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Apr 8, 2011
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Venture capitalists could be stifled by SEC share sale review

By Richard Beales
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Facebook could wind up changing the way people invest as much as the way they interact. A fundraising round led by Goldman Sachs for the social networking giant earlier this year has put the rules surrounding the way private companies raise capital into sharp focus. One of them requires any firm with 500 or more shareholders to disclose information as though it’s publicly traded. The Securities and Exchange Commission is now reviewing the issue. It could be bad news for venture capital firms and investment banks.

Mar 10, 2011
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Regulatory arbitrage could go far beyond Basel III

Regulatory arbitrage is the latest buzz-phrase. The financial industry’s parlor game is guessing whether Swiss, British or U.S. banks will end up with the toughest rules on capital and liquidity. But as reforms play out around the world, for instance in derivatives, there’s also the possibility that entire business lines will migrate — raising a whole new set of systemic risks.

Headlines often focus on which country’s banks will win or lose. Here, one big issue is the Basel III rules boosting bank capital, especially the extra cushion national regulators may force the biggest banks to hold. Some in Europe, including this week Oswald Gruebel, chief executive of UBS, worry that the Americans, having dragged their feet in adopting Basel II, will crawl at snail’s pace this time around, too. Conversely Sheila Bair, chairman of the U.S. Federal Deposit Insurance Corp, seems to think it’s in parts of Europe that the political will is questionable.

Feb 18, 2011
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Hedgie mogul Paulson teases out hawkish Greenspan

By Richard Beales
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Alan Greenspan has turned hawkish. The former Federal Reserve chairman, quizzed by John Paulson this week in a packed New York University hall now bearing the billionaire hedge fund manager’s name, admitted to gloom over President Barack Obama’s latest budget and concern that the government may be strangling the economy. It’s a pity he didn’t worry about the opposite effect while running the Fed.

Feb 15, 2011
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Merging Big Board takes its moniker literally

By Richard Beales
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

In its merger, the Big Board is taking its moniker literally. The Deutsche Boerse-NYSE boardroom crew will be 17-strong, a lot bigger than the norm. Board size can reflect the need for different skills — or, as with NYSE Euronext’s existing board, compromises that make M&A more palatable. The latter effect should be temporary.

Jan 27, 2011
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Time to avoid Uncle Sam’s debt, buy U.S. states’?

By Richard Beales
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

The budget shortfalls gripping many U.S. states have rattled the $3 trillion municipal bond market. Yet even with unfunded pensions added in, their debt burdens are dwarfed by those of the federal government. There are big structural differences, but the evidence suggests investors should worry less about munis and more about Treasuries.

Jan 19, 2011

Goldman perceptions shape Facebook reality

– The author is a Reuters Breakingviews columnist. The opinions expressed are his own –

By Richard Beales

NEW YORK (Reuters Breakingviews) – Perceptions about Goldman Sachs have shaped the reality of its Facebook fundraising. The Wall Street firm is now excluding U.S. investors from buying into the social network after media scrutiny made a private placement seem too public. Facebook invites attention — but Goldman does too these days. For all its focus on clients, the firm still has a blind spot about its own public image.

Jan 4, 2011

Still only end of the beginning for new bank rules

– The authors are Reuters Breakingviews columnists. The
– The authors are Reuters Breakingviews columnists. The
opinions expressed are their own —

By Peter Thal Larsen and Richard Beales

LONDON/NEW YORK, Dec 30 (Reuters Breakingviews) -
Policymakers and regulators around the world put in a lot of
work in 2010 designing post-crisis regulations. But there are
still plenty of question marks over implementation — and some
knotty issues have barely been tackled. Meanwhile, a level
global playing field looks an ever more distant dream. If
financial institutions hoped that 2010 was the high watermark
for regulation, they will be disappointed. Here’s a look at
potential developments in 2011.

Dec 17, 2010
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Who will regret giving insider minnows free lunch?

The widening U.S. insider trading probe brought more arrests on Thursday. Three were technology firm employees who, together with another, earned over $400,000 moonlighting as expert consultants. That kind of gig sounds a bit too good to be true. And they are now alleged to have shared inside information with hedge funds and others. But the key question is still which bigger fish the enforcers are after.

Preet Bharara, the U.S. attorney for Manhattan, alleges that staffers at Dell, AMD, Flextronics and TSMC distributed inside information. They got their consulting work through Primary Global Research, a California firm that boasts a network of such experts.

Nov 22, 2010
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FBI takes a stab at soft hedge fund tissue

The FBI is stabbing at soft hedge fund tissue. Monday’s raids of several funds’ offices owe something to tracking the firms’ use of third party “expert networks,” according to the Wall Street Journal. Almost by definition, these consultants risk unwittingly aiding the exchange of verboten information.

One such firm is Broadband Research, a technology industry specialist based in Portland, Oregon. In late October John Kinnucan, a principal at the firm, emailed clients with a tale of a visit from two “fresh faced eager beavers” from the FBI, according to the Journal. Despite the agents’ entreaties Kinnucan had, he said in the email, declined to wear a wire while talking to his hedge fund clients.

Oct 29, 2010
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Rohatyn’s values a distant prospect on Wall Street

Felix Rohatyn would, as the dustjacket of his new memoir notes, belong in any investment banking Hall of Fame. Yet the Lazard Freres old-timer, financial savior of New York and U.S. ambassador to Paris reveals surprisingly little of himself in the book—but he does exhibit a relatively unobtrusive ego, a love of dealmaking and strong distaste for the greed of the 1980s and 2000s.

According to the 82-year-old eminence grise the financial industry is at a turning point. To be of use to companies, investors and society, it needs a return to the principles and practices he learned under the legendary Andre Meyer at Lazard starting in 1949. In Rohatyn’s world— heavily populated with the great and good of finance and politics over more than half a century—that means recognizing that “investment banking is not a business; it is a personal service where bankers work hand in hand with their clients.”

    • About Richard

      "Richard Beales joined Breakingviews.com in 2007 from the Financial Times, where he was US markets editor and a Lex columnist. Prior to the FT, he spent more than 10 years as an investment banker, based largely in Hong Kong. He was a director in Citigroup’s mergers team, and before that head of Schroders’ regional project finance group. He has also lived briefly in Sydney, Australia, and began his working life in London at Mars & Co, a management consultancy, in 1989. Richard holds a masters in business journalism from New York University and a degree in biochemistry from St John’s ..."
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