Geithner Warns EU on HF and PE Regulation about Protectionism

U.S. Treasury Secretary Geithner has written to the European Commission warning that plans to regulate hedge funds and private equity firms could cause tensions with Washington, The Financial Times reported.

Citing a letter but not quoting from it directly, according to the FT report. Geithner wrote to Michel Barnier, European commissioner in charge of market regulation, on March 1 saying the EU was headed for a clash with the US and Britain if the planned rules proved overly protectionist. Read More at NYT summary.

Big Firm Strategic Pick Ups & Niche Firm Start Ups

Way Up from the bottom, with Wall Street and Big Bank's recent financial results, Rosenthal Recruiting sees the 'Employment Scene' picking up with the biggest firms strategic moves and smaller niche firms launching, expanding or adding capabilities such as Research and revenue producers.

Example of a new - or 'reformed' niche entrant: Mark Madoff will start his own research boutique firm. "Making up Madoff" (reported by Dealbreaker)
Link for more, go to Dealbreaker to read about the email Madoff sent to friends.

Reported yesterday by Bloomberg, WSJ and Business Week -- Morgan Stanley hired Citigroup’s Gary Shedlin, whose clients include BlackRock, now the world’s biggest money manager. Dealmaker magazine named him “top rainmaker” in the financials sector in 2006.

Shedlin, 46, will be a vice chairman, said an MS spokeswoman. Morgan Stanley's new banker helped NYSE Group Inc. create the first transatlantic securities market with its 9 billion euro ($12 billion) purchase of Euronext. Shedlin started his career at Lazard Freres . In 2004, Shedlin advised Bank One and its CEO, Jamie Dimon, on a merger with J.P. Morgan Chase.

Volcker Rule would Ban Banks from investing in Private Equity or Hedge Funds

President Obama yesterday sent Congress the Volcker Rule language, and as PE HUB notes it would indeed ban banks from investing in private equity or hedge funds. If enacted, this would mean at least two things: (1) Banks with direct investing arms would have to divest, either via sales to PE firms or indipendent spinouts. In either case, it's unclear if existing bank LP commitments to those platforms would be grandfathered in. (2) Banks would not longer be able to be LPs in private equity funds, thus depriving the alternatives market of a major capital source. Again, the grandfathering issue arises -- although perhaps this is where secondary funds can spend all that cash they've been hoarding. Read More from Reuters PE Hub.

I-Bank Pay Potential Remains Stellar & for Some College Grads too

Financial crisis was the worst in a generation — unless you were an American investment banker, Reuters' Breakingviews says. Employment in the securities industry fell by just under 79,000 positions from the peak in June 2008 to last month, according to the Bureau of Labor Statistics. That’s no small number. But it’s actually 14,000 shy of the number of jobs lost during the rout of March 2001 to October 2003 that followed the burst of the dot-com bubble.

We'll Pay You Anyway (BusinessWeek)
RBS may pay out $2 billion in 2009 bonuses for i-bankers. Not too shabby for a bank that’s 84% owned by British taxpayers. Summary via NYT Dealbook below.

Nomura to Almost Triple Salaries for Some University Graduates (Business Week too)

Royal Bank of Scotland (RBS or RBOS?) which is majority-owned by the government after a 2008 bailout, said Thursday it had set aside more money to pay bonuses to its investment banking staff after reducing its losses last year, New York Times reports.

The bank narrowed its 2009 loss to £3.6 billion, or $5.5 billion, last year compared to a £24.3 billion loss in 2008 — one of the biggest in British corporate history. Shares in R.B.S. rose 6.7 percent in London by midday because the loss was smaller than some analysts had expected, and the bank also said loan losses probably peaked. Read More »

Elder Statesmen Urge Tougher Regulation: Doomsday Scenario Laid Out

While the younger generation, visibly led by Goldman CEO Lloyd Blankfein, lobbies Congress against such regulation, their spiritual elders support the reform proposed by Paul Volcker and even more restrictions.

Meanwhile, JPMorgan analysts have outlined a worst-case regulatory scenario. What will happen if all financial regulatory proposals made by governments worldwide are implemented at the same time as the Basel Committee on Banking Supervision changes to capital and liquidity standards? JPM analysts concluded that major banks would see a significant decline in profitability. Deutsche Bank, Credit Suisse, RBS and other European banks would be hurt the most. Article overview from Financial Times - Access via Google News.

George Soros, William Donaldson, John Bogle and other elder statesmen of the financial industry made their fortunes in the 1970s and '80s, when financial institutions faced significantly stricter regulation. These power players are now pushing for a return to tougher rules, going against their younger counterparts. "I am a believer that the system has gone badly awry and needs massive reform," said Bogle, Vanguard founder and former CEO. The New York Times has more from these Street Vets.

Fast or easy ? Not for SEC's Mary Schapiro

As Mary Schapiro took the lead as SEC Chair last year, she vowed to quickly pursue short-selling restrictions and other changes. More than a year later, the SEC has not established additional limits on short selling or made most of the other regulatory changes it had proposed. Today Schapiro defends the SEC's progress: "It can take more time than one might have thought at the outset," she said. "We have to understand the real-life implications of what we're doing, the unintended consequences. We need to digest all the comments and all the economic analysis. And that leads us down a path that sometimes isn't 100% predictable at the beginning."

More on this from the Washington Post.

DC Insiders Say New Financial Regulation May Yet Pass in 2010

According to a new poll, 76% of Washington insiders say financial regulation will head to desk of President Obama in 2010. The House in December passed a wide-ranging package of regulations. Senate Banking Committee Chairman Dodd said Friday bipartisan negotiations on his panel reached an impasse and that he would draft overhaul legislation by the end of February. See more poll results from The Hill and comments posted there.

Meanwhile WSJ reports that Group of Seven (G-7) financial leaders have yet to reach a consensus on how to overhaul regulation of their financial sectors.

G-7 has become overshadowed by the larger Group of 20, which also represents emerging economies such as China, India and Brazil. G-7 financial leaders said they would continue meeting in a more informal fashion that won't include release of cooperative statements.

Harsh Criticism from Watchdog Monitoring $700 Billion Bailout

The watchdog charged with monitoring $700 billion government bailout unleashed one of his harshest criticisms of the program to date, questioning its overall effectiveness.

In his latest quarterly report to Congress, special inspector general Neil Barofsky said that the TARP failed to boost bank lending as well as halt the spread of foreclosures -- two key aims of the sprawling program. More at CNN Money.

FINRA Guidance for Brokers' Social Networking

FINRA Regulatory Notice 10-06 clarifies responsibilities to supervise the use of social networking sites to ensure suitabliliy of recommendations and that customers are not misled. The Notice also addresses recordkeeping and other responsibilities. Each firm must develop its own policies and procedures — in the context of its own particular business model and compliance and supervisory programs.

Helping to form the guidance was a Task Force of Compliance Officers and others from 14 FINRA member firms. Click for Press release and Notice.

Option Symbology Changes Scheduled for 2/12 - Are You Ready?

Option symbols have been confusing for many. Option symbols will soon be new & improved. Options Clearing Corporation (OCC) joined with industry representatives to devise the Options Symbology Initiative (OSI).
Industry expects to spend hundreds of millions of dollars on infrastructure and software alterations. The Options Pricing Regulatory Authority (OPRA) mandated a simpler method for reporting factors like options symbols, prices, and dates, though many Options firms are concerned about costs and adaptation to the new standards.

Your Options Technology staff should be set, but now is a good time to review the new symbology. On 2/9 at 12-1:00 PM Central, you or your clients can join an Instructor with The Options Institute, the CBOE educational arm, as he discusses what these changes will look like and what this means for options investors. Operations-wise you can view a PowerPoint from the 2009 SIFMA Operations Conference Options Symbolgy Panel.

Citi '09 Cash Bonus Cap below $100K; JPM I-Bank $379K ea.; Goldman Delay

Goldman Delays Release of Bonus Details. Had been expected to give staff the outline of their bonuses today (1/19)- before full-year results are released.
Article from Reuters via ABC News

UPDATE: JP Morgan's 24,654 investment bankers, including nearly 5,000 in London, will get an average of $379,000 each. Guardian UK: JPM "surfed a wave of recovery in global markets to notch up" year-end profits of $11.7bn, more than double its earnings of $5.6bn during crisis-stricken 2008. "These obscene bonuses paid so soon after the world's taxpayers had to rescue the banking system show that there is something fundamentally wrong in the relationship between banking and the rest of society."

NYT summary: Citi hopes the move will help deflect bonuse outrage, FT noted. However, it could also make it harder for the struggling behemoth to retain its top talent, The Financial Times said. Like its rivals, Citi will pay a large part of banker and trader bonuses in stock that could not be sold for a number of years. The bonus pool for 2009 is likely to be on par with that of 2008, the report said. Current Investment Bank, Accounting and Legal Opportunities click here and Subscribe to RSS Feed here.

CCO for Retail Broker-Dealer and Attorney needed for Institutional Brokerage

New York-based Broker-Dealer Opportunities.

FINRA Member Broker-Dealer is looking for a Chief Compliance Officer. Must have minimum of 5 years of experience. Should have been a CCO or reported to directly to the CCO in a retail environment, that offers Research and Underwriting activities. Municipal and Options Securities preferred. See more and APPLY.

Regulatory Compliance Attorney needed to service legal and regulatory matters for a wide array of products and services. The Company deals in equities, derivatives, US Treasuries, various fixed income desks, futures and foreign stocks. It offers electronic trading and asset management services.

Requirements:
-Must have in-house experience preferably with a large-to-mid-size Investment Bank supporting Institutional Brokerage activities covering Fixed Income and Equity markets.
Please read more about this Opportunity and APPLY.

Radio, Radio - Rare Opportunity

This is a rare opportunity to play a key leadership role in public broadcasting and to build a powerful NY radio station and brand known for excellence and innovation.
Submission Deadline: January 22, 2010
See More or contact Stuart Rosenthal.

Radio Gaga and four other Rock genre selections.

Bright Spot in Disappointing Jobs Report: Financial-Activities sector

If you only read the general media reports such as U.S. Job Losses in December Dim Hopes for Quick Upswing - it sure doesn't seem to include bright news.

As reported in the Investment News, one bright spot in the disappointing jobs report was the fact that the financial-activities sector of the economy added jobs for the first time since July 2007. Financial activities showed a net gain of 4,000 jobs in December, the Bureau of Labor Statistics reported. According to Bloomberg, that’s the first gain since the summer of 2007.

Excluding real-estate jobs, the number was even better. Finance and insurance alone added 9,900 jobs last month, also the first increase since July 2007. “The general idea is that the economy is turning, the financial sector is turning, and this is unequivocally a positive,” said Dan Greenhaus, chief economic strategist at Miller Tabak. The broader question, Greenhaus said, is how fast other sectors can turn around and boost the economy. Based on the overall middling numbers, “It doesn’t look like we’re set up for an explosion of job growth” like that U.S. economy has experienced following other recessions, Tabak said.

Wilco: Will Comply...Weekend Musical Diversion

In an interview, Wilco's Jeff Tweedy answered the question: Why is the band called Wilco? Tweedy said "it means 'will comply'in radio signaling and struck me as an ironic name for a rock band, which is historically responsible for not complying."

See and hear Wilco's Jeff Tweedy - perform "I'll Fight" (Live at Farm Aid 25)or the full Band Live in Concert on October 8th 2009.


Full Interview Published: July 2009. This week Wilco announced East Coast dates for its 2010 tour.

Employment Search Review for You and a Financial Star

THE beginning of the year offers a good opportunity to review every element of an employment search, from résumés to thank-you notes. Take a good look. Mishandling just one piece of the process could keep you from getting a job. Here is a checklist that covers some of the major links in the job search chain.


Read on about one of the few 'stars' to emerge from the financial crisis and his path to a new job: Neel Kashkari, the former Bush administration bailout chief. In December, he went to work as head of new investment initiatives at Pimco. Pimco said in a statement that Kashkari’s first task would be to recruit new employees and help build a new division to invest in stocks.

The people with knowledge of his employment search said that Kashkari met Pimco Founder William Gross while touring the country with the Treasury secretary in December 2007 to assess the country’s troubled housing market. Neither Pimco nor Kashkari would discuss how he ended up at the company or how he would be compensated. But people familiar with his job search said he wanted to work for a company where he could start a new business — just as he had with the relief fund for the federal government. More from the NY Times on "Neel Kashkari’s Quiet Path to Pimco".