss things when watching long, crowded presidential debates like the CNBC event on Wednesday night. So it can be good to go back to the transcript the next morning to verify one’s recollections.

I looked for the discussion of how to regulate the financial sector that I must have somehow missed. I searched for “Too big to fail” and turned up one fleeting reference by Ben Carson. There were zero references to “Glass-Steagall,” the Depression-era banking law discussed extensively in the Democratic debate earlier in the month, or “Dodd-Frank,” the 2010 law meant to rein in risks in the financial sector.

The transcript also revealed that I was not hallucinating when I saw a reasonably detailed discussion of whether the government should regulate“daily fantasy sports” sites — and learned that Jeb Bush’s fantasy football team is undefeated and is anchored by the Miami Dolphins quarterbackRyan Tannehill.

Read on.

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Ocwen posts big loss, erasing profits for 2015

As the company itself predicted just last month, Ocwen Financial (OCN) is now in a position to record a loss in 2015, after the nonbank reported Wednesday that it generated a net loss of $66.8 million in the third quarter or $0.53 per share.

The company generated revenue of $405 million, down 21% compared to the third quarter of 2014.

According to a note from Briefing.com, Ocwen’s third quarter results were worse than the Capital IQ Consensus, which had Ocwen posting a loss of $0.22 per share.

For the full year 2014, Ocwen recorded a net loss of $546 million, a stark reversal from 2013, when Ocwen reported net income of $310.4 million.

Read on.

Major civil rights groups join push to recapitalize Fannie Mae, Freddie Mac

Several of the largest civil rights groups in the country are joining together to call on the federal government to end the conservatorship of Fannie Mae and Freddie Mac and recapitalize the agencies, stating that an independent and fully capitalized Fannie Mae and Freddie Mac can better serve the country’s housing needs.

In a letter sent Thursday to President Barack Obama, as well as many other senior members of the federal government with housing ties, the National Community Reinvestment Coalition, the National Association for the Advancement of Colored People, and the League of United Latin American Citizens say they urge the Obama administration to reconsider its position on recapitalizing the government-sponsored enterprises.

Read on.

You Get What You Expect…

This last week I had the privilege of speaking to the Investment Management Consultants Association (IMCA), an organization with over 10,500 members. Established in 1985, the Association offers the premier investment consulting and wealth management credentials and educational conferences, research and publications that are considered the best in class. The Association offers certification in 28 different countries.
IMCA is well known and respected for setting the standards and practices for the investment management consulting practices. Their members manage portfolios which are more than 7 times the industry average, and advise more high-end clients than any other advisors in the industry. Their affiliations range from the smaller independent shops, to Charles Schwab, Wells Fargo Financial Advisors and Bankers Trust, among others.
What I found intriguing though, was the respect and attention paid to ethics. Each member must subscribe to and each designee must adhere to the Organization’s Code of Professional Responsibility. Their Standards of Practice and Performance provides guidance to their members in the course of conducting their practice and providing services to their high wealth clients.
The group is a worldwide organization; consequently there is a wide range of diversity in how business is conducted. Yet their meticulous attention to doing what is right makes this group stand out. They don’t just talk about a code of conduct, they expect and demand adherence to it. And if others did the same, we wouldn’t be grappling with some of the issues I have discussed before.
What does honor take?
Regards,
Richard

Fired Goldman Sachs banker fished for inside info over steak dinner

Even by investment bank standards, that was an expensive steak dinner.

Goldman Sachs is paying $50 million to settle accusations that an ex-banker took confidential documents from the Federal Reserve Bank of New York — and then pumped a former regulatory worker for more information at Peter Lugers steakhouse.

………..

Manhattan US Attorney Preet Bharara’s office is also expected to file criminal charges against the former Goldman employee, Rohit Bansal, and his government counterpart next week.

Bansal, who used to work at the New York Fed, and a former co-worker for the regulator, Jason Gross, are expected to plead guilty as early as next week.

The information swiped from the New York Fed, the DFS, the Federal Reserve and the Federal Deposit Insurance Corp. involved 35 documents tied to the regulatory exams of one of Goldman’s clients.

Even after stealing the documents, Bansal pressed Gross for more information about an upcoming exam at Gross’ birthday party on Sept. 23 at Peter Lugers in Brooklyn.

Bansal emailed his supervisor, Joseph Jiampietro, that the managers of the unnamed Goldman client should “keep their cool, not get defensive and not say too much unless the regulators have a blatant fact wrong,” according to the DFS consent order with the bank.

The examination “will go off better for them in the long run. Believe it or not the regulator’s [sic] look for reaction and level of mgmt respectiveness [sic] during these exit meetings,” he wrote after the steak dinner.

Read on.

AIG should break up to avoid ‘too-big-to-fail’ label: Icahn

Ever since the US began selling off its $183 billion stake in American International Group — which taxpayers bailed out during the financial crisis — the insurance giant has served as a favorite playground for big-name investors like John Paulson and Bruce Berkowitz.

Now it’s mega-billionaire Carl Icahn’s turn.

The activist investor announced via his Twitter feed on Wednesday that he had taken a “large stake” in AIG and had sent its chief executive a letter suggesting the company be broken into three parts.

Turning a popular phrase on its ear, Icahn said that AIG was “too big to succeed.”

AIG shares jumped 4.9 percent on the news, closing Wednesday at $63.90 — and pushing its 2015 gain to 14 percent.

Icahn’s entreaties may be a hard sell: Even before Wednesday’s stock pop, AIG was doing a lot better than Icahn Enterprises, which has tumbled 16 percent in 2015.

Icahn called on AIG CEO Peter Hancock to separate the company’s life and mortgage insurance units from its property-and-casualty business, and “embark on a much needed cost control program to close the gap with peers.”

Read on.

GOP Debate: The Republican Tax Plans Are All Basically Insane

Huffington Post:

Donald Trump’s plan would cost over $10 trillion.

Bobby Jindal’s plan would cost $9 trillion.

Rick Santorum’s would cost $1.1 trillion.

Jeb Bush’s plan? $1.6 trillion.

Marco Rubio? More than $1 trillion over the next decade.

One exception: The Tax Foundation says Rand Paul’s tax plan would save the government$737 billion. But other tax experts are far less sanguine. Citizens for Tax Justice estimates that Paul’s plan would cost $15 trillion. Much of the difference is due to less optimistic assumptions about economic growth. The Tax Foundation assumes that tax cuts benefitting Wall Street and the wealthy will generate very high levels of growth. Citizens for Tax Justice does not.

Total debt held by the public is currently $13.08 trillion.