Blog

Our experts frequently write blog posts about the findings of the research we are conducting.

Displaying 11-18 out of 18 results for "Puerto Ricof=Informational Post".

$85 million and Counting: What Price Will Citigroup Ultimately Pay for Its MAT/ASTA Deception?

(Mar 2012)

On March 13, 2012, Bloomberg published Citigroup Ex-Manager Islam Has No Regrets After Funds Crash. Then on March 21, 2012 USA Today published Investor hedge fund claims cost Citigroup $85M and counting. These two stories deal with MAT/ASTA hedge funds Citigroup sold to retail clients which suffered staggering losses in early 2008. Both recent stories discuss the $54.1 million award in Hosier et al v Citigroup covered in the WSJ, Citigroup Loses Muni Case in April 2011.

Craig McCann has...

Abuse of Municipal Finance in Wisconsin

(Mar 2012)

The Wall Street Journal is reporting that Stifel Financial has settled with five Wisconsin school districts on charges that they misled these municipal investors with their sale of several complex CDOs. This is just another example of the situation outlined in a previous postwherein a municipality or institutional investor was taken advantage of through the sale of inappropriate investments. The settlement involves $22.5 million in cash, plus $154 million in debt forgiveness. SLCG has been...

Greg Smith Leaves Wall Street

(Mar 2012)

The New York Times published an op-ed by Greg Smith, a Goldman Sachs' Executive Director who is resigning from his job after almost 12 years with the firm because, as he puts it, the firm's culture has veered far from what it was when he first joined the firm. He says in spite of the firm's recent scandals "the interests of the client continue to be sidelined in the way the firm operates and thinks about making money." At SLCG, we have come across many examples of the issues raised by Mr....

More SEC Charges Coming Related to MBS Disclosures

(Feb 2012)

According to the Wall Street Journal today, several banks may soon face charges related to the disclosure of risks related to their sales of mortgage-backed-securities in 2006. The SEC is reportedly concerned about whether these banks "misled investors about the underlying pool of assets."

We have several posts lately and a research paper on similar disclosure issues for both collateralized loan obligations and mortgage-backed-securities, in which we describe how the warehousing of assets...

Home Equity: Changing Perspectives

(Feb 2012)

We wanted to write a quick post highlight the changing perspectives of industry experts concerning something as mundane as home equity. The LA Times reported in August 2005 that, due to the rapid appreciation of real estate values and perceived wealth accumulation, consumers were beginning to spend more freely. In fact, at the time it was becoming commonplace (and even suggested by experts) to cash out equity in your home to finance otherwise unobtainable, and sometimes transient, purchases...

Dealbreaker on the Hayes award and LCM VII CLO

(Feb 2012)

Matt Levine at Dealbreaker posted last night on our work regarding the Hayes award and the LCM VII CLO. He interpreted some of the facts of the case differently, but we think he did touch upon the key issue: the proper disclosure of the decline in the market price of collateral on the closing date. We wanted to directly address a couple points he raised.

To be clear, at least by the closing date the CLO did track the daily mark-to-market value of the loans in the LCM VII portfolio using...

Freddie Mac, complex derivatives, and one huge conflict of interest

(Jan 2012)

There have been many news reports lately describing the difficulty homeowners have had in refinancing their mortgages. Many decry the strict requirements imposed on them by Fannie Mae and Freddie Mac, the massive taxpayer-owned-but-ostensibly-nongovernmental mortgage financing firms. Well today, NPR and ProPublica are reporting that Freddie Mac bet billions that many homeowners would not be able to refinance their mortgages.

Now that's a conflict of interest. Other outlets have begun to...

President and CIO of Direxion admits that leveraged ETFs are not appropriate for most investors

(Jan 2012)

Today Seeking Alpha posted an interview with Dan O'Neill, President and CIO of Direxion, one of the first and best known issuers of leveraged ETFs. Readers familiar with our work on leveraged ETFs know that we feel these products are almost always unsuitable for retail investors.

Surprisingly enough, Mr. O'Neill agrees completely:

The leveraged indexed ETFs are used by very tactical investors, and so there we have bull and bear funds. They have daily betas, which means that essentially...

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