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Trading Now

Thursday, August 6, 2009


*BofA in big trouble over this but their stock goes up through the ceiling?
Judge refuses to approve settlement between BofA, SEC
U.S. District Judge Jed Rakoff said it might be unfair to the public to accept a proposed settlement between the Securities and Exchange Commission and Bank of America. The $33 million settlement is related to the bank's acquisition of Merrill Lynch. "Despite the public importance of this case, the proposed consent judgment would leave uncertain the truth of the very serious allegations made in the complaint," Rakoff wrote, adding, "The proposed consent judgment in no way specifies the basis for the $33 million figure." Rakoff scheduled a hearing Monday on the subject. Reuters (06 Aug.)

E-mails delve into what BofA knew about Merrill and when: Two days before Bank of America's shareholders voted to approve the takeover of Merrill Lynch, the latter's loss projections increased by almost $2 billion. Bank of America executives concluded that the losses did not need to be publicly disclosed because they were not severe enough, according to internal e-mails and sources. The Wall Street Journal (06 Aug.)

*looks like a bubble in the making to me. But what do I know.
Foreclosure shopping in U.S. becomes race between buyers
The days of foreclosed houses owned by banks, known as REOs, sitting empty for months without even prospective buyers are over. Many REOs in the U.S. are selling in a single day, or faster. "Offers come in immediately after the listing comes on the market," said Brad Geisen, founder of A few houses were under contract for sale in less than 90 minutes. (8/5)

*yeah right. They will find some way to rig this whole thing so they never get what they deserve on fundamentals.
Boom in investment banking might be short-lived
With the top dozen investment banks having recorded $136 billion in revenue before expenses in the first six months of 2009, the sector appears to be booming. Behind the headlines, however, the banks' earnings have come from an unusual combination of market events and conditions that are unlikely to continue much longer. Analysts said the long-term outlook for the industry is uncertain as markets normalize and inexpensive government-backed funding wanes. Financial Times (tiered subscription model) (8/5)

*and the regulators have done such a good job eh?
Specter introduces bill to reverse Stoneridge case; SIFMA opposes
Sen. Arlen Specter, D-Pa., introduced legislation last month that could make it easier for plaintiffs' lawyers to file fraud suits from shareholders. If passed, the bill will reverse the Supreme Court's decision in Stoneridge Investment Partners LLC v. Scientific-Atlanta, which prevents shareholders from suing third parties. The measure would also expand the number of shareholders who can sue for fraud. Some groups said the bill would have negative consequences. SIFMA spokesman Travis Larson said efforts to overturn the Stoneridge case were "totally misguided," adding that securities regulators "are already equipped with all the necessary regulatory tools to recoup lost money for investors." The Wall Street Journal/Dow Jones Newswires (8/5)

*what? Congress not having any say?
Schapiro says SEC should fund itself from industry fees
Mary Schapiro, chairwoman of the U.S. Securities and Exchange Commission, said the commission would be able to run more smoothly and take on tougher investigations if it were able to fund itself directly from industry fees. The SEC takes in $1 billion each year but must get congressional approval for its budget before spending any of it. "Self-funding has been discussed over the years, but I think it may now well be the moment," Schapiro said. "Some stability in funding would be an enormous benefit because it would help with long-term planning in such areas as technology and staffing." Financial Times (tiered subscription model) (06 Aug.)

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