citadel and the fed

"something's only worth what you can sell it for" ..didn't they tell u that in orientation?

MTM should henceforth be Mark To Size @ Bid. If you don't have or can't identify an executable bid, it has no value.

make the entire order book transparent. the fed, treasury, banks, funds, even lowly daytraders etc... all participants quote in the same centralized, fully transparent 24/7/365 order book. list and clear everything

whatcha think guys? sounds fair to me

 

Let's just say that I ain't the same dumbass that I used to be because we all know who the real dumass is (or are).

 

Hindsight is 20/20, asshole. And what do you think would happen to stock prices if all these hedge funds dumped their multi billion dollar portfolios on the market before the crash? The crash would have been WORSE! Go back to playing Warcraft in your parent's basement.

 

That's right, I helped cause the financial meltdown with all of my predatory lending practices. I admit that I lent my nephew $10 last year and made him pay me back $1 in interest.

Now I KNOW you're mentally unstable. Go back to churning the ES with your 1 contract, you big swinging dick you.

 

The New York Times
October 27, 2008
Breakingviews.com
Citadel Projects Calm; Call to Merge the Regulators
Projecting Calm Amid the Chaos

Citadel, the hedge fund in Chicago run by the wunderkind Kenneth C. Griffin, has found just how hard it is to calm investors during these troubled times.

Attacks that claim problems concerning forced sales, liquidity troubles and regulatory crackdowns make it hard to do business. But responding to such charges is also risky.

Mr. Griffin’s decision to hold a surprise conference call late Friday afternoon when the markets were in a free fall was a big gamble. The announcement itself set off a slight panic, and the call had to be delayed as Wall Street’s global hordes swamped the lines as they tried to dial in.

But the real risk is that, after the failed attempts by Bear Stearns and Lehman Brothers to tamp down rumors about them, lenders and counterparties might not have bought Mr. Griffin’s story.

Whether they have is hard to tell. Citadel isn’t a public company and has only a sliver of bonds that rarely change hands. It’s also hard to find credit-default swap prices on Citadel that are a reliable gauge of its health.

That’s a great advantage to the firm — counterparties that may be nervous about the firm’s performance won’t be scared off by a sinking stock price or a drop in the value of credit-default swaps.

Mr. Griffin and the firm’s chief operating officer, Gerald Beeson, delivered a strong case for calm. Its flagship Kensington fund is down 35 percent because the cash markets crashed harder than their hedges rose in the weeks after Lehman’s demise.

But they said that Citadel had more than 30 percent of its investment capital in cash or similar investments, $8 billion of undrawn credit capacity and no losses from counterparty exposures, which, they went to lengths to explain, were broadly diversified. Also, they expect just some investors to withdraw only a “few percent” of the fund’s investment capital at year end.

All this sounds fine. But in these fraught times, the medium can be more important than the message.

Investors and counterparties have been subjected to blatantly false sugar talk from bank boss after bank boss, and have paid the price with steep losses. Mr. Griffin may be the exception to that sorry rule, and Citadel may be as rock-solid as its name implies. But by sticking his head over the parapet in such an unexpected way, he risked having it lopped off by disgruntled investors and counterparties.

 

Major banks ask Citadel to post more collateral: report
Fri Nov 7, 2008 8:19am EST
(Reuters) - Ken Griffin's Citadel Investment Group is being asked by several major banks to post additional collateral to cover big losses on its investments, the Wall Street Journal said, citing people familiar with the situation.

Citadel has fallen nearly 40 percent this year, prompting the firm to hold conversations with lenders including Goldman Sachs Group Inc (GS.N: Quote, Profile, Research, Stock Buzz) Deutsche Bank AG (DBKGn.DE: Quote, Profile, Research, Stock Buzz) and Merrill Lynch & Co (MER.N: Quote, Profile, Research, Stock Buzz) that finance its trades, the paper said.

Citadel executives said the calls for more cash are a normal part of business when securities they hold fall in value and emphasized that they have significant amounts of cash to satisfy their lenders, according to the paper.

The executives said they have met all the demands for collateral, according to the paper.

Citadel, one of the biggest hedge funds, manages roughly $18 billion. The firm's main Kensington and Wellington funds have lost 35 percent this year.

Citadel could not be immediately reached for comment by Reuters.

(Reporting by Ajay Kamalakaran in Bangalore; Editing by David Cowell)

 

I think they were worried too much their views would trigger a sell-off, so they kept it for themselves.

They had too many people to look after, to sell their position without starting the rumour mills.

Also, some of them have geopolitical reasons.

They are scared of china taking over (so they kept amassing money in case china would invade afghanistan..i guess) or they didn't want their new partners in the chinese government to suffer too much..so they waited until the last minute.

Anyway, it is not stupidity..it is spending dependance.

It is driven by something much more complicated than the superficial stupidity they showned.

That is why it is worrying.