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

We bumped into Danny DeVito a fortnight ago in Berlin.  The pocket-sized actor was in town for the Golden Camera awards, the German equivalent of the Oscars, where he was due to receive a well-deserved Lifetime Achievement accolade from his peers in the German movie business.

DeVito has been involved in numerous good movies as an actor, director and producer – but we’ll always remember his role as corporate raider and asset stripper Lawrence Garfield in the 1991 drama Other People’s Money.   Engaged in a battle for control of struggling New England Wire and Cable with ‘old school’ businessman Gregory Peck as the company’s patriarch, the high point of the movie is when DeVito as Larry the Liquidator persuades the reluctant shareholders to take his money and run.  Faced with the encroaching new technology of fibre optics and a share price in terminal decline, the shareholders finally succumb to Larry’s appeal to their pockets. “I’m not your best friend.  I’m your ONLY friend.   I’m making you money”, he explains to them. Continue Reading