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HSBC Renews Focus on Emerging Markets

Sep 29, 2009 @ 10:07 AM By Kerry Massaro,

HSBC Asia-Pacific CEO Sandy Flockhart discusses the firm's management restructure in order to further develop the banks focus on emerging markets and China.

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High Frequency Traders Provide Liquidity in Current Rally, Says Author

Sep 22, 2009 @ 11:26 AM By Ivy Schmerken,

What impact is computer-driven, high frequency trading having on the current stock market rally? Yesterday, Rishi Narang, author of "Inside the Black Box," a new book on quantitative trading, told the Wall Street Journal in a video interview “Taking Stock of Quants in Rally” that computer-driven, high frequency traders are providing liquidity in the current rally and they are on the other side of transactions with the pension funds and real money asset managers.

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Eliot Spitzer on How Banks Have Spent Taxpayers' Money

Sep 15, 2009 @ 12:21 PM By Kerry Massaro,

Former Governor Eliot Spitzer talks with CNN's John Roberts on the economy and Wall Street. Spitzer says not enough has been done since Lehman failed a year ago, likening what has transpired so far to moving deck chairs on the ship of the Titanic and not actually doing anything at a regulatory level that will change the system.

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One Year Later: An Insider's View of Lehman’s Collapse

Sep 14, 2009 @ 01:07 PM By Ivy Schmerken,

A former Lehman Brothers bond trader, Lawrence MacDonald, offers his take on why the firm should not have collapsed, in a story posted on Yahoo’s news site.

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Video: Future of Lehman In Europe

Sep 14, 2009 @ 10:15 AM By Kerry Massaro,

I watched an interesting and indepth video interview on CNN this morning that is worth watching. Tony Lomas, Lehman Brothers Int'l Administrator talks to CNN's Jim Boulden about many of the decisions made by Lehman Europe one year ago and what has transpired over the year.

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Lehman: One Year Later

Sep 14, 2009 @ 10:07 AM By Kerry Massaro,

Check out a recent video on CNN which discusses lessons learned from the collapse of Lehman Brothers one year ago. One says Lehman wasn't too big to fail, it was too big to succeed. The CNN video can be seen here

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93 Year Old Still Trading

Sep 3, 2009 @ 12:57 PM By Kerry Massaro,

Check out this video of trader Paul Dannebaum on CNN. He's 93 years old, still doing push ups and trading out of his Del Ray Beach home.

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Catching Up with Portware’s Harrell Smith

Sep 3, 2009 @ 12:25 PM By Kerry Massaro,

I caught up with Harrell Smith, Head of Product Strategy for Portware yesterday. We chatted about the world of high frequency trading, of course, as well as what Portware is working on in the coming months. The company has a lot on its plate and according to Harrell, has experienced 40% growth this year despite the woes that most other technology and trading firms are experiencing. That growth is coming from smaller proprietary shops as well as larger sell side institutions. In fact, Harrell said Portware has recently signed on a European-based bulge bracket broker-dealer, which has helped to propel the firm’s growth. He was not at liberty to disclose the firms name until the fall.

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Madoff Used SEC Incompetence to Lure Investors

Sep 3, 2009 @ 11:04 AM By Cristina McEachern Gibbs,

It was pretty obvious that SEC Inspector General David Kotz’s internal review of the agency’s missteps around the Madoff fraud wasn’t going to be pretty. But when the executive summary was released yesterday I couldn’t pull myself away.

The details around how exactly the SEC botched each individual complaint it received about Madoff and his questionable practices were very interesting. Particularly that every time they were set to ask an outside third party for trade or counter party verification for some reason the documents were never sent.

Several times they never got out the door and if they had, if one person had actually sent the document they were supposed to send, the fraud would have easily been uncovered years ago.

But what also caught my eye and was surprisingly damaging to the agency’s reputation I would think was the part about how Madoff used the fact that the SEC had investigated his firm and found nothing to then assure investors their money would be safe.

He knowingly used the fact that the SEC had been in and examined his firm and did not detect any fraud to allay investor fears. And apparently they bought it—it’s a government regulatory agency charged with protecting investors, of course they bought it.

According to the executive summary, “We also found that investors who may have been uncertain about whether to invest with Madoff were reassured by the fact that the SEC had investigated and/or examined Madoff, or entities that did business with Madoff, and found no evidence of fraud.”

And even better, “Moreover, we found that Madoff proactively informed potential investors that the SEC had examined his operations. When potential investors expressed hesitation about investing with Madoff, he cited the prior SEC examinations to establish credibility and allay suspicions or investor doubts that may have arisen while due diligence was being conducted.”

So he was playing into the investor confidence in a government regulatory agency to do its job and its due diligence. The summary continues, “Thus, the fact the SEC had conducted examinations and investigations and did not detect the fraud, lent credibility to Madoff’s operations and had the effect of encouraging additional individuals and entities to invest with him.”

As feeder funds are being shredded to bits in the press and by investors for not doing their due diligence it will be interesting to see how the SEC fares after this revelation. Lawsuits are popping up left and right against these feeder funds. Even the state of Massachusetts is suing one of the biggest feeder funds, Fairfield Greenwich Advisors, for fraud.

It seems the SEC did not do its due diligence either and investors were the victims. Now it’s out in the open. Could there be other repercussions for the agency?

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Wedbush's Bell On Sponsored Access: Put the Risk Controls Everywhere

Sep 1, 2009 @ 10:21 AM By Ivy Schmerken,

With the practice of sponsored access — and naked access — coming under scrutiny from the SEC, there are several theories emerging as to what are the best ways to manage the risk and compliance of high frequency trading firms gaining direct access to market centers.

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