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Mar 15, 2013
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Maybe SAC should forget about other people’s money

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

Maybe SAC Capital should forget about managing other people’s money. Steve Cohen’s $15 billion hedge fund firm is paying a whopping $616 million to settle Securities and Exchange Commission insider trading charges. It would be an ignominious time to follow legends like Stanley Druckenmiller, but Cohen is already losing over a quarter of some $6 billion of outside investor funds this year. It could be time to focus mainly on looking after his own cash.

Mar 13, 2013
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Private equity at 4-and-20? Think twice

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

Private equity with a 4-and-20 fee structure doesn’t sound too inviting. It’s what a new vehicle will charge people with only $50,000 to invest to gain entry to Carlyle Group’s private equity funds, and it’s far more than what institutions pay. While the firm’s long-term internal rates of return on private equity, after fees, are nearly 20 percent, today’s reality holds less appeal. The arrangement could be risky for Carlyle, too.

Mar 7, 2013
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Where did Apple’s missing market value go?

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

Mr Market has slashed Apple’s market value by $260 billion in six months. Meanwhile, the combined worth of a wide group of smartphone and tablet rivals has added less than half that. If investors think Apple is fading, the competing Android complex could be worth far more – to someone.

Feb 25, 2013
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Apple’s halo loses shine in investor fight

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By Richard Beales

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

No one looks too good in Apple’s fight with David Einhorn. The Greenlight Capital founder scored a legal point, but better governance wasn’t his main objective. Apple comes off amateurish. The California Public Employees’ Retirement System, despite worthy shareholder-friendly aims, seems careless. The Securities and Exchange Commission also missed a trick.

Feb 7, 2013
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Apple and Einhorn could both use cleaner design

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

Apple and David Einhorn could both use some of the iPhone maker’s famed simplicity. The $430 billion technology company has combined three governance fixes better considered separately. Also a bit unwieldy is an idea from the boss of hedge fund firm Greenlight Capital to unlock value at Apple. A sleeker approach makes more sense.

Feb 5, 2013

Warning: it’s not just the hacks being hacked

By Richard Beales

NEW YORK, Feb 5 (Reuters Breakingviews) – The hacks have
been hacked. The New York Times (NYT.N: Quote, Profile, Research), the Wall Street Journal
and other media outlets have revealed network intrusions –
seemingly from China. They think the hacking is related to their
investigations of the Beijing regime. But news paranoia is only
a small part of a big story.

Defenses are necessary because electronic spying is
everywhere. The United States government does it for
geopolitical reasons and there’s plenty of evidence pointing to
industrial espionage by entities linked to the Chinese
government. Other governments, unscrupulous rivals and criminals
all see electronic opportunities.

Jan 18, 2013
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JPMorgan flaws should ring alarms everywhere

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By Richard Beales and Martin Hutchinson
The authors are Reuters Breakingviews columnists. The opinions expressed are their own.

JPMorgan was supposed to be among the best managers of bank risk in the world. This week it published an internal report into the failings which led to $6.2 billion of trading losses at its chief investment office in 2012. If the mix revealed – conflicting mandates, discredited theory, inadequate checks and primitive technology – is really as good as it gets, financial watchdogs and investors everywhere should worry. There are plenty of lessons for regulators and bank executives who want things done right.

Dec 28, 2012

Draft obit for 2020: 2-and-20 fee structures

(The authors are Reuters Breakingviews columnists. The opinions
expressed are their own.)

By Neil Unmack and Richard Beales

LONDON/NEW YORK, Dec 28 (Reuters Breakingviews) -

( Anticipated publication around 2020.)

The most surprising thing about the demise of two-and-20
hedge fund fees is how long it took. Neither losses in the 2008
credit crunch nor the feeble returns during the ensuing
seven-year euro zone crisis did much to bring down the
archetypal fee structure: 2 percent management fee and 20
percent of gains. Now, though, it can finally be
said: two-and-20 is dead.

Dec 17, 2012
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Central bank independence at risk in 2013

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By Richard Beales

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

The Federal Reserve will celebrate its centennial in 2013. Though independence for the U.S. lender of last resort and its peers elsewhere has historically come and gone, in recent decades it has become an article of faith. But these days, faith in central banking is far from rock solid.

Dec 12, 2012
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SolarCity IPO valuation approaches earth

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

SolarCity’s underwriters have come down closer to earth. The U.S. solar panel installer slashed its expected initial public offering price by more than 40 percent at the last moment to $8 a share. The old price of $14 at the middle of the range, equating to some six times expected 2012 revenue, always looked starry-eyed. The new price merely requires optimism.

    • 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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