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Finance

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Bring Elliot Spitzer Back!

Now that it's evident that "self-regulation" and Wall Street is like oil and vinegar, some are suggesting bringing former New York governor Elliot Spitzer as possibly the next chairman of the Securities and Exchange Commission to crack the whip.

Yes, he hired a call girl, but so did Sen. David Vitter (La.), and he's still a sitting Republican senator in good standing, who apparently plans to seek re-election. Yes, he committed adultery, but so did Newt Gingrich (thinking about running for president), Rudy Giuliani (thinking about running for governor), and John McCain (the most recent Republican presidential nominee).

Do we have to exclude Spitzer from addressing the issues on which he has considerable expertise? Issues that have nothing to do with an unrelated sex scandal?

Food for thought.

[Via]

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Rich Get Richer: I-Banker Wins Lotto

An investment banker who already counts himself as a millionaire became the winner of the first ever "$1 million per year for life" scratch-off lottery. Keenan Altunis, a Wharton graduate now working at a firm in London remarked:

"Don't get me wrong, no matter how rich anyone is, a million a year is a lot of money," he said. "But I don't expect this to change my life very much at all."

He just made my list of People-I-Really-Dislike-Even-Though-They've-Never-Done-Anything-Against-Me. It's a long list. And as an additional fuck-you to the rest of us, because he lives abroad, he only has to pay state taxes, not federal.

Read more here.

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The Wet Line for the IRS Job Open House

New York Times:

The I.R.S. dangled the possibilities when it held an open house at the federal office building at 290 Broadway in Lower Manhattan on Tuesday. An hour before the fair was scheduled to begin, the crowd began lining up — recently laid-off Wall Street types in charcoal-gray pinstripe suits and trench coats; less formally dressed people; a woman with a new accounting degree on her résumé and a 14-month-old baby in a stroller."

"Part of the daily lineup outside the State Employment Service Office. Memphis, Tennessee. June 1938. Photographer: Dorothea Lange." [Via]

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Full Text of Quitting Hedge Funder

Andrew Lahde, head of Lahde Capital Management which posted a 870 percent gain last year thanks to the US subprime mortgage defaults, closed the fund and wrote the following "Jerry Maguire–like farewell letter" on October 17 to clients:

Today I write not to gloat. Given the pain that nearly everyone is experiencing, that would be entirely inappropriate. Nor am I writing to make further predictions, as most of my forecasts in previous letters have unfolded or are in the process of unfolding. Instead, I am writing to say good- bye. Recently, on the front page of Section C of the Wall Street Journal, a hedge fund manager who was also closing up shop (a $300 million fund), was quoted as saying, “What I have learned about the hedge fund business is that I hate it.”

I could not agree more with that statement. I was in this game for the money. The low hanging fruit, i.e. idiots whose parents paid for prep school, Yale, and then the Harvard MBA, was there for the taking. These people who were (often) truly not worthy of the education they received (or supposedly received) rose to the top of companies such as AIG, Bear Stearns and Lehman Brothers and all levels of our government. All of this behavior supporting the Aristocracy, only ended up making it easier for me to find people stupid enough to take the other side of my trades. God bless America. There are far too many people for me to sincerely thank for my success. However, I do not want to sound like a Hollywood actor accepting an award. The money was reward enough. Furthermore, the endless list those deserving thanks know who they are. I will no longer manage money for other people or institutions. I have enough of my own wealth to manage. Some people, who think they have arrived at a reasonable estimate of my net worth, might be surprised that I would call it quits with such a small war chest. That is fine; I am content with my rewards. Moreover, I will let others try to amass nine, ten or eleven figure net worths. Meanwhile, their lives suck.

Appointments back to back, booked solid for the next three months, they look forward to their two week vacation in January during which they will likely be glued to their Blackberries or other such devices. What is the point? They will all be forgotten in fifty years anyway. Steve Balmer, Steven Cohen, and Larry Ellison will all be forgotten. I do not understand the legacy thing. Nearly everyone will be forgotten. Give up on leaving your mark. Throw the Blackberry away and enjoy life. So this is it. With all due respect, I am dropping out. Please do not expect any type of reply to emails or voicemails within normal time frames or at all. Andy Springer and his company will be handling the dissolution of the fund. And don’t worry about my employees, they were always employed by Mr. Springer’s company and only one (who has been well-rewarded) will lose his job. I have no interest in any deals in which anyone would like me to participate. I truly do not have a strong opinion about any market right now, other than to say that things will continue to get worse for some time, probably years. I am content sitting on the sidelines and waiting. After all, sitting and waiting is how we made money from the subprime debacle.

I now have time to repair my health, which was destroyed by the stress I layered onto myself over the past two years, as well as my entire life – where I had to compete for spaces in universities and graduate schools, jobs and assets under management – with those who had all the advantages (rich parents) that I did not. May meritocracy be part of a new form of government, which needs to be established. On the issue of the U.S. Government, I would like to make a modest proposal. First, I point out the obvious flaws, whereby legislation was repeatedly brought forth to Congress over the past eight years, which would have reigned in the predatory lending practices of now mostly defunct institutions.

These institutions regularly filled the coffers of both parties in return for voting down all of this legislation designed to protect the common citizen. This is an outrage, yet no one seems to know or care about it. Since Thomas Jefferson and Adam Smith passed, I would argue that there has been a dearth of worthy philosophers in this country, at least ones focused on improving government. Capitalism worked for two hundred years, but times change, and systems become corrupt. George Soros, a man of staggering wealth, has stated that he would like to be remembered as a philosopher. My suggestion is that this great man start and sponsor a forum for great minds to come together to create a new system of government that truly represents the common man’s interest, while at the same time creating rewards great enough to attract the best and brightest minds to serve in government roles without having to rely on corruption to further their interests or lifestyles. This forum could be similar to the one used to create the operating system, Linux, which competes with Microsoft’s near monopoly. I believe there is an answer, but for now the system is clearly broken.

Lastly, while I still have an audience, I would like to bring attention to an alternative food and energy source. You won’t see it included in BP’s, “Feel good. We are working on sustainable solutions,” television commercials, nor is it mentioned in ADM’s similar commercials. But hemp has been used for at least 5,000 years for cloth and food, as well as just about everything that is produced from petroleum products. Hemp is not marijuana and vice versa. Hemp is the male plant and it grows like a weed, hence the slang term. The original American flag was made of hemp fiber and our Constitution was printed on paper made of hemp. It was used as recently as World War II by the U.S. Government, and then promptly made illegal after the war was won. At a time when rhetoric is flying about becoming more self-sufficient in terms of energy, why is it illegal to grow this plant in this country? Ah, the female.

The evil female plant – marijuana. It gets you high, it makes you laugh, it does not produce a hangover. Unlike alcohol, it does not result in bar fights or wife beating. So, why is this innocuous plant illegal? Is it a gateway drug? No, that would be alcohol, which is so heavily advertised in this country. My only conclusion as to why it is illegal, is that Corporate America, which owns Congress, would rather sell you Paxil, Zoloft, Xanax and other additive drugs, than allow you to grow a plant in your home without some of the profits going into their coffers. This policy is ludicrous. It has surely contributed to our dependency on foreign energy sources. Our policies have other countries literally laughing at our stupidity, most notably Canada, as well as several European nations (both Eastern and Western). You would not know this by paying attention to U.S. media sources though, as they tend not to elaborate on who is laughing at the United States this week. Please people, let’s stop the rhetoric and start thinking about how we can truly become self-sufficient. With that I say good-bye and good luck.

I can't wait until I too become an uber-millionaire and finally tell the world to fuck off.

Here's the PDF of the actual missive.

[Via]

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Market Rollercoaster

Following last week's steep decline, today the DJIA experienced "the biggest single-day percentage gain in 75 years" after "governments and central banks around the world mounted an aggressive, coordinated campaign to unlock the global flow of credit, an effort that investors said they had been waiting for."

Paul Krugman (now Nobel winner), on his blog, posted this cartoon which was published in The Economist in 1987, but it seems very relevant today in an attempt to rationally explain the heck is going with the financial markets.

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Former Lehman CEO Dick Fuld Punched at His Gym

I'm a few days late on this story, but apparently someone punched and knocked out then Lehman CEO Dick Fuld at the company gym.

[Fuld] was on a treadmill with a heart monitor on. Someone was in the corner, pumping iron and he walked over and he knocked him out cold. And frankly after having watched this, I’d have done the same too.

Here's what I always immediately think of when someone gets knocked out:

Dammmnnnn.

[Via]

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$1000 Dollar Lap Dances Defy Market Slide

Reporter Jennifer 8 Lee is on a roll: First $1 menu items and now research into strip clubs?  Apparently down and out Wall Streeters are finding refuge at the strip club. Business at the "gentleman's club" V.I.P Club in Chelsea has been so good lately that owner Sam Zherka introduced a premium lap dance package for $1,000.

The package will buy a 20-minute lap dance, a bottle of Dom Pérignon and a private Champagne room. Not to mention, as Mr. Zherka did, they also “get to keep the girl’s G-strings.”

I wouldn't know, but a typical lap dance is $20 a song according to the article.

Read more here.

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Where Did the $700 Billion Figure Come From?

This $700 billion proposed bailout is raising a lot of red flags amongst the public, media, and Congress, both democrats and republicans. And as Forbes points out even the basic question of how this enormous figure of 700 billion was determined is unclear:

"It's not based on any particular data point," a Treasury spokeswoman told Forbes.com Tuesday. "We just wanted to choose a really large number."

ARE YOU FUCKING KIDDING ME?!?!?

[Via]

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Insane ATM Receipt Shows A Lot of Money

This receipt was found at a Chase ATM on 45 Wall Street showing a savings account balance of exactly $97,084.23 after he withdrew $100 (probably to buy lunch). As the Consumerist points out:

...this guy knows what he's doing; note how the balance is just under the $100,000 limit for full FDIC coverage.

Uhm, right! That's why I too keep my savings account balance under $100,000.

And I just heard that JP Morgan Chase purchased my bank Washington Mutual. So this means that I too now can access the same ATMs as this account holder without having to pay a transaction fee! Cha-ching! Money in the wallet and two dollars closer to $97,000.

[Via]

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NEW YORK MERCANTILE EXCHANGE FLOOR HAND SIGNALS

Take a look at this NY Times link of hand signals required to buy and sell commodities on the raucous trading floor (take a look at all three pages, which includes signals for months as well as miscellaneous signals--my favorite is the one for oil). Am I the only one that looked at this and could not stop myself from mimicking the hand motions? I felt like a finance Navy Seal. I am a dork. Good night.

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