Frankfurt, May 1st, 2010

Warren Buffett, not surprisingly, is siding with Lloyd Blankfein in Goldman Sachs’ trial before the Senate in the SEC civil suit against the bank. With his company Berkshire Hathaway earning $500m in annual dividends from its $5bn stake in the investment bank, what’s not to like about his partnership with the titans of Wall Street?  Besides, as he said last week at his annual shindig in Nebraska, he would never assume to second-guess what investors on the other side of a trade he was involved in were thinking.  “They could very well be shorting a product, they do not owe us a divulgence of their position more than any reason why we need to explain what we are doing with our position.”

The Sage of Omaha is perhaps being a touch disingenuous, given his stake in the outcome and in the alleged perpetrator.  However, as a trader, he’s fully aware that moral compunctions have no place in the decision as to WHEN to enter or exit the trade.  We suspect that his views might be a little more tempered if he was paying advisory fees to the bank, presumably to act on his behalf, only to have them trade against him.

In the decisive moments of the trial, Continue Reading

This year’s MIPIM was good fun, as always. Nearly anybody we wanted to talk to was there, and most seemed to have time for a chat. We found the pace of the fair agreeable, and highly hospitable in a manner much less frenetic than in earlier years. We attended a wide range of pre-selected events, had plenty of our own appointments, and there still seemed to be enough time for spontaneous, unplanned gatherings, leading to new faces and ideas. Call it serendipity if you wish  - we always associate it with Cannes, and it was there in plenty this year.

Even the entertainment was low-key, in keeping with the buttoned-down tenor of the industry these days. Only the lawyers seemed to have no qualms about making a late-night splash on their harbour-side motor yachts, or in Cannes’ better class of hotel – but then, it’s good to be the winners, whether the market is leveraging up, or trying to negotiate its way out of a lost cause. Somebody has to salvage the MIPIM’s reputation as a glamour event, after all – now that the Russians no longer appear quite so keen to entertain all and sundry, and Europe’s now-nationalised banks have to be seen to be acting suitably chastened. Continue Reading