CEO Brian Moynihan said the bank faces up to an additional $9 billion in costs related to the financial crisis and mortgages beyond its reserves.» Read More
An economic tsunami warning is being sounded but are bank investors listening?
Jim Rickards, Senior Managing Director of Market Intelligence, and Chris Whalen, Co-Founder and Managing Director of Institutional Risk Analytics tell me the sputtering real estate industry is brewing a cocktail of economic disaster and bank investors need to be on high alert.
I generally regard company disclosures of SEC investigations as MERELY a headline. Investigations, it appears, have become a commodity with little to show in the end. The good news is that there’s an inquiry; the bad — rarely do they find anything or does any company get severely penalized.
Lawmakers may have unintentionally opened the bond-market up to high frequency traders by passing controversial derivatives-clearing requirements as part of the Dodd-Frank financial reform bill.
The Blanche Lincoln-sponsored clearing-house requirements will force certain derivatives, including many credit default swaps \(CDS\) on corporate bonds, to be cleared by centralized clearing houses and traded on swaps exchanges. The hope is that this will make the market in derivatives more transparent and reduce counter-party risk.
Very little attention has been paid to the likely unintended consequences of this move. Let's begin with a simple observation: government intervention into established market processes always produces unknown and unintended consequences.
Shares of Green Mountain Coffee, which makes those K-Cup coffee pods, have taken a hit after the company’s disclosure yesterday that it overstated revenue last quarter related to an inter-company markup in its inventory balance.
It also said that it had received an inquiry from the SEC into certain revenue recognition practices and its relationship with a fulfillment vendor.
The company snuck out the disclosure in an 8-K filing with the SEC without a formal press release. In its disclosure, Green Mountain claimed the revenue overstatement was an “error” and “immaterial.”
However, as immaterial as it may appear, the “error” added 3 cents to earnings per share of the company, which beat estimates by a penny.
Some (options) guys (or girls) have all the luck.
Well, at least one of them has had a tremendous amount of good fortune lately by playing long and short positions against each other on drug store chain Walgreen and pocketing nearly half a million dollars in profit.
This particular trader’s good fortune began back on Sept. 20 when he or she sold 35,000 put options at the October $27 strike price for an average premium of 17 cents apiece on a day when the stock closed at $29.24, according to information from Interactive Brokers.
That there is no clear indication of whether Vanity Fair's piece is intended strictly as comedy may give us some insight into the current state of affairs in hedge fund land.
The setup is this: VF's article lays out a skeleton process for starting a hedge fund. Then a writer doing shtick is paired with an "Actual big-shot hedge-fund manager," who dispenses what he may or may not believe to be bona fide advice. Wacky hijinx ensue.
Mortgage applications down for fourth straight week. (CNBC.com) This despite 30 year fixed rates at — 4.38% the lowest level since data collection began twenty years ago.
Goldman Sachs launches a new public relations campaign today with a full page ad in the Wall Street Journal touting the company's role in raising capital for a clean energy project.
The clean energy ad is the first of many that will tout the role of Goldman as a good citizen, a person familiar with the matter said.
Other ads may emphasize Goldman's role in providing business education to women and small business owners, the person said.
Goldman has suffered from bad publicity and political heat since the financial crisis began. It has been sued by the SEC for allegedly misleading investors, described as a "vampire squid" in the pages of Rolling Stone , and had its executives hauled before Capitol Hill committees. The prominent roles many of its executives have played in government, which Goldman long viewed as evidence of its public-mindedness, is now widely perceived as a source of undue influence by the company.
John Carney is a senior editor for CNBC.com, covering Wall Street and finance and running the NetNet blog.
Jeff Cox is finance editor for CNBC.com.
Lawrence Delevingne is the ‘Big Money’ enterprise reporter for CNBC.com and NetNet.
Stephanie Landsman is one of the producers of CNBC's 5pm ET show "Fast Money."