$$$Trump: You thought he wouldn't have anything to say about Madonna and her Malawian baby. You thought wrong. [Trump Blog]

$$$Shake-up at Fortune [Valleywag]

$$$British banker and erstwhile DJ with joie de vivre seeks lady friend for "laughs smiles...adventures...spontaneous tickles and hugs." [Craigslist]

$$$Last minute Halloween options [Forbes]

NYSE: Westchester Co to Berumuda Int’l on its Gulfstream IV

(Wal-Mart Spawn) Jim Walton: Lethbridge to Grande Prairie (Alberta) on his Cessna Skylane

Donald Trump: Pease Int'l Tradeport to La Guardia on his Boeing 727-100

David Becker: Port Isabel Cameron Co to Austin Bergstrom Int’l on his Mooney M-20

[We've got our hands full with Wall Street Warriors, episodes 3-6, so you're going to have to fend for yourselves today, salacious and mud-slinging conspiracy theory-wise. Be good and we promise to give Becker the full planespotting treatment on Thursday. Be bad and we'll make sure your dreams are haunted by this guy.]

We’ve been reading about the death of newspapers for years, and the declining circulation numbers recently released have prompted a whole new round of pre-mortem elegies for ink and dead tree dailies. But there’s something odd about the whole “death of print” thing. For one thing—if the papers are really in so much trouble—why is private equity so hot after them?

The answer is probably that private equity understands that a lot of thinking at newspapers is hopelessly outdated. The New York Times has done a great job with their website but most of the real innovation was done by outside consultants. The consultants made the site work better. It was the Times folks who thought "Times Select" was a good idea.

The fact is that people who have built there lives and livelihoods thinking in terms of "ink by the barrel and paper by the ton," newstand sales and subscriber numbers might not be very good about thinking in terms of digital content delivery. We've met more than one newspaper editor who, quite frankly, just didn't get the web. In their hearts, a lot of these people think people are reading less newspapers because, well, they've become too dumb or lazy to read long, well-reported pieces. But there are plenty of people who do get the web, and we wouldn't be surprised if a few of these old-school newspaper companies get snapped up by private equity and end up blazing a path into better digital delivery.

Newspaper Circulation Falls Sharply [New York Times]

That’s the gist of today’s Wall Street Journal editorial discussing the pressure coming for tighter regulations on hedge funds from, well, just about anywhere you look. There’s Senator Charles Grassley’s letter to regulators looking for suggestions on how to regulate hedge funds. (Our bet is that they’ll somehow come up with a couple!) And Connecticut’s Attorney General Richard Blumenthal’s mini-Spitzerism. And the noise from Germany about putting global regulations in place. (Look for more of this if Barney Frank gets control of the House Finance Committee.)

You see, a regulated industry is an industry whose players need to make campaign donations in order to influence lawmakers. It’s a pretty simple formula: regulate an industry and you instantly politicize it. Which is another way of saying that you monetize the industry for politicians.

But it’s not all about wringing donations from hedge fund managers. There’s also corporate managers who are tired of getting those pesky shareholder letters from hedge fund types, and worried they could lose their jobs as hedge funds buy up their shares. And those folks have lots of money to spend on campaign donations, as well. It’s a win-win if you’re a politician.

All the other talk—about “systemic risk” or pension funds or low-liquidity real estate millionaires—is just the sound of a policy in search of a rationale. And that policy, of course, is the enrichment of politicians. That’s always the policy.

Targeting Hedge Funds [Wall Street Journal]

Some comments and emails to our Zwirn item below have prompted us to ask the time honored question: are strippers a reimbursable client expense? So have at it below and let us know.

Halloween may be the world’s worst holiday. First of all, if people are encouraged to wear costumes where you work, you know that cute girl from recruiting—the one with the still discernable Long Island accent—came in as a “sexy” something or other. Just keep your distance today and remember that sexual harassment laws apply even if she is dressed like a Hooker Cop.

Second, if you’ve got kids, you’re spending the evening trailing them around as they pick up the most loathsome candies imaginable. And then you’re going to spend the rest of the week trying to talk them down off the sugar high, and probably the rest of the year paying for the dental damage incurred.

Third, if you live south of Fourteenth Street in Manhattan, you’ve got that parade to deal with. Which means you won’t be able to get home without combating about ten thousand people who think cross-dressing is an original and daring achievement.

Finally, there are no good Wall Street themed costumes this year. Discernable visages such as Ivan Boesky and Michael Milken are dated. How do you dress like Amaranth or Backdating? Isn't natural gas invisible?

We guess you could do “A.J.” or “Lucy Gao” or “Aleksey Vayner” but those folks lack a certain, uhm, visual presence required for a good costume. Who can tell the difference between an Aleksey Vayner costume and that douchebag who hated Ralph Macchio in the Karate Kid?

What’s the October 31st translation of “Bah-Humbug” anyway?

In Business Week:

$$$ Is there an entrepreneurial gene? A group of experts provides us with very few answers on a question that's crossed all of our minds. [Is There a Gene for Business?]

$$$ A college degree can earn you up to $23,000 more per year than a high school diploma -- climbing interest rates on student loans and cutbacks in financial aid could put that number in the negatives.

$$$ This ain't is your grandpa's MySpace: social-networking for baby boomers. [MySpace for Baby Boomers]

$$$ A clear recipe for peace: loans, multinational banks and the developing world [What the Nobel Prize Means for Microcredits]

In Forbes

$$$ Former CEO Andrew J. McKelvey may be using his own site to seek employment opportunities (funny) following his resignation from Monster Worldwide in the wake of far-reaching options scandal. [Options Monster Claims a New Victim]

$$$ A big week for Merck, who bought out Sirna Therapeutics for $1 billion AND won FDA approval for its diabetes pill Januvia [Merck's $1 Billion Bet/Merck Starts Diabetes Race]

$$$ Also a big week for EMI, who will be losing publishing executive Martin Bandier AND licensing former actor Dean Martin's name, image and likeness. [Music Boss Bails Early/EMI to License Dean Martin's Name, Image]

In Fortune

$$$ When the well-fed can't leave 'good enough' alone: the fairly ridiculous rage of America's lower upper class. [Revolt of the Fairly Rich]

$$$ Steve Jobs says Negroponte's international One Laptop Per Child initiative, "looks like a science project." Negroponte's response: "Your company backdates" [This PC Wants to Save the World]

$$$ Murdoch to repay the $50,000 per month bill he incurred News Corp after he (and the SEC) decided it's a little inappropriate to make others pay your rent when you're a billionaire; investors are unmoved by the findings.

Things are not looking good for Wal-Mart, Forbes reports:

The discount giant announced over the weekend that its same-store sales for October grew by just 0.5%, the company's most anemic monthly growth rate since 2000. At the same time, a government report shows that consumers kept a firm grip on their wallets in September, boosting spending by just 0.1%, the smallest increase in ten months.

With the all-important holiday shopping season around the corner, major retailers are poised for their usual joust over consumer dollars. The battle may be more intense than usual this year, with high gas prices and a general economic slowdown pointing to a deceleration from the rate of spending growth in 2005.

Wall Street, meanwhile, is doing its best to handicap the upcoming slugfest, presenting investors with their best and worst bets on department stores, electronics sellers and specialty stores.

Merrill Lynch is already predicting a lackluster season for big-box discounters Wal-Mart Stores (nyse: WMT - news - people ) and Target (nyse: TGT - news - people ), whose sheer size makes it difficult to drive year-over-year sales.

We’re not much ones for passing moral judgment—pots/kettles, glass houses/stones having nothing to do with our abstention—but perhaps the ‘Mart should think about Karma and her predilection for being a bitch the next time it decides to take away stools from older cashiers in order to encourage them to quit and requiring workers—including those with young children—to be on call 24 hours a day. (Then again, those old people/damn kids probably had it coming).

Wal-Mart's Trailing The Pack [Forbes]

Another example of genius in reverse at a hedge fund came to light this morning, as the New York Post reported that D.B. Zwirn & Co, a Manhattan based $5 billiion loan-trading hedge fund, had held conference calls with investors to discuss internal financial controls. Apparently, a former finance executive with the fund “inappropriately expensed ‘items’”—although the fund declined to say what the items—cough, strippers*, cough—in question were.

*Yeah. That’s completely without basis. But we can always hope, right?

Hedge Fund Loot Riddle [New York Post]

When the word spread last week that IAC/Interactive Barry Diller is the highest paid chief executive in America—by some counts pulling down $295 million last year—it should have been clear that he expected IAC/Interactive to come up with some dynamite numbers this quarter. It’s pretty simple really. Diller was clearly cooperating with the reporters covering his pay package and there’s no way he would do this if his company wasn’t going to beat expectations this quarter. No one wants to be known as the highest paid executive of an underperforming company. We’ve got a word for that—“Bloodsucker.”

And now we’ve got a word for whatever the opposite of that is. And, like it or not, it’s BarryDiller.

IACI soars on earnings; Google buys a Wiki-maker [MarketWatch]

Another week, another hedge fund goes down. This time it’s a child of Salomon Brothers—Archeus, run by Gary K. Kilberg and Peter G. Hirsch. The official word is that whoever was running the books at the Manhattan based hedge fund screwed up, which prompted redemptions. Of course, having its main fund down almost 2% this year probably didn’t help.

The bottom line? Archeus went from $3 billion under management last year to around $700 million today. And everything’s getting redeemed back to investors at the end of the year.

A $700 Million Hedge Fund, Down From $3 Billion, Says It Will Close [New York Times]

The Swiss can’t catch a break. Last week rumors insisted that Credit Swiss had suffered bigger than reported losses from derivatives trading. As we mentioned briefly in the Opening Bell this morning, today UBS unveiled its third-quarter financials showing a 21 percent drop in profits, led largely downward by its proprietary trading unit which seems to have made some bad bets in the market for US Treasuries. As signs of a slowing economy led many to expect there would be no further rate increases from the Federal Reserve, Treasuries shot upward. UBS apparently found itself on the wrong side of the trades.

The proprietary trading units of investment banks--where banks trade on their own account--are the divisions that most make the banks look like hedge funds, so its no surprise to see that these things blow up like hedge funds occassionally do. Later this week Credit Suisse will unveil it's quarterly numbers, and so we should see whether the rumors of trading losses there are right.

UBS Reports 21% Decline in Profit on Trading Slump [Bloomberg]

One of the first great viral video sensations to hit the video sharing services were the various experiments mixing Diet Coke and Mentos to explosive effect. At one point the videos became so ubiquitous it seemed that everyone with a digital camera and a YouTube or Revver account had made one. The Wall Street Journal even ran a feature on the different corporate reactions to the videos (Mentos loved them; Coke didn't get it.) The pinnacle of this line of videos came from Fritz Grobe and Stephen Voltz, two men from Maine who created the stunning display shown in the video above.

Now comes word that Google has penned an agreement with Grobe and Voltz to share ad-revenue with them in exchange for hosting their video on Google video. The bet seems to be that viewers will follow the most popular content to whichever site hosts the videos. Thus the era of proprietary video sharing and possible profitability for the creators of online video content seems to have been born.

And, of course, the deep-pocketed Google probably doesn't mind creating any industry standards that will make video sharing more expensive for the host website, a move which will probably help stifle competition.

Google shares ad wealth with videographers [CNetNews.com]

Crime/Fraud/Legal/Investigations/Inquiries/Regulation:
SEC files civil fraud case against nine former Adelphi executives [Fraud]
Canadian court freezes assets of former Sun-Times publisher [Legal]
Pickens’s son pleads guilty to stock scam [Legal]
Former Treasury Secretary John Snow, now at Cerebus, criticizes push for hedge fund regulation [Regulation]
Investment boutiques snared in KPMG tax shelter case [Taxes]
Monster.com founder resigns [Stock options]

M&A: [? = not yet closed, problems with the deal, lingering questions, etc.]
Thelen Reid & Priest + Brown Raysman Millstein Felder & Steiner
Merck + Sirna
GE Thelen Reid & Priest + Trustreet Properties
CB Richard Ellis Group + Trammell Crow
Suez + Gaz de France
Sidestep + TravelPost.com

For Sale/ LBOs/ Going Private/ Auctions/ Offerings:
Buyers circle troubled newspapers [For sale?]
Bruckman Rosser Sherrill buys Logan’s Roadhouse [Sold]

People & Moves:
EMI’s chairman may have decided to leave because Warner Music merger talks unraveled [Resigned]
What Barry Diller’s Michael Jackson has been up to at IAC/Interactive [Profile]

Miscellaneous:
Bershire Hathaway buying up shares of Target and Johnson & Johnson [Investing]
Google inks deal with “Diet Coke & Mentos” video makers [Video]
Trader Monthly’s “Women in Trading” issue [Trading]
Morgan Stanley’s hedge fund moves [Hedge funds]
UBS reports drop in 3Q profits [Earnings]
RBC and Mingsheng Bank form joint venture fund management firm [China]
Hedge fund Archeus collapses [China]

Sponsored by Bloomberg.com

A Proposal for Federal Protection From Catastrophe Divides Insurers (NYT)
Watch out General Re and your Cayman Islands-based cohort, the federal government is increasingly getting into the re-insurance game. In a bid to protect themselves against catastrophic losses, many retail insurers are asking the government to guarantee aid in the event of major losses. This is flat out ridiculous. For one thing, the whole point of buying insurance is to insure against catastrophes, and the one risk in writing insurance isin too many catastrophes, or really large ones. Trying to take out the catastrophes pretty much negates the whole point of insurance. This is why we have reinsurance, so that insurers can by policies to protect them. Fortunately, not all insurers have their heads screwed on backwards. Some are noting that federal guarantees would have the effect of lowering premiums in disaster-prone areas (Hello FEMA), which will only lead to more enormous disaster and payouts. Bingo.

Kodak Posts Eighth Loss on Costs to Eliminate Jobs (Bloomberg)
Just to be clear, Kodak is still struggling to deal with the explosion of digital cameras. We've been hearing for years now about the aggressive restructuring going on at the world's largest photography company, and how it would leverage its brand into becoming an important player in digital photography. It was even on the cover of Barron's back in 2004, touting it as a turnaround play. Well, the company is still reporting quarterly losses, eight in a row now, and it lowered its outlook for next year. So any comeback looks like it'll have to wait awhile.

Morgan Stanley May Double Down on Hedge Funds (Dealbook)
It's always trouble when you start doubling down. You think to yourself, "Ok, I just had a string of bad natural gas trades, but if I double down, then eve one moderate win will make up for it". And then that fails, and then you double down again, looking for a big win, and so on, until you're busted. In the broader picture, it hasn't been a great year for hedge funds; many of the outsize returns we're used to seeing just haven't materialized. Nevertheless, Morgan Stanley is "doubling down" on the funds, taking stakes in them on a daily basis. The firm is close to buying hedge fund FrontPoint partners, which comes on the heels of taking a stake in Avenue Capital Group, which specializes in distressed debt. Eventually, one of these bets will come up big.

UBS profit drops; trading income falters (Marketwatch)
It's the season of discontent for any bank that has Suisse in their name. First, Credit Suisse may go skimpy on the bonuses this year due to big trading losses, and now UBS turns it some pretty weak numbers, again on trading losses. The company turned in earnings that were down 21%; the big culprit seems to have been a wrong bet on interest rates. It's instances like these which really make some of these banks look like hedge funds. One mistaken bet on interest rates led to a 21% decline? That's pretty crazy.

$$$The Natty Banker: Halloween’s Top 5 [Banker's Ball]

$$$35 y-o investment banker with "a lot of wine, beer, vodka in the fridge" seeks good looking gal to imbibe said drinks, etc [Craigslist]

$$$The Expense-Account I-Banker: How Much She Spent This Week [NYM]

It was kind of exciting that a bank and a banker won the Nobel Peace Prize this year. We thought we were being a bit mean spirited when we pointed out that we couldn't quite figure out what making tiny little loans had to do with peace. Turns out we weren't skeptical enough. As Richard Posner points out on the Becker-Posner Blog, microfinance is probably way overrated.

The evidence for the efficacy of microfinance in stimulating production and alleviating poverty is so far anecdotal rather than systematic. The idea of borrowing one's way out of poverty is passing strange. And I am unaware of any historical examples of nations that climbed out of poverty on the backs of small entrepreneurs financed by credit.

Microfinance and Third World Poverty and Development [Becker-Posner Blog]

Bess here, done with episode one and ready and raring to go with episode two. (And ready, dying, to get back to the first-person plural. I feel naked without it). If the first episode of Wall Street Warriors knocked your socks off, hold on to your pants, because episode two is like the A.D. to episode one’s B.C. WSW’s pièce de résistance. And why, pray tell? For two reasons. 1. Bob’s made it into the opening credits! And 2. Well, reason number two, is two words, friends. Reason number two is: TIM. SYKES. B’nai Mitzvah extraordinaire.

What's sadder? The fact that people still try the whole phony stock tip trick or the fact that it apparently still works.

The son of billionaire oil tycoon T. Boone Pickens pleaded guilty to securities fraud Monday, admitting his role in a scheme to inflate the stock value of three companies so he could make hundreds of thousands of dollars illegally.

Michael O. Pickens, 52, of Nocona, Texas, entered the plea in U.S. District Court in Manhattan after signing an agreement calling for him to be sentenced to as little as four years and nine months in prison or as much as five years and 11 months.

Judge Loretta A. Preska set sentencing for Jan. 30 after Pickens entered the plea to three charges of securities fraud.

Oh. Right. Trick question. What's really sad is drunkenly presumably) breaking into a fly-fishing shop.

Billionaire T. Boone Pickens' son pleads guilty in NYC [Associated Press]

But first, a postmortem on episode one. By now you’re likely asking yourselves a few questions—“why is DealBreaker covering the WSW pilot a week late”; “what is this, this Wall Street Warriors”; and “have you ever a been with a woman.” All excellent questions. First of all, we do things differently ‘round these parts. We don’t follow crowds, we don’t mindlessly adhere to standard protocol like a bunch of sheep, and we don’t always remember to request copies of shows before they air, thereby allowing other people to put in their two cents while we stand silently on the sidelines looking stupid quirky for our unorthodox take on the situation at hand (we also don’t subscribe to certain high resolution channels, but that’s neither here nor there). Second, if you don’t know what Wall Street Warriors is, we don’t even know where to get started with you—but in the interest of indoctrination, start by reading our Dear Diary entry: Tonight I went to the Wall Street Warriors party and it was all I dreamt it would be—and more. It won’t necessarily elucidate much, per the series, but it’ll do…something. Lastly, no, there’s never an appropriate time to ask that question. Don’t feel bad, we’re kind of with you on thinking that maybe now, given the political climate of us being in the vulnerable position of not having done something we should’ve done, um, what’s that a week ago (?) it’s sort as though we ‘owe you a freebie,’ so to speak, but yeah, no. Let us begin.

It only takes Vanessa Grigoriadis seven paragraphs before her New York Magazine piece on billionaires hits on one of our favorite subjects: sex-crazed rich dudes! More specifically, it's Jeffrey Epstein time again.

So what's Jeff been up to? Well, aparently not much has changed. It's still all work and massages.

To be a billionaire is to be radically free. You are your own galaxy. You make your own rules, hang out with the former president, send tourists to space. Billionaire investor Jeffrey Epstein, who lives in the largest dwelling in Manhattan, a 51,000-square-foot palace on 71st Street—though his business, naturally, is located on a 70-acre private island in the Virgin Islands—was humiliated this summer when his lifestyle was made public. Epstein was known to be a womanizer: He usually travels with three women, who are “strictly not of our class, darling,” says a friend. They serve his guests dinner on his private 727, and are also there for touching.

But it seems that he was also interested in younger women: Over the past few years, a then-17-year-old Olive Garden waitress, Haley Robson, brought at least five high-school girls between the ages of 14 and 16 over to Epstein’s house in Palm Beach to “massage” him, which meant watching him masturbate and even allegedly having sex. Epstein’s defense seems to be that he didn’t know the girls were minors, and that he is “very passionate about massage,” as one of his lawyers says.

Those who know Epstein say he’s unfazed by his travails. “He’s totally open about his life: His life is about making money and living an erotic life, and his escape isn’t alcohol or drugs—it’s sex,” says a friend. “I was talking to him the other day, and he said to me that he was doing well and working steadily—between massages.”

The rich really are different. And by different, we mean: pervy.

Billionaires Are Free [New York Magazine]

It's even Halloween themed!

The news that Google owned YouTube took down the ubiquitous Daily Show clips and other material from Comedy Central got a lot of play over the weekend. But, as TechTraderDaily noticed, it’s not at all clear that the purge is actually working. There are hundreds of Daily Show, Colbert Report and South Park clips still available on the site. So what’s going on?

One possibility, raised in this video, is that Googtube is only deleting videos that last longer than five minutes. Is there some maximum time for stolen videos? Comedy Central owner Viacom did not return our request for comment.

Okay. So this is totally true. Everyone says they are a contrarian-innovator. So do you trust the guy who says he follows the flock because that would be truly contrarian?

On Wall Street everybody says he's a contrarian, and nobody is. It is so hard to recognize the moment when you are caving to conventional behavior. I've seen over and again in my subjects - and there is greatness in this - a trigger that goes off in their mind, a switch that flips when they sense that everyone is going one way, and it's stupid. And they take pleasure in taking a bloody-minded stance against it.

Going beyond 'Moneyball' [Fortune]

Yeah. He’s still going to be running JPMorgan Chase when all is said and done but its got to be a headache to have to deal with another SEC investigation. This time it’s JPMorgan’s relationship with the Bysis group that’s caught the SEC’s attention. Bisys is the mutual fund administrator that’s paid millions in fines to the regulators. As it turns out, a fund owned by Bank One was mixed up with them, and JP Morgan inherited the problem when it picked up Bank One.

SEC investigation turns to J.P. Morgan Chase [New York TImes]

Having the best paid public relations guy is a bit like having the best paid lawyer--people start to wonder why you need such extravagent help. So pencil Goldman in on the dangerous help list. Last week the investment bank made Lucas Van Praag a partner, meaning he will likely be bringing down a salary of several million (after bonus). So next time we write, "Goldman Sachs could not be reached for comment" remember that Lucas is getting paid millions not to return our calls.

It’s check-in on your favorite white-collar criminal day at the New York Post, so be sure to read all about Steve Dunleavy’s day with former Tyco head Dennis Koslowski. The Koz is definitely not king in the Mid-State correctional facility. His wife has only visited him once—to deliver the message that she wanted a divorce. Ouch.

On Her First Visit [New York Post]

Crime/Fraud/Legal/Investigations/Inquiries/Regulation:
Options timing as tax cheating [Taxes]

For Sale/ LBOs/ Going Private/ Auctions/ Offerings:
Tribune attracts buyers [For sale]

Miscellaneous:
YouTube taking down lots of videos [Video]
Bond trading [Bonds]

Sponsored by Bloomberg.com

Yahoo's Dilemma: Deal Or No Deal (CNNMoney)
Yahoo's been getting some bad advice from the media. Everybody knows that it's in danger of seriously falling behind Google in the internet wars, and that it needs something to jumpstart its growth again. Unfortunately, as it puts its ears to the track, all it hears is people talking about how it needs to buy out this or that company. Sorry, but a buyout of some piddly hot startup, even a decent-size hot startup isn't really going to change things for the company -- and they know it. Now it's being reported that the company recently held discussions, or tried to hold them, about a possible buyout of AOL. Now on what planet is the key to reviving a dying brand buyout a dead brand? Other than the price tag, such a move wouldn't seem much smarter than the last time AOL got bought out.

Online gambling firms in £1.6bn merger talks (The Guardian)
Two major online gambling firms are considering a merger in the wake of the US' "ban" on online gambling. The companies, Party Gaming and 888, are two of the more well-known online casinos, and see a possible tie-up as a good way of coping with the hard times. Both companies have taken major hits in the wake of the new laws. The whole thing's funny, since research done by the Opening Bell indicates that it's not too hard to find plenty of sites that are willing to take your bets. Apparently these guys really like to play it by the book.

Sarbanes-Oxley Brings American Firms Record IPO Earnings Abroad (Bloomberg)
Several have decried that Sarbanes-Oxley has contributed to an increase in foreign-listed IPOs, as companies avoid the regulatory burden associated with being listed here. But at least one sector hasn't seemed to mind, our great banks. As companies list in places like Hong Kong and London's AIM, American investment banks have seen their foreign operations surge. The major banks will collect $1.3 billion more in fees from these IPOs than they have in any other year. There are a lot of stories these days about how the US and New York is losing its role as the center of global finance. Good to know that the words Goldman Sachs are spoken at all corners of the globe.

Dodging Taxes Is a New Stock Options Scheme (NYT)
As if stock options weren't eyed suspiciously enough, a new scandal may be brewing. Great. This time it involved changing the date on options to avoid having to pay income tax. In other word, not only were options used to guarantee a profit, but they may have also been used for tax fraud. So far, executives at Symbol and Mercury Interactive have been associated specifically with such schemes, and here comes the widening net. If this goes anywhere, it could prove serious. Confusing options practices that skirt the edges of the law are one thing, robbing Uncle SAM of his hard-earned tax dollars is quite another.

$$$Busty Jewish Girl Seeking Beautiful Brown Banker asks, "Do you hate all other people?" "Have you ever dreamed of Matzo Ball Vindalu?" [Craigslist]

$$$Murray's Hill: Episode 2 [Leveraged Sell-Out]

$$$Merrill's "nuts or sluts" defense. [Wall $treet Folly]

How bad have the losses from derivatives trading hurt Credit Suisse? That’s the question that is making the rounds at the Swiss bank, as hard working bankers fret that their year-end bonuses might be hurt.

You know all that from our item this morning. Now an additional source at Credit Suisse has told DealBreaker that if the bank reports worse than expected numbers with its third quarter financials—due next Thursday—some bankers will be dusting off their resumes in expectation of “getting fucked over” at bonus time. Credit Suisse’s equity-trading arm has lagged behind industry leaders like Goldman Sachs and Morgan Stanley for much of 2006, and at least one top executive has reportedly been ousted over the poor performance.

Keep in mind that what we’re reporting here are internal rumors at Credit Suisse, and it is entirely possible that these rumors lack any basis in reality. But we think our readers—and even the gnomes who run the Swiss bank—deserve to know what the folks in the New York office are talking about.

[Another disclaimer: When John Carney practiced law, Credit Suisse was a client of his law firm and he worked on more deals for them than he can count.]

[Photo explanation: That photo is "Switzerland beneath clouds seen from a plane" and meant to convey the impression that we're discussing rumors and loose talk flying around Credit Suisse.]

You’ll have to excuse the pictures/commentary from last night’s Trader Monthly party, as they may seem overly dismissive in their resentment. Perhaps that’s due to some residual anger we’re holding onto from being CARDED by the name checking girl at the door. Molière once said, “The greater the obstacle, the more glory in overcoming it.” Groucho Marx once said, “I, not events, have the power to make me happy or unhappy today. I can choose which it shall be.” And Jon Corzine, when asked during a debate with Doug Forester last November, if he though the drinking age should be lowered to 18, replied, “I think it is 18, isn’t it?” But none of those people were at event last night, and none had to suffer the great injustice of being asked to substantiate the fact that he/she was over 21. Honestly, that’s just tacky. (And we’ve been well over 21 for some time now, thankyouverymuch).

You’d think, after surveying the facts, we’d be right to simply upload our pictures, slap on a “You all suck” caption to each one and go on about our day. And you’d be right—we would be right to do just that. But we’ve decided that’s not going to happen, not today, not on this blog. We’re going to earn our keep one saccharinely sweet photo/accompanying blurb at a time. For two reasons: the first is that, once in the party, everyone was very nice, not once asking us to produce a birth certificate with the raised seal. And we don’t want to let our feelings for Chippy at the door affect our portrayal of the others. (Although, come to think of it, one did ask if we were “over eighteen.” Should we lump him and Door Wench together? Eh, questions best left unanswered. Besides, we’ve already captioned the pictures, and let’s be honest—you’re not going to put up much of a hissy fit either way). Secondly, we’ve decided by a vote of one to raise the level of discourse on this site. Let’s get started.

The New York Sun thinks that the allegations made against Pequot Capital and Morgan Stanley chief John Mack have been getting a little too much ink from the New York Times. And they think they know why.

Mystified New Yorkers were left wondering what could possibly explain the Times's fascination with this story. Some might say it's Mr. Mack's connection to Mr. Bush, but it could just as easily be Mr. Mack's connection to Morgan Stanley. That is the bank that, earlier this year, withheld its proxy votes for members of the board of the New York Times Co. to protest the Sulzberger family's preferential voting status. A Morgan Stanley analyst complained at the time that the Times was underperforming as a business in large part because of the ossified management perpetuated by the ruling family's use of super-voting shares to control the Times despite a relatively puny stake in the Times company.

It's a scandal about the scandal! And just insanely paranoid enough to possibly be true!

‘A Full Airing' [New York Sun]

[Disclaimer: John Carney has written for the New York Sun and the Times, and he's friendly with a couple of the girls at both papers. Morgan Stanley was a client on several deals he worked on. He's never met John Mack or anyone named Sulzberger. George Bush won't return his phone calls.]

We're hearing vicious unconfirmed rumors that the new head of MTV [Ed.--as in the channel] will be Mika Salmi, who is currently the CEO of Atom Entertainment (a recent MTV acquisition).** This will probably be announced Monday. Mika's bio (from a random conference website left over from 2000):

Mika founded AtomFilms in September, 1998... Prior to launching AtomFilms, Mika was the Director of Business Development for Getty Images and PhotoDisc, Inc. where he was responsible for new business development, acquisitions, and strategic business partnerships. Prior to Getty, Mika was in charge of business development for the media and entertainment industries at RealNetworks. He also spent seven years in the music business in various international roles for both Sony and EMI, and has the distinction of discovering and signing two major artists: Nine Inch Nails and The Presidents of the USA. Mika graduated with honors and Phi Beta Kappa from the University of Wisconsin and earned his MBA from INSEAD in Fountainebleau, France.

UPDATE: In the "more passable" vein (fun!) Now we're told Salmi's promotion is a bit further down the chain. Salmi's heading MTV (the channel) but not MTV (the entire division). [Ed.--Less interesting! Boooooo!]

** If we're wrong, we'll eat our blog. Or something.

Mika Salmi: CEO, Atom Films [BusinessWeek]
Keynote Bio: Mika Salmi

Yaser Anwar's Q&A with Roger Ehrenberg of Monitor 110 and the former chief executive of Deutsche Bank Advisors:

Y: Even though trading desks account for majority of the revenue, the average trader still makes a lot less than an average investment banker, why this discrepancy when traders generate more revenue than investment bankers?

R: I don’t think this is a game of averages. Rock star traders make way more money than rock star bankers at Wall Street firms, much less hedge funds. I would argue that investment banking is actually “flatter” by its nature than trading, since it is possible to be a competent banker but not a star (and collect a healthy but not stratospheric paycheck) while this is really impossible in trading (merely competent traders don’t last long – they can lose you money fast).

Interview With Roger Ehrenberg, Former CEO of Deutsche Bank Advisors and Managing Director at Citigroup [Investment Ideas via DealBook]

At the Trump Vodka launch party, of course!

Drinking Vodka With Teetotaling Trump [NYM]

Sponsored by Chicago Board Options Exchange

James DePorre is the founder of SharkInvesting.com and the author of the forthcoming Invest Like a Shark. And he'd prefer you to call him RevShark.

In Bonfire of the Vanities, Sherman McCoy attempts to explain to his four-year-old daughter what he does for a living. How would you explain to a four-year-old what you do?
I've actually have had that conversation with my 5 year old daughter. I told her that what I do is buy and sell different kinds of money. I try to find money today that other people will want to buy in the future for a higher price.

How did you get your first job in finance?
I was an attorney and CPA with a practice in Ann Arbor, Michigan. I suddenly become completely deaf and stumbled into online trading as the internet became available to the average user. I've never worked for anyone else in the financial or investment field and am self taught. I now run a hedge fund, operate SharkInvesting.com and am a featured writer for RealMoney.com. My book “Invest Like a Shark” will be published next year by Prentice Hall.

Describe your trading strategy.
I focus primarily on small caps and use a momentum strategy. I’m primarily a technician with some fundamental considerations.

If you were starting out in your career now, where would you want to work?
In my home office overlooking the beach. I would be interested in working with a mega-billion dollar fund just to see how they operate but ultimately I will always work for myself.

What is your favorite career accomplishment/best trade ever?
The launching of Shark Asset Management last year was a major milestone for me. I've done well trading my own capital and this market is a transition into a whole new game. I am now attempting to grow and develop my abilities in something that is quite different than managing a personal portfolio. It has not been easy but I'm pleased with the progress and looking forward to continued evolution as a professional money manager.

Who are your heroes or role models, fictional or real?
I admire people who overcome adversity and difficulties. The true test of character is to overcome obstacles and to not let them drag you down. There are many people both famous and not so famous, like my father, who I admire for having done that.

What is the most important quality a trader should have?
Emotional balance. You can't get too excited when times are good or too depressed when they are bad. You are going to have ups and downs in this business and you have to take them in stride or they will doom you.
What is the worst character fault for a trader?
Impulsiveness and decision making based solely on emotions.

Tell us about the lowest of low points, the time you thought should just give it all up and take a simpler, easier job?
I have always been in the unusual position of having no choice but to be a trader. I'm deaf and couldn't get a job at a fast food restaurant let alone a well-paying job in another field. I have no choice but to be a trader which happens to work out very well because I love what I do. I had some struggles in my early going but one on my tenets has always been to protect my capital base beyond anything else and that has served me well.

What job would you have taken? What's your 'exit strategy'—how long until you retire or move on?
I don't foresee ever retiring from this business. The market and trading and writing is part of my life and I anticipate I will continue to do them all to some degree for as long as live and can hit the keys on my keyboard.

What is your motto?
My favorite quotation is by Calvin Coolidge: “Nothing in this world can take the place of persistence. Talent will not; nothing is more common than unsuccessful people with talent. Genius will not; unrewarded genius is almost a proverb.”

Whose teachings are more useful in your business—Machiavelli, Sun Tzu, Jesus Christ or Marquis de Sade? (Feel free to nominate another choice.)
I find the teachings of psychologist and philosopher, William James to be of great value to me. He offered many insights into behavior and thinking that I find quite valuable. Some of his observations include "A great many people think they are thinking when they are really rearranging their prejudices” and “the greatest discovery of my generation is that a human being can alter his life by altering his attitudes of mind.”

(If you missed the last installment, featuring independent trader Alexander Paul Morris, click here. And if you think you’d make a good subject, or want to nominate someone else, please email us at tips (at) dealbreaker (dot) com--subject line: “Better Know A Trader”).

One of our favorite hobby horses is finally getting a real ride. We’ve often pointed out that Gary Aguirre charges against the SEC, made under oath before a Senate committee, were very serious and deserved serious investigation. Now it seems that someone’s been listening. The New York Times reported this morning that Senate Finance chairman Charles Grassley has greenlighted an investigation into the SEC by the Government Accounting Office.

If you thought the SEC was full of dullish accounting mavens and lawyers, you haven’t seen anything yet. The GAO is like the special forces of super-nerds. Basically, as good as it gets when it comes to government accounting (which is almost an oxymoron).

So, yes, it is on.
S.E.C. Facing Wide Review of Practices [New York Times]

If you’ve read the transcripts or seen even a day of testimony of the government’s prosecution of an exchange floor trader, you know how complex these trials can be. Much of what goes on is an attempt to educate the jury about the habits and dialect of specialists, and some of it is so obscure that at least one judge announced that he had lost his way amidst the jargon.

So it was a bit surprising when the jury in the trial of Bank of America specialist Dave Finnerty came back with a verdict after just one day. Similar trials have seen juries spend days deliberating the charges. The guilty verdict in Finnerty’s trial came back so quickly that even the judge overseeing the case voiced concern.

Quick verdicts can cut both ways. They can mean that the defendant was really, really obviously guilty. Or they can mean the jury didn’t understand the charges or consider all the evidence. Now it’s up to an appeals court to decide which way this one went.

Trader Floored [New York Post]

DealBook has a simply brilliant piece today about the impact of Amaranth’s collapse on the cabbies of White Plains and Greenwich. When the hedge fund was roaring, cabbies could count on a regular stream of reverse commuters taking the $45 cab ride into the Connecticut back-country. These days, business is down. Way down.

And, of course, there are always vultures circling over the corpse.

...the taxis still carry some riders to Amaranth as well.

“Now I think we’re bringing lawyers,” Mr. Talley. “Helping to close the company, I think.”

Is it just mean that we assume the lawyers aren’t tipping the way the hedge fundsters did.

Amaranth’s Other Casualty: The Cabbies [DealBook]

Apparently Sharesleuth's investigations take a very, very long time. The last article was published in August. And now at the end of September we have a follow-up. This kind of delay is probably a good thing, since the website employs just one reporter and aims at accurate, investigative articles uncovering corporate fraud and misdeeds. But just how is Sharesleuth picking its targets? Gary Weiss points to one possibility--Mark Cuban's short portfolio.

When Mark Cuban's Sharesleuth insider-trading vehicle performed a hatchet job on a little company called Xethanol in early August, Cuban disclosed some unfinished business: he had taken a short position in not just Xethanol, but also a company called UTEK, a Xethanol shareholder.

The UTEK short position was "underwater," Cuban disclosed at the time.

Well, Sharesleuth's second article has come out, and it is about a company called (surprise surprise) UTEK!

Mark Cuban's Unfinished Business [GaryWeiss.com]

Employees of Swiss banking giant Credit Suisse are worried their bonuses might be affected by outsized losses the firm has suffered. A source within the bank confirmed to DealBreaker that gossip mongers within the firm are saying that losses from derivatives trading may be twice as high as the $120 million previously reported by Bloomberg. (The source denied, however, that the losses amount to $900 million, as suggested by a DealBreaker commenter).

The rumors have some bankers concerned that their year-end bonuses will be affected by the losses, the source said. Typically, bonus packages at investment banks are based, at least in part, on the overall performance of the institution. Large losses can reduce the money distributed to bankers at the end of the year.

Of course, all of this is unconfirmed. Credit Suisse could not immediately be reached for comment. But we eagerly await its response.

Once again, DealBreaker makes an appearance on WallStrip.

Sponsored by Bloomberg.com

Bank sues Tokyo exchange over 'fat finger' blunder (Times Online)
Remember last year's 'fat finger' error, when a trader at Japan's Mizuho securities inadvertently offered to sell 610,000 shares of a company at 1 yen, as opposed to 1 share of the company at 610,000 yen? It ended up costing the company 40 billion because it couldn't cancel the trade, and the entire trading staff went without bonuses that year. Well, it's now filing suit against the Tokyo Stock Exchange, since the exchange admitted early on that the mistake was partially their fault. The trade should have been cancellable. The real story, which the article notes, is that it's not a very Japan-like move. You don't hear much about lawsuits like that there. If it had happened here, sure. There'd have been lawsuits the next day, probably from like 15 different parties all claiming to be affected.

New-Home Prices Fall Sharply (NYT)
Continued weakness in the housing market prompted homebuilders to dramatically slash prices so as to reduce their inventory. In addition, they had to experiment with incentive programs as well, when lower prices weren't enough. In fact, builders aren't crazy about lowering prices, because it makes homeowners think they'll go lower, so incentives like "free upgrades" (!?) are becoming more common. It's beginning to sound like the US auto industry. Soon they'll be offering cash back, interest-free mortgages, and employee pricing. And once they go down that road, they won't be able to get out of it; even when things are strong, homebuyers will demand some modest cash back for their troubles.

Microsoft profit, revenue climb 11% (MarketWatch)
We just keep waiting for the other shoe to drop with Microsoft. Nobody believes it can really be a rapid grower anymore; instead its constantly on the defensive as new alternatives threaten take down many of its core businesses, that use to be virtual monopolies So, it's with some relief that the company managed to exceed expectations (on the back of good server sales), and guided positively going forward. Its only division that is actually growing rapidly is the XBOX, but the bast that can be said about it is that it's not losing as much money as it used to. Oh, and the company has some chintzy iPod knockoff coming out. Yeah, that'll sell.

New York Isn't the World's Undisputed Financial Capital (NYT)
The Times runs a scare piece today, throwing out the idea that perhaps New York isn't the center of the finance world like it used to be. We can't help but feel like we've read this story one too many times. Maybe it's just we've seen a lot of versions of it, like Silicon Valley is no longer the heart of technology, or the US dollar is no longer the world's currency of choice, or English is not the official language of business anymore. Granted, we'd expect that over time other cities became important. Yes, SarbanesOxley has thrown some more IPOs over to London. And two Chicago-based exchanges just merged, so now there's one big one over there. But neither of those things feels all that big or fundamental. On the other hand, complacency isn't a good thing, and if undue regulatory burdens are undue, well then they should be undone. Still, nothing we're worried about here, yet.

$$$Because we haven't posted a video in what feels like forever: yuppies. [Banker's Ball]

$$$Soros pays $24 mm for a home he already lives in. [W$F]

$$$Yet another, "but you'll have to fight Carney for her first":Pretty girl seeks banker with whom to drink whiskey. [Craigslist]

The word is that the first Paulson signed bills are rolling out into the streets soon.

So, we're going to have a contest. The first person who sends in a picture of himself or herself holding a Paulson twenty l wins drinks with DealBreaker's Bess Levin. The catch: the drinks have to be Manhattans. And we're pretty sure that after a couple of rounds, Bess will dish all the dirt she has on Paulson from her time working for Jon Corzine.

New Name on the Money: Henry, Not Hank [Forbes]

We’re not sure exactly what to make of this trend of investment rapping. First we had Mike Masdea creating his very own version of Eminem’s “Lose Yourself” to tout semi-conductor stocks. And now the team up at Canada’s National Post have gone an written an original hip-hop song, just in time for the Toronto Get Your Money Right Hip-Hop Summit on Financial Empowerment.

It’s not so bad, actually. We like the line about having “more shares than Sonny.” (Hint: Say it aloud and it makes sense.)

National Post investment rap [National Post]

Warren Buffett: Santa Monica Municipal to Centennial (Denver) on his Gulfstream IV

Drinks? Dinner? Tomorrow? 7:30?*

Donald Trump: John F Kennedy Int'l to Pease Int'l Tradeport on his Boeing 727-100

*In a room full of people, you're the only one we see.

Blackstone Group: Westchester Co to Edward Lawrence Logan Int'l on its Raytheon Hawker 800

*In a room full of people, you're the only one for me.
(But this does smell fishy)

[Editor's note: the opinion's expressed here are Bess's and Bess's only. I continue to hate Warren Buffett. --JC]

DealBreaker editor John Carney will be on CNBC's On The Money tonight at 7:40, discussing the new Goldman Sachs P.M.D.'s. Watch him/read him all at the same time-- meta!

Update: Well, looks like we've got the night off. Team OTM just emailed to say their dance card was all full for the night. So instead we'll be off stalking the new PMDs at happy hour tonight.

No. Not those Canadians. So far as we can tell, the Calgary team—a/k/a Brian Hunter—that made the trades that crashed the house of Amaranth has vanished without a trace. The folks we’re talking about this afternoon are the team led by Manos Vourkoutiotis, who has been at Amaranth for six years. Bloomberg reports that his team is going to be based in Toronto, working for Moore Capital.

Now a lot of Amaranth people have already found work at banks and other funds. But Vourkoutitotis is by far the most senior of the Amaranth staff to publicly land a new position. This is a good sign for other senior Amaranth folks, some of whom were reportedly worried that their reputations might be tainted by association with such a large failure.

Hedge fund Moore Capital Management said it will open an office in Canada with a new team of traders hired from Amaranth Advisors, the Greenwich, Connecticut firm that lost $6.6 billion last month on natural-gas trades.

Manos Vourkoutiotis, 37, managed Amaranth's Canadian debt, equity and derivatives portfolios for the last six years. He and his team of former Amaranth employees will be opening Moore Canada in Toronto, where they will trade a range of securities, including equities, convertible bonds and high-yield debt.

Moore Capital Hires Amaranth Team for New Canadian Office [Bloomberg]

Since yesterday's announcement of Goldman Sachs’s latest class of P.M.D.'s, we’ve found it all but impossible to log onto the internets without reading about how, for these 115 very special girls and boys, life “will never be the same.” Lots of “getting made” by the mafia references, being knighted by the Queen analogies, and so on and so forth. You know the drill. And we’re kind of torn on our feelings about all of this (the coverage, that is). On the one hand, it seems appropriate— recognizing the fact that these people have worked hard, that this is a “pretty big deal, etc, etc. And that’s nice, you know? Giving credit where credit’s due and all that. But on the other hand, we're jealous we feel as though this is all being sugar-coated a bit too much. Which is why we were heartened to read Duff McDonald’s take on the whole situation.

The truth is the new PMDs really can't hang around too long. The secret to keeping the Goldman brass ring so shiny is high turnover in their partnership ranks. There are only 287 current partners, 115 new ones were just announced, and there's a new partnership class every two years. They've got to get out, or the money gets disbursed too widely. So you get to keep your snout in the money trough for a half decade, and then you're shown the door if you haven't already left of your own accord.

A Possibly Bullshit Theory on the Cosmic Meaning of Goldman Partnerships [NYM]

Jamie Dimon can cross one line off the legendary list of “people who owe me stuff” that he reportedly keeps in his breast pocket. Back in 2004, when William Harrison was negotiating with Dimon to acquire Bank One, which Dimon then ran, Harrison reportedly promised to step down as chairman in 2006 and hand the spot over to Dimon. As we noted just moments ago, this morning news broke that Harrison will retire at the end of the year and is expected to be succeeded by Dimon.

It’s mostly a formality at this point. The board of JP Morgan is packed with Dimon’s allies, and the lieutenants of Dimon are already running the place, according to most reports. But the news that Harrison will retire confirms the consolidation of the levers of power at the bank under a senior management largely brought in from the outside following the acquisition of Bank One by JP Morgan. Many of these folks came with Dimon from Bank One or worked with him when he was at Citigroup.

Or, as a source inside JP Morgan put it in a phone call with us this morning, "Finally, the greasers beat the socs! Ponyboy would be proud."

Bloomberg reports that Bill Harrison will retire from his post as Chairman of JPMorgan by the end of the year and "and expects** to hand the title to Chief Executive Officer Jamie Dimon". Dimon will presumably continue doing what he's been doing for the last few years: running the company as if Harrison wasn't there. Harrison's further involvement with JPMorgan will be limited to impersonating a media-and-financial-services analyst from Goldman during analyst conference calls and making up for lost JPM membership revenue at Augusta National by spending as much time there as possible. We're not sure what Harrison's departing words will be, but we'd imagine it'll be something like this:

Well, all I'm saying is that I want to look back and say that I did I the best I could while I was stuck in this place. Had as much fun as I could while I was stuck in this place. Played as hard as I could while I was stuck in this place... Dogged as many girls as I could while I was stuck in this place.

JPMorgan Chairman to Retire; Dimon Likely Successor [Bloomberg]

“By any objective measure, Barry Diller is grossly overpaid,” said Jonathan Weil, managing director of Glass Lewis tells the New York Times today. The story is about Barry Diller, the highest paid executive in America.

Some say he's paid $85 million. Others say it's $295 million. So what's the real deal? Basically, Barry Diller is paid more money than anyone can count.

Diller Takes the Prize for Highest Paid [New York Times]

Apparently recently fired Viacom executive Tom Freston is still in that stage of the break-up. You know, the part where you keep saying how great a girl she was even though she just dumped you. You had so many good times together. You’ll totally always feel “passionate” about her.

Next stop is the Cole Bar in the St. Regis, and few too many cocktails. Next thing you know you’re partying with folks you barely know backstage at the Mercury lounge, coming on to actresses until their bodyguards put you back in your place and calling that bitch who dumped you a stupid slut.

Sorry. That might have been oversharing. But seriously, Tom, you’ve got to get over her. She’s moving on. Seeing other people. It’s kind of sad that you keep talking about how pretty she was. C'mon, Tom. Your romance is over.

Ousted CEO Freston still feels good about Viacom [Reuters]

Brock Fantasia is the only remaining person in the JPMorgan analyst class of 2002 to still work at JPMorgan, which is in no way testament to the work environment at JPMorgan. In fact, Brock likes to think of himself as the Highlander of his analyst class, wielding an indestructible claymore of corporate finance.

After “totally wrecking” (in his own words) the Analyst-to-Associate program in the M&A group, Brock was briefly moved to the Natural Resources group, due to increased deal flow in the M&A group. Brock graduated from the prestigious University of Pennsylvania Wharton with a degree in Finance and is working in investment banking until he can find a buy-side job. Brock has been interviewing for buy-side jobs throughout the past 3 years and has not been a “good fit” anywhere, despite his ever-burgeoning skill-set. [Editor's P.S.,- Some of this is true. But only some of it. Previous Ask Brocks are here. Send your questions to : brock AT dealbreaker DOT com]

We will, we will, Brock you! Brock here, ready to win this once again.

Many of you last Saturday may have noticed an especially large contingent of people rolling top down, models and bottles style, with arm candy and $200 drinks to spare, almost as if AJ was having a family reunion at every single club or bar in New York. By the fifth time you heard that Panjabi MC song without Jay-Z’s accompaniment, by the fourth Priya you put in your cell phone and by your 7th IPA, you started to wonder whether or not the Indians were reveling in the triumph of good over evil by getting extremely hammered.

As it turns out, Priya #3 was clean, and last Saturday was the Hindu festival of Diwali. The festival of Diwali is known as many things to many different people – Divali, Deepavali, Deepestvali, Taco Tuesday, Yom Kippur or Arbor Day, depending on which part of India or Murray Hill you are dealing with. Diwali is the 3rd day of a 5-day festival, signified by the new moon, for some sects the New Year and for many others, the time when the stretch of road on Lexington Avenue between 27th and 30th street, Curry Hill, stretches a little farther.

The stunningly high price of Berkshire Hathaway stock—now over $100,000—might make many companies consider a stock split. Investors like splits because they can make the equity trade easier. There’s a far more limited numbers of buyers for a stock priced at $100K than at $100. But Berkshire Hathaway has refused to split its stock despite the constraints this might put on the liquidity of the stock.

Today we learned why. CNBC’s Liz Claman spent six hours with Berkshire boss Warren Buffett yesterday, and the Oracle of Omaha revealed why the stock doesn’t split—his salary is directly tied to the price of the shares. His pay is based on the market price of the company’s shares, so any split would reduce his pay.

Of course, the company could always split adjust his pay, so this isn’t entirely a serious answer. But it demonstrates how a metric designed by bring management’s incentives in line with shareholder interests can have perverse effects. Linking executive pay to stock price seems like a good idea but here we see it acting to deny shareholders the value of a stock split.

Okay. Thanks to our well-informed and gossipy readers, we’re starting to fill in the details for a few of the new Goldman partners. Go team!

We've got some information on six of the newbies. That leaves 109 to go! And even on the folks we've been able to get something, there’s still a lot of information we need to know. (And, of course, even what we do “know” is more or less unconfirmed right now.) So keep your comments and emails coming. We’ll keep updating our new partner database as we go along.

Susan J. Scher—Capital markets, New York. Middlebury undergrad, MBA Columbia Business School (1991). Started at Salomon Brothers before business school, returned there afterwards. At Goldman since 1997. Better known as Susie. (Pictured left.)

Peter Comisar—Investment banking. Possibly based out of Los Angeles.

Jin Yong Cai—Goldman Sachs Asia. Hong Kong. Commenters view: “a jerk” with “good family background which comes in very handy for a firm like GS in cracking China deals.”

Richard A. Kimball Jr—New York. Son-in-law of Blackstone chairman Pete Peterson.

Tim Flynn—Co-head of European leveraged finance. London.

Simon Mansfield—head of European distressed debt trading. London.

Lucas van Praag is spokesman and head of Global Communications. Commenters view: van Praag “must be the best paid PR in the world!”

WallStrip keeps getting better. This morning’s episode was the best one yet.* Think The Office meets Thank You For Smoking.

* Best one not featuring DealBreaker, that is.

M&A: [? = not yet closed, problems with the deal, lingering questions, etc.]
Dewey Ballantine + Orrick, Herrington & Sutcliffe: ?

For Sale/ LBOs/ Going Private/ Auctions/ Offerings:
Clear Channel [For Sale?]
Altria closer to sale of Kraft [For Sale?]

[Apologies for the shortest Shorter DealBook ever. There seems to be some trouble over at the Times this morning.]

Sponsored by Bloomberg.com

Growing Funds Fuel Buyout Boom (WSJ)
News about private equity has become something of a bore lately. Record buyouts? Check. New fund breaks record? Check. Record annual bonuses.... etc. So, yeah, just to make sure we're not leaving out anything important, some private equity players have been raising some really massive funds lately, which means that the size of vulnerable companies is growing, which means we're probably going to see a record buyout fairly soon... and the cycle continues. And while we're round up the PE news, Yankee Candle is being taken private by Madison Dearborn for $1.4 billion. The firm says no store closures or layoffs are expected. What kind of deal is that? Also, it was revealed yesterday that Clear Channel is in talks with all of the usual suspects about being taken private.

Daimler Minus Chrysler = Pure Speculation (NYT)
Are all of the big mergers of the 90s bound to get unwound. Almost since the day it was completed, there's been talk that Time Warner may one day bid adieu to AOL, a partner it should never have gotten together with. And in recent days there's been more talk that Daimler and Chrysler would go back to just friends. At this point, there's no substance backing up the rumors, but management won't publicly rule the possibility out, which apparently is enough to stoke the flames, even though they'd pretty much have to say that. We assume that if they broke up, in the divorce proceedings, Daimler would get to keep Dr. Z., which would be rough on Chrysler.

SEC seen investigating 27 mutual fund firms (Reuters)
Stories about mutual funds always feel pretty quaint, seeing as nobody invests in mutual funds anymore. Index funds and ETFs, sure, but not mutual funds. Contributing to their plummeting caché, the SEC may investigate 27 mutual funds for improperly using money from the fund for marketing purposes. Whether there's a legal defense or not, it sounds seedy. See when the SEC investigates mutual funds, it just makes them look bad, whereas the hedge fund industry only looks cooler when regulators try to do their best to bring down the hammer on them. Even cooler is that when the SEC comes knocking, hedge funds just flip 'em the bird, and get away with it. So you can see why the money flows the way it does.

Oil Trades Above $61 a Barrel on Unexpected Drop in U.S. Supply (Bloomberg)
Is the cartel getting its house in order? Oil has moved back above $60, the first solid gain for the brown stuff since it started falling. Supply numbers came in surprisingly light, which is being attributed to some combination of higher US demand and lower supply from the Mideast (duh). But weren't the cuts basically just announced this last week? Do they really work through the system that quickly? Maybe it's just speculators again, driving the price of oil up, as they always do.

$$$B-school rankings: putting in your two cents. [Banker's Ball]

$$$"Busty blond saint seeking Wall Street Commando" has change of heart. [Wall $treet Folly]

$$$Defending the bull [Crossing Wall Street]

As it turns out, we’re not quite alone in lamenting the quasi-life sentence handed out to Jeff Skilling yesterday. Twenty-four years seems an awfully long time for what Skilling was convicted of to a lot of other folks as well.

• Larry Ribstein says “the lynch mentality that has surrounded Skilling and Lay is appalling” and notes that Skilling got “13 years longer than Al Capone.”

• Ellen Podger asks “If we are so intent on punishing the wrongdoer with heavy prison time, then how can we accept Andrew Fastow being sentenced to 6 years, or Scott Sullivan receiving 1/5 of the sentence received by Bernie Ebbers. It becomes clear that what we are really doing here is punishing individuals who exercise their right to a jury trial. And permitting the government to continue this practice is not proper.”

• Geoffrey Manne says: “…Skilling’s sentence is problematic not only because…it is probably disproportionate to the actual crime (which I take it is the point Dave wants to see the rest of us make about drug prosecutions), but also and primarily because the costs of excessive prosecution are so large.”

• And Christine Hurt explains why defending Jeff Skilling is hardly indefensible.

Wow. That’s a pretty smarty pants group of folks coming in on the DealBreaker tequila soaked Skilling Prison Blues side of things. Which is kind of scary. Usually when this many academic types start to agree with us we start wondering if we've got it wrong.

Today is the day. Goldman Sachs named 115 partnership managing directors, according to an internal memo obtained by Reuters and DealBook. (Hey, send us a copy!)

Partnership managing directors, or PMDs, get an increased base salary, the opportunity to invest in Goldman deals, a discount on Goldman stock purchases and a share in the partner compensation pool, among other perks. These latest PMDs join the firm's existing 287 partners.

Last year, the group received more than $2 billion in bonuses, about 20 percent of total compensation paid to some 25,000 employees. That works out to nearly $7 million per PMD on average.
And based on the $36 billion in revenue analysts expect Goldman to generate this year, the expanded pool of PMDs could receive nearly $9 million each.

There’s really no equivalent to anything else like a Goldman partnership in the modern business world. It’s almost archaic in the vast elevation of wealth and status it can bring to those who receive it. Some have compared it to the equivalent of getting “made” by the mafia. But that seriously underestimates what it means to be a Goldman partner. It’s more like being knighted on the battlefield by King Arthur, only this time the battlefield is the global financial market and the Holy Grail is, well, money.

After the jump, read the names of the 115.

[Bonus: If you know what any of these folks do at Goldman, send us an email or leave a note in the comments. It should be interesting to find out which groups at Goldman did well in terms of partnerships.]

Goldman names 115 partner managing directors [Reuters]

Ever think to yourself, "Hmm, I guess Bush was right this time." Yeah, neither do we. Until now. Yesterday Jorge told CNBC that he doesn't e-mail because, and this is paraphrasing, "it might end up the history books someday." Perhaps, in light of the now publicly searchable database of Enron e-mails, he should've imparted such wisdom on K. Lay, et al. Ah, well, hindsight. At least now we have something to do for the rest of the afternoon.

RE: Lunch
Email detailsFrom: To: sschroed@us.ca-indosuez.com , dgiron@enron.com , randy.g.kruger.jr@arthuranderson.com , mikeshaw@andrews-kurth.com , todd.w.taylor@bakernet.com Sent: 09/01/2002 at 16:36 Email metadataThemes:
--------------------------------------------------------------------------------
The messageEither week is good for me, but lunch is better.....I finished shredding weeks ago.
DG

-----Original Message-----
From: SSCHROED@us.ca-indosuez.com@ENRON
Sent: Wednesday, January 09, 2002 10:27 AM
To: dgiron@enron.com; randy.g.kruger.jr@arthuranderson.com; mikeshaw@andrews-kurth.com; todd.w.taylor@bakernet.com
Subject: Lunch

OK you slackers (excluding Shaw), I'll give you another chance to respond.
Lunch this week or next, let me know what's good. If meeting after work is
better for you, let me know. Certainly all of you can stop shredding
documents for 5 minutes to respond.

Schroeder

Enron Postscript: The Emails [WSJ]

Office Space is pretty high up there on our list of great movies. And, of course, Super Friends was one of our childhood addictions. It explains our passion for justice and leagues and halls and buckets of water. So this is pretty much the perfect thing to get us over the middle of the middle of the week. Yeah. We still feel like that somedays.

We just wish it included our favorite bit of dialogue from Office Space. The part where Peter tells Joanna that he’s not quitting his job. He’s just not going to go anymore. And he’s not going to pay his bills either.

Update: But just because we can't watch Superman tell Wonderwoman he's not going to his job anymore doesn't mean YouTube won't bring us the clip from the original film.

So who is the big shot who poinied up nearly $8 million for Hank Paulson’s Upper West Side digs? None other than another Goldman Sachs big, of course. The buyer was Goldman managing director Tony Lauto.

Like everything else that seems to take place in 2006, it’s also still 2003. Haunting that apartment and the sale are the ghosts of Dick Grasso, Eliot Spitzer and the New York Stock Exchange.

Despite a tremendous amount of interest in the old C.E.O.’s uptown-facing apartment, it was easy for Mr. Lauto to introduce himself. There was more, after all, than just Mr. Lauto’s current job at Goldman. His little brother happens to be John Lauto, the C.E.O. of Goldman’s stock specialist, Spear, Leeds & Kellogg, and a member of the New York Stock Exchange’s Director Candidate Recommendation Committee for 2006. Why might that matter? Before joining the Bush administration, Mr. Paulson was a NYSE board member who was loudly critical of former exchange chairman Richard Grasso’s compensation package. Goldman president John Thain was named as the stock exchange’s C.E.O. in December of 2003.

Hank Paulson Sells $8 M. Condo To a Well-Connected Banker [New York Observer via Wall$treetFolly]

Our friend Joe recently ordered a Bacardi and Diet Coke and felt, after what he believed was a disapproving look from the bartender, he needed to qualify the order with, “it’s for a chick.” While this may have been true—we can vouch for this, her name was Christine and she was well worth the blow to his masculinity—why did Joey think he had to make an excuse for wanting a little calorie-free soda with his rum? We couldn’t figure it out. Which was why we were somewhat drawn to Eric Felten’s article in the Wall Street Journal “He Drinks, She Drinks.”

Felten writes, “Girly drinks limit men and women both. Women get lulled into the habit of drinking cocktails that don’t taste like, well, drinks. And for men, it’s even worse: in their haste to avoid anything that smacks of the emasculating girly-drink taint, they deny themselves the great adventure of exploring cocktails and all their variety.” He recommends that “non-girly guys with a sweet tooth” drink Daiquiris,Old-Fashioneds and Smith and Wessons, while non-girly girls drink “female-friendly” beverages like Manhattans, Campari and Soda and Gimlets.

Carney, who only swills Jameson, thought this article was clearly a challenge posed on DealBreaker, and countered, “Challenge accepted,” passing the assignment on to his minions. Thus, we descended upon Bull Run at William and Wall Street last night.

Assembled there was our team of experts, including but not limited to, the ubiquitous Pete Murphy, Adam Rodman, Pat Harper and yours truly. These were our findings:

Yesterday’s guilty plea by the former chief financial officer of Comverse Technology may help shed some light on the government’s view of criminal liability for backdating stock options. David Kreinberg is the first executive to plead guilty to backdating charges.

When the backdating scandal first broke, many observers assumed that the government would focus its attention on executives who engaged in secretive self-dealing by granting themselves in the money stock options dated to appear as if they had been granted at an earlier date. In other words, many assumed criminal liability would arise from executives who had inflated their own compensation and while hiding the real value of their options from shareholders.

And many companies who have disclosed their own backdating practices have gone out of the way to point out that the individuals approving the stock options did not directly benefit from the grants. The most prominent case of this is probably Apple, which said its CEO, Steve Jobs, "did not receive or otherwise benefit from any of the improperly granted stock options."

But that’s not what the government is focused on in the Comverse backdating investigation.

Prosecutors claim the three men backdated stock option grants so employees could buy shares at low prices and make the maximum profit, prosecutors said. Stock options typically give an employee the right to buy a specified number of company shares at the market price on the option grant date.

Which means that federal prosecutors are not restricting their view of criminal liability for backdating to self-dealing executives. They are going after the Comverse executives for creating backdated options intended to address what Kreinberg calls “employee retention and recruitment challenges.”

Uhm, Steve Jobs, call your lawyer.

Comverse Ex-CFO Names Jacob Alexander in Guilty Plea [Bloomberg]

How much has the backdating scandal cost corporate America? In terms of resignations and firings, the cost has been steep, according to a report from the financial advisory firm Glass-Lewis. “The firm has said at least 44 executives and directors at 24 companies have been fired or resigned to date,” according to the San Jose Mercury News.

But that’s just people. How about what really matters?

According to the Mercury News, Glass-Lewis is claiming the scandal has cost at least 152 companies nationwide about $10.3 billion. But is it really that high? We’re not sure.

Glass-Lewis gets $10.3 billion by adding a decline of $5.1 billion in the backdating companies' market value to $5.2 billion in additional pre-tax compensation costs to the companies. It’s always troubling to calculate initial declines in market value as a “cost” of a particular event because share prices might bounce back once investors have had more time to analyze things. For instance, once it becomes clear that executives or board members at a particular won’t be going to jail for backdating, share prices might recover. Backdating creates additional uncertainty and risk but these might be temporary effects that can be resolved by public disclosure and internal investigations.

What’s more, there’s something fishy about the similarity of those two numbers—$5.1 billion and $5.2 billion. It looks to us like investors may have accurately discounted market value for the actual pre-tax compensation costs. Which would mean that there’s some double counting in adding these number together. Shouldn’t it be five and thus five and not five plus five?

Which pretty much sums up our impression of the entire backdating "scandal"— it's only about half as bad as it seems.

Study finds options scandal has cost companies billions [San Jose Mercury News]

Hedge fund managers lately have worried that their industry needs to burnish its image in the wake of recent high profile troubles such as the collapse of Amaranth and insider trading allegations at Pequot Capital. Even though the Amaranth meltdown demonstrated that even a large hedge fund could fail in an orderly way and an SEC investigation cleared Pequot of any wrongdoing, some managers worry that a public impression that hedge funds are dangerous and possibly nefarious is creating public pressure for regulation.

But maybe that’s not it at all. A recent study suggests that hedge funds might really be suffering from unrealistic expectations.

Research firm Morningstar Inc. polled 600 advisers in August and found that 65 percent of them expect more than double-digit growth in alternative investments, which include hedge funds; and 67 percent of them report that more than 10 percent of their clients are already using alternative investments.

Double digit growth forever! Hurrah! And maybe Greenwich has a “lake of stew and whiskey too, And you can paddle all around 'em in a big canoe.”

Or maybe not.

This year hedge funds returned roughly 7 percent in the first nine months of the year, lagging behind the average stock mutual fund, which is up roughly 8 percent and the broader Standard & Poor's stock average, which is up about 12 percent.

The last time hedge funds delivered double-digit returns was in 2003, when they were up nearly 20 percent, according to Hedge Fund Research data. In 2004 and 2005, they returned less than half that, gaining only about 9 percent each year.

Americans hope hedge funds can make them rich: poll [Reuters]

This morning Carl Icahn woke up for the first time as chairman of biotech drug maker ImClone Systems—a company with one product, falling sales, a rocky relationship with its marketing partner Bristol-Myers Squibb, no chief executive and a troubled history that involves insider trading, Martha Stewart and a founder serving a seven-year sentence in an upstate New York federal prison.

And, presumably, he woke up with a smile. This is exactly the situation Icahn has been struggling to create for the last few months, criticizing the companies choice of executives and threatening the board with a proxy fight for the election of directors. So is the fun part now over? We can’t help but suspect that for Carl Icahn, somewhere deep in his heart, it’s all the fun part.

Icahn Named ImClone Chairman; Profit Rises 85 Percent [Bloomberg]

Crime/Fraud/Legal/Investigations/Inquiries/Regulation:
Euopean judge calls for creation of merger court [legal]
French Senate approves merger plans for Gaz de France [legal]
The Chicago Board of Trade choses Mayer, Brown, Rowe & Maw over Jenner & Block for exchange merger [legal]
British law almost nixed Berkshire Hathaway-Lloyds deal [legal]

M&A: [? = not yet closed, problems with the deal, lingering questions, etc.]
Harrah’s + London Clubs: ?
Dubai Energy + Premier Oil: ?
Barrick Gold + NovaGold Resources: ?
Connetics + Stiefel Laboratories
Bellsouth + AT&T
Microsemi + PowerDsine
Mobius Pictures + ThinkFilm
BT Group + Counterpane Internet Security

For Sale/ LBOs/ Going Private/ Auctions/ Offerings:
Will Jack Welch buy the Boston Globe? [For Sale?]
U.S. insurance arm of Credit Suisse Group’s Winterthur [For Sale]
Digg [For Sale?]

Miscellaneous:
Financing glitch threatened Tata merger until Credit Suisse came to the rescue [Lending]
Goldman’s fulcrum investing [Distressed debt]

Sponsored by Bloomberg.com

Crude Oil Futures Rise for a Second Day on Colder U.S. Weather (Bloomberg)
We've heard from traders who trade heating oil futures that the price always jumps a little bit on the first day of snow. That may be apocryphal, for all we know (it'd be easy enough to go back and verify, with the data), but we suppose it could have some momentary and consistent psychological effect for one day. Apparently, energy prices also jump on the first day that you wonder if you should've warn a scarf. Maybe there are other one day events that people haven't realized yet. Does gold do well on the first sunny day of spring? Someone needs to start a hedge fund that just buys around these days, really leveraged of course, since the movements tend to be rather minimal.

Feds not expected to raise rates (AP)
At this point, a surprise rate hike, or even talk of a surprise rate hike would be a real suckerpunch to the market. And with the election coming up and all, the Fed will probably hold rates steady, using much the same language as last meeting (it seems to have worked). But that doesn't mean rate hikes aren't in the cards at some point. We can try wishing it away as much as we want, but there's enough of a lingering whiff of inflation to make your lunch taste weird. Last week, when the inflation indicators came out, steep declines in energy prices masked a core rate that was lurching forward.

Amazon Turns in a Smart Third Quarter (BusinessWeek)
It's been a rough quarter for many of the bellwether tech shares. And if there's one company that can always be counted on to disappoint shareholders, it's Amazon. But, lo and behold, it actually seems to have turned in solid results, at least the market thinks so judging by the 14% after-hours spike. The company report brisk summer sales, which it attributed to its fierce efforts to bring down prices and offer cheaper shipping. Analysts have always been leery about this strategy; "they're selling $1.00 for $.99", has been a commonly heard refrain about the company. At least for the moment, it's earned a reprieve from the sniping.

GM Net Loss Shrinks, Operating Profit Tops Forecasts (Bloomberg)
This year has seen a dramatic reversal of fortune between Ford and GM, at least in the eyes of the market. Earlier this week, we were treated to Ford's mounting losses and restatement warnings, while today, GM comes through with what appear to be tolerably poor numbers. It helps to have lowered expectations. The company benefited by plant closures, worker buyouts, and reduced healthcare costs. One thing the company hasn't done is boost sales, which is ultimately what it will take to turn things around. As long as Toyota keeps gobbling into the company's market share, it's not going to be able to get out of its decline. Initial moves on this front haven't been particularly inspired; the best thing that can be said is that it redesigned its Saturn Sky roadster. Ok, that's a start.

$$$The $440 cigar (too...weak...can't...make...homo...erotic...joke) [Wall $treet Folly]

$$$Goldman PMD's: The New Class [Banker's Ball]

$$$Handsome Irish banker seeking pretty girl to explore city, get hammered with. [Craiglist]

Warren Buffett: Teterboro to Santa Monica Municipal on his Gulfstream IV
No dead hookers! This trip is fine by us!*

*Warren. Warrie. (Can we call you Warrie?). Let’s chat. No need to be afraid, we promise. Really, we’re not going to say anything defamatory. Girl Scout’s honor and you know we’re telling the truth because we were once real live Girl Scouts (yeah, we were pretty awesome at peddling Thin Mints—the crack of cookies, honestly, those babies practically sell themselves—back in the day). Okay. Wow, this is harder than we thought it’d be. Seriously, we’re shaking. Does anyone have any Valium up in this bitch? No? It’s all gone? Honestly, whose turn was it to refill that prescription? Jesus, if we’re going to do one thing right, let’s do this, okay? (Sorry, it’s just something that we’ve had, like, a billion office meetings about and every time we say we’re going to implement a system and follow the system and we never do and it’s just kind of frustrating how something we’ve talked about a thousand times could be so flagrantly disregarded like that).

Anywho. So. You know how sometimes, in the past, so, so far in the past that it’s like, well, it’s kind of like it never happened, we’ve had some good natured jabs at your expense? Like, you know those, little jokes and stuff? You know what, let’s not even call them jokes how about something more fitting like, um, like ‘love pokes’? Yeah, that’s better. So, the love pokes—the loves poke, the love pokes, don’t make us say—ok, like saying you were going to hell, that you were trying to get people to think you were Jewish, that you were a smug little bitch, the way you just up and auctioned off your 2001 town car like you were too good for it or something, and a little high and mighty if you ask us for thinking that someone would want to buy that piece of crap just because it was yours, etc. What’s that? We didn’t write that about the car? Oh, well we definitely—you know what? Forget that last one, yeah, that was a mistake.

Anyhow. We'd like to take it all back. We got to work this morning and saw that your stock’s doing pretty well; mazel tov. And this has nothing to do with that but we just wanted to say we’re sorry about that stuff from before. Honestly, we don’t know what came over us. Actually, can we be honest? It was Carney. He’s been going through some personal problems (rehab) and for some reason (heroin) really laid into us about “writing as many hurtful things, even though you don’t want to, as possible about Warren Buffett.” But today we finally stood up to him and it feels great and we just wanted to share that with you. So, what do you say, water under the bridge? Because I think we should date (mate).

The kids over at Gawker have posted the latest Aleksey Vayner video on YouTube. This time he's battling with Deborah Norville. (And yes, this whole "one post leading to another" is spooking us out today too. This is a blog. We're not after narrative consistency here!).

The best part is that Aleksey says he is sticking by the video, and given a chance to go back and do it all over would have done it all over! Finally, he's starting to take our advice! Never learn from your mistakes, Aleksey. Stay golden!

And we can thank Karl Wellner for doing his small part. As the head of Papamarkou Asset Management, Karl specializing in providing private-banking-cum-concierge services to his wealthy clients—everything from money management to scoring hot theater tickets to introductions to elite social circles, according to a profile in today’s Wall Street Journal.

Just in case you haven’t been approached as a potential client, Papamarkou was set up by Alecko Papamarkou to cater to European royalty. Early on Papamarkou had made the wise decision to be college roommates with a business man savy enough to marry the sister of the King of Spain.

And Wellner isn’t just marketing himself and his firm to these types. He’s living the life himself, having wisely been born to a Swedish water skiing champ who sold industrial machinery who was himself the son of an Estonian industrialist. Oh, then there’s the whole, “I married Deborah Norville” thing that helps get him into the best parties.

Must be nice, that. Sure beats the whole “painful and demanding practice and hard work” thing any day.

A Money Manager to High Society Cultivates the Art of the Schmooze [Wall Street Journal]

Fortune didn’t return any of our phone calls this afternoon so we’re just going to go ahead and run this possibly false but not evidenced to the contrary statement: Geoffrey Colvin is full of shit.

According to Colvin, who penned “What It Takes To Be Great” for the mag’s “Excellence Issue,” the secret to greatness lies in—get this—“painful and demanding practice and hard work.” Holy shit! Someone should have told us this a long time ago. Dad always said it was “great legs and the third martini.”

The rogue journalist goes on to say that “You are not a born CEO or investor or chess grandmaster. You will achieve greatness only through an enormous amount of hard work over many years.” Right, and next you’re going to tell us Hanukah Harry was something our parents made up to exculpate themselves from getting us the inferior Barbie Dream House back in ’89 (“This is Harry’s doing, Bess, it’s out of our hands entirely!”). Stick with us because the man-who-makes- outrageous-and-downright-ridiculous-claims goes on:

In virtually every field of endeavor, most people learn quickly at first, then more slowly and then stop developing completely. Yet a few do improve for years and even decades, and go on to greatness.

The irresistible question - the "fundamental challenge" for researchers in this field, says the most prominent of them, professor K. Anders Ericsson of Florida State University - is, Why? How are certain people able to go on improving? The answers begin with consistent observations about great performers in many fields.

The first major conclusion is that nobody is great without work. It's nice to believe that if you find the field where you're naturally gifted, you'll be great from day one, but it doesn't happen. There's no evidence of high-level performance without experience or practice.

We suspect Colvin has some unresolved anger over not being being fast enough to coin his saying, damn it! 'there's no such thing as a free lunch,' but honestly, it's irresponsible and hate-fuckingly obvious articles like this that are giving business journalism a bad name.

Update: This article was, like, totally already written back in May by the Freakonomics folks Stephen J. Dubner and Steven D. Levitt.

Update Update: And, what’s more, to the extent there’s any non-obvious, controversial claim here, it’s probably wrong! Steve Sailer shot so many holes through it, it might as well be Dick Cheney’s hunting partner.

Our heads are still aching from drinking one (okay, three or four) too many margaritas in honor of Jeff Skilling, the guy at the helm when Enron hit the iceberg of its financial gambles who yesterday got hit with a sentence of 24-years or life (whichever comes first). So it is comforting this morning to know that it’s not just us tequila-quaffing kids who are skeptical about increasing the risk of criminal liability for American corporate executives.

U.S. Treasury Secretary Henry Paulson said he is considering recommending changes to the 2002 Sarbanes-Oxley corporate governance law because its restrictions have overwhelmed some American companies. While the "net result'' of stricter reporting standards for executives has been positive, Sarbanes-Oxley has also contributed to "an atmosphere that has made it more burdensome for companies to operate,'' Paulson said in an interview today from Washington.

"We're going to need to look at how we can address some of these issues,'' Paulson said. "This is something we're giving a lot of thought to.''

Paulson's comments come as business groups press the Bush administration to loosen the Sarbanes-Oxley restrictions. The U.S. Chamber of Commerce and other groups say the law stifles innovation and puts corporate officials, who must certify the accuracy of their financial results, at risk of prison terms.

"We as a country do as good a job as any nation of shining a light on a problem when a problem occurs,'' Paulson said in the interview. "Oftentimes the pendulum will swing too far.''

If he keeps this up, we're going to start feeling bad about the whole "tree-hugger" thing.


Paulson Says Sarbanes-Oxley Adds to Companies' Burden [Bloomberg]

Corrupting the young was one of the charges that got Socrates served hemlock. A day after Jeff Skilling received a 24 year sentence for his role in the destruction of Enron, Peter Cohan asks whether or not Harvard—Skilling was a Harvard Business School graduate—should bear some responsibility for its students misdeeds.

And it’s not just Skilling. As Cohan shows, Harvard had more ties to the Enron scandal than just its most famous convict. It’s a tangled web of personal and institutional connections—which is not exactly surprising. At one time, Enron was considered one of our most successful corporations. Of course, it would have ties to one of most prominent academic institutions.

Fortunately for Harvard, we’re not in the hemlock business anymore. Cohan prescribes some less lethal remedies.

Since so many business and government leaders attend Harvard on their rise to the top, Harvard should examine whether it could be doing more to screen its students for their ethical values and reinforce those values so that its name is not dragged through mud again by its connections to shady ethics at the top.

Enron's Harvard connections [Blogging Stocks]

Casey Serin’s story is being treated as a morality tale of greed and hubris gone wrong. Oh, and maybe a dash of stupidity thrown in. And no doubt there’s a fair amount of that. But reading the story, keep in mind that it was easy access to debt—helped along by a generous federal reserve—that financed this particular production of The Rise and Fall of the Speculator. And that this is just one version of a story being played out across America as the housing bubble deflates.

The rise and fall of Casey Serin is a tale with moral and financial lessons for real estate buyers, lenders and regulators. Having consumed real estate guides and seminars, Serin made just about every mistake a newbie could make — most of them, he admits, were no one's fault but his own — from fudging loan applications to buying homes sight-unseen. That he began with bold dreams of class mobility makes his fall a peculiarly American saga.

The best part about it is that Casey has a blog. This time around the bubble bursting will be blogged.

10 mistakes that made flipping a flop [USA Today]

Ever thought to yourself, ‘Man, I would love to know what the Donald likes to sink his teeth into,’ in a non ‘anything thirty years his junior, vaguely resembles his own daughter’ way? Yeah, neither have we. But the brass over at Buckhead Beef is hoping we’re not a statistically representative bunch, as it has recently entered into a licensing deal with the big guy that will put the Trump brand on its steaks. DT’s really going to have to bring his A-game on this one, as the partnership’s likely come about as a result of his 2004 bankruptcy filing, wherein The Don owes Buckhead $715,240. The insouciance with which he approached The Apprentice is certainly not going to fly out on the ranch.

Trump Steaks. Ehhh? [New York Inquirer via Gawker]

In Business Week:

$$$ Amercica's top B-Schools: Who made the list and why?

$$$ Putting a value on social networking sites: Are we on the tail-end of a Web 2.0 bubble?

$$$ High-tech disenfranchisement: Can we really trust untested electronic voting systems to minimize the error of casting and counting ballots?

$$$ Analog Devices Inc.: A godfather in stock option grant manipulation.

In Forbes:

$$$ Ex-Desperado Skilling awaits a possible 20-year sentence for orchestration of one of America's biggest financial scandals.

$$$ IBM and Amazon in a legal battle over web patent infrigements made by the online retailer.

$$$ Third quarter losses for Ford Motor reach $5.8 billion; "Unacceptable," says CEO Alan Mulally.

$$$ "Why Apple Won," and some more insight into the managerial genius that is Steve Jobs.

In Fortune:

$$$ Natural talent or good old-fashioned hard work? The secrets of "greatness."

$$$ Anwar Ibrahim's thoughts on corporate accountability in the developing world.

$$$ Backdoor options: Amercan Tower's own tactics for hiding above-average compensations for executives.

$$$ Wall Street has got it's eyes on cable market: Why Comcast, Liberty Global and Charter Communications are the hot stocks to watch.

Yet another member of the insider trading ring alleged led by David Pajcin and Eugene Plotkin has pleaded guilty. You remember this one right? It’s the plot where the plotters seemed to put together a “greatest hits” albumn of every insider trading scheme of the past three decades to hatch their own private world-wide conspiracy. All for a total gain of the awesome sum of, uhm, less than $7 million.

The latest plea comes from one of the most elaborate parts of the plot. Nickolaus Shuster actually moved to Wisconsin to take a job at the plant where Business Week is printed in order to pass information on to his co-conspirators. Business Week, of course, is one of the traditional go-to places for insider trading. Several times over the last few decades, people have been prosecuted for trading on information obtained from advanced copies of Business Week.

All told, though, the entire infiltration scheme seems only have resulted in the plotters making one trade on one stock, for a profit of what we’re told was less than $400,000.

Note to would be insider traders—this particular trick seems to have run its course. Just because some folks made money off it in the past, doesn’t mean it’s going to work for you. Or, as we say, past performance does not guarantee future results. Stealing Business week is officially over.

Printing plant worker admits to insider trading [Reuters]

Steve Sailer points us toward an entertaining interview between Comedy Central's Stephen Colbert and chemistry Nobel guy Peter Agre.

Colbert: "You said 'anyone who grew up on a farm knows that evolution exists'. Ok, are you saying a monkey can milk a cow?"

Agre: "Well, if I can milk a cow I suspect a monkey as smart as I am can milk a cow."

Colbert: "Are there monkeys as smart as you?"

Agre: "I'm sure there are quite a few, quite a few.

Colbert: "Oh really? mmhum. Do they give a Nobel prize for thowing your own faeces?"

Agre: "........That's the Economics prize, I think."

Okay. It’s not exactly an original point—but our president sure speaks strangley. Remember his line about “the internets?” It wasn’t just the odd sounding pluralization that made it so weird. It was the misplaced article—the “the” where none is usually used. Well, he’s at it again.

CNBC last night aired an interview with the president, and when asked about whether he uses Google the president replied: “One of the things I’ve used on the Google is to pull up maps.”

It’s not a big deal but it sure is weird. Where does this misplaced article come from? Is this some regional tick that we aren’t aware of or is it something else?

You can watch the video here (but only if you are running WIndows, of course, because they are hosted in some space that is partnered up with Microsoft).

Crime/Fraud/Legal/Investigations/Inquiries/Regulation:
Are private equity firms colluding? [legal]
Complaint filed against head of Deutsch Bank [legal]

M&A: [? = not yet closed, problems with the deal, lingering questions, etc.]
AT&T + Bellsouth: Held up by FCC tiebreaker recusal
Royal Dutch Shell + Shell Canada
Aer Lingus + Ryan Air
Developers Diversified Realty + Inland Retail Real Estate Trust
Alliance Atlantis Communications + CanWest Global
Oracle + MetaSolv Software
National Oilwell Varco + NQL Energy Services

For Sale/ LBOs/ Going Private/ Auctions/ Offerings:
Ford asset sale talks prompted by poor earnings [For Sale?]
Marsh & McLennan [For Sale?]
Premier Oil [For Sale]
Macquarie pulls London listing [Offering]
KBW, the parent of the financial-services boutique Keefe, Bruyette & Wood, pushes ahead with IPO plans [Offering]
Goldman pulled down $4 gains on China bank IPO [Offering]
Speaking of that China bank IPO: $22 billion [Offering]
Insurance IPOS [Offering]

Miscellaneous:
Berkshire Hathaway: $100K [Buffett]
Canada wondering why its always the bought and never the buyer [Canada]
Huge investment banking and legal fees from Inco deal [Deal costs]

Sponsored by Bloomberg.com

Shell bid may start rush for oil sands majors (Globe & Mail)
We saw yesterday that Shell would buy out the remaining 22% of Shell Canada that it didn't already own, but we didn't really appreciate the significance of that. That last chunk is no small amount, as Shell is coughing up over $7 billion for the stake. If the move is being properly understood, then the desire to consolidate it into the company is a sign of growing seriousness about the role that Canadian oil -- particularly Canadian oil sands -- will play for Shell. Some of the big oil sands companies -- many of which are independent trusts -- could be attractive acquisition candidates, particularly if falling oil prices causes investors to lose confidence in them. (By the way, that picture should clear up why they call it oil sands, and why it costs to much to refine it into something cool and drinkable.)

Canada Wonders Why It’s the Bought and Not the Buyer (NYT)
Why do we read so many stories like the one above? It's Canada that's seen billions upon billions of petro-Loonies flow into its boarders, and yet it's Canadian companies that keep getting acquired. Conventional wisdom would suggest that wealthy Canadian firms would like to snatch a bit of the US, if for no other reason than to boost its ego. We've been hearing the same thing about China too, that it's got so much cash it could buy out the entire Dow Jones 5 times over tomorrow if it wanted to. And yet it's always American companies buying into China, not the other way around, with the exception of Lenovo's purchase of IBM's PCs. Not sure what China's excuse is; pundits in Canada think that Canadian firms are just too cautious, noting that actual foreign investment is up, but that aggressive buyouts -- going all the way -- is beyond the strategic scope of many Canadian companies.

HBiPod (Cafe Hayek)
The iPod got a lot of attention yesterday for celebrating its fifth birthday. Raise your hand if you have iPod fatigue, by the way. But even if you've come to agree with the Opening Bell, that there's not an iota of coolness left in the iPod, you can still appreciate it as an economic achievement. In just 5 years, you can now buy 20-times the storage capacity of the original for $50 less. Pretty impressive, and pretty anti-inflationary. It's also evidence that supply is the mother of demand.

Biotech draws lion's share of shrinking venture dollars (Boston Globe)
For the most part, when you hear about venture capital it's tech or internet related. Some hot new startup sells out to Google and makes Sequoia, the famed VC firm, $1 billion over two years. But it's actually biotech that still draws more cash, which is good. Drug development and production is not a cheap proposition, unlike, say, building a web 2.0 community site for oenophiles. But maybe we don't hear about it as much because there's no consumer angle, and you don't have VC bloggers banging the drum, telling people to try the latest pancreatic cancer cure from one of their portfolio companies. And if a company don't have jack, it's not going to sell out for billions to Pfizer.

$$$Lloyd Grove doesn't want your filthy money.[Wall $treet Folly]

$$$Because we haven't met our video quota for the day: Aleksey on MSNBC [Gawker]

$$$Thursday night's A.J., today. [ibid]

The verdict is in! Jeff Skilling got sentenced to 24 years for his role in the Enron collapse. Certainly one of the harshest white collar crime sentences on record but short of the record-breaking number that some had predicted. In our reader poll, 13% picked 21 to 25 years for his sentence. Sixty-three percent of our readers who responded to the poll thought Skilling would get 20 years or less.

So why did our respondents think the sentence would be lighter? We suspect that twenty-four years strikes a lot of people involved in business and finance as extremely harsh for the crimes Skilling was convicted of. In any case, Jeff's probably had his last margarita for a long time. Don't worry Jeff, we'll order one for you at the bar tonight and then give it away to a stranger in your honor. Preferably a good looking stranger with post-modern moral views.

Former Enron CEO Skilling sentenced to 24 years [Associated Press in Seattle Times]

...it ain't easy.

Wall Street Warriors: Money, Stress, Kickboxing [DealBook]

Earlier: Party Crash: Wall Street Warriors

Hank Paulson got a pretty sweet leaving package when he stepped down from running Goldman Sachs to take the job as George Bush's Treasury Secretary. And now his move down to Washington, DC is looking even sweeter. Eight million dollars sweeter.

U.S. Treasury Secretary Henry Paulson, the former chief executive officer of Goldman Sachs Group Inc., sold his 50th floor condominium near Manhattan's Lincoln Center for almost $8 million, according to public records.

Paulson paid a total of $2.88 million for two apartments he bought and combined on West 67th Street, one in 1996 and the other in 1998. Tax on the re-sale was about $112,000, according to the New York City Register.

U.S. Treasury's Paulson Sells New York Condo for $8 Million [Bloomberg]

This is getting interesting! All the experts keep telling us the Skilling is probably looking at a very, very long sentence. Possibly more than twenty-five years. But so far in our reader poll, the DealBreaker readership is betting on a shorter sentence. Our of seventy-five votes, forty-eight votes have been cast for twenty years or less. So its all of us—DealBreakers’s writers, editors, sources and readers—against all of them. The sentence may be coming down any minute, so don’t wait to get your votes in.

Around this time last year, when Nancy Botwin wanted to increase sales from her marijuana peddling business, she was instructed by her accountant to open up a fake bakery as a front to legitimize her dealings to neighbors, friends, the DEA, et al. The bakery, Doug, explained, would put people off the trail, and she would be free to get as many housewives high as she wanted. Forbes explores a similar situation today:

Chief ethics and compliance officers have become trendy in recent years, but some experts fear they act mainly as window dressing. If one person is in charge of ethics, they argue, everyone else might think they're off the hook. "In a way, it's a job creation program," says Mary Ann Jorgenson, a partner in the law firm Squire, Sanders & Dempsey. "It's not great for every company. It's not necessary for every company."

Chief ethics officers started appearing in corporate hallways in 1991, when the Federal Sentencing Guidelines for corporations went into effect. The guidelines stated that companies with effective compliance and ethics programs could receive preferential treatment during prosecutions for white-collar crimes. It's an "A for effort" philosophy, in which companies that prioritize ethics can sometimes escape punishment when their ethics programs fail.

But the position is sometimes "just a mask for the company to hide behind," says Efrem Grail, a partner at law firm Reed Smith, who specializes in corporate investigations. Hunsaker is the perfect example. In an e-mail exchange obtained by The New York Times, Hunsaker asked Anthony R. Gentilucci, the head of HP's global investigations unit, whether the spying tactics used by a subcontractor were "above board." Gentilucci responded, "I think it is on the edge, but above board." To which Hunsaker replied: "I shouldn't have asked."

Chief Ethics Officers: Who Needs Them? [Forbes]

The Real Problem With Hedge Funds [NYM]

Jeff Skilling is set to be sentenced this afternoon for his role in the collapse of Enron. Many observers are convinced that his could be the longest sentence ever for a white collar criminal. We have no idea where the judge will come out on this so we’re going to where we always like to go for answers—our readers! Below is a reader poll asking how long Skilling’s sentence will be.

One of the more adorable things about Liz Claman’s blog for Morning Call has been her conceptual dyslexia—calling her readers “Bloggers” when everyone else in the world knows that it’s the folks who write blogs who get called that. We’re not sure where she picked up the opposite idea but it’s been cute and unique. And now it’s over. Someone spilled the beans and let Liz know that she was a blogger and that her readers were, well, something else.

What else? Liz isn’t happy with just calling her readers “readers.” She thinks there needs to be a special term for blog readers. Actually, it’s kind of surprising that there isn’t a word blog readers. So if you have a suggestion, please leave it below in comments. We’ll forward the best answers on to the gang at Morning Call.

Blog-o-spherians (or whatever you are), Listen Up!!!! [The Morning Blog]

Another day, another DealBreaker video. Actually, this ran last week on CNBC's On the Money. We make just a brief appearance in this video. It's actually our first "remote" television appearance--where you sit alone in a room before a television camera. And it's not pretty. Apparently something had happened that day that stopped us from holding our head in an upright position. We're quite obviously still getting the hang of these video things.

We’ve never been entirely clear about why financial institutions employ people with the title “chief economist.” It’s not as if the analysts looking at individual stocks or market segments are really influenced by these people. We’ve heard that its mostly “for marketing” purposes—the idea would be that if the bank could show it had some bright academic-type making big prognostications about the macro-economy it would project the image of omniscience, reassuring clients about its micro-analysis.

A story in the New York Post suggests another possibility—they are political players who help their institutions land deals with governments.

A Morgan Stanley economist bragged to his bosses about playing a "key role" in getting the U.S. Treasury to change a key position in its dealings with China, and paved the way for the firm to do more deals in the booming economy, a document obtained by The Post indicates.

An e-mail from Morgan Stanley's veteran chief economist, Stephen Roach, to senior executives in September 2003 boasts of Morgan Stanley's role in getting Treasury Secretary John Snow to back off the Bush administration's vow to pressure China over the value of its currency.

In the e-mail, Roach told Stephan Newhouse and Vikram Pandit, the then bosses of Morgan Stanley's international and institutional securities units, that "I helped him script rather carefully" key lines of a policy announcement in Beijing.

Roach wrote to Newhouse and Pandit that the Chinese might be very appreciative for the help Morgan Stanley provided in changing Secretary Snow's mind.

"I do believe we should make every effort to let the Chinese know that we played a decisive role in shaping the outcome on a key issue of great strategic importance for them," Roach wrote.

New York magazine this week carries the story of Angelo Haligiannis, the college drop-out turned high-flying hedge fund manager turned fugitive. For a couple of years he brought in some wild returns by trading tech bonds and then, well, you know what happened. Only instead of letting investors know he had lost $17 million, he went for the cover-up. After that, the tale pretty much writes itself.

Take the Hedge-Fund Money and Run [New York Magazine]

Although the SEC has subsequently reinvestigated and cleared Pequot Capital and Morgan Stanley chief John Mack in connection with Pequot’s acquisition of a large state in Heller Financial in the weeks leading up its acquisition by GE, questions still linger over allegations that the initial investigation was quashed when the lead investigator sought to subpoena Mack. Now two Senate investigations are underway to determine whether the SEC failed to thoroughly conduct the initial investigation and whether politics played a role in that failure.

On Sunday the New York Times ran a story based on files the canned SEC investigator, Gary Aguirre, had turned over to Senate investigators. The evidence seems pretty damning.

The file shows that after Mr. Aguirre was blocked from questioning Mr. Mack about the Heller deal, Mr. Hanson, the S.E.C. branch chief, acknowledged in e-mail messages that he had discussed Mr. Mack’s “political clout” and the “juice” of his lawyers with officials at the commission.

In an exchange of e-mails in the summer of 2005, Mr. Hanson said that he had merely been trying to “alert folks above me,” and that politics did not influence S.E.C. decisions. Mr. Aguirre replied: “Bob, this is spin. You told me it would be tough to take Mack’s testimony because he has political clout.”

Ironically, these allegations of political corruption at the SEC are being substantiated at the same time lawmakers are considering giving the SEC more clout over hedge funds. This summer a federal court struck down regulations requiring hedge fund managers to register with the SEC and permit investigators to examine their books.

But if the SEC has trouble engaging in its core functions—investigating things like insider trading—does it really make sense to give the agency an even broader scope of authority?

S.E.C. Inquiry on Hedge Fund Draws Scrutiny

Crime/Fraud/Legal/Investigations/Inquiries/Regulation:
Are private equity firms colluding? [legal]
Complaint filed against head of Deutsch Bank [legal]

M&A: [? = not yet closed, problems with the deal, lingering questions, etc.]
Ontario Teachers Pension Fund+ Goldcorp: Going to shareholder vote
Germany pondering buying a stake in Airbus parent EADS
Chicago Mercantile Exchange + Chicago Board of Trade
Tata Steel + Corus Group: Shareholders worried
AT&T + Bellsouth: Consumer groups demand concessions
Sears Canada + Sears Holdings: Canadian shareholders will get vote
IBM + ISS

For Sale/ LBOs/ Going Private/ Auctions/ Offerings:
Is Wild Oats for sale? Or is it just Ron Burkle stirring up trouble [For Sale?]
Bruce Wasserstein going after trade magazines [Publishing]
Time Warner Cable IPO may attract lots of investors [Offerings]

People & Moves:
Hank Paulson sells his UWS condo for nearly $8M [Real Estate]
Stephen Roach of Morgan Stanley takes credit for Treasury easing up on China [Economists]

Miscellaneous:
AOL will concentrate on revenue from “tiny classified ads” in Europe [Internet]
Warren Buffett bets on lower asbestos claims, buys policies from Lloyds spinoff [Insurance]
Lots of mini-YouTubes [Video]
Pitchfork rejects come-on from Microsoft [Music]
Commerical banks moving in on Investment Banking [Investment banking]
Perella Weinberg launching real estate fund [Investment banking]

Sponsored by Bloomberg.com

An era ends today as Skilling learns fate (Houston Chronicle)
Today is the day that Jeff Skilling will learn his fate, but to say that the Enron Era ends today sounds like wishful thinking. We've still got the NatWest Three among other cases winding their way through the courts. Analyst consensus estimates are for Skilling to receive somewhere between 20-30 years in prison, though the whisper number is for something lower than that. 15? Ultimately though, the full burden of Enron's collapse falls on his shoulders. Fastow got a measly 6 years after his sentence was reduced; he was so relaxed during the sentencing that he drank a Starbucks in court. Ken Lay is dead, and if there were any justice that would double Skillings sentence automatically. Any guesses?

Panama backs ambitious canal expansion in vote (SABC news)
The nation of Panama comes off as something of a one-trick pony, wouldn't you say? When you think Panama, you're next thought is always Panama Canal, right? Either that, or maybe Mariano Rivera. So, the one time it's in the news, it's about a big plan to improve the economy renovating the canal. It's going to spend over $5 billion to widen its lanes, and make it friendly to massive cargo ships. And though the expense may bankrupt the nation (!) it believes it will be good for the economy because -- of course -- it will create jobs for the poor. We can't help but be skeptical that any plan that involves investing more into a centralized, government-run infrastructure project will have a limited benefit for the poor, but good luck to them.

Ford to Restate Earnings, Posts $5.8 Billion Loss
Ford reported a monster loss this morning on costs associated with job cuts, and writing down the value of Land Rover and Jaguar. The biggest joke is that the company called these expenses "one-time expenses". How many consecutive quarters do you have to have one-time charges before they're not considered one-time anymore? Without the charges, the company lost just $.62/share, which was in line with analyst expectations. But the good news ends there. The company said it needed to restate 5 years worth of earnings, get this, including those announced today. That's pretty bad when on the day a company announces results, it's already warning that they may be wrong.

Zune Shut Out (NY Post) (via Dealbook)
Microsoft was totally rebuffed after trying to strike up a deal between its Zune division and the indie online music bible, Pitchfork.com. Microsoft had approached the site about some sort of exclusive, but the site refused to sell out... to the man! It's the most punk rock rejection of a business overture we've hard of since Epitaph records refused to sell out to a major label in the late 90s for $50 million. Although, the label recently joined the industry group, the RIAA, which is about the least punk rock thing we could think of.

The masses have tasted blood and want more. Enter A.J., of "Thursday Night" and "Models and Bottles" fame, the latest in a series of case studies demonstrating the various personality disorders that plague many an inhabitant of Wall Street and the like. But A.J., pagans, is not a douche bag.

Now, wait, let us finish. For the past several weeks, nearly every media outlet—ourselves included—have lumped these kids—Aleksey, Lucy, A.J., that kid from Merrill Lynch—together to collectively comprise Team Douche Bag. But that’s wrong on so many levels, the most offensive being the linguistic one. We realize this is a business tabloid and really no place to offer an English lesson but who says we can’t take a few minutes to make ourselves better people, huh? Not us. Because we’re not going to sit idly by any longer. So let’s gather round the campfire and put one up on the boards for humanity. Okay:

Aleksey Vayner, people, is a douche bag. A classic, archetypal douche bag. Lucy Gao, is a megalomaniac. A.J. is a jackass. Subtle differences, but differences still. These nuances may seem insignificant to you now; you might even think this is just us trying to make it to our minimum number of daily posts. And you're right. But we’re also sharing an important public message that you'll be happy we shoved down your throats lovingly caressed you with you come next week, when Brock Fantasia adds his own video to the mix, making it all but impossible to keep the Hodgepodge of 'Douche Bags' apart, but quite easy, effortless, even, to keep track of Douche Bag, Megalomaniac, Jackass, and—don’t get too excited because you're still a good eight days away—Cocky Fuck. Have a great weekend.

A.J. the Analyst's Boogie Nights Might Be Ending [NY Sun]
A.J.: Point/Counterpoint, Thursday Still the Night That He Balls [Gawker]
The Resume Mocked 'Round the World [DealBook]

Just in time for Hindu Christmas, The New York Times today runs an article on India’s dearth of smart workers. That might strike a lot of finance people in New York as surprising—Wall Street seems pretty well-populated by folks from the subcontinent. But just because there are a lot of smart, skilled people in India—people who want to work in finance, become engineers, programmers, etc—that doesn’t mean there is an endless supply.

Our Indian friends tell us that the problem is rooted in the country’s wildly divergent population groups. Some groups just make better workers for the information age—either because they have better access to higher education, are more familiar with the culture of international capitalism, are less prone to disease and other afflictions that can retard intellectual progress or just have better native intelligence. We’ve never been to India and can’t quite evaluate this kind of claim.

Steve Sailer says the mainstream media isn’t helping because it is somewhat allergic to questions about intelligence, fearing that someone, somewhere might draw racist conclusions from the facts.

So we turn to DealBreaker readers. What’s up with India? Has India reached the bottom of its talented talent pool or is this just a temporary problem? (Bonus question if you can explain why the New York Times is running this as Diwali kicks off.)

Skills Gap Hurts Technology Boom in India [New York Times]

DealBreaker might need to set up a Namibian branch office if things keep up like this.

Today Reuters reported that Wesley Snipes—indicted earlier this week for tax fraud—is in Namibia. You remember that place right? It’s the semi-desert African country where Kobi Alexander was discovered, arrested and eventually bailed out of jail to await his extradition treaty.

Can this really be happening? Why Namibia (a country we only really had heard of as the place where Angelina Jolie and Brad Pitt went to hatch their offspring)? At first blush, Namibia seems like a good place to flee. It doesn’t have an extradition treaty with the US, it’s got some fancy resorts and sports lots of European and Israeli ex-pats to pal around with.

Unfortunately for the fugitive types, its also got a government eager to keep the US happy. After Kobi Alexander was discovered there, the country quickly passed a law permitting extradition of alleged criminals wanted in the US.

So why did Snipes stick around when it became apparent that Namibia probably wouldn’t shield him from the long arm of US law enforcement? Well, it seems that he’s not there hiding out at all. He’s filming a movie!

"It is confirmed. He is definitely here," Edwin Kanguatjivi, chief executive officer of the Namibia Film Commission, said by telephone. "He has been in Namibia since the end of August."

Snipes, the star of the "Blade" movie series, is the lead actor in a new movie entitled "Gallowwalker" filming in the Namibian desert near the town of Swakopmund -- the same coastal resort where Hollywood superstars Angelina Jolie and Brad Pitt had their first child in May.

We’re not sure this is entirely plausible. So Snipes just happened to be hanging out in a country with no extradition treaty when his indictment came down? A little convenient, no?

“It will be interesting to see whether he waives extradition proceedings or fights it. That may hint at whether he was there as a fugitive or there for other reasons,” we were told by DealBreaker’s favorite extradition law expert, Douglas McNabb of McNabb Associates.

Indicted U.S. actor Snipes in Namibia: officials [Reuters via the Ka-Ching! blog]

We like CNBC’s On The Money. And not just because they had the luscious Julia Boorstin interview us about Wall Street bonuses on Wednesday. They’ve got the right sensibility for covering Wall Street—except, you know, the whole being-on-the-air during-happy-hour thing. (We actually missed our own segment the other day because our bar insisted on showing the Mets pre-game instead of the CNBC feed.)

But we like them even more today because they are offering some good advice to Aleksey Vayner. (You've got to click on the link to the video since they MSNBC hasn't quite got the whole embedded video thing down yet). Everyone’s been hating on Aleksey lately, and we’ve felt like the only ones offering him some useful, practical advice. Aleksey gave us all at least a week’s worth of chuckles. What’s to hate? Good on the OTM for taking the high road.

The gist of the advice from OTM: forget Wall Street. Think Madison Avenue. Jay Whitehead of HRO Today Magazine says, “This kid has some advertising, some marketing savvy. Maybe a little hint of genius.”

This is your calling, Aleksey. You already have a job offer from none other than Donny Deutsch. Go for it! And if anyone around you tells you that you can’t succeed—cross them off your list!

Video resume becomes joke of Wall St. [CNBC on MSNBC.com]

You're on notice, Page. Brin-- you escaped our ire only because we realize you've got bigger-- Lonlier-- fish to fry.

YouTube Removes 30,000 Files Amid Japanese Copyright Concerns [WSJ]

The San Diego Country Employees Retirement Association, which lost more than $100 million in the Amaranth collapse, is considering bringing a lawsuit over the loss, Josh Gerstein at the New York Sun reports. Uh-oh. This may prompt a series of lawsuits, as Amaranth’s investors may find themselves in a race to the courthouse to grab whatever dollars might be left over—either at Amaranth itself or with its money managers. There’s a limited pool of money out there, and an almost unlimited number of plaintiffs lawyers who will be all too eager to carve legal fees out of the carcass of Amaranth.

The big looming threat—fraudulent transfer lawsuits. What happens if a court decides that Amaranth shouldn’t have liquidated its assets on the way out? The picture of our courts second guessing Amaranth’s investment and divestment decisions, and also deciding on the legality of Amaranth’s end days redemptions and spending is not a pretty one.

Lawyers Circle After Failure Of Hedge Fund
[New York Sun]

Both Eliot Spitzer and Dick Grasso are saying they won’t settle the case after yesterdays summary judgment opinion came down from State Supreme Court judge Charles Ramos. Charlie Gasparino reported this morning on CNBC that he’d spoken with Grasso, who told him that this was looking like a heavyweight title fight—a champion will be declared. We prefer the Terrordome analogy: two men enter, one man leaves. Meanwhile, Jim Cramer told CNBC that Spitzer has also ruled out a settlement. This thing isn’t going away, and its only going to get messier from here. We can’t wait.

Yesterday viral video star Aleksey Vayner pushed himself back up out of the obscurity that was starting to overtake him by talking with the New York Post. Today he’s given his first sit down interview since the story broke—with Michael J. de la Merced of the New York Times. It seems that he’s taking a leave of absence from Yale to do promotional media interviews until this whole thing blows over.

We still think Aleksey’s going about this the wrong way. Aleksey—you’ve got to run with this. You are “pure gold”—as one of the investment bankers who forwarded your email around put it. Drop the lawyer and get an agent. Someone who can book you as a guest host on Saturday Night Live. Someone who can get you a book deal—Impossible Is Nothing: The Aleksey Vayner Guide to Success At Everything. Someone who…

Look. Let’s have lunch. We’ve got some great ideas. Stop talking to the newspaper guys. Stick with the folks what made you—the interwebs. We’ve got a great future together. We can feel it.

The Resume Mocked ‘Round the World [DealBook]

Sponsored by Chicago Board Options Exchange

Meet Alex Morris: founder of Yourika Capital LLC; creator of the tymoraPRO trading platform; big fan of Warren Buffett (but don't hold that against him).

In Bonfire of the Vanities, Sherman McCoy attempts to explain to his four-year-old daughter what he does for a living. How would you explain to a four-year-old what you do?
After people panic and lose interest, I look to buy things with as little risk as possible. Then I wait to sell it back to them when prices jump higher and they all go crazy trying to buy it.

How did you get your first job in finance?
I've always been fascinated by the markets, gaining interest by watching how my grandfather picked stocks, with some investments going back to the days of the Great Depression. Over the years, I've tried every combination of trading products available, and none of them were able analyze the markets to the extent that I felt necessary to enable me to find, analyze, and trade the best opportunities moment-by-moment. I finally gave up the search, and began developing my own trading system, known as tymoraPRO, from the ground up. Since then, tymoraPRO's blossomed into a complete trading platform that remains more powerful than any other available to this day.

Describe your trading strategy.
Scanning for and identifying cycles of fear and greed at key levels of supply or demand, and entering positions as new trends reassert themselves but before the momentum players join the party.

If you were starting out in your career now, where would you want to work?
I would look to join a trading group like the one I created, Yourika Capital LLC, offering truly unique tools and a strategic trading edge that I could learn to use and leverage to give me the best possible chance to successfully and consistently beat the market.

What is your favorite career accomplishment/best trade ever?
Creating my own trading platform to use for trading, and using it to find and analyze high-probability trading opportunities throughout the day.

Who are your heroes or role models, fictional or real?
Jesse Livermore's trading style and acumen, Warren Buffet's long-term value investing approach.

What is the most important quality a trader should have?
Discipline, humility, accepting losses gracefully, and understanding yourself.

What is the worst character fault for a trader?
An addictive personality and needing to always be right.

Tell us about the lowest of low points, the time you thought should just give it all up and take a simpler, easier job?
Probably 9/11 - the day of the World Trade Center attack. Although I wasn't caught in any positions, I was in such shock at the time watching it all happen from my downtown apartment that it took me a while to get back the nerve to start trading again. Events such as that remind you to step back from trading and take a moment (or two) to enjoy life.

What job would you have taken? What's your 'exit strategy'- how long until you retire or move on?
It's hard to say since trading really seems to be “in the blood” and it's not something that you ever have to give up completely. Over time, while I may become less active in trading the markets, I'll always be ready to pounce if I see the right opportunity to do so.

In terms of the “bigger picture” I'm also a partner in a hedge fund called “Eagle's View,” whose purpose is to invest in 'niche oriented' off-radar strategies, such as Electricity Arbitrage, Environmental Credits (Emissions) Trading, and Natural Gas Delivery Basis Arbitrage, unknown or inaccessible to most investors. These strategies have the potential to generate attractive, diversified, low-volatility returns in a "fund of funds" capacity, which is managed by a solid and well- established team. For those interested in investing in hedge funds, this is the ideal situation for most investors to consider.

What is your motto?
I'm generous - I'll give you three mottos!

"I'm convinced that life's 10% what happens to me and 90% how I react to it."
"Feed the ducks while they're quacking."
“Add to positions as they prove you correct, reduce positions rapidly as soon as the market proves you wrong.”

Whose teachings are more useful in your business-Machiavelli, Sun Tzu, Jesus Christ or Marquis de Sade? (Feel free to nominate another choice.)
Certainly Sun Tzu's Art of War, since it disciplines the mind in preparation for battle. Also Jesse Livermore, who seems to be appreciated more by seasoned traders who reread “Reminiscences of a Stock Operator” because they are able to relate through experience to the many points he makes throughout the book. One of my favorite Livermore quotes is: “Stocks are manipulated to the highest point possible and then sold to the public on the way down.” Also Barton Biggs of Traxis Partners, whose book “Hedgehogging” is a must-read for anyone interested in getting involved with hedge funds.

In fact, for those who want to learn how to trade, I recently released a DVD that guides people to exactly what it takes to successfully trade the stock market. I also host an online financial show at www.moMoneyTV.com that keeps viewers informed on important trading and money tips and concepts.

(If you missed the last installment, featuring independent trader Tim Sykes, click here. And if you think you’d make a good subject, or want to nominate someone else, please email us at tips (at) dealbreaker (dot) com--subject line: “Better Know A Trader”).

This morning we're teaming up with our friends over at Wallstrip to discuss this week's hottest stories. Think GooTube, Wesley Snipes' tax troubles, the girls of Hewlett-Packard and, of course, Aleksey Vayner.

Just in case you've been living under a rock for the past week, Wallstrip is the fun, funny and informative daily video site that launched this week. Oh, and it stars the very pretty, very bright Lindsay Campbell. And if you still don't get it, watch the video they put up explaining the site.

A note about, uhm, some wide margins in our relative onscreen perfomances. Well, all we can say is that you might notice that there are two people on the show and one of us spends most of our time writing in a semi-darkened cavern and taking calls from disgruntled investment bankers while the other one of us is Lindsay Campbell. We'll probably get better at this but that's a forward looking statement. And lets face it, past performance probably indicates future results here.

Since we've been asked several times, the video and the site are very, very safe for work. We keep our clothes on and so does Lindsay.

Crime/Fraud/Legal/Investigations/Inquiries/Regulation:
Grasso ordered to return part of pay package [legal]

M&A: [? = not yet closed, problems with the deal, lingering questions, etc.]
Tata Steel of India + and the Corus Group
Nippon Steel + Posco
Newscorp+ Fairfax
National Grid + KeySpan
Companhia Vale do Rio Doce + Inco
EuroZinc Mining + Lundin Mining gets shareholder approval
Alcan + Carbone Savoie

For Sale/ LBOs/ Going Private/ Auctions/ Offerings:
Is the Boston Globe for sale? [For Sale?]
Datamark [For sale]

Money Raising:
Jesse Jackson getting back into the capital access business [Rainbow/PUSH]
European VCs look to IPOs to raise cash but not exit altogether [Venture Capital]
Xencor raises $45M [$$]
Keyeye raises $16M [$$]

People & Moves:
Aleksey Vayner Speaks To The Times [Aleksey Vayner]

Miscellaneous:
Competition worries after Chicago exchange merger [Exchanges]
How Sony got shut out of MGM deal [Entertainment]
Another Wall Street video [Video]

Sponsored by Bloomberg.com

Two former Treasury secretaries join hedge funds (Marketwatch)
Some high-profile blowups, and constant scrutiny in the media hasn't dulled the lure of hedge funds. Just yesterday, two former Treasury secretaries announced that they'd be joining on to the funds. John Snow, also former chief at CSX, is joining Cerberus as Chairman, while Larry Summers is joining D.E. Shaw in what appears to be a more strategic role, advising the company on portfolio management, stuff like that. We're not sure how much Larry Summers will be pulling down, but it's gotta be pretty competitive with his role as president of Harvard. And now he can joke as much as he wants about women in science, and nobody will give a damn, which has to feel nice.

Google Shares Rise After Third-Quarter Results Beat Estimates (Bloomberg)
In case you missed it, last night, Google absolutely crushed in its last quarter, sending shares sharply higher after the bell. This comes after reports that the company now controls 25% of all web advertising. In fact, its growth is accelerating. Last quarter, its net earnings grew by 60% (ho hum), but this time by 92%. Yahoo and Google, talk about two companies going in opposite directions. Get ready for a bunch more upgrades, as analysts trip over themselves to say nice things about the company. Oh, and there's an extra bonus with Google. It's too young to have been involved in any backdating schemes.

Why Is Time Warner Spinning Off Cable? To Buy Cablevision (Tech Trader Daily)
There's speculation that Time Warner is spinning of its cable unit now so that it's in position to make a play for Cablevision. Meanwhile, the Dolan's have already announced their plan to take Cablevision private, so it appears that the company is definitely 'in play'. The timing of it seems difficult for Time Warner. The Dolan's are acting now, setting the wheels in motion for their purchase. Meanwhile, Time Warner just filed for its IPO. It'll take a while for that to happen; then it'll take some time after that before it can put together a deal. Certainly seems like Cablevision could be accounted for in some way or another before all that happens.

Beware: More Fed hikes may be coming (CNNMoney)
Talk about a mood killer. A few months ago, everyone was repeating the word 'stagflation' as if it was a new bad word that they had just heard for the first time. Now nobody is talking about the inflation side of it. But as we've pointed out, when you strip out declining energy costs, inflation is still alive and well. And if you stripped out energy on the way up, you really ought to do it now. Well, it really doesn't matter what you do, or what you think. What matters is what Ben Bernanke thinks about this, and with the Dow setting all time highs, and core inflation ticking back up, he might just decide that the economy can afford another squeeze.

$$$Rich, self-described "normal" banker seeks same for a "private tour of Bergdorf," maybe Barneys-- if you play your cards right. [Craigslist]

$$$When an investment banker gets bitch-slapped by a PR flack on national television, we've got to break something out of the archives that we've gone far too long without: BURN. [Gawker]

$$$London Banker: shaking things up at the gym. [Things I Can't Tell Boyfriend Number 1]

Just when we thought the story was beginning to fade—IvyGate had declared a moratorium on it, Gawker seemed to be returning its attention to the children of celebrities, we were ginning up another hotties contest—Aleksey Vayner is pouring fuel onto his own burning effigy, hiring a lawyer and telling the New York Post he might sue UBS if the bank’s employees were responsible for leaking his now-infamous video.

"Institutions like this are expected to maintain complete privacy," Aleksey Vayner told The Post. "If a graduate cannot trust them with the privacy of their resumé, how can people trust them with their money?" Last month, he sent UBS a link to the video, as well as a written resume, references and a writing sample, through Yale's job-recruiting service.

The video features Vayner supposedly bench-pressing 495 pounds, karate-chopping through a stack of seven bricks, ballroom dancing and smashing a 140 mph tennis serve.

"I thought it would help me get a job," said the native of Uzbekistan.

Instead, he got thousands of scathing e-mails from people who saw the video.

"It was shocking," he said of the response. "[It has] put me and my family under a great amount of stress and greatly affected future employment in a negative sense."

Some advice to Aleksey. We understand you might be enjoying the spotlight and want to prolong your now fifteen days of fame. But this is the wrong way to go about it. You need to embrace the public's image of you. Play to it. Make another video. You'll probably land a cable television series based on "Impossible Is Nothing" is you work this right. Everyone would love to see you on a date, ordering at a restaurant, anything, so long as you keep in your character.

Video Resume Leak Has Yalie Crying Foul [New York Post]

Denise Rich: Westchester Co to Washington Dulles Int'l on her Learjet 60
(We have nothing to say about this trip.)

Eliot Spitzer won the first substantive round in the New York Attorney General’s lawsuit against former NYSE head Richard Grasso today. State Supreme Court Justice Charles Ramos ruled that Grasso must return part of $58 million in “deferred compensation” he received as part of his controversial $198 million compensation package from the then exchange.

Ramos also shot down Grasso’s claims for damages against the exchange and a defamation claim against the current NYSE chairman.

Of course, all of this is at the summary judgment stage, and open to appeal at some point. And you know Grasso’s not exactly opposed to appealing Ramos’ judgments. He’s already got three in front of the state appeals court.
(And, by the way, in New York the “State Supreme Court” is actually the lower court. It makes them lower court judges feel better if they get to call themselves Supreme.)

The opinion hasn't yet been published but we probably won't read it even when it is. Unless, you know, there are some juicy, mean or funny bits.

Grasso Must Return Part of $190 Million Pay Package, Judge Says [Bloomberg]

Peter Cohan at BloggingStocks has an original take on the Wall Street Journal cover story on Hewlett-Packard spying we linked to earlier. Here’re the money graphs.

There are many levels of irony in this story. Reporters do all sorts of investigations on their subjects. I don't know how they cultivate their anonymous sources to dig up the details that they report. But my hunch is that while they're often snoops -- peering into places where their targets would prefer they did not -- reporters don't resort to the kind of tactics (pre-trash inspections or monitoring phone calls and IM sessions) to which Tam was subjected.

But I can't help but think that Tam's subjects share some of the same fears of being investigated that she must have felt when she began to realize that HP was placing her under surveillance. Her article's cool, almost tongue-in-cheek tone does not reveal these fears explicitly, instead leaving them to the reader's imagination.
But I imagine that former HP Chair Patricia Dunn must have felt a similar fear when she realized that someone on HP's board was leaking to the media. I'm not defending what HP did; I think it's a 1984-like invasion of privacy for which HP will suffer significant consequences.

We get the point—what’s good for the goose is good for the duck, or whatever. We at DealBreaker certainly aren’t against reporting on reporters. Actually, we're really into it. But, look, it’s a bit of an understatement to say that “reporters don’t resort to the kind of tactics…to which Tam was subjected.” Uhm, that’s right they don’t. Pretending to be someone you’re not, stealing phone records and attempting to tap into other forms of personal communications are not just things reporters don’t do…they’re things that can, will and have gotten reporters fired from respectable news organizations. This is the equivalent of espionage, not reporting.

Let’s not encourage our paranoid corporate leaders to think that H-P spying is on anywhere near the same moral plane as business reporting.

HP turns the table on the Wall Street Journal [Blogging Stocks]

We guess this makes it official. Today we checked in with both of our favorite Ken Lay Lives conspiracy sites—and neither of them have been updated in ages. KenLayLives.blogspot.com sports a post dating back to July. And plain-old KenLayLives.com is now just blogspam.

So Ken Lay Lives is officially over. Ken Lay is dead. And his ghost has seen his conviction vacated.
Rest in peace.

We’ve said it before but we’ll say it again. Hewlett-Packard’s out-of-control investigation into leaks from its board of directors reads like something out of science fiction. The Corporation employing its own secret agents, tapping into the records and stealing the trash of directors and reporters.

Except that the future is now. As it turns out, corporate spooks are real and we’re just now learning how far they’ll go. In fact, there’s still a lot to learn, as this creepy story by WSJ reporter Pui-Wing Tam shows. The creepiest (and we’re sorry to keep repeating “creepy” but it seems exactly right) part of the story is that even Hewlett-Packard seems not to know what its agents did to Tam. Either that or they aren’t telling.

A couple of weeks ago we wondered aloud whether it really made sense to file criminal indictments against Hewlett-Packardites and their spies. We’ve got a gut reaction against criminalizing business executives. But in this case, it seems more and more evident that a criminal prosecution is the only way we’re going to get to the bottom of this thing. And find out how low that bottom really is.

A Reporter's Story: How H-P Kept Tabs On Me for a Year [Wall Street Journal]

[On a slightly more upbeat note: we sometimes like to drop in obscure graphics on our posts, and this one is no exception. Bonus points for whoever leaves the first comment explaining where the picture is from and what it has to do with corporate spying.]

Brock Fantasia is the only remaining person in the JPMorgan analyst class of 2002 to still work at JPMorgan, which is in no way testament to the work environment at JPMorgan. In fact, Brock likes to think of himself as the Highlander of his analyst class, wielding an indestructible claymore of corporate finance.

After “totally wrecking” (in his own words) the Analyst-to-Associate program in the M&A group, Brock was briefly moved to the Natural Resources group, due to increased deal flow in the M&A group. Brock graduated from the prestigious University of Pennsylvania Wharton with a degree in Finance and is working in investment banking until he can find a buy-side job. Brock has been interviewing for buy-side jobs throughout the past 3 years and has not been a “good fit” anywhere, despite his ever-burgeoning skill-set. [Editor's P.S.,- Some of this is true. But only some of it. Previous Ask Brocks are here. Send your questions to : brock AT dealbreaker DOT com]

Everything’s going to be alright, Brockabye! Brock all up in your jock here, so let’s win this, weekly roundup style.

It was refreshing to know that the Dow Jones has seen Wedding Crashers, as it played a game of “just the tip” with 12,000 this week, entering it “just for a second, just to see how it feels,” only to pull back like a frightened turtle yesterday before closing.

Another thing I learned while waiting at the bank on Friday night for my VP to call and give the go-ahead to include an earning’s call transcript in a public information booklet to leave on a Managing Director’s chair in our Houston office is that not since Police Academy 7: Mission to Moscow have Russians and Americans come together to create something as profound as the recently created longer-lasting, minty fresh, lab tested, mother approved, super heavy element with atomic number 118.

New Yorker Editor David Remnick dropped by Princeton to give a lecture the other day. The Daily Princetonian reports an interesting exchange during the qestion and answer period.

When asked by a student in attendance if he had any advice for Princeton students interested in journalism, Remnick — known for his self-deprecating humor in conversation — responded: "Goldman Sachs."

Okay. We get it. Real world experience can help journalists because, after all, the world they are writing about is supposed to resemble the real world. But David, if you send your promising journalists to Goldman, how are you going to get them to accept journalist salaries afterwards? What’s more, how many aspiring journalists can even handle the basic math required to work at Goldman? From what we can tell, most experienced journalists couldn’t handle the math.

Remnick '81 faults journalists [Daily Princetonian]

General Motors chief Rick Wagoner—has there ever been a more appropriately named auto-industry honcho—came out of the recent turmoil at the automaker looking stronger than ever. Not long ago it looked like he might be on his way out, as the company reported record losses and seemed, well, lost. But when the board of directors recently rejected the Kirk Kerkorian instigated proposal of an alliance with Renault and Nissan, with all three companies probably led by legendary turnaround artist Carlos Ghosn, it was clear that Wagoner at least had the confidence of his board and would be around a while.

Now he may be facing another challenge—this one from the crony capitalist land once called the Soviet Union. There have been conflicting reports about whether or not Russia’s Oleg Deripaska has bought a significant stake in the company. Over at Jalopnik, the motorheads try to figure out what’s really going on. Their big break comes when they hear from the source from one of Reuters’ sources who tells them, “"Who the hell knows, everything is possible."

Glad that’s all cleared up then.

Watch Out, GM! The Russians Are Coming! The Russians Are Coming! [Jalopnik]

Hey! Whatever happened to the “Bond Biz Hotties Contest?” We hear that question every couple of days. And we’ve been avoiding the question because, frankly, the answer is embarrassing. Embarrassing for us. Embarrassing for you. And, most of all, embarrassing for the bond boys and bond girls.

Here’s what happened—the entries, submitted by readers, were thin and weak. We had a couple of possible winners but not enough to call it a contest. This is truly sad because, well, AboveTheLaw held an ERISA lawyers hotties contest and they actually had a close contest, featuring some honest-to-God hotties. ERISA lawyers? Lawyers in general? We got beat by the lawyers?

So we’re planning to revisit the hotties contest but we want your help. Which segment of the financial community should we concentrate on? Wherein is the most fertile grounds for finding hotties? Send your suggestions to us at tips (at) dealbreaker (dot) com. Or leave them in the comments below. We’re sure we can make this work. But we need your help. Thanks!

Nineteen years ago we saw the second largest ever single day percentage drop in the Dow Jones Industrial Average. Remembering the period leading up to that day is not exactly comforting. Need a reminder? Years of rapid growth had led to fears of a recession, which were then tempered by talks of a soft-landing. Inflation fears were fading. And then it happened. We were young then, very young. Our most vivid memory of October 19 is of the father of one of our friends who had lost a lot of money that day, seen his savings wiped out. He didn’t exactly defenstrate himself but his eyes looked as if he might have already died.

Of course, after a few days, weeks or years, it became clear that Black Monday, 1987 was no Black Thursday, 1929. We didn’t plummet into a depression. The market roared back, and lots of folks made their reputations buying into Black Monday. Oddly, we haven’t seen much by way of reminiscing about Black Monday today. Is Wall Street’s institutional memory just not quite that long? Does no one want to think about it? Or is it just not relevant anymore? Feel free to leave your thoughts, comments or memories in comments below.

Its two previous tenants have been arrested. It’s got a secret, illegal stairway sealed up behind sheetrock. The interior—fr