US Weighs Summer Sale Of GM Stock (WSJ)
To break even, the U.S. Treasury would need to sell its remaining stake—about 500 million shares—at $53 apiece. GM closed off 27 cents a share at $29.97 in 4 p.m. trading Monday on the New York Stock Exchange, hitting a new low since its $33-a-share November initial public offering. “Planning for the sale of our remaining GM stock is still at an early stage, and the IPO lock-up does not expire until late May,” a Treasury spokesperson said. “At that point, we will consider all of our options, based on our twin goals of protecting taxpayers’ interests and exiting as soon as practicable.”

Obama administration officials tried to keep S&P rating at ‘stable’ (WP)
Treasury officials told S&P analysts that they were underestimating the ability of politicians in Washington to fashion a compromise to curb deficits, a Treasury official said. They argued a change in ratings was not needed at this time because the debt was manageable and the administration had a viable plan in the works, the official said.

IMF’s Blanchard Says US Lacks Deficit Plan (Reuters)
“There are reasons to be worried. The United States lacks a credible plan, for the medium term, to reduce its budget deficit,” Blanchard said.

Justice Department Seeks Data In Nasdaq-NYSE Anti-Trust Review (Bloomberg)
Antitrust review is emerging as a key test in the battle for the 219-year-old market, which Nasdaq OMX Chief Executive Officer Robert Greifeld tried to snatch away from Deutsche Boerse with an $11.3 billion offer on April 1. Giving Nasdaq control would create a monopoly in listings, a prospect that may create undue risk the takeover will be blocked, according to NYSE CEO Duncan Niederauer.

Congress Mulls Budget Deal Forcing More Taxes, Spending Cuts (Bloomberg)
Proposals being circulated among the bipartisan “Gang of Six” Senate negotiators, and about 20 other lawmakers in both chambers, would set deficit-cutting targets, according to people familiar with the plan. They would impose automatic, across-the- board spending reductions and higher taxes if Congress failed to meet the goals.

Freshman Republican’s bind: Vote convictions or help economy by rising debt limit? (WaPo)
“I desperately want to vote ‘no,’ ” Rep. David Schweikert said at the town hall. “I also desperately don’t want [the economy] to crash.”

Bank of America Merrill Lynch to Exit Private Equity Business (CNBC)
The unit, BAML Capital, has not been particularly active in recent months, having made its last investment in the fall of 2010. Bank of America, under pressure to conserve capital, has apparently decided it could no longer provide capital to the unit, which has roughly 35 professionals. A Bank of America spokesperson said BAML Capital is being spun off, and will be run by the current management team. The team will continue to manage the $5 billion in assets owned by BofA. Those assets will remain on the bank’s books, with expecations they will be monetized.

London Skyscraper Boom Ends as City Goes ‘From Vanity to Sanity’ (Bloomberg)
“The age of bling is over,” said Shuttleworth, who led the team at Norman Foster’s firm that designed the seven-year- old tower in the City of London financial district. He said it would never get off the ground today. “Money now drives everything, so if you can build something for half the price, you will,” he said.

Mubarak clinically depressed in hospital, officials say (NYP)
Doctors said the ousted leader spends all day in bed and is eating very little with his wife Suzanne by his side, the official added.

Facebook Seeks Friends In Beltway (WSJ)
Until lately, Facebook has spent very little money in Washington, even by Silicon Valley’s frugal standards. The company’s outlays on lobbying totaled $351,000 last year, federal records show. That’s a fraction of the amount spent by other technology giants, including Google Inc.’s $5.2 million and Microsoft Corp.’s $6.9 million. Facebook’s new Washington office, designed to look like a hacker’s lair, with walls of faux construction rubble, is a work in progress. People familiar with the company’s plans said talks to hire former Obama press secretary Robert Gibbs to guide the company’s communications strategy, including with Washington, have fallen apart in the wake of a leak to the media that made a deal for him to join the company sound imminent.

China Speed Yuan Push (WSJ)
A senior Hong Kong monetary official told The Wall Street Journal on Tuesday that China’s central bank is “actively considering” new rules that would make it easier to bring yuan funds raised offshore back onto the Chinese mainland.

Leader of Big Mortgage Lender Guilty of $2.9 Billion Fraud (NYT)
After more than a day of deliberations, a federal jury in Virginia found Lee B. Farkas, the former chairman of Taylor, Bean & Whitaker, guilty on 14 counts of securities, bank and wire fraud and conspiracy to commit fraud. Mr. Farkas, 58, faces decades in prison for his role in the $2.9 billion plot, which prosecutors say was one of the largest and longest bank fraud schemes in American history and led to the 2009 collapse of Colonial Bank.

Goldman Luster Fades On Revenue Worries (NYP)
“There’s a possibility that at least over the next six months the bank will have weak earnings,” said Rochdale Securities bank analyst Dick Bove, who cut the firm’s shares to “neutral” from “buy.”

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General Electric Co. refuted a statement claiming the company would return a “$3.2 billion tax refund” for 2010, following criticism of its tax rates and policies. “It is a hoax,” said Anne Eisele, a GE spokeswoman. The statement, which purported to be from GE Communications, claimed the Fairfield, Connecticut-based company was responding to a “public outcry” and would “allow the public to decide how to spend” the returned money. [Bloomberg]

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Obama Demands Budget Deal To Avert Government Shutdown (Bloomberg)
fter meeting with House Speaker John Boehner and Senate Majority Leader Harry Reid, Obama said issues remained unresolved and he hoped for a breakthrough that would prevent a shutdown, set to begin at midnight tonight. “I’m not yet prepared to express wild optimism but I think we are further along,” he told reporters. “My hope is, is that I’ll be able to announce to the American people sometime relatively early in the day that a shutdown has been averted.”

SEC May Relax Limits On Shares In Private Firms (WSJ)
According to the letter and people familiar with the matter, the likely changes would include raising from 499 the number of shareholders private companies can have without being required to open their books, and also making it easier for such companies to publicize share offerings.

Portugal To Face Strict EU Aid Terms Amid Political Storm (Bloomberg)
In an unprecedented intervention in national politics, euro-area finance ministers said Portugal can win relief by mid- May as long as it makes cuts that go beyond measures that failed to pass parliament in March and led to the government’s downfall.

EU Stress Tests To Examine 90 Banks, 5% Capital Pass Rate (Bloomberg)
“Make no mistake, 5 percent of Core Tier 1 is harder in comparison with last year,” James Babicz, head of risk at SAS, a business analytics company, said in telephone interview in London today. “But I think you have to look at how risky a bank is rather than look at a static capital threshold.”

Marc Faber: Gold Is Still Cheap Despite Record Surge (CNBC)
Faber rejected the notion that gold is in a bubble even as it begins to approach $1,500 an ounce. “If it were a bubble a lot of people would have gold. The whole world would be trading gold 24 hours a day,” he said. “But I don’t think it’s really a bubble. I think gold is maybe cheaper today than it was in 1999, when it was $252.

Why London Can Live Without Its Big Banks (Reuters)
“One or two of them might change their corporate headquarters for tax purposes but if they do go we probably won’t even notice. There won’t be a great outflow of workers and Canary Wharf won’t turn into a ghost town.”

Corporate Jets Often First Thing To Go After Leveraged Buyouts (Bloomberg)
Companies bought by private-equity firms are 32 percent less likely to have a jet in the three years after the deal closes than in the year before, according to a paper written by the Federal Reserve Board’s Jesse Edgerton. The study, published Jan. 21, found that jet fleets at LBO-backed companies are at least 40 percent smaller than at similar publicly traded firms.

Jefferies Expands (Breakingviews)
Jefferies’ lineup now includes municipal bonds and an enlarged investment bank. Staffing has increased by more than a third since the financial crisis struck. Now it’s adding commodities and futures, by buying Prudential Bache for $430 million. Jefferies is still far from joining the big boys. Net profit last year was just $280 million, far less than what Goldman harvested. There’s still scope to grow, however. New hires arguably have not yet settled in enough to crank out their full earnings potential. Shareholders appear to have baked in a better relative performance at Jefferies: the stock trades at about 1.7 times book value, double Morgan Stanley’s multiple and a third better than Goldman’s.

An Aggressive Fed? More Of Street Betting On It (Reuters)
The survey found that about a third of the economists, fund managers and strategists who responded to the survey see the Fed hiking interest rates this year, double the percentage from the March survey. About 27 percent believe the Fed will begin selling assets in the second half of 2011, to reduce the size of its portfolio, up from around 16 percent in the prior survey.

How To Pay No Taxes (BusinessWeek)
Some tips.

Asian Central Banks Intervene As Currencies Rise (WSJ)
Asian currencies rose against the dollar Friday, prompting a number of regional central banks to intervene, as the U.S. currency fell over that nation’s budget woes and a rise in the euro spurred the region’s currencies higher. The move follows Thursday’s rate increase by the European Central Bank, its first tightening since 2008. While the move was widely expected, it suggests world economic growth will continue to improve.

Speed Trading May Be Heading Out To Sea, Literally (CNBC)
In many cases, the best places to maximize chances of buying low in one place and selling high in another (for example between New York and London) were located in the world’s oceans. So could this be the end of traditional fixed stock exchanges in the world’s biggest cities and the rise of floating exchanges in the mid-Atlantic ocean? Wissner-Gross believes that floating trade centers could be a reality of the future.

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According to the PIMCO CEO: “Bill [Gross] and I–we do not consider ourselves elite. In fact, we’d like to be taxed more. I said this even before the Middle East started: It is not in the interest of any society for income inequality to keep on going up. It is in everybody’s interest to avoid the extremes.”

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Several months back, it came to light that Phil Falcone had loaned himself some $113 million from one of Harbinger’s funds to pay personal taxes. He didn’t tell anyone about it at the time because he hadn’t thought it was that big a deal but when investors finally heard about it in November, it turned out they were mighty pissed. Goldman and Blackstone pulled their entire investments from the flagship fund and even though they should’ve take the loan as a postive sign (Falcone pays his taxes! Not everyone does that!), a bunch of clients feared it was a harbinger of not very good moments to come (some where also miffed about the fact that the loan was taken from a fund in which redemptions had been suspended). We too were a bit worried and couldn’t help but going to the dark place in which Wilbur, the Falcone’s piano-playing pig was laid off, Lisa had to sell the crown jewels of her wardrobe (including The Gladiator, Mermaid Chic, and Slutty Peacock, and the couple’s bar-in-closet could no longer stock top shelf liquor. The whole thing was very stressful, so today’s news brings some sweet relief.

Philip Falcone recently rid himself of a headache when he paid off the balance of a controversial $113 million loan he had taken from his hedge fund, public records reveal. On March 11, lawyers for Falcone’s Harbinger Capital Partners filed a formal “termination” notice for the loan with the New York State Department of Corporations. The termination notice removes a lien the hedge fund had placed on some of Falcone’s assets at the time the loan was arranged in October 2009. Liens are terminated when a debt is paid.

Everyone can breathe a collective sigh of relief, especially Wil, who’s so happy about this news has said he’ll do some Bette Midler tonight, should anyone request it.

Falcone Pays Back Hedge Fund Loan [Reuters]

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A Goldman Unit Is Said To Have Rejected Facebook (Dealbook)
Goldman Sachs Capital Partners — a group that manages and invests for pensions, sovereign wealth funds and other prominent clients — was given the initial opportunity to invest $450 million in Facebook. But the unit’s chief, Richard A. Friedman, a longtime Goldman partner, decided the Facebook deal was not suitable for his clients, in part owing to the high valuation and to a mismatch with his investment criteria.

FrontPoint Partners Launches Biggest Fund Amid Probe (WSJ)
FrontPoint Partners LLC, the hedge-fund firm that was hit late last year by the government’s insider-trading investigation, completed its biggest launch ever on Thursday. The Greenwich, Conn., firm, run by Dan Waters and Mike Kelly, announced the final close for FrontPoint-SJC Direct Lending Fund LP with total commitments of more than $1 billion. The launch suggests the insider-trading probe hasn’t scared off all FrontPoint’s investors.

Paul Volcker To Step Down From White House Panel (Reuters)
The decision to leave the board was Volcker’s. A source close to him said he was ready to continue to advise Obama on an informal basis as often as the president would like.

LinkedIn Plans To Pursue An IPO (WSJ)
Unless Goldman wants to throw them $450 million.

Angry Witches Cast Spell To Protest Romanian Taxes (NPR)
Angry Romanian witches are using cat excrement and dead dogs to cast spells on the president and government who are forcing them to pay taxes. Also in the eye of the taxman are fortune tellers, who should have seen it coming. And President Traian Basescu isn’t laughing it off. In a country where superstition is mainstream, the president and his aides wear purple on Thursdays, allegedly to ward off evil spirits. A dozen witches will head to the Danube to put a hex on the government and hurl mandrake into the river “so evil will befall them,” said a witch named Alisia. She identified herself with one name, as is customary among witches.

Goldman Sachs May Sell, Hedge Facebook Stake Without Warning to Investors (Bloomberg)
In the last sentence of a one-page investment profile sent to private wealth clients, the firm explains: “GS Group may at any time further reduce its exposure to its investment in Facebook (through hedging arrangements, sales or otherwise), without notice to the fund or investors in the fund.”

Greece: No Problem Paying Debts (WSJ)
Papandreou also denied that Greece was engaged in talks to restructure its debt, despite lingering market concerns that the harsh austerity plan forced on Greece by its lenders will stifle growth and force it to restructure its debt. “There are no such talks. If we look at the fiscal consolidation, our reforms and the strong backing (of the European Financial Stability Facility) mechanism, we believe we will have no problem in paying back the debt to our private debtors,” he said on the sidelines of a conference of the future of capitalism in Paris.

Soros Mistrusts EU Aid as Irish Default Risk Soars (Bloomberg)
Assessing the aid plan, billionaire George Soros wrote in the Financial Times last month that the country will have to renegotiate the accord. Finance Minister Brian Lenihan said a default would “destroy” the country.

Obama Turns To Experienced Hands For New Staff (NYT)
William M. Daley, who was commerce secretary in the Clinton administration, visited the West Wing to meet with the president and other advisers for a final series of discussions about serving as chief of staff. He has told associates he would accept the job if an offer was extended, and officials said Mr. Obama was favoring him.

Dogfight Erupts In Plane Ticket Sales (WSJ)
In a retaliatory move against American Airlines, Sabre Holdings Corp., a middleman for many carriers’ seats, said it is raising the fees it charges American to distribute its fare information and sell its seats through thousands of travel agents. Sabre also said it will display American’s flights less prominently than rival airlines in its vast booking system.

Article courtesy of Dealbreaker

Onto the house!

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And in America, we don’t negotiate with terrorists! Except for when we do! [RCP]

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There’s a rule on Wall Street that says if banks are considering doing something a little outside the box, something that might rock the boat a bit, they wait for Goldman’s signal. Whether it’s sartorial choices (Zubaz), internal protocols (the initiation of a buddy system between the prime brokerage and prop desk in order to facilitate front running of clients), or grooming (shorn scrotums), everyone waits for Goldman to go first and they then follow.

In some cases, the rationale comes down to the fact that the other firms really want to go for it (Deutsche, for one, was pushing hard for the hairless balls, telling anyone who would listen that “there’s really nothing like it”) but realize that if there’s any blowback, Goldman Sachs is best equipped to take the heat (by telling those who criticize to go fuck themselves). In others, the move being considered may not be something management at other shops want to do at all; they hold out for as long as possible until Goldman has to screw by doing it, at which time the other firms must follow suit, lest their employees get jealous of, for instance, their GS counterparts’ newly aerodynamic sacks.

To that end, the Times reports that Wall Street is “discussing whether to move up their bonus payouts from next year to this month,” out of fear that “lawmakers will allow taxes to rise for the wealthiest Americans beginning next year.” Apparently executives “at two large banks said their companies tentatively decided not to speed payouts, unless Goldman did. Then, these two executives said, they would consider paying early as a competitive measure, so that their workers were not upset.”

Mind you, Goldman itself has not yet decided anything and it would be a bit crunched for time on coming up with the numbers if it did in fact decide to accelerate the bonus timetable, to say nothing of the fact that the same paper reported on the same day that it’s looking like the tax cuts will be extended (not just for those making up to $250,000 but higher-earners as well).

So, you know, what will happen remains a bit unclear. Also unclear: what’s going on in the article’s accompany photo:

“Goldman Sachs’s headquarters in Manhattan. Goldman often plans bonuses early, and the richness of its payouts sets the tone.”

Tax Fear May Move Bonuses Earlier [NYT]

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According to a filing, the investigations are looking at “particular investments and trading in securities of particular issuers,” and it’s unclear as to who is conducting the probe (or if it’s related to the inquiry the Securities and Exchange Commission reported last week). One thing, however, is clear.

Phil and the rest of the Falcones don’t need this shit– someone cut them a break! The guy’s fund is down a not insignificant amount, he can’t afford to pay his taxes without borrowing himself some money from investors, said investors are all over his ass about said loan and now regulators, the one group of people he thought he could count on to give him a little breathing room, are on his ass. Everyone is down in the dumps at Chez Falcone– in fact, the only thing getting the couple and their staff of Little People through these trying times is the nightly performances by Wilbur, the family’s singing and dancing pig. And who knows? The way things are going, as their most valuable asset, they might have to trade him, too.

This is a message: LEAVE PHIL ALONE!

Falcone’s Trading Investigated [Reuters]

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