Vanity Fair on BSC Collapse........

oke fine so it does that, and the stock goes up. Then when everyone start looking at the books and realized its cash reserve of $18 billion is now at $9billion for example after the stock buyback. Take a guess what will happen? yep stock falls right back down and bsc has even less cash reserve now.

Obviously this article is slightly biased towards bear stern, I mean the ceo(alan, not the bridge playing idiot) didnt do anything....he should be start raising cash very aggressively right at the beginning of the rumor. Lehman clearly learned from bsc.

We all know cnbc is just a bunch of talking heads that will say anything for headlines, so no big surprise there.

What i find most surprising is they actually named the hedge fund citadel and sacs as the possible attacker. I was expecting a few rogue small funds, not the 2 biggest and well respected funds on the street.

Also everyone was makning fun of lehman as cryingbaby for going to the feds about short sellers, based on this article it does seem they had a legitimate concern and did the right thing.

This is even better than the movie wall street, cant make this stuff up or can you....

 

Oh wow, now that is something of an understatement wouldn't you say??

 

Sorry fly, but I reviewed a bunch of your posts in this thread and I have to agree with Hydro on this one. You seem to be complaining about things that have been SOP on Wall Street since its inception. Were you under the impression that Wall Street is set up to do anything other than to enrich insiders? If so, how did you get that idea?

Isn't your job as a trader to be on the side of the smart money?

Maybe you lost money going long of BSC. If so, that's too bad but I know that as a trader, you didn't overexpose yourself.

 

Actually, I had puts. Legally. that's different. Legally, I mean.

http://www.deepcapture.com/vanity-fair-reports-greatest-financial-scandal-in-history/

Vanity Fair Reports “Greatest Financial Scandal in History”
June 30th, 2008 by Mark Mitchell
You read it here first. But if you don’t believe us, hear it from Vanity Fair instead.

In the magazine’s latest issue, released today, correspondent Byran Burrough reports that “More than a few veteran Wall Streeters believe an investigation by the Securities and Exchange Commission will uncover evidence that [investment bank Bear Stearns] was the victim of a gigantic “bear raid”—that is, a malicious attack brought by so-called short-sellers, the vultures of Wall Street, who make bets that a firm’s stock will go down.”

According to Vanity Fair, the SEC is investigating short-sellers who “employed a complex scheme to force a handful of major Wall Street firms to hold up trades with Bear, then leaked the news to the media, creating an artificial panic.”

People on Wall Street are calling this “the greatest financial scandal in history,” Vanity Fair reports.

The magazine argues, just as Deep Capture did a few days ago, that CNBC’s David Faber facilitated this scandal. The magazine describes Faber’s appalling interview with Bear Stearns CEO Alan Schwartz as follows:

Faber’s first question was a bombshell. He told Schwartz he had direct knowledge of a trader – a single trader – whose credit department had held up a trade with Bear Stearns, citing concerns about its health. At Bear, many executives gasped. It was a killer statement: Faber was saying, in essence, that Bear’s status as a trader, the basis of its business, was in question….only later did Faber say on-air the trade in question had finally gone through. But the damage had been done.

‘You knew right at that moment that Bear Stearns was dead, right at the moment he asked that question,’ a Wall Street trader of 40 years told me. ‘Once you raise that idea, that the firm can’t follow through on a trade, it’s over. Faber killed him. He just killed him.’
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All in all, this is a pretty good article. But it could have done more to describe the full scope of “the greatest financial scandal in history,” noting that this scandal has touched hundreds of other companies, and that its most worrying component, ignored by the financial press, is the sale of billions of dollars worth of phantom stock. More than 13 million shares of Bear Stearns stock that was sold on the day of Faber’s bombshell was not delivered on time – no doubt because the stock did not exist.

So who provided that bogus tip to Faber? Who sold all the phantom stock? Who killed Bear Stearns?

Further down, Vanity Fair reports:

According to one vague tale, initially picked up at Lehman Brothers, a group of hedge-fund managers actually celebrated Bear’s collapse at a breakfast that following Sunday morning and planned a similar assault on Lehman the next week. True or not, Bear executives repeated the story to the S.E.C., along with the names of the three firms it suspects were behind its demise. Two are hedge funds, Chicago-based Citadel, run by a trader named Ken Griffin, and SAC Capital Partners of Stamford, Connecticut, run by Steven Cohen. (A spokesman for SAC Capital said the firm “vehemently denies” any suggestion that it played a role in Bear’s demise. A Citadel spokeswoman said, “These claims have no merit.”)

I think it’s wrong to point a finger at Ken Griffin of Citadel. My initial reporting suggests that Griffin was not even short Bear Stearns. Also, Griffin’s rivals routinely throw his name around – usually when they are trying to distract attention from their own misdeeds.

It will be up to the SEC and DOJ to indentify the true culprits, but perhaps they could start by interviewing the hedge fund managers who were short Bear Stearns. These include Griffin rivals David Einhorn, Jim Chanos, Dan Loeb (who once vowed to go “to war” against Griffin), and, yes, Steve Cohen.

As described in “The Story of Deep Capture,” all of these hedge fund managers are in some way closely connected to CNBC’s Jim Cramer. They routinely conduct gang tackles on companies, employing the services of a small, but influential group of financial journalists, most of whom are also connected in some way to Jim Cramer – himself a former hedge fund manager.

One of these reporters is David Faber, who has been close to Cramer for over twenty years. A former employee of Cramer’s hedge fund has written a book that describes Cramer routinely feeding tips to Faber and then illegally trading ahead of Faber’s reports on CNBC.

Deep Capture reporter Patrick Byrne began describing the activities of the Cramer crowd of journalists and hedge fund managers more than three years ago. I began investigating them more than two years ago.

For that, we have both been labeled “conspiracy theorists.”

Now Bear Stearns is dead. Vanity Fair has written its own “conspiracy theory.” And the SEC and DOJ are on the case.

When people start going to jail, we will know who was right.

 

"Did Bear Stearns melt down — or was it murdered?"

There are some interesting Reader Comments in Deal Book in today's NYT Business Section today on the VF article.

For starters, no way they had 18B at the start of the week it looks like.

 

Fantastic article.

 

i was very surprised to see Barry Ritholtz chime in. He's too smart to have to resort to this sort of behavior, but, if you wanna side with them, have at it.

Why? I'll level the playing field. then, we'll see who has the talent. Another reference to how Loeb plays, and how he went from 500,000,000 bragging on the Elgindy chat, where he was a member to multi billions. Pure talent:

http://www.deepcapture.com/roger-and-me-insights-into-the-dark-world-of-stock-manipulation/

The rest of us are swimming upstream.

 

Why is that surprising? If anything it is expected.

All these firms and hedge funds are not friends, they are competitors & enemies. Sometimes direct and sometimes indirect. But if one of them shows a bit of weakness, the rest move in for the kill.

Bear Stearns showed weakness and stupidity with their subprime holdings. And they became prey for the sharks. I don't think even Goldman could survive that type of attack, but then messing with Goldman means dealing with the likes of Paulson and that type of power.

 

I wish it was made up. Much too serious. You must read, and involve yourself. There will be plenty of money to be made when this is breaks. But you can't be sloppy.

http://www.deepcapture.com/vanity-fair-reports-greatest-financial-scandal-in-history/

1. I think it’s wrong to point a finger at Ken Griffin of Citadel. My initial reporting suggests that Griffin was not even short Bear Stearns. Also, Griffin’s rivals routinely throw his name around – usually when they are trying to distract attention from their own misdeeds.

2. A recent post by Patrick Byrne on OSTK Investor Village actually call s out the miscreants saying, 'sue me'. He knows what he has, and he knows the other side will not risk discovery.
In response to msg 20256 by De Daumier-Smith (De Daumier - Smith is Judd Bagley, who was brought on by Patrick. Judd is a marvel at outing internet bashers.).

Recs: 19 Re: Latest from ASM (Anti-socialmedia.net)
Wow. That's wild. Judd is explicitly accusing people of taking part in illegal stock manipulation. Floyd, Michelle, Dan Loeb and other hedgies, and quite possibly, Roddy Boyd.

One cannot go around accusing a noted hedge fund manager like Dan Loeb of taking part in a crime, and not have them sue, right? He is, after all, a respected member of society in New York. There was a period where it seemed the NYTimes could not have a week go by without mentioning his new $45 million apartment. They should probably sue. Just so they can clear their good names, and all that.

Patrick Byrne

3. Look at the latest story on Lehman:
Lehman speculation blamed on short-sellers

By Ben White
Tuesday Jul 1 2008 16:20
Shares in Lehman Brothers (NYSE:LEH) , battered in recent days by rumours of an emergency sale, stabilised on Tuesday after several analysts said what Lehman executives have been saying privately for days: that the rumours are completely bogus.

The problem for Lehman is that similar rumours circulated about Bear Stearns (NYSE:BSC) in the weeks leading to the investment bank's collapse and emergency sale to JPMorgan Chase. Those rumours, mainly that the bank had run out of cash, were also untrue until they became a self-fulfilling prophecy.

People close to Lehman say the bank is now convinced that it is the target of an orchestrated campaign by short-sellers attempting to force it into sharing the same fate as befell Bear.

http://us.ft.com/ftgateway/superpage.ft?news_id=fto070120081728347865&referrer_id=yahoofinance

If you look closely, remembering that people were warned off rumor mongering financials, they appear to be doing it again. That's all it takes. The Feds will have to move, or bail out another financial. Paulson will not take kindly to this.

This is one time you don't need an inside tip to figure out which way the wind is blowing. It's all right here.

 

He just does not get it. Just one of those people .

Now if he wants to be a retard, that's fine. The problem is that his ridiculous mentality spreads and then the regulators move in, creating the illusion that they are "fixing" the system, while instead actually rigging it even more for the insiders, convoluting it with rules that cause more expenses & issues for the public. Basically doing more of the same that they have been since inception.

If you do not like how Wall Street works, don't get involved. There is nothing more concerning to the Wall Street elites than the public completely abstaining from their markets. Crying & complaining about it, while asking for help from regulators, only validates them.