Eric Lipton of The New York Times has a fascinating tale of Washington and Wall Street getting perhaps a little too cozy for their own good, detailing how BlackRock and Goldman Sachs went out of their way to try make themselves, er, ah, useful to Charles Millard after he was appointed by President Bush to run the Pension Benefit Guaranty Corp. The clear implication is that the attention the firms gave to Millard was intended to help win contracts managing billions of dollars in retirement funds.
Investors in real estate funds can’t give their stakes away.
In another sign of more bad news to come for commercial real estate, NYPPEX Private Markets reports a sharp drop in prices for limited partnership stakes in real estate funds in the unregulated secondary market. NYPPEX says the average bid for these partnership shares plunged 61% over the past month to a price that represents roughly 22 cents on the dollar.
In late 2006, Goldman shrewdly began backing away from the residential mortgage market. With little fanfare, the firm began aggressively hedging its exposure to home loans, in particular mortgages to borrowers with shaky credit histories.
from Rolfe Winkler:
It was a surreal moment two weeks ago when analysts on Goldman Sachs’ earnings conference call pressed CFO David Viniar to jack up leverage. They seem to think that the worst of the credit crisis is behind us, so Goldman should goose its risk profile to increase returns. This is remarkably short-sighted.
There’s an old joke in New York that the most dangerous place is the space between a TV camera and Sen. Chuck Schumer. And the New York Democrat’s love of the limelight certainly was on display late last week with regards to the increasingly controversial subject of high frequency trading.
Poor Sergey Aleynikov.
The former Goldman Sachs programmer who allegedly stole some of the Wall Street firm’s top secret proprietary trading code picked the wrong firm to mess with–really. If Aleynikov had been an employee of UBS, he might only be facing a civil lawsuit right now–not federal criminal charges.
“We have and will continue to exit several forms of proprietary risk-taking. Where we continue to take principal risk, we will only do so when we have proven teams and a clear source of advantage.” – Citigroup CEO Vikram Pandit on January 16, 2009.
Don’t be fooled by Vikram Pandit’s playing the part of a prudent banker.