Friday, 24 Sep 2010 | 1:43 PM ET

SHOCKER: Goldman Sachs Trading Desks Are Hiring

Posted By: John Carney

Goldman Sachs may be losing some of its proprietary traders thanks to Volcker rule restrictions on betting the firm's own capital. But the firm is hardly getting out of trading.

The Goldman Sachs booth on the floor of the New York Stock Exchange
Getty Images
The Goldman Sachs booth on the floor of the New York Stock Exchange

In fact, Goldman has recently given mandates to recruiters to seek out quants for its trading operations in both its Quantitative Investment Strategies group and its high frequency trading operations.

These are high-level positions. The QIS job requires a PhD and at least three years of experience in finance. It involves doing quantitative portfolio research for Goldman’s Algorithmic trading desk, which trades currencies, futures and equities. Basically, these are the guys that program the squid’s tentacles.

The other quant position is at Goldman’s designated market-marker arm at the New York Stock Exchange. This is the gang that runs the high-frequency trading ops of Goldman.

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  Friday, 24 Sep 2010 | 11:07 AM ET

Hedge Fund Trade Of The Day: Short Gold

Posted By: John Carney

Investing in gold has been one of the best ideas of the past couple of years.

Gold bars
Tom Grill | Iconica | Getty Images
Gold bars

Gold December futurespassed $1300 for the first time. The potential for dollar-weakening further Fed easing is likely a driver behind the continued rise. If the economy continues to weaken, the Fed may push more dollars into the economy by purchasing more debt securities. This could hurt the dollar, and lead to a rise in the price of gold.

Which is why a smart hedge fund manager would start shorting gold.

Let me explain right away that this is not a prediction about the direction of the price of gold. I suspect that the tendency of a deficit spending government concerned with high unemployment will be to debase the dollar, which implies a nominal rise in the price of gold. Bernanke is a believer in the power of inflationary policy to spur the economy. Fundamentally, this should be a bullish analysis for gold.

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  Friday, 24 Sep 2010 | 10:29 AM ET

Senate's Lame Ducks Delay Tax Debate

Posted By: Lori Ann LaRocco

It is no shocker that the Senate delayed its vote on extending the Bush Tax Cuts till after the election.

But this delay is just adding to the uncertainty hanging over the U.S. economy. Our great country is sick. She's bloated from drinking too much from the debt well and we have politicians on both sides of the aisle fighting like children and pushing back the inevitable vote.

While this finger pointing, "I'm rubber, you're glue" game is played on Capitol Hill, there are new taxes coming down the pike next year that will impact Middle America, the very taxpayers that President Obama says he wants help.

Pete Sepp, Executive Vice President of the National Taxpayers Union \(NTU\) tells me while the focus is on the 2001 and 2003 tax cuts, there are new tax problems looming for the middle class.

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  Friday, 24 Sep 2010 | 8:28 AM ET

Market Forces Trump Balance Sheet Fundamentals?

Posted By: Ash Bennington

Federal government will sell low percentage of G.M. stock in order to fetch highest price. (New York Times) Analysts seem to find consensus that it will take years for gov’t to recoup its $43 billion investment.

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  Friday, 24 Sep 2010 | 8:17 AM ET

Hedge Fund King David Tepper Explains His Consistent Inconsistency

Posted By: Maneet Ahuja

Though very few hedge funds on the Street can claim to compare to the 17-year track record of David Tepper’s Appaloosa Management, LP, the only thing that is consistent about the performance of the fund is that it is, well, inconsistent.

“We’re consistently inconsistent”, the legendary billionaire investor says over a lunch of spicy tuna rolls and salad at his office in Short Hills, NJ, earlier this week. “It’s one of the cornerstones of our success.”

Inconsistent maybe. Incredible, certainly. Last year, Tepper’s flagship Appaloosa fund returned an eye-popping 132.7%, net of fees, after grossing $7.5 billion by betting on financials early on, more than any other hedge fund firm last year. Through July of this year, the fund is up almost 42% on a net trailing annulized basis, according to performance documents from an investor.

When Lehman Brothers filed for bankruptcy in September 2008, investors panicked on Wall Street, causing dangerous aftershocks across the markets. And while most of Appaloosa’s peers were desperately trying to mitigate losses and stave off redemption requests amidst the market’s free fall, Tepper decided it was the perfect time to leap right into the eye of the storm.

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  Thursday, 23 Sep 2010 | 5:28 PM ET

PIIGS Still Pigs

Posted By: Ash Bennington

Buffett: "We're still in a recession" (Reuters)

The next time your annoying coworker defines a recession as two consecutive quarters of negative GDP growth, tell him Warren Buffet thinks he’s an idiot.

PIIGS still pigs (Yahoo) Ireland’s GDP report increases concerns for Europe’s most indebted nations.

The next time someone offers to sell your nana corporate paper with a 9% YTM... \(BusinessWeek\) You have my permission to sock them.

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  Thursday, 23 Sep 2010 | 4:46 PM ET

Hedge Fund Manager Phil Falcone Talks Satellite Broadband with Forbes Magazine

Posted By: Ash Bennington

Phil Falcone has$9 billion and ambitious plans to build a next generation mobile broadband network using satellites and a network of unbuilt terrestrial towers — but can he pull it off?

»Read more
  Thursday, 23 Sep 2010 | 4:05 PM ET

Correlation: Two Other Smart Guys Weigh In

Posted By: Jeff Cox

Apparently, my report last week about the elevated level of market correlation and the corresponding havoc it was wreaking on portfolios touched a nerve or raised an eyebrow or maybe just twitched a muscle.

The story ran Friday, spanning a convulsion-inducing \(at least among ‘Net editors\) 1,465 words in describing how closely virtually all the financial market asset classes were running together, and how difficult that makes it to hedge and keep portfolios diversified.

I’m not sure how many readers stayed with me the whole way, but some analysts must have liked it.

Two pretty good ones quickly followed up Monday with analyses of their own about correlation and how much of a problem it poses for investors.

In a piece titled, “Are Elevated Correlations Part of the New Normal?” Standard & Poor’s chief equity strategist Sam Stovall crunched some numbers to take a pretty insider-ish view of all things correlation.

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  Thursday, 23 Sep 2010 | 1:51 PM ET

Oliver Stone: They Are All Sharks

Posted By: Maneet Ahuja

To kick off the NY premiere of the much-awaited Wall Street: Money Never Sleeps , the cast of the film gathered to ring the opening bell Monday morning at the Nasdaq.

20th Century Fox

Having helped with the movie a bit behind the scenes, I thought I'd head over to the floor to say hi to the gang while conducting a bit of business for "Squawk Box." At the NASDAQ I pulled Director Oliver Stone aside and asked him how he assembled his cast of real-world market movers to secure the script stick to reality as much as possible.

"We talked to at least 30 or 40 people, we went everywhere. The producers, the actors, we all knew various people. I think one of the most earliest helpful figures was Eliot Spitzer actually because he investigated AIG and he knew a lot about Goldman Sachs so he could tell us where to look. And we went to Jim and he was brilliant," Stone said.

Jim, of course, is James Chanos, the head of the $6.7 billion hedge fund Kynikos Associates, who happened to be guest-hosting "Squawk Box" that day. Chanos served as one of the main technical consultants on the film, helping to ensure the story line was representative of what was actually happening out there on the short (and long) sides of markets during the financial crisis.

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  Thursday, 23 Sep 2010 | 12:30 PM ET

Geithner Is Toast After Midterm Elections

Posted By: John Carney

Tim Geithner will probably be tossed out of the Obama administration following the midterm elections.

»Read more

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