The City Diary: Goldman spat: Stein weighs in and Blodget blogs back
Slackbelly exposes The Good, The Bad and The Ugly of The Square Mile
Sunday 25 April 2010
Another spat seems to have resurfaced between Henry Blodget, a former Wall Street analyst turned commentator, and Ben Stein, the economist who once wrote speeches for Presidents Nixon and Ford before taking the higher-brow role of playing the dour economics teacher in the film Ferris Bueller's Day Off.
Stein has long been fond of slamming Goldman Sachs, and weighs in again over the allegations that the bank's trader, Fabrice "Fabulous" Tourre, sold clients an investment that another Goldman client had helped fill with bad loans.
That's offended Blodget, who's penned a blog pointing out that Stein was once sacked by The New York Times, and headlined: "Canned NYT Columnist Moves Goldman-Bashing To Bloomberg". What an odd thing for Blodget to do. Does he think everybody's forgotten his ban from the securities industry in 2003 for behaviour not completely dissimilar from that alleged of, er, Tourre?
Dragons roar before their new TV series begins...funny that
More on the "spat", reported here last week, between Duncan Bannatyne and James Caan from Dragons' Den – which has, remarkably, erupted at a time when the ensuing publicity provides a huge boost to the forthcoming series.
Bannatyne, you'll recall, is suddenly outraged by his former friend's long-standing non-dom status, Caan has hit back with a crack about Bannatyne's spell in clink and – well – I can only assume that everybody has since leant back, sparked up the cigars and enjoyed all the attention. Now Bannatyne has written a column on his blog about immigrant families becoming non-doms entitled: "You, the refugees, their children and your children", which has prompted a statement from Mo Chaudry – another businessman with plenty of time to appear on the telly. He says: "Bannatyne has become a one-man 'Monster Raving Loony Party'. Labelling migrants to this country as refugees is downright racist."
Bannatyne's people respond by musing that Chaudry's line might be libellous, and point out that their client is merely continuing his campaign for "the fairest tax system possible for our children and grandchildren".
Is there anything this lot won't do for a bit of exposure?
Brownites' plan for Gavyn Davies and the Old Lady
Gordon Brown's branding of Goldman Sachs as "morally bankrupt", while calling for an immediate investigation into the bank's dealings, is an astonishing U-turn (and valediction?).
Goldman got its big break in Whitehall via its former banker, Gavyn Davies – who is married to Brown's friend and former private secretary, Sue Nye. Davies went on to become chairman of the BBC (stoically brushing aside barbs of Labour cronyism), but the ultimate Brownite plan was to have him installed as Eddie George's successor at the Bank of England. Where did it all go wrong?
Musical chairs at Cazenove committee won't help the FSA
The Financial Services Authority has yet to unearth the inside source at Cazenove who supposedly supplied tips to Malcolm Calvert, the bank's former partner convicted of insider trading last month.
City watchers have speculated that Calvert got his information from a member of the Commitments Committee, the cabal of partners that gives the nod to each Cazenove deal. Possibly, although I learn that the committee is a movable feast, consisting of about six partners (now MDs) who vary depending on the deal they are scrutinising.
If the deal is to advise on a flotation, then somebody from the research department will be on the committee, as the bank has to be sure its analysts are not going to trash a client's listing. If it's an M&A deal, research will be excluded, but transaction specialists called in. All of which might explain why the FSA has struggled to unmask Calvert's alleged mole. At least, thus far.
Give this GE boss a degree in sub-prime loans
Rewards for the villains of the credit crisis just keep on rolling in. After honorary degrees doled out to Sir Derek Wanless, the diligent former head of the risk committee at Northern Rock, and Sir James Crosby, the genius behind the fearless strategy at HBOS, I now learn of another prize, for Jeff Immelt (right), the chief executive of conglomerate General Electric, who is to receive an honorary doctorate from Boston College.
"Immelt successfully guided GE through the post-9/11 era, and today the company is the world's biggest maker of jet engines, locomotives, medical-imaging equipment and power plant turbines," the university gushes – somehow forgetting that Dr Jeff also presided over a company that pumped out masses of those sub-prime loans which almost obliterated the world economy. Could do better.
Sorry, Sportingbet – you cashed in your chips too early
The odds of the American ban on internet gambling being lifted are shortening after moves in Washington. City traders are getting excited that this might be a boost for London-listed companies, including Sportingbet. Well, yes and no. The latest idea seems to concern only online poker, while any changes for sports betting and casino sites are unlikely to be useful to Sportingbet. The company sold those US firms for $1 when it withdrew from America in 2006 and it retains no details of its former punters. A bit of a long-shot then.
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