GO
Loading...

NetNet

More

  Friday, 27 Jun 2014 | 11:06 AM ET

Ex-Mt. Gox chief cites break-in for bitcoin theft

Posted By: CNBC.com staff
Mark Karpeles, chief executive officer of Tibanne Co., poses for a photograph with a bitcoin in the office operating the Mt.Gox K.K. bitcoin exchange in Tokyo, Japan.
Tomohiro Ohsumi | Bloomberg | Getty Images
Mark Karpeles, chief executive officer of Tibanne Co., poses for a photograph with a bitcoin in the office operating the Mt.Gox K.K. bitcoin exchange in Tokyo, Japan.

Mark Karpelès has advice for anyone looking to start a bticoin trading platform: Hire security.

The former head of the Mt. Gox exchange—once the most prominent place to trade the cryptocurrency—should know. Mt. Gox lost 850,000 of its clients' bitcoins, and he believes the 200,000 or so recovered since the theft are as good as it's going to get.

Karpelès blames the initial theft on a slew of occurrences: Aggressive hacking attacks, along with physical break-ins at the company's Tokyo offices, and an employee who ran off with electronic data.

"If anyone wants to start a bitcoin exchange, I would say, 'Be sure to have 24-hour security guards,'" Karpelès told the Wall Street Journal.

»Read more
  Tuesday, 24 Jun 2014 | 3:06 PM ET

The 'Black Swan Index' is on a scary flight higher

Posted By: Jeff Cox

Where some investors see nothing but rolling green fields and placid summer lakes, others see black swans circling high above.

Such is the picture painted when comparing the widely followed Chicago Board Options Exchange Volatility Index—the market's "fear" gauge— and its sister measure, the Skew, aka the "Black Swan Index," which charts, well, lots of fear. (The black swan is a metaphor for a highly unusual occurrence and took on added significance in the market following Nassim Taleb's 2007 book, "The Black Swan.")

While the VIX is closing in on historic lows and has tumbled nearly 20 percent year-to-date meaning there is a high level of complacency among investors the Skew has surged in June, rising more than 12 percent for the month.

Taken together, the two measures reflect an interesting dichotomy among investors.

»Read more
  Thursday, 26 Jun 2014 | 12:18 PM ET

Post-DOMA, same-sex couples struggle with finances

Posted By: Kayla Tausche
Edith Windsor, the woman at the center of the U.S. Supreme Court decision granting gay couples federal marriage benefits, attends the gay pride parade in New York last year.
Mike Pont | FilmMagic | Getty Images
Edith Windsor, the woman at the center of the U.S. Supreme Court decision granting gay couples federal marriage benefits, attends the gay pride parade in New York last year.

Since the Supreme Court struck down a ban a year ago, getting married has become a whole lot easier for same-sex couples. Managing their finances, though, remains a challenge.

When the Supreme Court repealed the Defense of Marriage Act in June 2013, roughly 215 financial planners were certified by the College for Financial Planning to advise on issues pertinent to same-sex couples. Although that number of Accredited Domestic Partnership Advisors (ADPA) has more than doubled in the last year, enrollment in these programs may have tapered off.

"Many potential students may have thought that there was no further need for alternate planning," said Gregg Parish, professor of estate planning at the college. "Nothing could be further from the truth."

A recent Wells Fargo survey found that two-thirds of respondents in legal same-sex marriages still did not understand fully how federal and state laws affect them.

»Read more
  Thursday, 26 Jun 2014 | 10:34 AM ET

Even if Brazil wins World Cup, it loses: Bankers

Posted By: Lawrence Delevingne
Children play football in the street in the poor neighbourhood of Itaquera, adjacent to the 'Arena de Sao Paulo' stadium, on June 21, 2014 in Sao Paulo, Brazil.
Getty Images
Children play football in the street in the poor neighbourhood of Itaquera, adjacent to the 'Arena de Sao Paulo' stadium, on June 21, 2014 in Sao Paulo, Brazil.

Emerging markets experts are bearish on investing in Brazil regardless of the World Cup—but say fiscal reforms from a new administration could have a big effect.

"There's no upside for this government, even if everything goes well," Drausio Giacomelli, head of emerging markets research at Deutsche Bank, said Wednesday at the New York Society of Security Analysts Latin American Capital Markets Conference.

"It's not about (if Brazil wins the World Cup), it's about what it exposes: a government that's unable to deliver what they say the people need for education, for transportation, infrastructure in general," he said. "They can give stadiums ... but not what matters."

Brazil plays Saturday against Chile in the first game of the Cup's knockout round.

»Read more
  Tuesday, 24 Jun 2014 | 12:40 PM ET

Wall St. pros weigh in on costs of climate change

Posted By: Lawrence Delevingne
Henry Paulson
Peter Kramer | NBC | Getty Images
Henry Paulson

A small but elite group of former financial executives have issued a stern warning on the economic costs of climate change in an effort to get the business community and others to take action.

"Our economy is vulnerable to an overwhelming number of risks from climate change," former Treasury Secretary Hank Paulson said in a statement announcing his new "Risky Business" report Tuesday.

"These risks include the potential for significant federal budget liabilities, since many businesses and property owners turn to the federal government as the insurer of last resort. But if we act immediately, we can still avoid most of the worst impacts of climate change and significantly reduce the odds of catastrophic outcomes—but the investments we're making today will determine our economic future."

»Read more
  Tuesday, 24 Jun 2014 | 11:08 AM ET

Could inflation be the new subprime?

Posted By: Jeff Cox

When Fed Chair Janet Yellen essentially dismissed inflation as a threat last week, she sought to calm investors' fears but in doing so also raised an unpleasant specter of the not-too-distant past.

To some, the central bank chief's assertion that inflation threats were coming from "noisy" data—economist talk for volatile, one-off conditions not likely to persist—sounded at least a little like her predecessor, Ben Bernanke, who in March 2007 said problems in the subprime mortgage market were "contained" and unlikely to pose a larger, more systemic threat. The subprime market, of course, was in the early stages of a meltdown that spread across the financial system and triggered the worst economic downturn since the Great Depression.

"Do not be surprised if 'noisy' is now the new 'transitory,'" Tom Porcelli, chief U.S. economist at RBC Capital Markets, said in a note to clients.

"This is part of a larger message that came through in Yellen's press conference. That is that the Fed is not setting policy based on their best guess of where they believe the economy will be, but rather where the economy has been," he added. "In other words, instead of trying to shape the economy on a forward-looking basis through monetary policy, they are instead more likely to react to largely coincident-to-lagging developments. The potential for a policy mistake and a Fed that falls well behind the curve seems obvious."

For Porcelli and other Wall Street pros who issued warnings on Yellen's blithe inflation comments, the worry is that the Fed waits too long to give at least lip service to an inflation threat and ends up having its hand forced in tightening monetary policy and raising interest rates.

»Read more
  Monday, 23 Jun 2014 | 1:10 PM ET

Mutual fund pro: Don't fight 'wrong' Fed policies

Posted By: Lawrence Delevingne

The Federal Reserve may be wrong to keep turbo-charging the economy with easy money, but one big mutual fund manager thinks investors shouldn't try to fight it.

Michael Aronstein, who manages a top absolute return mutual fund—one that acts like a hedge fund by betting both for and against securities—delivered the message at the Morningstar Investment Conference in Chicago.

»Read more
  Monday, 23 Jun 2014 | 6:39 AM ET

The rich get richer as stock buybacks surge

Posted By: Jeff Cox
Trader on the floor of the New York Stock Exchange.
Getty Images
Trader on the floor of the New York Stock Exchange.

As the stock market sets a series of historic highs, investors can thank companies for buying back their own shares at a near-record pace.

Repurchases and buybacks soared nearly 60 percent in the first quarter, putting a floor under a market that struggled amid a brutal winter and an economy that contracted at least 1 percent. Companies have used bargain-basement interest rates to borrow money for stock purchases, which have fed the equity market even as gross domestic product growth has stumbled along.

In all, corporations increased buybacks by 59 percent to $159.3 billion, according to S&P Dow Jones Indices. That's up strongly from the $100 billion for the same period in 2013 and a bit below the $172 billion high set in the third quarter of 2007, just before the financial crisis and market crash that sent indexes plunging 60 percent. The S&P 500 stock market index gained just 2.2 percent in the first quarter, but it likely would have been substantially worse without the buybacks.

"Companies bought more shares, reducing their share count, and got a tailwind in the first quarter," said Howard Silverblatt, senior index analyst at S&P. "The big question is, was it a one-shot deal to help through the poor weather of Q1, or was it the start of something new?"

»Read more
  Monday, 23 Jun 2014 | 11:46 AM ET

Fightin' Phil: Falcone's back, and doing a deal

Posted By: CNBC.com staff
Phil Falcone.
Amanda Gordon | Bloomberg | Getty Images
Phil Falcone.

Don't count out hedge fund magnate Philip Falcone yet.

The head of Harbinger Group had a pretty miserable 2013 that culminated with him agreeing to an $18 million settlement with the Securities and Exchange Commission—an agreement under which Falcone wouldn't be allowed in the securities industry for five years.

However, that settlement didn't include Harbinger Group, which is a holding company. Falcone had headed Harbinger Capital, which once managed $26 billion but fell on hard times amid investor withdrawals and regulatory scrutiny focusing on a $113 million personal loan Falcone took from one of his hedge funds to pay personal taxes.

Now comes news that Harbinger will be acquiring Central Garden and Pet in a deal estimated at $505 million, according to a report Monday in the Wall Street Journal, though other reports put the price tag lower. (FactSet said the number would be closer to $488 million). Including debt assumption, the price tag balloons to $1.1 billion.

»Read more
  Friday, 20 Jun 2014 | 7:00 AM ET

Ho-hum hedge returns no problem for some investors

Posted By: Jeff Cox

Hedge funds have gotten a lot of bad publicity over the past few years for underperforming broad market gauges, but most institutional investors couldn't care less.

In fact, they prefer funds that focus less on eye-popping returns and more on generating steady, achievable growth levels and portfolio diversification, according to a survey released this week by Preqin, an information provider for the alternative investment industry.

That's important at a time when the S&P 500 stock market index is coming off a year in which it posted gains in excess of 30 percent, while hedge funds as a whole rose a comparatively modest 8.9 percent net of fees.

"It doesn't surprise me," Anthony Scaramucci, founder and co-managing partner of SkyBridge Capital, said of the survey results. "In the search to make actuarial goals, institutional investors and high net-worth investors are looking for high single-digit, low double-digit returns that can be generated with less volatility than the overall market and certainly less volatility than the S&P 500."

The survey numbers at least on their face are fairly startling.

»Read more

About NetNet

  • NetNet is where you'll find the low-down and the high jinks of Wall Street. It's the place for insider stories, trader gossip, and tales of the foibles of the moneyed crowd and the culture of finance.Wall Street news and commentary served fresh all day long.

 

  • Jeff Cox is finance editor for CNBC.com.

  • Lawrence Develingne

    Lawrence Delevingne is the ‘Big Money’ enterprise reporter for CNBC.com and NetNet.

  • Stephanie Landsman is one of the producers of "Fast Money."

NetNet TV

Wall Street